Links - 6/26/2020
“When we look at a business and we’re looking out in the future, obviously if we see growth in that picture and it’s growth which produces a high return on incremental capital involved, we love it. But we do not rule out companies where we think there will be little or no growth if the price is attractive relative to the earning power.” —Warren Buffett (2011)
“The interesting thing is that in our country, the business schools teach people to make these projections way in the future, and they program these computers to grind these projections out. And then they use them in their business decision making, et cetera, et cetera. I’ve always regarded those projections as doing more harm than good. And Warren has never prepared one that I know of. And where an investment banker prepares one, we tend to throw them aside without reading them. I think an enormous false precision gets into things when you program computers to make forward projections for a long period of time. We make rough projections in our head all the time. And we don’t do any of those formal projections, because the fact that they’re there on paper and came out of a computer makes some people think they must be significant. I really think they do more damage than they do good.” —Charlie Munger (2011)
CNN coronavirus town hall [Bill Gates is on the Part 1B and Part 2 videos.] (LINK)
Brookfield CEO Flatt on the Long-Term Investment Outlook (video) (LINK)
Wirecard and the missing €1.9bn: my story - by Dan McCrum (LINK)
Fed puts restrictions on bank dividends after test finds some banks could be stressed in pandemic (LINK)
A 100-Year Bond at Less Than 1%? It's No Big Deal (LINK)
Nothing says it’s cheap to borrow quite like a 100-year bond with a yield of 0.88%. Austria returned to the century-bond club on Wednesday with a new 2 billion-euro ($2.3 billion) debt issue on its most favorable terms yet.
Markets Bombed, Investors Carried On - by Jason Zweig ($) (LINK)
The Dawn Of Chaos - by Hugh Hendry [free email registration required] (LINK)
What we need to know about the pace of decarbonization - by Vaclav Smil (LINK)
Related videos: 1) Energy Transitions : Global & National Perspectives | Vaclav Smil; 2) Reconciling Slow Transition & Fast Climate Change | Vaclav Smil; 3) Energy Systems : Transition & Innovation | Vaclav Smil
Acquired Podcast: Oprah (Harpo Studios) (LINK)
Revisionist History Podcast: Hedwig’s Lost Van Gogh (LINK)
Ed Yong’s advice to the next generation of journalists (LINK)
An excerpt from George Soros' The Alchemy of Finance worth thinking about today:
In other words, financial markets constantly anticipate events, both on the positive and the negative side, which fail to materialize exactly because they have been anticipated. No wonder that financial markets get so excited in anticipating events that seem quite harmless in retrospect! It is an old joke that the stock market has predicted seven of the last two recessions. We can now understand why that should be so. By the same token, financial crashes tend to occur only when they are unexpected.
This last point should not be overstated. There are many events that actually occur in spite of the fact that they were widely anticipated. The collapse in oil prices is a case in point; the outbreak of the Second World War was another. It has become fashionable to be a contrarian, but to bet against prevailing expectations is far from safe. It will be recalled that, in the boom/bust model, events tend to reinforce prevailing expectations most of the time and contradict them only at the inflection points; and inflection points are notoriously difficult to identify. Now that the contrarian viewpoint has become the prevailing bias, I have become a confirmed anti-contrarian.