Grab Bag #1

Supported by Greenhaven Road Capital, finding value off the beaten path.

So many podcasts, so little time. Let’s go through some notable ones. I listened to each of these at least once, but none will get the full set of notes.

Alex Moazed on Invest Like the Best. Re-listened to this one after reading the book Modern Monopolies. Platforms businesses must be like a casino poker table; create a place people come to where they can do things they enjoy. Sometimes assholes will drink too much and expose themselves or try to cheat, so you need some rules, but not too many. Make sure there’s a dealer, cards, chairs and that if people want food you build a kitchen.

Thomas Russo on Capital Allocators. This one was great. Russo had a natural curiosity about what made people do the things they did. A curiosity of people led to investing and now he looks for family owned companies willing to invest for the long term and suffer through doldrums. Part of what’s kept Russo in business is aligned capital (read: stakeholders). He said:

“and when I explain our (long-term) goal it’s quite familiar to what they felt as owners of businesses.”

Jack Vogel on The Meb Faber Show. Vogel demystifies ‘quant’ investing as using a computer to do calculations that reduce the entire universe of securities to only the best options (based on your criteria; value, momentum, etc.). Vogel wasn’t too worried about spilling the beans because:

“For each investor, the most important thing is understanding their own behavior.”

 

Mark Bowden on Longform. Bowden, the author of Black Hawk Down, talked his newest book, Hue 1968. He explained that he tries to tell a big story in a moment. Soldiers don’t land on virgin soil. There are attitudes, expectations, history, anger, love, kindness, danger and apathy all waiting for them. Bowden tries to tell both sides. Having empathy and knowing history help.

Freakonomics. When Helping Hurts. Stephen Dubner goes through a social study that found the treatment actually hurt the recipients. It’s another example of the some is good so more must be better fallacy. The episode ends with an encouragement toward more research. It echoed what Chris Blattman said about small experiments.

Edward Glaeser at London School of Economics. What makes cities great? People. Building higher keeps costs down. More people, more ideas, more idea pollination. Ironically Silicon Valley/ San Francisco has some of the highest cost of living despite creating technologies for working anywhere.

“Cities have always been built around the transportation technology that was dominant in the era in which they were created.”

“You can’t build your way out of congestion. If you build it, they will drive.”

Morgan Housel on North Star Podcast. Slow down. Think more. Read things that don’t change. In honor of Housel we’ll keep this short.

 

Joe Norman on The North Star Podcast. Systems can grow (preferred) or be designed (not-preferred). If we design we’re making assumptions that what happens at one scale will happen at other scales. This isn’t always so. “We’re bad at predicting emergent properties,” said Norman. Systems that grow, like evolution, tend to work better and “does things you wouldn’t expect.”  Like this:

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Adam Blitz on Capital Allocators. When Blitz looks for the right hedge fund manager he’s looking for Bryan Mills. “I have a very particular set of skills.” He wants these people to be aligned with his motives (stakeholders) and have a high intellectual integrity (like [David Salem](https://thewaiterspad.com/2017/05/29/david-salem/) talked about). He also want’s to ‘be there’ and talk to the managers regularly.

Rishi Ganti on Invest Like the Best. Ganti said that there are a lot more “Bait Shops” (introduced by Trish and James Higgins) out there than we realize. If you get off the highway and be more like Indiana Jones you may find one. Ganti also talked about getting the right stakeholders on board.

“If you find a gold nugget on the ground you could be rich for a day. We don’t do that. What we do is pick up the gold nugget, look around, and say, ‘who owns this land?’. We buy all the mineral rights and put an expert mining operation on that land and mine that seam until it gives up….We’re building alpha factories.”

 

Thanks for reading, if you liked this Grab Bag edition let me know on Twitter, @mikedariano.

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