People talk about stocks a lot. Individual equities, the market as a whole, etc. But there’s wide disagreement on exactly what we mean. This is not an accident. If we all agreed on the fundamentals, there would be less to talk about: one of the persistent aberrations academics struggle
Does Alan Greenspan still matter? Reassessing his legacy feels like the Cadaver Synod: we’ll dig up a bunch of FOMC transcripts from the early 2000s and complain that the Fed was completely unaware of what is obvious only in hindsight. Rehabilitating Greenspan is equally pointless, though: he was the
A quick blueprint for a successful company: 1. Start with a team of talented perfectionists, ideally ones who prefer non-verbal communication. 2. Work on a task that’s either impossible or so vague that it might as well be. 3. Once it’s apparent that you will never achieve your
There’s this meme that you shouldn’t work more than forty hours per week. Don’t believe it. It’s just laziness apologetics. If you’re reading it on Twitter or Hacker News, it doesn’t apply to your job. There are studies showing that productivity per hour drops
There’s a general recipe for megacap success: find a business where the upfront costs are high, the marginal costs are low, and building a copy is much more expensive than building the original. This is the very high-level outline of every large-cap tech success story, but it extends beyond
My piece on the East Asian Economic Miracle has gotten some attention. It’s time to follow up. Noah Smith tweeted this: I should note that Noah and I are friends. We’ve hung out together, and maintain a sporadic email correspondence which usually starts with me emailing him to
Investment acumen is hard to measure. In the short term, skill is indistinguishable from luck, and if you wait until the long term has arrived, skilled investment managers won’t take your money. So asset allocators — fund LPs, heads of multi-manager funds, and portfolio managers who work with teams of
The Seven Deadly Sins are a good framework for thinking about your dream job. There’s the job you’d do out of greed — something involving either lots of options or the numbers two and twenty. There’s the sloth-job, probably manning some counter during the night shift of an
If you guys were the inventors of Facebook, you’d have invented Facebook. - Mark Zuckerberg, as imagined by Aaron Sorkin As a general rule, a large tech company will be chronically undervalued if 1) it produces reasonable free cash flow in its core business, and 2) investors are rolling
It’s easy to get distracted by Amazon’s stock price and forget that, on paper, they’re a financial train wreck. Historically, being a software provider for a high-growth sector is a great way to report 40%+ operating margins with minimal capital expenditures. Amazon… does not report stats like
Whenever a hot company raises a round or IPOs, there’s a traditional Hacker News ritual where people dig through the S-1 looking for reasons to hate it. According to Hacker News, the typical well-funded tech company is a company that: 1. Has no real technology advantage 2. Is losing
Netflix’s ostensible goal is to win the Moment of Truth: when you’re home from work and too tired to do anything but vegetate, are they your first choice? But for investors, this breaks down into two separate, related missions: 1. Be available to anyone who enjoys passive entertainment