31: Fixing My Folly; TIKR's Unique Feature; The Good Side of Inflation; Woodpecker Wisdom

A Turning Point For This Newsletter

Nov 17, 2021

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Mead’s Folly

One of my faults is creating or courting unnecessary complexity. It’s a good trait in certain contexts. But other times my habit of adding more layers, steps, or “things”, or in going deeper when I should stop, frustrates me and leads to worse outcomes.

Last week I had the great privilege of hosting a Twitter Spaces chat with what turned out to be about sixty wonderful people. That nearly 2.5 hours with friends (and they do feel like friends) helped me re-orient myself. The original intent of the chat was to get ideas for this newsletter—probably more stuff to add (see, courting complexity). Instead, I walked away with a feeling of having been given permission to “be me”.

We talked a lot about authenticity in that Spaces chat. Upon reflection, I realized that while I wasn’t not being me, I wasn’t really showing the complete me. I’ve tried to keep this newsletter businesslike and only give you the best of business, Buffett/Berkshire, and investing. The problem is it was another example of me compartmentalizing complexity—this stuff over here, that over there.

I realized I enjoy reading, watching, and listening to my favorite people because they include their whole self in what they do.

Liberty writes a great Substack newsletter, Liberty’s Highlights, which includes curated content from multiple disciplines sprinkled with his own content and wonderful emojis. I enjoy watching Matt Lowne’s YouTube videos of him playing Kerbal Space Program in part because of his quirky commentary about the game, sidebars about his bike rides, and random whiskey reviews. I enjoy Vitaliy Katsenelson’s emails because they come with artwork from his father and brother, and classical music recommendations. And Shane Parrish has created an immense body of work at Farnam Street by, in part, showing some vulnerabilities while in the process of exploring multidisciplinary learning.

So where does that leave this newsletter? Well, we’ll have to see. I’m going to see where this newly revealed authenticity takes me. You can probably expect to see much of the same, with a focus on business and investing, and especially Buffett/Berkshire. I’ll also share selected content and things I’ve learned from my Deep Dives work.

But perhaps 20% will be me thinking aloud, sharing my thoughts on random subjects, or sharing interesting tidbits I’ve found from time to time. I plan to keep the frequency to at least weekly, but perhaps more frequent if I feel like it or have something to share.

Some of you expressed a desire for less frequent communication. Just last week I used a feature in Substack to create a separate newsletter to allow for both weekly and bi-weekly posts, but in hindsight, this feels like folly. Instead, I’m going to keep it simple and put it all under one banner. If these emails become too frequent for you or you don’t like the new flow, you can always unsubscribe or stop receiving email notifications. We’ll part as friends. After all, it was me who deviated from what you originally signed up for.

If you do decide to stick around I’m always open for feedback and comments. Thank you for being on this journey with me!

TIKR’s Business Owner Feature

I’ve been a beta tester of TIKR for a few months now. I received an invite and figured why not? After using it for a while I like it. It has a good feel and contains convenient access to transcripts and downloadable financials going back to 2004.

Perhaps one of the coolest features is what’s called business owner mode. You can change a setting to hide all price and market cap information. That way you can get to the financials and do your analysis without anchoring on price.

I’ve heard Buffett say he often looks at the financials without looking at price. That works fine if you have years worth of physical copies onsite. But for us 21st century investors using the internet it’s often impossible not to see the price. Most investor relations pages have fancy stock ticker feeds in them, and every other service, including Morningstar which I pay for, starts with a price chart.

Give it a try.

The Good Side Of Inflation?

It seems like all talk is now on the subject of inflation. As a student of history, especially financial history, it’s been an ever-present risk I take into account when looking for investments. For me, nothing has really changed. My investments are entirely in good businesses that have built-in inflation protections (or so I hope!)

But I digress. I’ve been thinking about inflation from the standpoint of the individual consumer. I wonder if there’s a good side to it. Or at least a mitigating factor to the real destruction it brings. I’m thinking about the psychological bias of anchoring and how it could lead to frugality.

The perfectly rational human, who lives only in economics textbooks, considers real prices. A 5% increase in expenses coupled with an equal increase in income is of no import. And yet, we all anchor to the past. Think of Grandma clipping coupons and scoffing at the price of bread at $3.99 a loaf. “That’s far too much to pay!” she says as she searches for a cheaper store-brand alternative. Grandma has anchored to the price of bread 20 years ago.

But there’s a good side to Grandma’s tendencies. To the extent that inflation causes us to be more frugal and pay attention to prices, to compare substitutes, etc., it’s actually a good thing. I liken it to the cleansing effect of an economic recession. Sure, no one wants to have a recession. But economic cycles help us get ahead by clearing out the deadwood. Inflation can help us re-calibrate our real spending.

Now I’m not one to welcome the uneasy inflation we’re currently experiencing in the United States. But if it’s here we might as well look for some good in it, right?

Woodpecker Wisdom

“A woodpecker can tap twenty times on a thousand trees and get nowhere, but stay busy. Or he can tap twenty-thousand times on one tree and get dinner.”

―Seth Godin

Stay rational! —Adam

Cover Photo by Bre Smith on Unsplash

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