Returns for Great vs. Bad Businesses

Munger and The Cattle Rancher

Munger’s ability to find great businesses is directly related to his ability to consistently discard bad businesses. He is excellent at inverting, and discarding the bad businesses as quickly as possible.

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Clippers’ Owner Comments on Recent Tech Announcement…

In honor of a certain announcement out of Cupertino tomorrow, see this great video of Steve Ballmer’s commentary shortly after the introduction of the iPhone.  He mentions the  Motorola Q as being a great phone in the market place and how the Zune has taken 20%-25% of the portable listening market (the

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Mrs. B and Blackberry

The story of Rose Blumkin (“Mrs. B.”) is almost legend at this point in the study of value investing and Buffett.  Her story is quite amazing if you have never read it.  Featured in both biographies of Buffett (The Making of an American Capitalist and Snowball). Buffett’s due diligence and

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Holiday Meals and Portfolio Allocation

          I like simple things, which is why I like analogies or metaphors (I can never remember the difference, which again is why I like to keep things simple). There are entire books and high-level graduate courses devoted to portfolio allocation.  I have read a few

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A Textile Business and The Rest of the Story

I always enjoyed listening to Paul Harvey and his radio segments, The Rest of the Story.  I don’t have his voice or his patience for crafting an elaborately detailed, yet masked story, but… It’s the early 1970s and a young man owns a textile business in the northeast.  He wants

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Relative Results and High School Classmates

On the last day of the season, September 28, 2011, the Boston Red Sox blew a lead in the bottom of the 9th against the Baltimore Orioles coupled (mere minutes later) with an extra inning come from behind Tampa Bay Rays victory, which made the Rays the American League Wild Card winners, eliminating Boston

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Questioning the Board?

In my Corporations class at law school, we learned that Boards of companies act in a way that benefits the company, otherwise an efficient market would remove the socialist offenders to be replaced with Randian actors that will better serve the interests of the shareholders. I unlearn this lesson at

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11th Commandment of Investment Study

“Nobody goes to church expecting to learn about the 11th commandment.” Regardless of one’s religious views, it’s pretty clear that most religious people do not expect to receive the 11th commandment this Sunday (or Friday).  Many religions study the same passages in the same books over and over.  The point

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The Lottery, Penny Stocks and Fannie Mae

This past week, two people won a record lottery, after taxes each person will receive about $120m. On Monday of this week, CNN Money published an article about a young man who traded penny stocks for three years and turned $1,500 into $1m. In other news, an investor in Australia,

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Moats in Real Life (Mouse Ears Included)

What’s a value investor to do when most of the companies you are interested in are selling for approximately 30 times their 10-year average free cash flow.  Put down that 10k and go to Disney World. I believe I have a slight genetic flaw when it comes not fully being

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