Relax. Take it easy. It’s as if I’m terrified, as if I’m scared. Relax.

A week ago, I wrote that the “melt-up” might be beginning. Well, since then the financial media have gone into melt down mode. Talking heads have been buying stockpiles of food at Costco. The end is nigh.

Perma-bears have come out of their caves. Screams of joy were heard last night, ricocheting down the empty streets of  Permabearville:

“CNBC returned my call” – “CNBC returned my call”

“They want a doom and gloom guest”  – “They want a doom and gloom guest”

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Words from the wise

Portraits of Persian creatives.

 

I like long form interviews, whether it be podcasts or print.

Below are some of the podcasts I’ve been listening to recently:

  • The Meb Faber Show (Investing)
  • The Joe Rogan Experience (Everything)
  • The East Africa Business Podcast with Sam Floy (Primarily start-ups)
  • Motley Fool Money (Investing)
  • The Moment with Brian Koppelman (Mostly interviews with creatives)
  • Masters in Business with Barry Ritholz (Usually investing)

By far the best regular interview series I’ve come across in print is Lunch with the FT. It’s behind a pay wall but you can register and read 5 or so articles a month. Continue reading

Do you have the rarest skill in investing?

Packer & Co. is an Australian based investment firm. They received some media attention recently, thanks to a blunt assessment of the Australian economy (more on that later).

I checked out their website and was surprised to find half-yearly investor letters since 2008, with both thematic commentary and detailed portfolio breakdowns. They have also uploaded their Pre-Financial crisis (2007) and Pre-Tech Crash (1999) letters which are worth reading.

After working my way through 5 to 10 of these letters, it became clear that Packer & Co seem to have one of the rarest skills in investing. Many people think they have it, but few really do. Continue reading

This presentation on investing is surprisingly simple and powerful

This presentation on investing has been getting a lot of attention on social media today.

Definitely worth a look, with plenty of nuggets of wisdom.

Two key messages I gleaned from the video are:

  1. Sophisticated investors tend to over complicate investing
  2. You don’t need to be an investment expert, just hold your nerve when everyone else is going full Cramer.

Private Equity used to make money like bandits, this is how they did it

I came across Dan Rasmussen on Meb Faber’s podcast this week. Dan runs Verdad, an investment firm which seeks to invest in leveraged small value (i.e. low multiple) stocks. The research behind his approach you can find here.

In essence, Dan’s thesis is that the reason that private equity beat the market by 6% per annum after fees in the 1980s and 1990s, was its ability to:

  1. Buy cheap firms (i.e. less than 6x EBITDA)
  2. Use leverage to amplify returns

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Meb Faber on how different asset classes perform in a crashing stock market

As you can see from some of my recent posts, I’ve been searching for information on how different asset classes handle financial crises.

I came across a nice white paper from Meb Faber and his crew at Cambria, which has exactly what I was looking for. They have evaluated performance of stocks, bonds, commodities, gold and REITs during the S&P 500’s 10 worst months  since July 1986. Continue reading