The link below will take you to many other links to investing resources like case studies, business histories, foreign stock information, value investing ideas. There is more here to keep you learning for the next few months. I can’t vouch for the quality of all the information, but you can root around for yourself. Tell me your favorite links: http://www.scorpioncapital.com/manual/links.php. A potential treasure trove!
This brings me to the philosophy of this blog. In the Value Vault you will find the book, Applied Investing and a Powerpoint of Porter’s Five Forces. I do not feel those works are particularly useful. I wrote a critical review on Amazon of Applied Investing here:
I find many of the readers’comments on Amazon’s book review section ludicrous. Do the the author’s students write the reviews?
But I do not want to censor material because of what I think; instead make up your own mind. Greenwald in his book Competition Demystified says that Porter’s analysis is four forces too many. I would rather have you read Porter’s book, Competitive Strategy (1980) or view the Powerpoint of the Five Forces than exclude them. If you find material totally misleading or harmful to learning how to become a better investor, let me know.
To prepare yourself to read the world’s best business analysis ever done (to be posted Friday December 16th) please read Munger’s, The Art of Stock Picking.
Next, sit quietly and write to your investors how you will build a multi-billion dollar business from scratch. Take no more than an hour. You can go into the Value Vault* and read Bruce Greenwald’s Competition Demystified and the Powerpoint of Porter’s Five Forces to assist your understanding of competitive advantages since if you are to succeed you will need several or many working for you.
To gain access to the Value Vault (a collection of videos and materials on business and investment analysis) just email me at email@example.com with VALUE VAULT in the subject heading. I will email you a key provided you use the materials for your own use.
A generous reader sent me these links of value investing classes circa 2010.
And a generous video wizard downloaded the following videos to the Value Vault which you can gain a key to my emailing me at firstname.lastname@example.org and place VALUE VAULT in the subject line and I will send the key.
I haven’t seen them yet. Can’t wait. A treasure trove here.
Jacob Wolinsky of http://www.valuewalk.com pointed out this blog on European markets. Subscribe to learn more about investing outside the U.S. You should look in the areas of dislocation like Europe.
Jacob writes, “My good friend Tim Du Toit is a value based investor in Germany. He has over 20 years in money management, and many years of experience in value investing. On the side he runs a blog http://eurosharelab.com about value investing containing lots of good ideas for European equities, behavioral finance etc.
Do not forget to watch the stock 52-week new low lists. There is tax-loss selling that occurs until end of the year. If you can find a stock you are familiar with on the list and know its prospects are good, you may have the benefit of uneconomic–in regards to the company’s prospects–selling due to tax losses. Chrysler, many years ago, comes to mind. It started the year at its low around $3 per share and continued to climb to around $60 by mid-Year.
About three weeks ago (Nov. 15th) , I mentioned this strategy. http://csinvesting.org/2011/11/15/pzena-pzn-disappointment-despair-and-tax-loss-selling/
Of course, the markets have risen approximately 10% since the November 15th post, but PZN has risen 25% or more. Operationally, nothing has changed and PZN is not leveraged on its balance sheet. I am making an assumption that some of the selling pressure a few weeks ago was due to non-company factors.
To search go to the new low lists found here: http://online.wsj.com/mdc/public/page/2_3021-newhinyse-newhighs.html
The best blog for improving your thinking: www.simoleonsense.com. You will learn about your own psychology and how you think—essential knowledge for becoming a better investor. The material on this blog has excellent links.
New York Times Article on the Khan Academy
As previously mentioned, the Khan Academy is a great learning resources for you and for kids. Brush up on statistics, for example.
Referred to here:http://csinvesting.org/placing-ev-and-ebitda-into-perspective-case-studies/
A Protest at the Federal Reserve
http://www.newschannel5.com/story/16181894/protestors-disgruntled-with-federal-reserve-bank. Expect many more of these protests as our currency debasement continues.
Attack on the Austrian View of the Great Depression
I like to read theories, thoughts, or facts contrary to what I think is correct. You test your thinking and, God forbid, you could be wrong. The Great Depression will help you understand the biggest business cycle and depression of the past two centuries. Read: mises.org/rothbard/agd.pdf (Copy and paste into your browser.)
An article on the Austrian view of the Great Depression and the criticism of that view: http://mises.org/daily/5826/Defending-the-Austrian-Explanation-of-the-Great-Depression-from-an-Internet-Attack
I will start this week planning the curriculum to study strategic logic while developing the building blocks for valuation, then tying the two together.
Seth Klarman, “An investor must balance arrogance and humility. When you pay 1/8th more than the market for a stock, you are arrogant in believing you know more than the market. At the same time you must have humility to admit you can always be wrong.”
Eat More Fat
If anyone can find scientific evidence against this, I am eager to learn. http://www.marksdailyapple.com/how-to-eat-more-fat/
Blogs of Interest
Interesting valuation discussion of a micro-cap from a deep value investor here: http://greenbackd.com/2011/11/30/guest-post-imation-corp-nyseimn-worth-more-sold-than-alone/
What you do not learn in college: http://www.jamesaltucher.com/2011/11/10-things-i-didnt-learn-in-college/
A good short-seller and stock analyst http://brontecapital.blogspot.com/
Good learning resources: http://compoundingmachines.wordpress.com/ http://www.grahamanddoddsville.net/?page_id=52
Let me know of others that you like…………
Michael Burry, the self-taught investor, who shorted sub-prime in the Big Short by Michael Lewis is interviewed here: http://www.scribd.com/fullscreen/37453934
Don’t forget a favorite blog: Carl Icahn doing his bidding:http://greenbackd.com/2011/11/28/icahn-bids-for-commercial-metals-company-nysecmc/
A country in collapse (Cuba) where dissidents protest the dual currency system: http://pedazosdelaislaen.wordpress.com/2011/11/29/dissidents-arrested-for-demanding-one-currency/
Placing Europe in perspective: http://scottgrannis.blogspot.com/2011/11/putting-piigs-debt-into-context.html
Meanwhile guess what the Federal Reserve is busy doing?
Would investors be surprised by a “melt-up” in nominal values in the stock market? I am not predicting this, just thinking where the greatest surprise could be. Beware of US Treasuries.
Value Investing Newsletters
An excerpt from the Fall 2011 issue:
This issue features a trio of legendary value investors, who honored us with their time and sage advice. One thing became crystal clear: there is no single “right” way to practice value investing. Each successful value investor adapts the practice to his or her own style, although Graham & Dodd and their famous disciples remain an inspiration to so many of us.
We start off this issue with Lee Cooperman ’67, founder, Chairman and CEO of Omega Advisors, Inc. Mr. Cooperman reflects on the path of his incredibly successful career, describes how his firm constructs its portfolio, and outlines the theses behind a few of his top investment ideas.
We also had the privilege of speaking with Gabelli Asset Management (GAMCO Investors) founder, Chairman and CEO Mario Gabelli, well-known value investor and alum of Columbia Business School‘s class of 1967. Mr. Gabelli provides his approach to security analysis and discusses his interest in BEAM, National Fuel Gas and The Madison Square Garden Company.
Our third interview is with veteran value investor Marty Whitman, Third Avenue Management’s Chairman and Portfolio Manager, and an Adjunct Professor of Distress Value Investing at Columbia Business School. Mr. Whitman shares his thoughts on some compelling areas of investment opportunity, discusses his approach to company valuation and describes some of his firm‘s most successful investments.
For past issues and a good blog: http://www.grahamanddoddsville.net/
The Birth of the Federal Reserve by Murray Rothbard–a devastating indictment of the Fed.
I enjoy reading the irreverent James Altucher: http://www.jamesaltucher.com/2011/11/how-to-have-more-common-sense/
Sometimes you can find interesting articles on investing here-subscribe for free: http://www.frontlinethoughts.com/subscribe
Research Report on the Real Effects of High Government Debt: http://www.bis.org/publ/othp16.pdf
The end of the welfare state is now in process. High government debt hurts future growth. The report doesn’t discuss the cause of the problems only the impending effects. The parasite (govt.) has sucked the host (private enterprise) dry. So….ongoing volatility will be our friend as governments try to avoid the inevitable.
https://www.lmcm.com/default.asp?P=868060&S=868156 His articles can be of interest though somewhat too intellectual/academic for my tastes.
Prices rising but still there is a call for pursuing a failed policy. Conventional “Economists” and pundits haven’t learned in 200 years:
The average rent for a Manhattan apartment in October was $3,341, that’s 7% higher than October, 2010, reports the NY Daily News. Rents are just $53 off their all-time high of $3,394 reached pre-crisis in May 2007. The vacancy rate in October was 1.18%, below October 2010’s rate of 1.24%.
The Austrian School
Articles of interest:http://mises.org/daily/5796/The-Clear-Language-of-the-Austrian-School and http://mises.org/daily/1533/Housing-Too-Good-to-Be-True
www.greenbackd.com This blog does not have much recent content but it has excellent posts on special situation investing and asset based investing like finding net/nets. You won’t go wrong studying this blog.
http://www.gannononinvesting.com/ A blog written by a serious, self-taught investor. He is thoughtful and conservative. You gain a sense of his personality through his writings and investments. Investing is a personal endeavor.
Two interesting articles on money and economics:http://mises.org/daily/5673/Understanding-the-Price-of-Money
Enjoy the day.
In case you are not aware of this site:http://www.santangelsreview.com/ you are missing out.
Also, an interesting Charlie Rose interview with hedge fund manager, Ray Dalio. Note his thinking process.