Circle Of Competence Issue #14
What are you reading this week? Drop me a line and let's connect or tweet at @competence_co. Have a great week!
DEPARTMENT OF GENERAL FINANCE
Do yourself a favor and block out an hour to listen to this brilliant speech by Charlie Munger. He has such wisdom and depth of knowledge over many years of experience as Berkshire Hathaway's Vice Chairman. This speech goes in depth into the biggest psychological causes of bias and misjudgment in our every day lives and is one to revisit often. His wit and wisdom are unparalleled by anyone, even by Buffett who has admitted as much. HIGHLY recommend this link.
Great interview with Munger on trade policy with China, Elon Musk, investing philosophy, Bitcoin (which he compares to trading freshly harvested baby brains - I kid you not!), and the current political environment (he has some great wisdom here). Highly recommended!
Two examples of epic short squeezes. And wouldn’t you know it, they are in the most heavily shorted industry at the moment - retail.
Very interesting global story to be following. What is the future of the euro and eurozone? There are great arguments for both preserving and eliminating the common currency, but too often overemotional political and social trends are what decide the outcome (think Brexit!). This will be one story to follow closely.
Absolutely fantastic piece by Shane Parrish (fs.blog) on how your expectations and encouragement of others, especially in the work place, can lead to a virtuous cycle of success via the Pygmalion effect. Highly recommend this longer, but insightful article.
This is a study that was mentioned in "Quantitative Value" which I review below. It discusses global returns to equities