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From Shareholder wealth to Stakeholder interests: CEO Capitulation or Empty Doublespeak?

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  • In the statement, the CEOs seemed to be saying that corporations should be run to protect all corporate stakeholders, defined to include customers, society and employees, rather than hew to its conventional objective of maximizing shareholder wealth.

Avoid Selling Too Early – Investors Need To Allow Their Stock Positions To Exceed Their Expectations

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  • Ian Cassel: Yeah, I think there’s just a lot of luck involved and I think it’s hard for investors because you want to think of these multibaggers as kind of these linear up and to the right financials.
  • Tobias Carlisle: Or you do something like, Lou Simpson talks about this a little bit, that even if he thinks something is expensive, he trims it way back and he just keeps a small holding in it so he can continue to watch what it does.
  • I think it’s okay to trim them but you really don’t want to trim all the positions back.

Five Reasons Why Value Investing May Never Regain Its Appeal

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  • Here are five arguments why the value strategy might not work as well in the future as it has in the past.
  • Unconstrained value strategies tend to gravitate to certain sectors over others.
  • Technology stocks, meanwhile, have led the market and continue to do so.

Nassim Nicholas Taleb: If An Investor Has A Risk Of Terminal Blowup, The “Potential Returns” Of His Strategy Are Totally Inconsequential

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  • Just been re-reading Nassim Taleb’s book – Antifragile: Things that Gain from Disorder , which includes a great passage on risk and a real-life example of how it applies in investing.
  • Here’s an excerpt from the book:
  • Under path dependence, one can no longer separate growth in the economy from risks of recession, financial returns from risks of terminal losses, and “efficiency” from danger of accident.

Invest Now, Or Wait? The Results of My Decision

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  • Invest now, or wait?
  • So it’s only normal to fear the market will crash, especially when you have a lump sum of money to invest .
  • If you don’t believe the market will go up, what’s the point of even discussing it?

Is Your Stock Portfolio A Museum or A Warehouse?

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  • Rework by Jason Fried is one of the best books I have ever read on starting up.
  • But often, we end up building warehouses of our portfolios, not curated museums.
  • Investing follows life, and this is also what a lot of investors end up doing.

The ultimate value investing checklist

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  • More than 5,000 words explaining why each question is in the checklist.
  • A simple business is a focused business.
  • My rule of thumb is that good management should:

Warren Buffett: There’s No Easier Game Than Stocks

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  • Buffett is discussing how there is no easier game than stocks, but investors turn that fundamental advantage into a disadvantage saying:
  • That is a wonderful game to play in.
  • There’s no easier game than stocks.

Investors Can Generate Outsized Returns Using The Three Buckets of Micro-Cap Investing

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  • Ian Cassel: What’s really rare is when you can actually find a company that’s a small microcap that literally is the best in the world at what they do.
  • Ian Cassel: So that’s kind of the second bucket, and the third bucket, quickly is, kind of the sexiest bucket.
  • Ian Cassel: Probably the turnaround and the good to greats are kind of equally weighted larger, and the rocket ships are sort of smaller, so if you can think of it as 40, 40, 20 maybe, something around there.

Personal Finance Advice That Changed My Life

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  • We found that four categories were important to us: health, experiences, time, and education.
  • It’s not that we don’t have a budget for these categories, it’s just the budget is larger and much looser.
  • Therefore, to maximize health, education, experiences, and time and still live within our means, Rachel and I had to give up things that were less important to us – a huge house and brand new cars.

Nordstrom: A Retail Survivor With Potential Upside Catalysts

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  • Wall Street is shunning the stock due to its department store exposure, but the Rack business (a higher end version of TJ Maxx) is overlooked and should continue to grow.
  • The end result is a company that has built out a strong e-commerce business (30% of total sales) all while producing free cash flow year in and year out to fund a generous dividend (over 5% at the current share price) and impressive stock buybacks (share count has dropped from 220 million in 2009 to 156 million in 2019).
  • The dividend is also well-covered by cash flow.

(Ep.25) The Acquirers Podcast: Ian Cassel – Intelligent Fanatic, A Masterclass In Microcap Investing

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  • Tobias Carlisle: Well, that’s a good time to do it because there are lots of opportunities, and I did the same thing at around about the same time.
  • There’s not many of them out there but you can find them and when you do those are kind of those really special good to great businesses and that’s kind of what is that first bucket of opportunities that I look at.
  • Ian Cassel: You don’t do it all at once.

When CEOs Resign

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  • Our interest in Byrne and Overstock.com began innocently enough when a good friend and the best short-seller we have ever known suggested looking at Overstock.com as a short.
  • For another, your editor actually visited the company, long after the dust had settled on the naked short-selling conspiracy battle, at its then-new peace-symbol-shaped building at the suggestion of the short-seller who long ago had suggested looking at Overstock.com as a short ...only this time, he was, correctly, long the stock.

Some links

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  • John Hempton on Bank margins – Part 1 and Part 2 Ben Evens explains why Tesla and Netflix are NOT Tech companies The Long Term Value blog likes “cigar butt” Gamestop A good reminder on the potential threat from the “passive” boom in stock investing Must Read: The Network effect manual An honest analysis why a small cap investment has gone wrong The funniest take down of WeWorks S-1 clearly comes from Scott Galloway

Upping the ante on GameStop (GME)

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  • More than twice the number of shares were tendered at the bottom of the range ($5.20) than were provided for in the auction purchase (12 million).
  • Recent attention to the stock comes from the fact that Scion Asset Management (Dr. Michael Burry of The Great Short fame) sent a letter to the GME board on August 16 in which he states that he owns 3 million or approximately 3% of outstanding GME shares and urges management to accelerate the repurchase of shares under their existing $300 million share repurchase program.
  • Will the Board or management listen?

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