Liberty

Sorry if this has been posted before, but I hadn't seen it. Paul Tudor Jones interviewing Stanley Druckenmiller (in 2017): https://vimeo.com/351446016

Buffett interview:

I do most of the time, though I always end up hearing some over time when I can't skip or end up hearing the beginning or ends.. so it's still fairly effective on me at getting me to know some brands and products. Marco Arment who makes Overcast, one of the most popular podcast players, once shared some stats on ad skipping. It's less frequent than you might expect. You see in the graph people skipping the same spots in the audio, so it's the ad skipping, but it was still a small minority, maybe 10-20%... Can't seem to find the source anymore, so my memory could be failing me.

https://www.nytimes.com/2019/08/12/business/jeffrey-epstein-interview.html

I thought this was a good one: http://www.collaborativefund.com/blog/laws/

Yeah, it's kind of a bummer... But a useful one If you don't want to cry in front of your kids, don't read them 'Love You Forever' by Robert Munsch at bedtime: https://www.amazon.ca/Love-You-Forever-Robert-Munsch/dp/0920668372/

It's like the Scorpion and the Frog. It's not in his nature. He'd probably sell all his longs at the wrong moment if he didn't have a bunch of shorts and hedges to hold his hand, because he sees a catastrophe around every corner. That's my guess, anyway...

We just had a tax reform that had companies bring back a boatload of cash to the US where it can be used for buybacks.

Yeah, but isn't that like Adjusted EBITDA returns? He would've done great except for all the losses and bad stuff that actually happened...

Negative people always sound smarter than positive people. But the goal isn't to sound smart, it's to be as correct as possible.

If you like Dr. Satchin Panda, I've heard a couple of his interviews with Rhonda Patrick (she interviews a lot of interesting people and she's very smart): https://www.foundmyfitness.com/episodes/satchin-panda https://www.foundmyfitness.com/episodes/satchin-round-2

So you're saying there were many problems, some quite obvious (lack of fuel, cold weather), which led to another less obvious one (wires eaten by mice)... It's almost as if Housel used only one small part of a much larger and more complex story to quickly illustrate a point because his real point was about the nature of forecasting risk rather than about writing a book-length chapter about a specific WWII battle. Welllookathat... I mean, I get you're a history buff and these types of reductionist anecdotes grind your gears, but you're the one missing the forest for the trees here. I think you could've added the detail you've added as a "here's the rest of the story, isn't it cool and more complex than it seems" rather than attack Housel and claim that it somehow invalidates his broader points.

Good essay by Morgan Housel about risk: https://www.collaborativefund.com/blog/nobody-planned-this-nobody-expected-it/

I thought this was a good, wide-ranging dicsussion: https://www.jimruttshow.com/simon-dedeo/ Recommended by Michael Mauboussin on Twitter.

Recently saw Wind River (2017) and thought it was quite good. Written and directed by the same writer as Sicario and Hell or High Water, if that gives you an idea. https://www.imdb.com/title/tt5362988/

It's happening! :D

Cool, had no idea. I just saw it recommended by someone on Twitter a while ago and had noted the URL down to read later. Finally had a chance to do so today.

https://www.albertbridgecapital.com/drew-views/2019/6/17/stay-in-the-game That's some good writing.

Here's the video of the Neuralink presentation (I haven't watched it yet): https://youtu.be/r-vbh3t7WVI?t=5562

Older Mauboussin paper on Competitive Advantage Period: http://people.stern.nyu.edu/adamodar/pdfiles/eqnotes/cap.pdf

I believe the increased valuation in some stocks is due to the rush into compounders. I believe after one of the longest economic expansion in modern history, a lot of companies look like compounders, but are more cyclical than they seem. We will see after the next recession. Since many of them are roll ups (albeit well run roll ups), there is also reflexivity at work, such that a high valuation enables faster growth through acquisitions, due to lower cost of capital. Example are Heiko, ROP, DHR, TDG, ROK. They are well managed companies well worth keeping an eye on, but the valuation is a couple of bridges too far, since investors now discount many years of current growth rates into their stock prices. I'd agree with that. As an example, ROP has spent $11 bn on acquisitions in the last ~9 years to grow FCF from $471 mm in 2010 to $1.3 bn today. Meanwhile, EV/rev has more than doubled (~8.5 now from ~3.5x in 2010) and EV/FCF has nearly doubled (upper teens in 2010 to low 30s today). ROP acquisition targets aren’t cheap - the last one was done at around 17x EBITDA, so that keeps ROIC down. However, their return on tangible capital is very high due to the asset light business model. They can pay the high prices, because their cost of capital is very low, due to their high valuation and because debt is very cheap. Nevertheless, the comparison with Valeant doesn't hold water - ROP leverage isn’t high and they don’t buy cigar bits (at least they haven’t so far) to milk cash. my concern is simply with the valuation and the suspicion that some of their business lines may be more cyclical than thought. The one company they I am a bit suspect of is AVGO, especially after their pivot into acquiring software companies (and low quality one at that - CA Technologies). You can look at some of the older businesses that ROP owns, mostly the old industrial/energy stuff, and even after like 20 years of no acquisitions in those segments, the businesses keep getting better. They have like 30%+ EBITDA margins on these industrial businesses, and they didn't start there at all. These segments that haven't had any M&A have also grown organically a lot during that period (the energy stuff was hit in the recent crash, but that's normal in more cyclical industries.. over the cycle they did well). So the idea that they're buying declining assets and somehow hiding that like Valeant did doesn't make much sense.

Every acquirer is like valeant. Noted.

This kind of napkin math misses a lot. What are the assets that they bought? Do they have different economic characteristics than what they used to own? Suppose it depends on whether or not you include intangibles and goodwill in your ROIC calcs...yes they've bought more software/higher ROIC assets, but that's still $11 bn in cash out the door...what would the FCF CAGR have been without those acquisitions over the last decade? Is 8.5x revenue a reasonable price to pay? The question is, going forward, are those businesses of higher quality? Do they have stickier/more recurring revenues, higher margins with room for operating leverage, fewer needs for capital to grow or even negative working capital dynamics, self-reinforcing network effects in their industries, larger TAMs/higher terminal value, more opportunities to do accretive bolt-ons, etc. Some businesses are worth higher multiples than others because they'll produce more cash over their lives, and you can't know that by taking just a snapshot and looking at the short term. You have to understand the businesses, not just look at aggregate numbers, to understand a company like this one.

This kind of napkin math misses a lot. What are the assets that they bought? Do they have different economic characteristics than what they used to own?

Good post by Bill Gurley from 2011, going over the various competitive advantages and characteristics that make some companies more valuable than others: http://abovethecrowd.com/2011/05/24/all-revenue-is-not-created-equal-the-keys-to-the-10x-revenue-club/ Good overview of the basics (and most of what's important in investing is remembering the basics).