February 5, 2012

Don’t Spend Money to Feel Better About Yourself

Emotional Shopping Leads to Debt

I happened to be reading a forum for venture capitalists and investment bankers and there was a section for people new to the industry who work in major financial centers such as New York. We're talking about first year analysts earning between $60,000 and $90,000 including signing bonuses, and, if they are lucky, a $50,000 to $100,000 bonus depending upon annual profits, living in a majorly expensive city, who probably have significant student loans. Some of the people were advocating that … [Read more...]

Value Investing from the Goldman Sachs Chief Investment Officer

Eileen Rominger, the Chief Investment Officer at Goldman Sachs, told Fortune magazine how she, as a value investor, ranks companies.  She had a very good answer.  It's a sound process. Fortune Magazine: You've been a value investor for 30 years.  How do you decide whether a stock is attractively priced? Eileen Rominger: There are two components.  We believe in using industry-specific approaches to valuation.  So we don't just use price/earnings, for example.  If we're going to buy an … [Read more...]

Interesting Day Both for Our Businesses and the Stock Market

Exciting day ... quite a bit of stuff happened at the companies, but I'm not comfortable discussing it (and probably won't at any time in the future).  Suffice it to say, an opportunity presented itself that could have huge growth potential for one of our major businesses.  It just changed my plans for the rest of fiscal 2010 because it requires my attention.  It is a key component in our intentions for this business over the coming 36 months. Bought Some More Berkshire Hathaway Shares The … [Read more...]

Working on the Book and Investing

Working from the office on the next book

  I decided to start working on the book again today (forgive the HP notebook; I had to use a specific program that required Windows so the MacBook Pro is elsewhere until I recall it). I ended up watching the Goldman Sachs testimony to Congress. The culture of Wall Street doesn't appeal to me. All this complexity ... committees, VAR, derivatives cubed ... it's madness. Just find a place to invest your money, earn a decent return on it, and use the lowest cost capital … [Read more...]

Why Income Inequality Will Always Exist as Part of the Post-Industrial Revolution Global Economy

First: Before we begin, the education system in the United States over the past few decades has done such a poor job teaching basic logic that by virtue of the headline alone, it is statistically likely that you have already made a decision about whether or not this short essay on pay inequality is "good" or "bad".  You've done this without considering any of the factual data or evidence I'm going to offer by virtue of my own experiences in finance, based nothing more on your own political … [Read more...]