oddballstocks

Yes, I think it was in a Pabrai talk where he discussed this. He said you can tell a competitor exactly what makes you different and special and they won't copy it. That there is no point in being secretive because people just don't copy, that's what makes copying so powerful. I know the 'not invented here' mentality is strong, I've seen it daily. People would rather do something themselves however flawed verses copying something that works somewhere else.

Caveat: Haven't read the article yet.. Your point is one that should be blindingly obvious to investors, yet somehow it isn't. If a company is entirely focused on serving their customers then shareholder value should follow. Companies that are naturally maximizing shareholder value aren't doing it explicitly, they're fulfilling their main purpose which is to deliver a product or service that satisfies a vital customer need. If a company can do this profitably then shareholder value follows. Where the chain is broken is when companies can't satisfy customers and management starts to pull financial engineering levers to fake this. Look at all of the lauded companies, consumers either love them, or they fill an essential need.

I don't think you really know that until you have lived it, to be fair. You are a guy who appears to be doing a lot and seems to have pretty much two careers. I'm also guessing you have quite a bit of money. It's easy for you to rack down on ambition and whatnot, because you already have it by the bucketload compared to 95% of people. I have this not-so-close friend who is in sales. He's a decent guy, but very hyper and in your face. He earns a lot of money for a guy in his mid-20s (+$10k/month) and has been doing so for a couple of years now. He likes to spend at least as much as he earns and he doesn't shy away from talking about vacations in Dubai and whatnot. I never hear much about this directly, though. Probably because he knows I could outspend him but choose not to, so I wouldn't be impressed or jealous. Instead I hear of this through our mutual friends. They are easier targets because they work as teachers or go to school etc. You know, the usual stuff young and not rich people do. My point is that maybe you don't really know everything about what your friends think, because you (at least in some aspects) are probably the most successful one of the bunch. That was a tangent; but this stuff about "status" not mattering irks me a bit. Every single one of us thinks about the relative status of everyone in our lives, even if it may not be on a conscious level. I think it's delusional to think that family and friends will treat you the same whether you are a doctor or a garbage man, no matter how nice and open-minded they seem under present circumstances. In theory, everybody's a saint. Sorry for rant, but now I have written it so I will post it too. A lot of presumptions here about me, none true. I speak as one who's chased promotions, better titles, better positions. For a long time the grass was always greener, what I wasn't doing was always better than what I was doing. I've been on both sides of the fence and invariably where I came from or where I'm going was always 'better'. I currently live in a city neither my wife or I are from that we moved to for a job. When others talk about driving to visit family I agree it's doable, but I also know what a pain it is and how much my wife wishes we lived where her mom is. I am living what the poster asked. In terms of status this is something I found out myself, I also found out that contentment is better than status, money or whatever else. I don't have a bucketload of money like you presume. I've never been as successful as your friend, I've never earned a six-figure salary in my life. In terms of this board that might make me a failure, it's not something I care much about. Now some of my career dissatisfaction has driven me to do my own thing and work to branch out on my own. So in many ways I'm glad to have failed at the typical corporate American office job. If I hadn't fought to get up the ladder I might have never had the motivation to start my own company. And for how our friends think? They as well as family have the impression we're poor, we heard it first hand and third-hand. We live in a smaller house and drive used American cars. We're constantly bombarded with quips about how cheap we are or how little money we must have, or how we can't afford certain things. I've lived payment to payment before and decided that after paying off debt and starting to save and invest that I don't want to go back to that. So status, or lack thereof hasn't been an issue. Living differently has been rewarding, I'd be embarrassed to share our financial status with friends, I wouldn't want them to have a number color their perception of us. Likewise I hesitate to ever post performance numbers because I want any work I do to stand on it's own, not how I've done in the past. Maybe it's true that you know don't until you've tried, so in that case the OP should just move to see what it's like. I wasn't trying to look down in my original post, rather I've lived their experience and I was hoping to save them some of the pain I've gone through myself.

I'd keep your current job. It sounds like the only reason you'd move is prestige of working in a better facility with more renowned doctors. Moving to satisfy 'success' or ego is going to leave you unsatisfied, there will always be something else to chase. You have family close by, a great child care situation, your wife is satisfied, and you have satisfaction from serving those who are otherwise left unserved. Your co-workers are not perfect, but don't delude yourself into thinking that smarter people who are experts will somehow be better co-workers. I've found 'experts' are often terrible to work with, something to keep in mind. Maybe the job will be more satisfying, but life outside of work might not be. My advice is probably strange for a message board full of people madly pursuing money and success. But there is more to life than money and prestige. For me personally those close to me (wife, kids, family, friends) don't care how much I make or how well known I am, that's not what matters. Friends who only care about status and money are not the types of people I enjoy hanging out with, you can never measure up around them. Much of this thread discusses regret. You will always have regrets, regrets of things you did and regrets of things you didn't do. Don't get caught in the pursue of perfect, you'll never obtain it.

Attend annual meetings or conferences and befriend attendees who seem to have their acts together. Then connect with them and their friends, employees whoever knows their stuff. Take them to lunch, don't call. Over lunch or a beer you'll find out more than anyone would ever share on a phone. You will find out a lot even if someone never says anything. No spy mode required, just talk to people and ask questions. If you ask direct questions 90% of the time you receive direct responses. I have a friend who was a bank examiner and then bank exec. Great guy to talk to over lunch. His DD is this. He calls a potential bank investment and pretends to be a new resident and asking "why should I choose your bank?" he'll then call later in the week and pretend he needs a loan. He said most of what he needs to know about the quality of the business can be discerned with those two questions. I've found that talking to people adds an incredible richness that is lost in filings. I'm not sure what investment edge can be gained, but I know that I've enjoyed investing more knowing "the full story". So many times there are things that are speculated upon based on filings, but a simple question to the right person resolves the issue. To the right person there is no mystery, the answer is obvious. How can I sum this up, network, network, network. Just like you would to get a job. Take people to lunch and coffee, ask if they know people etc. In no time you'll have a giant network that you can talk to about anything.

Why do you think CFG is significantly better than mediocrity for it to be the best long-term idea today? Something about the management? Business mix? Just curious. Thanks I like CFG as well, agreed on valuation. RBS held them back after the crisis. This is essentially a spin-off where management has told shareholders what to expect in 3-5 years. Most shareholders won't wait that long, but the ones that do should be rewarded. This isn't my best long term idea, but I like them more than some other banks I own and have sized the position accordingly. Another bank worth looking at OSHC, cheap and with an activist pushing for a sale.

Get the CFA books, used on ebay or Craigslist would be cheap.

I can't speak for Racemize, but the way I understood it, some people target a certain % of cash "just in case" some big huge fat pitch comes along, because they believe that having the cash to jump on these infrequent opportunities makes up for the drag that the cash creates the rest of the time. So they might have a hurdle of 15% and invest in whatever they can find that meets that, but they keep an extra 20% cash on hand waiting for "blood in the streets" scenarios, even if they could use that 20% to just buy more of what they have in the other 80% of their portfolio, or similar things. Or a portion of their portfolio is illiquid and it's hard to sell illiquid stocks to buy the fat pitch. I keep a portion of my portfolio in cash for this reason. It fluctuates through the seasons but my goal is generally 5-15% if possible. It's easier to buy a new stock with cash and sell something illiquid on my timing rather than be held hostage to the market on an illiquid position.

I don't believe he just 'appears' promotion, he is. I was talking with a friend of mine who is a broker. He said that Greenblatt has set up weekly calls with brokers at warehouses and smaller firms to explain his funds. He also makes himself available to brokers to call and talk about his funds. My impression has been that he realized long ago that he was the brand. And that analysts can run the strategy, but people are buying his image. So he's on TV and in print promoting the funds wherever he can. I wouldn't be surprised if that's most of what he does now.

I have a pumpkin beer fermenting as well, did you actually put pumpkin in there? I just took a red ale and added about 1 teaspoon of spices. This is my first try with pumpkin beer. BeerBaron Just bottled last night. When I bottle I have a shot glass of flat beer to taste how things are moving along. I have to say this pumpkin might be the best I've done. I roasted a sweet pumpkin and added about half of it to the mash. Then I added the other half to the boil. I boiled a cinnamon stick and tossed in a very small amount of nutmeg too. Pumpkin has a very subtle flavor, but it helps balance the spices.

Being a permabear is difficult, the markets are biased upwards. It's like swimming against the current. Foreign investing is tough because there are two moving parts, the company and the currency. I've left all of my foreign investments unhedged. Right now my gains in USD are lower than my local currency gains on foreign holdings. But just looking at right now when the dollar is strong ignores a few positions I sold where I made outsized gains due to a lower dollar a few years back. There's a Tweedy Browne article on foreign investing that shows that over a longer time period the foreign currency gains/losses wash out. I believe someone posted a blog post on this for USD/CAD maybe two years ago as well. Like anything, if you jump in and out you have the potential to win big or lose big, but steady investing wins over both in the long haul.

Hell yeah taxes matter. I don't think most people have a sizeable amount of their liquidity in a tax advantaged account like an IRA. Besides, I think it's very important to disclose these things in the methodology and conclusion, otherwise, it would be highly misleading. I mean, 17% CAGR sounds fantastic, and to the average Joe with no deeper understanding of these things, they may just plow right into it without knowing that the taxes will take a significant chunk of the performance. They will end up heavily disappointed. I'm just saying, if you're going to provide some deeper statistics like draw downs, you should be complete and more accurate by including the tax implications of the strategy. Churning the entire portfolio over every year IS a big disclosure one should make. No interest in getting into a nit-pick fight but I have one thought. Everyone I know who isn't related to finance or investing in any manner ONLY has money in tax advantaged accounts. Most Americans can't even put away the $27k you get to shelter each year. So in a sense arguing over taxes limits the discussion to people who have wealth outside of retirement savings.

Do taxes matter? I know more than 50% of our portfolio is in tax advantaged accounts. Considering how much money an American can stuff in there a year I don't know why people wouldn't be investing in there. I can buy and sell all day long with no tax consequences in an IRA. In our taxable account I'm more aware of taxes, but I will always sell a company when it hits fair value or is over valued rather than sitting on it for tax reasons. As Walter Schloss said, don't let the tax tail wag the dog..

Nice, have a gallon of hard cider that just finished fermenting this week. Did something similar, gallon jug of apple juice (no preservatives, no additives, just apple) from Whole Foods, cider yeast, dissolved brown sugar (to increase alcohol content) and an airlock does the trick. I'd encourage cider yeast over champagne yeast. With champagne yeast you don't taste much of the original apple flavor, cider yeast preserves some of that. Keep in mind natural hard cider is very dry, if you want it sweet you need to add an artificial sweetener. I prefer to bottle rather than drink flat. Bottling is simple, dissolve a bit of sugar in water then siphon the cider into the dissolved solution. Then siphon the solution into bottles, cap and you're done. I'll be bottling the cider this weekend with a friend. Have a pumpkin beer I'm planning on bottling tonight. The brewing process is fun and relaxing. I can brew and not think about anything else, a nice change of pace. There's the challenge to doing something that you need to wait a month to see the results as well.

I have found professional data services to be night and day different from the free ones. I hate to say it, but the old maxim rings true "you get what you pay for"

Yes, afaik. Basically I always more or less ignore the company level. Yes. Company level is good to determine the strength of the company. I'm not sure what is 'good' to look for, but here are some bad things. Avoid companies where significant debt is held at the holdco level if the holdco doesn't have the cash, or might have issues getting cash dividended up to pay. This is where you can run into problems, holdco's debt is due and for whatever reason can't get to sub-debt in time with the company going bankrupt. You can also detect if one company is supporting another if you see capital moving up and then back down. In most cases these statements are extremely boring and are ignorable. It's not uncommon to see a parent statement with a few million in cash, a few hundred thousand in "other assets" and nothing else outside of investments in subsidiaries. Is there anything that you can learn from or look at the company level numbers?

You see this in the US as well for banks, there is a bank holding company and then subsidiaries. In my experience most European companies are organized with a holding company and then a subsidiary that conducts business in each country. So you have the parent only financials and then consolidated financials.

For durable goods, or for stuff where there's a real difference in quality, the value option can indeed be to buy higher quality, because you actually get more for your money. There's a saying about how poor people pay more for shoes (or boots, whatever) over time because the rich person will buy a good pair that will last for years and years while the crappy shoes will need to be replaced every few years, resulting in a higher cumulative price. I guess non-perishable items. For food we buy ingredients, not much packaged or canned. For cars and other perishable items I buy the best cheap thing I can. Some perishable things it does pay to buy quality. For example running shoes. I wear through those quickly, but bad shoes go even quicker, decent shoes are better on my body and last longer. For non-perishable items I pay up for quality when appropriate. I do the same math probably everyone on this board does. I always figure out how many cheap items I can purchase for the same price as the good item. If it's more than two and the expected lifetime is more than half it's better to go the cheap route. But more often the price differential isn't that large so it's better to pay for quality.

Anything that is based on a subjective experience is full of these interesting psychological effects. I'm sure you've heard of the study where they make people taste some wine, and their feedback varies a lot based on what they're told the bottle cost, even if it's the exact same wine. So two products that would score equally in a double-blind test might see the branded one win against the generic one in a non-blind test (which is how products are actually used). My algorithm with this is to always buy generic/store brand first, and if I don't like it try branded stuff. In most cases, I never get to brands because the cheaper stuff is just as good, or at least fine to me. Yes, I've seen the studies, they're awesome. There was a 20/20 where they did this with vodka. They took cheap vodka and purified it with a Brita and then did blind taste testing with supposed vodka experts. All picked the purified cheap stuff, and all believed the cheap stuff was their 'favorite' brand. We do the same thing with generic -> brands. We sometimes buy brands, but not always. Sometimes a generic offering isn't available. I've also found over the years that it pays (literally) to buy up in quality. I like to ski/hike/backpack/camp/run. And with cheap gear it wears out quickly, quality gear last decades. I have brand name gear I purchased 20+ years ago that I'm still using today.

Brands are fascinating. I've found in many cases the brand name is better than the generic. But other times the generic is the same or better than the brand name. I don't think there's a universal rule. What you get with brand names is reputation. There is an implicit quality guarantee with the name. If you buy a can of Coke and it takes like vinegar you can complain and I'm sure the company would stand by their product. If you buy Generic Cola and it takes like crap you're on your own.

Reading Antifragile, excellent book. Next up is: Bank Valuation and Value-based Management Recently finished and recommend: SPIN selling, Art of Profitability, Flash Boys, Marketing High Technology, Origin and Evolution of New Businesses

I don't have a position on this either way, but years ago I had a good friend who's father was a mining geologist. The father's point of view was that climate change was a given, in that the earth goes through warming and cooling cycles. To deny that was to deny history. The issue at play is whether human induced warming (if it's from humans and induced) will cause some issue that's abnormal to the earth's natural cycles. We don't know that, but speculation is abundant. The bigger issue to me is we have a few hundred years of history that we 'know' and that's familiar to us. Anything that's different seems bad. We want sameness. The earth has been warmer in the past, but we didn't record that history so we don't know what it'll be like. It might just be different, and humans like things that are the same. Personally I wish the world were cooling, and cooling fast. I love to ski and I'd like winters with a lot more natural snow. I live in a very hilly area and on many runs I will day dream about poaching some hill nearby if there were a few feet of snow covering the fallen trees.

If I'm faced with something impossible I do two things: 1) procrastinate 2) exercise It's been my experience that when faced with a task that seems impossible it's because I don't have all of the required information or prerequisites done. Exercise helps my mind re-organize my thoughts and think through the best way to approach the problem. Procrastination helps me work on other tasks first. In about 90% of the time something I do with my other tasks 'solves' or advances what I need to do for the impossible task. In many cases saving the impossible thing for last clarifies the situation so much that the impossible thing isn't impossible anymore it's very simple, or in some cases unnecessary.

I mostly work from home, it's something I enjoy and it keeps me sane. In my experience I am both more focused and less focused. At the office I can muddle along in a mildly busy state all day. At home I can focus for 2-3 hours as if nothing else existed, but at the end need to take a break. If I find my mind wandering, or if I have the urge to mindlessly surf the net or something I just take a break. I go run, talk to my wife, talk to the kids, something different. Then I come back and get in the zone. I'd say once a week I have a day where I'm in the zone all day. I'll come down into my office and will reappear for lunch and then dinner. Those days if feels like I only worked 5-10m whereas I really was just in the zone all day. Here's another thing I've found. My hours don't match office hours. I will work a block in the morning then go running and have lunch. Then a block in the afternoon and call it a day. Then I usually come back into my office after my wife goes to bed and I can find myself working for another 3-4 hours at night. I've found I work really well the later it is in the day. If I didn't have a family I could probably work 1pm-9pm and produce my best work. The key is finding a rhythm. I've been doing this for almost four years now, find a natural routine and it'll be easy to stick to it.

Sadly I am guilty of the same error. Your post made me think of this quote: "The term "value investing" is widely used to imply the purchase of stocks having attributes such as a low ratio of price to book value, a low price-earnings ratio, or a high dividend yield. Unfortunately, such characteristics...are far from determinative as to whether an investor is indeed buying something for what it is worth and is therefore truly operating on the principle of obtaining value in his investments. Correspondingly, opposite characteristics - a high ratio of price to book value, a high price-earnings ratio, and a low dividend yield - are in no way inconsistent with a "value" purchase. This is probably my single best investment. I purchased right after the IPO. The value metrics weren't there. I remember looking at their S-1 and thinking "a company that's essentially a duopoly shouldn't be losing money". I purchased and considered MA a spin-off, and it acted like one. The company started to earn money and grow like a weed once the banks didn't control it anymore. I stupidly didn't buy Visa when it IPO'ed. I don't know why, but buying both was the smart thing to do. Might have to turn in my value investing card after this admission, but I still own it. Might not be cheap right now, but I'm confident in 5-10 years the company will be bigger and better than where they are now. This is a buy, hold, and compound for me.