Latest memo from Howard Marks: Political Reality Meets Economic Reality
There is a saying “old water goes way with the arrival of new water”, automobiles swallowed carts, ballpoint pens made fountain pens disappear etc. These disruptions were always there, except that the speed at which the change is happening is bothering. And from the perspective of consumers, these changes are good, you get more for your money, more utility, more longevity, more satisfaction. From an investor’s perspective, it is hard to imagine and counter the ever-changing world filled with innumerable technologies.
Like Jeff Bezos said, the question should be what will not change in 10 years. But then again, if everyone takes shelter in such companies, their valuations will be always high. Also, I don’t think many investors are afraid of these changes, rather they embrace them, as they have their edge, they can take risk as they can afford losses and when they are rewarded, it is worth their effort.
Just my thoughts.
Completely agree with your thoughts.
There may be very few business which will exist for long and buying and forgetting won’t work in our times of fast changing world.
Many examples are always given like If you had bought this 20 or 30 years back and have forgot it , you had created this much wealth et cetera. I believe with the technology in hand and lots of innovation happening , an investor should always be vigilant and keep analyzing the companies he hold over a 2-3 year period rather than permanent Buy and Forget for 10-20 Years.
Definitely it is hard to imagine and counter the ever-changing world but staying updated with latest trends are very much necessary.
It is necessary to watch what new things are into markets, make careful observations about products used in the world. Look if the company have a stable moat that will work out for the long term. Buying a stock is just the start as businesses are always changing and so once one buy, monitoring how the companies are doing in the marketplace is must.
The entire game is about risks and rewards.
Absolutely, I wish such old times exist now. Invest and forget for 20-30 years and voila you have made substantial gains. Those were simpler times, in every sense. Now one has to be vigilant and keep an eye on what’s happening, I did not, so I have to pay the price - convert notional losses to real losses and salvage the remainders. The unknown unknowns are to be discovered if one smells smoke, that is the lesson.
Despite the simplistic nature of the concepts, for someone like me, it takes time to learn and practice but as it gives me some kind of joy, purpose and closure along with the possibility of gains, I am willing to do it.
Rising ITR emphasis on online process makes me think about egovernance companies.
Launch of umang app.
a report by Price water
I reached out to a professional wealth manager asking for some reference material to see if there has been studies to evaluate sustainability of high P/E businesses and following link was shared. An interesting read.
Not sure if this is an exception or the rule or somewhere in the middle. But it ties back to an article from Sanjay Bakshi some time back.
If there are any other studies with more data points, please do share.
Excerpts from Tom Gayner’s google talk - https://community.intelligentfanatics.com/t/tom-gayner-s-four-lenses-for-investing/1700
Good article. It shows two evidences for gaining from investing long term in Mutual fund.
A good set of FAQ on STCG one can find it at https://www.incometaxindia.gov.in/Tutorials/14-%20STCG.pdf
Prof Sanjay Bakshi in an engaging 3 part chat with Santosh Nair.
The China hustle…an interesting documentary available in Netflix…they are raising some serious allegations against Chinese companies listed in USA and against alibaba…SEC not any better to SEBI if their hypothesis is true indeed…some trillion dollar impact!!!
Another interesting article
Bajaj Finance Limited
Here are some links from various years people have been writing about the bubble :
The wikipedia says the following:
The market size of real estate sector in 2017 was US$120 billion which is expected to reach US$1 trillion by 2030. It is expected that the sector would have a contribution of 13% to the GDP of country by 2050.
(Interesting thing is that the 2006 article above predicted the size of the market to be $90 billion by 2015 , and the prediction was right, and the next prediction will probably be right again. )
“If you like something at $13 a share, you should like it at $12, $11 or $10 a share,” Wertheim says. “If a stock continues to go down, and you believe in it and did your research, then you buy more.”
An article on the recent Merger of 3 PSU Banks Bank of Baroda, Dena and Vijaya Bank.
A good video by Daniel Kahneman. Some takeaways - Human judgement is very noisy and if you just take away the noise you can do far better - he uses the word poisonous to describe noise - which tells you how he views the impact of noise.
Also interesting is a tidbit he shares about cilinicians who are asked to predict something and then a simple equation is drawn to simulate their prediction. This equation does much better than the clinicians themselves at predicting the outcome. This is the impact of noise on human judgement.
There are other things that stand out - where he says that wherever possible you should use alogrithms even if they do a poor job because humans do a much poorer job.
For someone who has advanced human behavior so much it came as a surprise to me how strong his views are on modeling wherever possible. Definitely a good watch