Good Reading -- December 2018
My best wishes for a healthy and prosperous 2019! - Phil
New writing effort In January I'm going to start a new writing effort. I want to improve as a writer, so I hope this will give me a chance to practice and generate feedback. I plan to write short posts about business and investing-related topics. Expect a healthy dose of questions without clear answers, skepticism, ranges instead of point estimates, and uncertainty. If any of this were easy it wouldn’t be interesting. Do not expect specific investment ideas, any commentary on what I’m buying or selling (our letters to partners are a separate effort), pronouncements about the market or economy, regurgitation of pithy soundbites, etc. I will post everything on the website and on Medium (https://medium.com/@pordway), and I'll also distribute via email. Thank you in advance for the help! Books
The Wizard and the Prophet: Two Remarkable Scientists and Their Dueling Visions to Shape Tomorrow's World -- I bought this in Omaha since it was labeled "Charlie's pick" for 2018, and it didn't disappoint. It was interesting on many levels, and well-written to boot.
Merger Masters: Tales of Arbitrage -- Business writer extraordinaire Kate Welling wrote this at the behest of fund manager Mario Gabelli. The title is accurate but doesn't do justice to all the interesting nuggets of Wall Street history found in the various vignettes: 17 featuring "the arbs' perspectives" and three featuring CEOs involved in the various deals. I have never done much arbitrage, merger or otherwise, but I still enjoyed the book, and I especially liked the chapters on Michael Price, Paul Gould, Paul Singer, Bill Stiritz, and Peter McCausland. In fact, I think the Stiritz chapter here is at least as good as his chapter in "The Outsiders."
To disclose my bias and self-interest, it should be noted that the author is a friend, I received the book for free, and I was profiled in Welling on Wall Street a few years ago.
The River of Doubt -- I've read a few other Theodore Roosevelt biographies, but this one is unique in that it focuses on a narrow episode (the near-fatal Roosevelt-Rondon expedition down an unmapped Amazon tributary in 1914). It is fascinating from start to finish, and it reads like a good novel. I've already started the author's second book, Destiny of the Republic.
Quoted "Anna looked at the soul of New York and recognized that if you distract people with shiny objects, with large wads of cash, with the indicia of wealth, if you show them the money, they will be virtually unable to see anything else. And the thing was: It was so easy." How An Aspiring "It" Girl Tricked New York's Party People -- And Its Banks (see below)
General Electric Powered the American Century -- Then It Burned Out -- Make this article a priority. Yes, it is more than 10,000 words, but it is one of the better business "books" you'll read this year, if not this decade. It is hard to find a topic in management, corporate governance, corporate finance, investing, strategy, leadership, or any other business-related topic that isn't featured here. This is a first-ballot Hall-of-Famer from a "psychology of human misjudgment" perspective.
On Writing Better -- Jason Zweig's three-part series on writing should be required reading for anyone in business, and it was the kick in the pants I needed (see above). Good writing isn't just important and rare in business; it's crucial and almost impossible to find. I read things every day that make me want to laugh, cry, or throw up on my desk. The time you spend with Zweig's series will be well rewarded.
Most of you know that I admire Zweig's work, and I'd recommend all of the supporting material that he references in this series, as well as his books and articles found elsewhere. (Disclosure: I was helped by the author's contributions on a talk I gave in 2017, but if you can't see the objective value of his work there is no hope anyway.)
The 109,894-Word Annual Report -- This article from 2015 has some good reminders about disclosure, complexity, and noise. "General Electric's chief financial officer was taken aback by the industrial conglomerate's 246-page annual report. The 10-K and support documents his finance team and others at the company produced was meant to give investors a comprehensive picture of GE's business and financial performance over the previous 12 months. It did everything but." (See above.)
Hard Choices: The importance of thoughtful deliberation -- and its implication for the future of capitalism -- A speech/essay by Seth Klarman is always worth the time, but this one is especially good.
Matt Rose: "Less is NOT better" -- A great interview in Railway Age with the retiring CEO of BNSF. Several interesting nuggets about returns on investment, interactions with Wall Street, his relationship with Buffett and Munger, and his model for corporate leadership, among many other topics. Highly recommended.
Jealousy List -- This is Bloomberg's annual list of articles its editors wished they had thought of first. The selections are all over the place but there are many, many good ones. (Thanks to Pat for sending this!)
There are more good articles here than I can possibly list, but three that really stood out were A Kingdom from Dust, a long look at California agriculture; What the Hell Happened to Darius Miles, an autobiography by the former NBA star; and How an Aspiring 'It' Girl Tricked New York's Party People -- And Its Banks, an amazing tale of deception that even has a Martin Shkreli cameo and a Buffett/Omaha-related part.
The Tinkerings of Robert Noyce: How the Sun Rose on Silicon Valley -- This Esquire article from 1983 is a long-winded but interesting time capsule. (Thanks to Oscar for pointing it out.)
4 Strategies for Becoming a Master Persuader -- Robert Greene has a new book coming out, from which this short essay is adapted.
Costco's 100 Million Chickens Will Change the Face of Nebraska -- Even if you're not a superfan of Costco there are many important angles to this story.
Powerless Placebos -- Following up on last month's article on this topic, this is an interesting post on the blog Slate Star Codex.
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