Gongol.com Archives: August 2024
August 26, 2024
Brand-name nonsense is still nonsense
An article in Investor's Business Daily -- a nominally reputable news outlet -- screams out the headline "Warren Buffett's panic sale of Apple stock cost $6.2 billion". ■ Anyone is free to write a story like this in pursuit of clicks. But that analysis is so wide of the mark that it betrays a total unfamiliarity with how Buffett makes investment decisions. ■ The IBD writer notes that Apple's stock price rose after Buffett's company, Berkshire Hathaway, sold off about half of its Apple stock holdings. Factual enough, perhaps. But Buffett's approach doesn't depend upon timing future events (like changes in stock prices). ■ Fundamentally, it's an investing philosophy based upon doing the work and taking the preponderance of the risk up-front; buying when the intrinsic value of a company is meaningfully greater than the market price. A Buffett sale is generally an indication that the market price exceeds his estimation of intrinsic value by so much that it's time to let go. ■ Dwelling on stock price performance after selling is a bit like speculating on the outcome of a baseball game if the starting pitcher had stayed through nine innings. Sure, plenty of things are possible -- but a manager goes into a game expecting to get something like five innings out of a starter. On a bad day, he might get replaced sooner. Once in a while, you might see a shutout. At the extremes, you might even get a perfect game. ■ But the "intrinsic value" of the starting pitcher is generally found in those first five or so innings, and anything far beyond that is great good fortune. Knowing when you've already gotten far more than you deserved to expect and walking away while you're ahead doesn't make you a sucker for not squeezing every last strike out of a pitcher or every last dollar out of a stock price. That's not "panic". It's prudence.
Ukrainian machine gun vs. Russian missile
(Video) Put it on the sizzle reel for Ukraine's NATO application. A large Russian air attack against civilians in Ukraine has once again disrupted the lives of millions of people who weren't doing anything wrong. This isn't the behavior of an aggressor that will contain its ambitions; it's the behavior of barbarians who won't stop until they are forced to do so. Send Ukraine whatever it needs to make that happen.
You dump the gold standard, quit relying on tariffs, and jettison highly restrictive immigration quotas, and what do you get? The progress made by American free enterprise since the 1920s.
A water buffalo got loose in suburban Des Moines. Someone call Fred Flintstone and Barney Rubble.
