ScottHall

Thank you Doo Diligence and Flesh for your latest questions and commentary. I appreciate it. However, I will not be responding to any of them because this forum has become a sad sack of Special Snowflakes who are uncapable of accepting dissenting opinion without acting like babies. As a result, this forum is no longer worthy of my time and I will be taking a sabbatical from the Nanny State as of this time.

I guess we are going to lock threads with political views, now. What an embarrassment. Is it any wonder our societies are crumbling around us when we cannot even engage in a conversation without someone having a temper tantrum and calling Daddy to give everyone time outs? I thought we were all adults here, but I guess some people prefer having a nanny state to deal with divergent opinions. I guess that's not too surprising, though; as a growth investor, I was a pariah around here until I was exonerated by Warren and Charlie at the Berkshire meeting. Now that growth investing has been canonized by the Value Gods, it is time to move on to silencing people for their political opinions instead. Despite its flaws, I had thought this forum better than this. I guess not! http://www.cornerofberkshireandfairfax.ca/forum/general-discussion/filthy-liberals/

The Democratic party is internally corrupt and also inept, unfortunately(?) for us.

Scott is doing a pretty good job of making fun of me. Probs don't take him seriously here. I, however, am asking what one hopes to gain from an undirected search through the filings in contrast to a direct (or hypothesis driven) approach. An aphorism about the benefits of preparation doesn't really address the issue. I am serious. I used to do all that shit and then I started trying a new style and found it way more interesting. There is no way I am reading every page of a 10-K. I have 30 positions and don't care that much about any one of them, and when I did read through 10-Ks, I found that more often than not most of what's in is completely useless. I wouldn't say I've been taught it's useless to even try. It can be very fruitful to try. I just reject the idea that reading SEC filings, beyond the financial statements, is necessarily all that useful in analysis. Most of what I've found to be important is qualitative. One way to look at it is that official filings are one source of information, but there are many. The Star Wars poster on my nephew's wall says a lot to me. So does the fact that when I'm searching for something, my first instinct is to load up Google. When I'm looking to buy something specific, I go to Amazon. Anecdotal evidence is so useful to me because it says a lot about customer or user psychology. My brother was a Star Wars fan when he was a kid, and now he takes all of his kids to see the Star Wars movies and has them hooked on them, too. That's a 30+ year loyal customer. And there are a lot of them. Obviously Disney is larger than just Star Wars, but that tells me a lot about one of the big drivers for its studio and consumer products businesses. Why would I look at SEC filings with all of their legalese and Mine Safety Disclosure risks when I can look within my own community to see how sticky brands can make customers? What is more useful? For some companies, probably the SEC filings. Probably the farther you go on the value spectrum, the more important these primary sources become. Obviously in bankruptcy situations, it is a must. But for the most part, I do not look at those companies. I look at the companies that excite me, and capture my imagination; the ones that really drive me to understand what is it that this business does? And not just what it does in the traditional sense of, they make pet food, or auto parts, or whatever. What they do for the consumer. What sort of reaction to the product do they have? Does this company's service make them happy enough so that they have them for life, or are they able to retain customers DESPITE shitty service? All of these things - and many more - are my own sort of mental flags, and when one gets set off I get very interested because these flags all tell me things about a business that aren't necessarily going to show up in the filings. These sort of questions are much more interesting to me than obsessing about the maturity dates of all of a company's debt. In many ways, focusing on filings can obfuscate the nature of a business rather than clarify it. As a person who aims to see the spirit of a business... to see a business for what it REALLY is... filings are only one part of the picture. And for many of the businesses I invest in, they are a very small part. I understand that filings may be useful for many people and aids them in the way they look at companies, but for me and my style, I've found them irrelevant. For most businesses I think only a few things really matter and though a trace of their spirit may be present in the filings, it is not where the spirit lives or where it can be seen most clearly. The spirit - what really matters for a company - are often inputs rather than outputs. So, it can be useful to go to the top of a funnel and observe what's going in... rather than what's coming out.

I pretty much don't read filings at all, beyond the financials that get posted to Google/Yahoo finance.

Gee, it sounds like Warren has been reading my topics on here. You're welcome for the great meeting, everyone.

No. Just no. Paying $40 per month is not a win for pet owner. Sorry. Maybe it is for people who throw money at pets as if they are family members, but it's not for a regular person. Sorry, if kitty gets cancer, it's not getting $5K procedure and it's not getting pet insurance. It is going to eternal hunting grounds where mice run slowly and bowl is always full of organic kibble. Not to say that he and FFH won't make tons of money on pet insurance. Cause there's tons of people who think that Fido is a family member and all that. It's a personal choice. There's no right or wrong answer, it's subjective. If you love your pet, insuring against it potentially dying because you don't have thousands on hand might make all the sense in the world and be a small price indeed compared to the alternative. Doesn't matter if you wouldn't do it if many others would, just like it doesn't matter if I wouldn't spend money on a luxury car or a fancy business suit if many others will. Maybe you love an artist and will spend hundreds to see them live but I think they're worthless and wouldn't pay a dime. We're both correct from our perspective. And I write this as a non-pet owner who can still see how many people feel deep attachment to their pets and want to take good care of their health. I literally spent like $3k getting rid of my cat's cancer a few months ago, and did it without a second thought. Animals mean a lot to me; they have always been there through feast and famine, and I will do what is in my power to make sure they have the treatment they need to live a happy life. He was growing cysts and some of them were cancerous and had to be removed. That 3K could have saved more than 10 cats who instead were killed because shelters don't have space. Yeah, attachments matter. And ethics is a harsh mistress ( https://en.wikipedia.org/wiki/Trolley_problem ) Meow. You are almost a good troll, Jurgis. :)

No. Just no. Paying $40 per month is not a win for pet owner. Sorry. Maybe it is for people who throw money at pets as if they are family members, but it's not for a regular person. Sorry, if kitty gets cancer, it's not getting $5K procedure and it's not getting pet insurance. It is going to eternal hunting grounds where mice run slowly and bowl is always full of organic kibble. Not to say that he and FFH won't make tons of money on pet insurance. Cause there's tons of people who think that Fido is a family member and all that. It's a personal choice. There's no right or wrong answer, it's subjective. If you love your pet, insuring against it potentially dying because you don't have thousands on hand might make all the sense in the world and be a small price indeed compared to the alternative. Doesn't matter if you wouldn't do it if many others would, just like it doesn't matter if I wouldn't spend money on a luxury car or a fancy business suit if many others will. Maybe you love an artist and will spend hundreds to see them live but I think they're worthless and wouldn't pay a dime. We're both correct from our perspective. And I write this as a non-pet owner who can still see how many people feel deep attachment to their pets and want to take good care of their health. I literally spent like $3k getting rid of my cat's cancer a few months ago, and did it without a second thought. Animals mean a lot to me; they have always been there through feast and famine, and I will do what is in my power to make sure they have the treatment they need to live a happy life. He was growing cysts and some of them were cancerous and had to be removed.

Is this another way of saying Fairfax suffers from a conglomerate discount or was this in a different context?

None of this matters because with the rise of the AI world productivity will increase by orders of magnitude even beyond our wildest dreams. So long as starvation can be staved off until All Becomes One, all problems of the mortal world will be ceased & moot. That is not dead which can eternal lie, and with strange aeons even death may die. g > WACC = ∞

I like how literature is just a worthless degree to many of you, but engineering is not. The lack of intellectual humility in this topic is staggering, even for a group of value investors. You guys place way too much emphasis on ranking the various types of toilet paper.

Sorry, was busy earlier. To answer your previous question (not this one), yes I think cigar butts can beat the market too. This is all about response optimization. :) Where do you tool response optimization? Ad copy, landing pages, ease of conversion (a lousy checkout process can kill returns...) Screw impressions, I want click through's & an inescapable funnel... All of the above, and more. We can take it to PM if you have anything specific you want to chat about; don't want to give a public forum free techniques if people can't figure it out for themselves.

Sorry, was busy earlier. To answer your previous question (not this one), yes I think cigar butts can beat the market too. This is all about response optimization. :)

I misunderstood your earlier post! Sorry :D Oh...you mean DRM as in direct response marketing. Yeah, I mean I'm talking about the digital marketing industry. The marketing around online newsletters are pocket change to these guys...the big branded campaigns is where the real money is. The tension between clients/agencies vs. the online platforms they market on, how this relationship plays out will move a lot of resources around. Yeah, that's fair. I will note however it's more than newsletters. You can sell health products, survival gear, razor blades, monthly boxes, seminars, educational products, etc etc. this way. I may well end up being wrong, but in my view the entire world is shifting to DRM. Most successful things on the internet use techniques from DRM to attract readers; I use them on this very forum to create threads I think will draw interest. And it usually works quite well, as you can see. As sales continue to shift online or alternatively away from traditional bricks & mortar, I think we'll see the multiple forms of advertising all pretty much converge. DRM is incredibly effective in an era of short attention spans and with the rise of mobile, these ancient techniques have never been more relevant and will only gain relevance from here. In our industry we tend to shit talk the big ad agencies b/c we think they sell bullshit and act as a similar sort of insurance policy as not getting fired for going with Goldman. That's not to say the people who work there aren't skilled and intelligent. I do think the historic stability of the big ad agencies is a testament to how good the model can be. Whether that gets disrupted... who knows. Lots of new players in digital for sure. A lot of the problems you're describing may be exacerbated by FB but they're not caused by them; it's a partially intractable part of not having near-immediate sales numbers to compare your spend to. Maybe that causes problems for them down the road, but when you're dealing with an oligopoly you only have so many options. Anyway, sorta stoned ATM so don't take this post too seriously. Am not trying to offend, just share my view from the opposite end of the industry.

It's DRM; I'm not talking about brand advertising. Brand advertising is IMO a largely fraudulent form of advertising. The economics are simple. You compare your customer acquisition cost against the lifetime value of a customer, or in my industry's case, subscribers, to measure your return. It's a very simple money out, money in calculation and everyone in DRM does some form of it, or they won't be in business very long. What some guy who manages eight figure spends has to say doesn't mean much to me, given my background. I do think to some extent we're talking past each other here, because we're talking about two largely different schools of advertising.

I work in DRM and it's not that hard to calculate your economics based on ad spend. FB gets a lot of use in my industry, for good reason.

I think that's the biggest lesson to take away from these blowups. A lot of times, value guys get way too sure of themselves and bet too much as a % of portfolio. I am a hybrid growth investor but I know I'm full of shit; all of my positions save one are single digit holdings.

I think this board needs people like you. I actually think its a great board because there are a lot of intelligent people and the views are pretty diverse. Its kind of funny because I have a friend something pretty similar to what you are doing with marijuana. I pretty sure it won't end well for you or for him. But I am often wrong. Anyways if it doesn't, don't beat yourself up about it...if your life isn't working it makes sense to experiment with things even if it doesn't work out. Good luck to you! Thanks Rukawa. I agree; why not shake things up now and then? Some people view life as a precious thing where it makes sense to find a system that works and stick with it. I have no desire for that; I think the path to knowledge requires blowing up your comfort zone sometimes.

Yes.

Can I be your agent and sell ScottHall Brand? 8) We gonna make multi-BUHLLIIOOONS! I want ScottHall Brand listed on the NYSE this time next year. It is a high-margin platform compounder that licenses the ScottHall brand name and other acquired names for use on private label clothing. The numbers totally aren't made up. The funny part here is, that you are already - for my part - on my ignore list. I'm just nosy about what you are posting, reading it all. The board technicaly alows me. Widening your mental state of thinking using pot etc. is to me not the way move forward. Cardboard has posted about it earlier on this board, based on personal experiences related to persons close to cardboard earlier, and personally I agree with cardboard. To me, most likely, you'll end up as a train wreck of a person - the same as investor - if you do not get a hold on your self with regard to this. - - - o 0 o - - - The first person to treat you as deserved is your self! : Never forget that!. - Good luck, Scott. So you're ignoring me to keep up appearances, you're not really ignoring me. That works for me if it works for you. It's funny you use those words... because I described myself as a train wreck in an article I wrote not too long ago. The only difference is I was talking about myself last year, before I started using marijuana. I don't think you really know much about me, but it doesn't offend me. I think it's kind of funny. I appreciate that you care about me enough to share that advice, but I think I'll look at what's happened in my own life since I started smoking pot instead of worrying about other people's failures.

You're all welcome to ignore me if you'd like, but the fact is that my topics are often hotbeds of activity. A topic about my own life of all things is 11 pages long. Maybe someone should think about the applications of that.

The funniest thing in the world to me is that the tech bubble people were right, just ahead of their time.

I mean to be fair you could have said the same thing about Amazon 3 years and 200% ago. I am not a big fan of "the market knows" arguments b/c you don't know what the market is really forecasting; all you know is the aggregate superficial valuation. These stocks have traded at high multiples consistently, and they've done well regardless thanks to the underlying business performance. The biggest edge on any company is having the ability to wait; most investors are way too short term oriented, and don't have time to let the world's best companies work their wonders for them. As good as the market thinks these companies are, they may actually be perpetually undervalued because a lot of people are scared away by high multiples. It's arguable the multiples aren't as high as they should be and that's why they consistently outperform.

Children are so young that they don't really understand concepts 20, 30 years out in any real way because they can't internalize them. That's multiples of their lifespan; it's harder for them to really comprehend when a day still feels like a long time. I'd probably use some sort of hyperbolic growth scheme early on to catch their attention, until the point that it gets too expensive. Basically I'd match their savings so long as they kept it locked up for a year, or something, and gradually lower the rate of return to a more realistic level. I don't know if it'd work, but if I had a hare up my ass about it, that's probably what I'd do. I probably wouldn't bother kids with it much, though. They have more important things to worry about.

It only works when people can't tell, bae. <3