Links - 01/02/2022
“Markets do not punish the greedy; nor do they necessarily reward the virtuous and frugal saver. Markets are amoral. ‘Good decisions’ and ‘bad decisions’ play a role in the outcome, but much depends on the wanton accidents of timing—when you get in and when you get out.” —Maggie Mahar (“Bull!”)
The Investor’s Podcast: TIP410: The Changing World Order W/ Ray Dalio (LINK)
Our new co-host, William Green, interviews Ray Dalio, the legendary founder of the world’s largest hedge fund, Bridgewater Associates. Dalio explains how to position ourselves to survive and thrive in changing world order.
Stock Market History, Illuminated (LINK)
10 Questions for 2022 (LINK)
Learning from corporate mistakes:: The rise and fall of Iridium [H/T @breadcrumbsre] (LINK)
Graham Holdings Has a ‘Mishmash of Assets.’ Why Its Stock Is a Buy. | Barron’s [H/T Linc] (LINK) [Note: The Investor Day presentation from last month is available HERE.]
“You don’t get more low-profile than Graham Holdings,” says Craig Huber of Huber Research Partners, one of the few analysts following the stock, citing the company’s lack of quarterly conference calls and limited investor-relations efforts.
That’s a missed opportunity, because the thinly traded stock, at around $590, looks cheap relative to the estimated value of the company’s assets. They include valuable local TV stations, the Kaplan education business, manufacturing and healthcare operations, several auto dealerships, and restaurants in the Washington, D.C., area such as the historic Old Ebbitt Grill, which was the highest-grossing eatery in the capital before the pandemic.
…Graham trades well below its book value of about $800 a share. Barron’s wrote favorably about the company in July 2020, when it traded around $360 a share…. On a sum of its parts, Graham could be worth over $1,100 a share based on an analysis we made with help from an institutional holder.
The Daily Stoic Podcast: Seneca on Pleasure and Joy (LINK)
The secret lives of cells — as never seen before (LINK)
William J. Bernstein on financial manias, via his book The Delusions Of Crowds:
Financial manias can be thought of as a tragedy like Hamlet or Macbeth, with sharply defined characters, a familiar narrative arc, and well-rehearsed lines. Four dramatis personae control the narrative: the talented yet unscrupulous promoters of schemes; the gullible public who buys into them; the press that breathlessly fans the excitement; and last, the politicians who simultaneously thrust their hands into the till and avert their eyes from the flaming pyre of corruption.
The promoters follow a classical Shakespearean tragic path and are consequently the most fascinating of the actors. Most begin as brilliant, hardworking visionaries who intuit before others the riches that a new technology will bestow upon society. In the process of bringing their visions to fruition, they grow rich and powerful and, in a capitalist society that judges men by their wealth, become their nation’s lions. When the speculation runs its course and bursts, they wind up disgraced and bankrupt and usually, but not always, narrowly escape the jailer.
The public proves easy pickings for the blandishments of the heroic, charismatic promoters. Competent investing requires a rare combination of mathematical ability, technological expertise, and, most critically, a working knowledge of economic history. Alas, people greatly prefer stories to data and facts; when faced with such a daunting task, humans default into narrative mode, and perhaps the most pleasing story of all is one that involves the effortless wealth to be had from buying into a new technology.
The press falls prey to the promoters in the same way as the public. Few things corrode journalistic excellence as the ease of writing about the revolutionary ventures of brilliant businessmen, who with alarming frequency grace magazine covers, first as heroes, then as accused felons.
Finally, financial manias sweep into their ambit politicians, whose reputations and popularity are enhanced by the economic prosperity that temporarily results from speculative excess, and who not infrequently get caught raiding the cookie jar.