Buffets framework also avoided all of the dot com crashers and what should have been anti-trust regulation against Amazon, Google, and Meta
SBC is one of the major reasons Burry is shorting Palantir
That’s not to say there isn’t room for expanding the framework but it requires the same deep level of understanding that underpins the originating framework. If you dont know what makes DataBricks sticky, dont buy the IPO. If you know Musk is a grifter then avoid anything he touches. What use does crypto have beyond crime and skirting sanctions? Are AI evangelized CEOs going to eventually course correct before their on average 5yr turnovers?
And just that easily, we are out of a whole sector. Safely
Hey Bear, thanks for the article and I had a great time reading through. I would like to ask a question:
-you mentioned Nick Sleep added the concept of scale economics shared to Buffett’s. Berkshire’s GEICO as a great underwriter had multiple years (especially end of the 90s and the following years) where it’s combined ratio was better as their target (think it was about 94%, please correct me if I am wrong). So they lowered prices for their policies (in force and new ones, they shared the too good underwriting). It attracted new policyholders and their market share gained constantly. My question is: what’s you thought on how to distinguish GEICOs “shared underwriting” and Nick’s “scale economics shared”? Was Nick just way more concentrated into those shared businesses?
- Seems like DMart India shares the economics of scale with their customers (as Costco). I am struggling to give it a price tag. Hard for me to assess a realistic long term growth rate for them. Would love if you would do a deep dive on DMart one day. Just an idea.
The Berkshire Hathaway 'framework' though I don't necessarily believe this thesis now works best when applied to private not public companies. If I was Greg Abel and I had $400Bs in my bonnet, I would be on the CATL, TCEHY, BYD, NU companies before they go public or even not bother taking them public. BH could change the face of markets by manufacturing innovation and then never allowing the market to participate, except through direct investment in BH. BH financial gravity has become its own central market. The public markets as far as I can tell have broken under a combination of fraud, malfeasance, extreme access to leverage and government intervention. True value now seems as archaic and quaint as a quarter-slot arcade.
Buffets framework also avoided all of the dot com crashers and what should have been anti-trust regulation against Amazon, Google, and Meta
SBC is one of the major reasons Burry is shorting Palantir
That’s not to say there isn’t room for expanding the framework but it requires the same deep level of understanding that underpins the originating framework. If you dont know what makes DataBricks sticky, dont buy the IPO. If you know Musk is a grifter then avoid anything he touches. What use does crypto have beyond crime and skirting sanctions? Are AI evangelized CEOs going to eventually course correct before their on average 5yr turnovers?
And just that easily, we are out of a whole sector. Safely
Hey Bear, thanks for the article and I had a great time reading through. I would like to ask a question:
-you mentioned Nick Sleep added the concept of scale economics shared to Buffett’s. Berkshire’s GEICO as a great underwriter had multiple years (especially end of the 90s and the following years) where it’s combined ratio was better as their target (think it was about 94%, please correct me if I am wrong). So they lowered prices for their policies (in force and new ones, they shared the too good underwriting). It attracted new policyholders and their market share gained constantly. My question is: what’s you thought on how to distinguish GEICOs “shared underwriting” and Nick’s “scale economics shared”? Was Nick just way more concentrated into those shared businesses?
- Seems like DMart India shares the economics of scale with their customers (as Costco). I am struggling to give it a price tag. Hard for me to assess a realistic long term growth rate for them. Would love if you would do a deep dive on DMart one day. Just an idea.
Enjoy your day, appreciate your great article.
The Berkshire Hathaway 'framework' though I don't necessarily believe this thesis now works best when applied to private not public companies. If I was Greg Abel and I had $400Bs in my bonnet, I would be on the CATL, TCEHY, BYD, NU companies before they go public or even not bother taking them public. BH could change the face of markets by manufacturing innovation and then never allowing the market to participate, except through direct investment in BH. BH financial gravity has become its own central market. The public markets as far as I can tell have broken under a combination of fraud, malfeasance, extreme access to leverage and government intervention. True value now seems as archaic and quaint as a quarter-slot arcade.