Liberty

YES!!!! Honest question: And after that, what would have happened..?

[amazonsearch]Thinking, Fast and Slow[/amazonsearch] http://www.nytimes.com/2011/10/21/opinion/brooks-who-you-are.html?_r=1 Coming out soon. His research into cognitive biases and heuristics is very helpful to any value investor who tries to have an edge by being more rational than the market. I also recommend: [amazonsearch]Judgment Under Uncertainty: Heuristics and Biases[/amazonsearch] [amazonsearch]Heuristics Biases: The Psychology of Intuitive Judgment[/amazonsearch]

http://online.wsj.com/article/SB10001424052970204618704576644632834963512.html

http://www.bloomberg.com/news/2011-10-20/jobs-regretted-not-getting-cancer-surgery-sooner-biographer-isaacson-says.html

The way I look at it, there are three levers you can pull to increase your net worth. 1) Increase income/revenue 2) Decrease expenses 3) Make good capital allocation decisions It seems obvious that a combination of the three will give better results than just pulling one or two.

http://dealbook.nytimes.com/2011/10/18/buffett-returns-to-cartoonland-joined-by-jay-z/

Thanks for posting, I appreciate it!

I guess that in the end, all of this depends on the "why" you want to have money. If it's to have a nice car and party all night and buy nice things, then don't wait too long, do it now and enjoy life. But for me, I wouldn't live much differently if I had a few millions. I'd have a nice house and a few more electronic gadgets, but that's not why I do it. I do it for the security. To know that I can do whatever I want, and it's ok. I can work on my projects all day and read my books and listen to my music and explore whatever piques my interest and never be forced to do stuff I don't want to do just for money. That's the end goal for me. So being a bit frugal doesn't feel like a sacrifice to me because saving the money is helping me get something that is worth so much more. I don't want a ferrari or a yacht, I want personal independence.

People looking for tips to save money should check out: http://www.amazon.com/Complete-Tightwad-Gazette-Amy-Dacyczyn/dp/0375752250/ It's from the early 90s, so some of it is dated. But there's so much stuff that even if you use only 5% of the tips, you'll probably end up paying for the book dozens of times over. That book, please a few blogs that I read for a while, have no doubt saved me thousands of dollars at not real cost to me life enjoyment. But more importantly, they helped change my mindset a bit, and after a while I didn't need any reinforcement to stick to it. None of it feels like a sacrifice, it feels like finding bargains, and that's fun!

Agreed. I'd rather enjoy life. He's the only one who can decide if what he does gives him more satisfaction than what he's giving up, in the same way that Buffett's frugal ways are obviously giving him more satisfaction than he would get out of a bigger house and all kinds of bling. There's a lot of things that I want but I delay getting them because to me it's better to own a few more shares of the businesses that I like, and it's better to be financially independent a bit sooner, etc. There's such a thing as going too far - ie. if Buffett didn't buy the coke and burgers that he loves so much to save money - but it's up to each person to decide what that is for themselves. I'm saying this because people tend to project their tastes and needs and limits on other people way too much, and that's a flaw in their mental models, as Munger would say.

Financial independence is a huge turn on, don't you know? ;) 8)

Looks like he has the discipline to achieve his goals. Hopefully he has the same discipline on the investment side as on the saving side :)

Thanks AZ, you beat me to it! :)

[amazonsearch]Quality of Earnings[/amazonsearch] Anyone has read this one? would you recommend it? In confidence Game, Bill Ackman sends a box of books to someone else, and out of the 5, I have read 4. This is the fifth one, so I'm thinking of getting it.

Hey. I was wondering if there's a more high-tech alternative to SEDAR.com to get filings from Canadian companies. SEC.gov has a RSS feed for each company page so that you can easily track new filings. Anything equivalent for Canada, either on SEDAR or on another site? SEDAR.com looks like it was made in 1996 and never updated...

I've been to Mikes and Scores and they're decent. Usually pretty full of customers, so at least there's that.

Thanks for posting that!

2 people, renting a 1.2k sq/feet apartment, no kids, late 20s. $40k last year, but we got married. In the $30k range this year, but we moved and bought a bunch of appliances and furniture. As long as I have books and a computer I'm happy, and my wife doesn't spend much either, so we're living pretty frugally. I'd rather save what I earn now and invest it since I'm pretty young and time will help with the compounding.

[amazonsearch]Confidence Game[/amazonsearch] Just started reading this and it's very interesting so far.

Words of wisdom. Thanks Parsad!

http://www.bloomberg.com/news/2011-10-14/eu-may-impose-rules-to-limit-commodity-derivatives-high-frequency-traders.html

Well, back then he did buy Gen Re using stock, so he kind of did benefit from that overvaluation of many of Berkshire's stocks :) I think our difference might be semantics, so I'll reformulate what I said: Sometimes it is possible to look at a business that appears fairly valued on a purely quantitative level, and some people might say that it should be sold, but some investors might see a significant margin of safety remaining in more qualitative attributes (moat, growth potential, management's quality, etc), and so they continue holding it. It is also possible that to some investors certain attributes are worth more than to others, so for example you might not want to sell the safest and most predictable business in the world and replace it with a much less safe and predictable business just because it's X% cheaper; to you, that safety and predictability might be worth a lot more than the difference over the long-term.. This is why what is "fairly valued" to one can be "under valued" to someone else. Sorry if I wasn't clear the first time. But this applies more to something close to "fair" value than "insanely overvalued", obviously...

It depends on your style and what kind of companies you are interested in. Someone like Buffett will hold KO at full value, or even above, because to him the margin of safety comes from the moat and the future growth, and because if he sold he might not find a better business to invest in. So what you said definitely applies to cigar butts, but not necessarily to good businesses. IMHO.

That part sounded very Keynesian to me. Reminded me of the famous quote about putting money in empty bottles, burying them in an old mine, and having people dig them up as a way to create jobs...

All that matters to me is what kind of return I'm getting on incremental dollars earned. For big mature businesses, it might make sense to pay out a dividend because reinvestment opportunities are mediocre, but for businesses that still have much room to grow and reinvest, it can be much better to retain earnings (more tax efficient too). Money productively retained in a businesses will be recognized by the 'weighting' function of the market over time, so dividends aren't intrinsically superior. Money that comes out of the business reduces the market valuation over time. If you really need x% of your portfolio to live on each year, you could just as easily sell part of it. I also think that looking at dividend yield based on initial money invested doesn't make much sense, unless you start to look at everything like that (ie. I bought stock X ten years ago and now it's worth 10x what I paid for, and it grew book value by 10% this year, or 100% of my original investment! Wow!).