« Truly great businesses, earning huge returns on tangible assets, can’t for any extended period reinvest a large portion of their earnings internally at high rates of return. » — Warren Buffett “Over the long term, it’s hard for a stock to earn a much better return than the business which underlies it earns. If…
Category: Compounding
Heavy Tolls and Light Tolls – When the Cost of Growth Becomes a Moat
“A fat wallet is the enemy of superior investment results.” — Warren Buffett Download the Slide Deck (PDF) : Heavy vs Light_Tolls Listen to the deep-dive discussion – Why giant wallets need heavy moats I. The Framework in Brief A short orientation for the reader new to this collection. Every business contains two forces….
Toll Position – The Architecture of the Permanent Wave
“All of humanity’s problems stem from man’s inability to sit quietly in a room alone.” — Blaise Pascal “The big money is not in the buying or the selling, but in the waiting.” — Charlie Munger Download the Slide Deck (PDF) : Toll_Architectures Listen to the deep-dive discussion – The Invisible Tolls Of Global Capitalism…
The Toll Collects – What the SpaceX IPO Reveals About S&P Global and MSCI
“You paid for a front row seat. Don’t miss the show.” — Nobody (Terence Hill), My Name is Nobody (1973) “Nobody pays attention to the guy who collects the tickets at the gate.” — attributed to Nobody Download the Slide Deck (PDF): Owning_the_Index Listen to the deep-dive discussion – Index Giants Own the SpaceX IPO…
The Double Swell – How S&P Global Graduated to the Rarest Architecture in Investing
“I don’t think there’s ever been a swell that big. There were no sets. It was just line after line after line, as far as the eye could see.” — Laird Hamilton Download the Slide Deck (PDF) : The_Double_Swell_SPGI Deep-dive discussion – The Double Swell : How S&P Global Graduated to the Rarest Architecture in…
The Gap, the Gift, and the Guarantee – What You Actually Buy When You Buy a Great Business
“Price is what you pay. Value is what you get.” — Warren Buffett Listen to the deep-dive discussion – The Gap the Gift and the Guarantee Download the Slide Deck (PDF): The_Financial_Architecture I. The Floor The traditional approach to valuation projects growth—estimates future cash flows, discounts them at a rate that blends the risk-free…
Why Berkshire Is Right About Google – The Alphabet Reinvestment Thesis
“I feel like a horse’s ass for not identifying Google. We screwed up.” — Charlie Munger Listen to the deep-dive discussion – Why Berkshire Hathaway Bet on Alphabet AI Download the Slide Deck (PDF) The_Alphabet_Architecture I. The Decision Worth Defending When Berkshire Hathaway committed $10 billion to Alphabet at roughly $350 per share,…
$190 Billion to Grow – What the AI Race Reveals About the Cost of the B
“For the investor, a too-high purchase price for the stock of an excellent company can undo the effects of a subsequent decade of favorable business developments.” — Warren Buffett Listen to the deep-dive discussion – Why Alphabet dilutes shareholders for AI Download the Slide Deck (PDF) : The_Growth_Ledger_Averagingup I. The Headline On June 1st,…
Visa vs Mastercard – Why the Market Pays a Premium for the Smaller Twin
“Charlie and I always knew we would become very wealthy. We were just not in a hurry.” — Warren Buffett Listen to the deep-dive discussion – Why Visa is cheaper than Mastercard Download the Slide Deck (PDF) The_Payment_Twins I. The Rarest Architecture on Earth Every business has two forces operating inside it. The A…
Three Layers, Zero Cost – The Geometry of Compounding
“Give me a lever long enough and a fulcrum on which to place it, and I shall move the world.” — Archimedes, 3rd century BC Listen to the deep-dive discussion – How Freesurfers Multiply Profits For Free Download the Slide Deck (PDF): Geometric_Compounding_AveragingUp I. What Hohn Sees In a rare interview, Chris Hohn—TCI…