How Big Warren & Slick Charlie got rich
Howard Marks just dropped his newest newsletter. It was all about why avoiding risk is risky and it’s critical to investment success. Hopefully you click the link above and read it or check out the audio version if you’re feeling a bit lazy. Anyways, Howard knows I have a fetish for Warren & Charlie and broke down their success in three parts: (a) a lot of investments in which they did decently. (b) a relatively small number of big winners that they invested in heavily and held for decades….
What I missed about SBUX….
This community is simply the best! After yesterday’s Starbucks “0% bond” letter, reader Ron who worked for a large grocery chain had a great response. So I’m going to paraphrase and try make it easier to understand…. Sometimes, people forget to use or lose their gift cards, and the company has to keep track of all of them.The government steps in after several years and says, “Hey, if no one’s going to use the cash balance, we’ll take it!” So the store has to show lots of old records to prove…
So Starbucks has this crazy 0% bond…
Hey it’s tax filing day in the United States! Can you feel the electricity in the air? Here’s a fun thought if you’re a W2 “Wage Slave” and you got a tax refund. You just gave the U.S. government an interest free loan. We should all be getting a big “thank you”, right? This reminded me of Starbucks, which we stopped at yesterday because my daughters had gift cards. Actually, the gift cards for sale shown below reminded me. Starbucks has about $1.64B sitting around from unused gift cards. The…
Stop buying dividends.
Presented By: The Early Bird Official affiliate partner The Early Bird And start buying the business paying the dividend instead. That’s it for this week, so let’s get to the portfolio update. I’m kidding. But seriously, as I’m wrapping up The Great Depression: A Diary, the Author, writing in January 1936, had a great observation. In the Roaring Twenties, everyone bought high-yielding investments without understanding what they were buying. 4% and 5% returns were too low, so most retail…
The best thing you’ll (probably) hear all day.
We’re in Lafayette, Indiana, for a weekend volleyball tournament, and I was reminded of something I read to reframe “failures” as opportunities. Jen Sincero’s quote, “The only failure is quitting. Everything else is just gathering information,” is great advice. It reminds us that mistakes are not failures but opportunities to learn and gather information that can be applied in the future. This is a very analytical approach to life and investing, which is valuable. The key is to keep learning…
📉Don’t be scurred.
Last night I dropped by the Money Happy Hour podcast for what turned out to be a fun chat. The host, Tom the Savings Captain and I touched on something you might like. We were talking about Costco being very expensive and waiting to buy. And then dot com darling Cisco came up. At its peak in 1999 it was trading at 200X earnings. Had you bought $10K worth on 12/24/1999, you’d be up $3,886.17 or 38.80%. With dividends reinvested. That’s an annual return of 1.36%, which is a big old bucket of…
Hit 100 shares of this stock today.
This morning I bought 5 more shares of Johnson & Johnson (JNJ) at an average cost of $149.18 Which brings us to 100 shares in the taxable portfolio with the intention to also start selling covered calls. I’m not sure if there is a universal intelligence, but something out there might be trying to tell me something. I’ve been listening to and taking notes for all of the Berkshire Hathaway annual meetings since 1994. Today I started the 2022 annual meeting and Warren Buffett said something very…
Expect the unexpected.
A pretty cool realization hit me while reading The Great Depression: A Diary by Benjamin Roth. It’s a fantastic book based on the personal diary of a lawyer from Youngstown, PA, who lived through the Great Depression and shared his firsthand account in real-time. The bottom of the Great Depression was in the summer of 1932, almost three years after the stock market crash in October 1929. But Americans in the summer and fall of 1932 couldn’t know this, and everyone wanted a change. Americans…
I Really Suck at This.
Presented By: The Early Bird Official affiliate partner The Early Bird It’s 6:37 AM in Las Vegas, and my family is asleep behind me. But I’m awake because I have something on my mind that I need to share with you. In 2023, we saved 32% of our income, but here’s the thing: I suck at enjoying spending money. For instance, one of the things my 16-year-old daughter wanted to do most on our Vegas trip was to eat pizza at the New York, New York hotel (which is owned by VICI Properties 😀). So we…
⚠️ Caution: This Could Make You Mental.
Presented By: The Early Bird Official affiliate partner The Early Bird Have you ever seen a product and thought, “This won’t be around very long?” Congratulations, you’ve used a mental model! The Product Life Cycle model, to be exact. This suggests that products go through different stages: introduction, growth, maturity, and decline. Source: Investopedia.com Charlie Munger was big on having hundreds of mental models to apply to his investment decision-making. I’ve been slowly working through…