Sunday, February 26, 2017

UOS another year

The juggernaut keeps on rolling, despite some currency headwinds:

Land held for property development
Property plant and equipment
Investment properties
Total of Asset Items above
Total liabilities

Thursday, February 16, 2017

Transcript of Charlie Munger's DJCO meeting 2017

Here is this year's DJCO transcript.

My learning from giants continue.

The author has already highlighted the important points, so I will not repeat them here.

It is currently reporting season, and things are looking pretty pricey. DLX 30x, RWC 30x, COH 35x, IVC 30x. I look on forlornly and cannot help thinking that the number 30 is this year's financial equivalent to fashion's black. It is a perilous environment, as things trading at 15x starts to look interesting, just when cash is starting to pile up. This is an example of how our brains are wired to think and judge matters on relative terms, rather than on absolute terms. Pretty soon envy will be driving market prices, as everyone strives to do better than the Jones'.

The make-up of the market comprises of over 90% of spots where all capital goes to die, and only a handful of spots where capital is protected and thrives. If you avoid the bad spots, you cannot help but do well.

Enjoy and Prosper,
Yours One-Legged

Sunday, February 5, 2017

Book Review: A Man for All Markets

A Man for All Markets: Beating the Odds, from Las Vegas to Wall Street by [Thorp, Edward O]

A Happy New Year to all.

Readers of this blog will hardly be surprised at my excitement and enthusiasm for this book. I finished the first reading of this book in 2 sittings over 2 days. I am now on my second reread.

Initial takeaway points, relevant to both investing and life in general:

1. What matters most in life is what you do, how you do it, and who you share it with. Note: cross refer with Guy Spier's book. Essential for all seeking a better life.

2. Understanding and dealing correctly with the trade-off between risk and return is a fundamental, but poorly understood, challenge faced by all gamblers and investors. Note: I have bleated about this ad nauseam, but I will stop now, as it is to my advantage that participants continue to misunderstand this. To recap: high risks do not equal high returns.

3. The surest way to get rich is to play only those gambling games or make those investments where I have an edge.

4. The Ten-Count System had shown moderately heavy losses mixed with "lucky" streaks of the most dazzling brilliance. I learned later that this was a characteristic of a random series of favorable bets. Note: read this again carefully- it is a goldmine.

5. If the market does a good job of using today's public information to set current prices, then the only investors who have an edge are those with material private information. Note: I am not sure I agree with this. There is often great variability between system participants irregardless of system average values.

6. Because you can't get out in time when trouble is coming, the excess returns you expect from illiquid investments may be offset by the economic impact of unforeseen future events. Note: very relevant to those focused on small caps.

7. Economists have found that one factor has explained a nation's future economic growth and prosperity more than any other: its output of scientists and engineers. To starve education is to eat our seed corn. No tax today, no technology tomorrow. Note: important message for our political leaders, and also forming a seed for my own personal end-game in life.

Reporting season is coming up- busy time ahead.

Enjoy and Prosper,
Yours One-Legged