Good Reading -- November 2014
Facts and Figures
A net worth of $3,650 puts you in the wealthiest half of the world's citizens, and $77,000 qualifies you for the top 10 percent. Anything above $800,000 puts you in the top 1 percent of the world. (Source: Credit Suisse)
October 24th marked the 9-year anniversary of the last hurricane (Wilma) to make landfall in Florida. That is the longest hurricane-free stretch on record, dating to 1851 (during which time 114 hurricanes have made landfall in Florida). The longest hurricane-free stretch in Florida before this one was six years.
Wilma also marked the last major hurricane (Category 3 or greater) to make landfall anywhere in the U.S. That streak is the longest on record, dating to 1878. (Source: NHC and Colorado State)
Attributes of a Good Investment Process: The Critical Role of Decision Making -- An excellent presentation by Michael Mauboussin from 2005. (My apologies -- I can't remember where I found this.)
Advising the Sage: The Man Who Taught Warren Buffett How to Manage a Company -- This is an excellent profile of Tom Murphy. Highly recommended.
This profile, linked in the article, is one I've previously sent around and it's excellent as well.
"How pensions make investing too complex" -- Roger Lowenstein dives into the problem facing institutional investing. “Pricey consultants have convinced many pension funds to pile into private equity, real estate and hedge funds, which don’t necessarily promise higher returns or long-term investing.”
Joel Greenblatt on Wealthtrack -- Greenblatt fans won't learn anything new from this, but it's a good overview with some nuggets that are always worth repeating. A good example is his research into investment manager performance. Of the best 25% of managers over the decade of 2000 to 2010, essentially all of them had at least three bad years within the decade (causing many of their partners to bail and miss out on the ultimate return). "The secret...is patience, which is in short supply."
The Empire of Edge -- An in-depth look at Steve Cohen and SAC. (Thanks to Jason for sending this.)
"12 Business Books..." -- There are some great books on this list, including a few you might have missed.
Five Good Questions -- This website looks awesome. The link is to an interview with Howard Marks, but here's the description of the website: "[T]he average American watches 5 hours of television per day. What the world would be like if we dedicated one of those hours to reading books instead? I don’t know, but I’d like to find out. So to inspire others to read more, I ask five good questions of interesting authors and share the videos with you every Friday in your inbox. Let’s see if together, we can’t rescue some of those lost hours."
"When Stock Buybacks are Not a Waste of Money" -- It always amazes me how much nonsense is written and said about buybacks, regardless of the context or the investing climate. Will Thorndike, author of the hall-of-fame-worthy book The Outsiders, has some great thoughts in this article that will hopefully get some airplay. "You're looking at a stock repurchase as an investment decision with a return and you're comparing that return to other alternatives, and when it's attractive you're aggressive in implementing it."
"A House Is Not a Credit Card" -- A recent op-ed by Bethany McLean. She makes the argument that much of the housing finance market is unrelated to homeownership, with skewed and counterproductive incentives across the board (subscription required)
Best advice from CEOs: 40 execs' secrets to success -- There are some empty platitudes in here but also a lot of really good, thought-provoking ideas.
Moneyball for Business -- A startup is using technology and a "Moneyball" framework to try to improve business performance. Sociometric uses "sensor identification badges and analytics tools to track behavioral data on employees, providing insights that can increase productivity.
The Cult of Busy -- "Busy can become a way of life. We’re seduced by all the incoming – the emails and text messages that make us feel wanted and important ...but in an exhausting, ultimately empty way. Busy has a dangerous allure. If your normal is busy, it’s tough to sit quietly with your thoughts or to really feel what you’re feeling. What if, instead, everything became a choice – how we spend time, who we respond to and how much or little we write? What if we recognized the difference between accomplishing our goals for the day and responding to other people’s requests? What if we learned to say no – a lot?"