Liberty

Thank you, Castanza, that was epic and very interesting.

Q4: http://investor.spglobal.com/Cache/1001248254.PDF?O=PDF&T=&Y=&D=&FID=1001248254&iid=4023623 http://investor.spglobal.com/Cache/1001248259.PDF?O=PDF&T=&Y=&D=&FID=1001248259&iid=4023623

Another one, this one in Italy by TSS: https://www.totalspecificsolutions.com/about-us/transaction-updates?tid=38 h/t @pearnick on Twitter

My preferred approach is to mostly stay fully invested and sometimes switch from more expensive things to less expensive ones, or from things that have grown too large in the porfolio to new ideas when they are available at a good price

Have you read 'Thinking Fast and Slow' by Daniel Kahneman? And if you want more, you can go back to the original studies: https://www.amazon.com/Judgment-Under-Uncertainty-Heuristics-Biases/dp/0521284147 https://www.amazon.com/gp/product/0521627494/

https://ofdollarsanddata.com/even-god-couldnt-beat-dollar-cost-averaging/ I thought this was an interesting thought experiment. Obviously it's not what investing in practice is like, but I think it shows the challenge that those who prefer to sit on lots and lots of cash and then only invest during a big crash face. They'll look really cool during the recovery and claim insane CAGRs, but if you look at it over long periods, over the whole cycle, it becomes a lot harder, especially if your timing isn't perfect (and who can claim that?).

Another one, this time at Volaris: https://www.volarisgroup.com/news/article/smartrak-acquires-the-assets-of-lingo-systems h/t @pearnick

Might be useful: https://arbital.com/p/bayes_rule/?l=1zq

This is addressed in the book. But it's also not that simple. Just like growth mindset vs fixed mindset affects your actual behavior and decisions and creates a positive or negative loop, mindset about stress also affects these things and affects outcomes. If you think stress is scary and bad and you always try to avoid it, you'll try to avoid all kinds of activity and experiences (especially new ones or challenging ones) that might make you grow or bring you good things. And people who usually try to avoid this kind of stress aren't less stressed, they just avoid the things, so it's a double loss. If you're about to do something stressful and think "I'm just excited, my body's gearing up to help me do well, all this adrenaline is making my mind sharper, etc", you'll probably do better than if you're worrying about being too stressed to do well and think that to do well you have to not be stressed, which itself is putting pressure on you and making you more stressed, etc.. she also talks about stress responses aren't monolithic, there are various ones, and how you think about the situation will impact which one is triggered. If you think you can handle things, you'll more likely have a challenge response, which is healthy and helps performance more, while if you think you can't cope and can't handle it, you're more likely to have a threat response, which has more negative effects (ideal in a life or death situation, but not ideal to have frequently in day to day life). On the correlation/causation issue, there's studies cited in the book where they track people before and after the mindset intervention and show results. If it was just that people less affected by stress had that mindset, it wouldn't show results on those. It makes a lot of sense. I suggest you read the book.

Broeb22 explained the negative WC well, so I'll do the margins: They started out as a more industrial conglomerate that still had decently high margins because it focused on niche stuff where there isn't a ton of competition and where performance matters. If you're selling some kind of industrial pump, the buyer cares a lot more about reliability and performance than price, because if the pump fails, it might screw up their whole operation and they'll lose a lot more than the price of the pump. Or if you are doing structural testing on nuclear power plants, they care more about the results being accurate than saving a couple bucks, etc. Over time they climbed the quality ladder by buying even higher non-industrial niche businsesses, lately mostly medical products and software, and application software (for law firms, construction planning, etc). They also are good at improving operations over time. Their legacy segments that haven't had any acquisitions in many years are still improving their margins and reducing their capital intensity. They don't market it like DHR does with its business system, but they get the results.

Both the Rosling and Pinker books are on my to-read list. Another book in the same vein which I have read is "Abundance: The future is better than you think" by Peter H. Diamandis & Steven Kotler, which is excellent. I have that one too, but haven't read it yet.

Brand inertia is a real thing.

The author did this talk in 2013. Might also be an intro to the concepts:

I haven't read it yet, it's in my pile, but I just want to second that Hans Rosling was a great human being. This book should probably be read along with Steven Pinker - Better Angels of Our Nature.

I'm only 1/3 through, but I can already say that many here could benefit from this book. It contains some counter-intuitive data and insights that are worth a look (even if taken with a dose of skepticism, still many useful ideas): https://www.amazon.com/Upside-Stress-Why-Good-You-ebook/dp/B00OI5PGWU

Consumer Reports satisfaction survey: https://www.consumerreports.org/car-reliability-owner-satisfaction/10-most-satisfying-cars-owner-satisfaction/

As AWS becomes a bigger slice of the pie, that'll drive EBITDA up faster than revenue growth because it has a much higher margin than retail. Same for advertising. There can also be tipping points where international operations mature into profitable businesses that contribute positively rather than negatively to the aggregate margin on the retail side and helps EBITDA grow faster than revenues. There are also infrastructure investments that you don't have to keep making over and over. Once you have fulfillment centers close enough to all population centers to offer 1-day shipping, you have to keep expanding them at a much lower pace than the investment that was required for going from no-1-day capability to 1-day capability.

I enjoyed this article: https://www.mrmoneymustache.com/2019/01/28/how-to-slow-down-time-and-live-longer/

Q4: http://www.transdigm.com/investor-relations/news-releases/news-article/?myartid=2386031

Apart from all the obvious stuff (want to catch up to AMZN and MSFT and be a real hyperscale cloud player), I think now's probably a good time for all these businesses to depress their profitability because of politics. Whatever they invest today in capex probably is pulled forward from the future. Amazon has gone through these cycles.

Another one at TSS: https://www.totalspecificsolutions.com/about-us/transaction-updates?tid=37 https://nostradamus.nu Also, the japanese sub is buying: http://www.csi-japan.co.jp/wp-content/uploads/2018/11/株式会社レスコの株式取得に関するお知らせ.pdf h/t @pearnick for both

Q4: https://abc.xyz/investor/static/pdf/2018Q4_alphabet_earnings_release.pdf?cache=adc3b38 Capex up over 25bn in the past year, more than MSFT..

Didn't this also happen with LILA/CWC? Most people on CoBF claim that Malone screwed LILA shareholders by selling CWC at inflated price. But he took LILA shares in the merger and those are down hugely since then (possibly at least partially because of inflated CWC price). Yeah, that's why people think the CWC assets (undersea fibers and such) are being undervalued by the market. Time will tell, I guess. Or maybe Malone just made a mistake.

TSS acquisition in Spain: https://www.totalspecificsolutions.com/about-us/transaction-updates?tid=36 h/t @Pearnick

I don`t think that matters much, because to develop new products or factories they need cash, a lot of cash. Where is that coming from? The debt markets are closed for them. The cash balance in the financial statements looks high, but that is only because they pay suppliers at the start of the quarter. If you look at the interest payments they got on the cash, average cash balance for Q4-2018 was around 1 billion, that`s barely enough to repay the march debt. And payables on the end of last quarter were ~5.5 billion, with just 1 billion in outstanding receivables. If revenue goes down this is not sustainable, because they have to pay suppliers more than they get from customers each month. Negative working capital only works when revenue is going up. So they have to raise capital, increase revenue by a lot or they are bankrupt sometime in 2019. Either way the stock price will go down. I suspect that Deepak has left because he realized that Elon is again gambling on the future of the company (and doesn`t want to raise equity) but this time the odds are clearly against him. Elon is deep on margin on Tesla stock and his margin call is getting closer every month, because hes probably pledging more stock every month, since he can`t afford to pay the interest. None of his enterprises pay him in cash. You can`t expect him to make unbiased and reasonable decisions. I really like the cars they make, but the company is a mess. And to come back to world wide EV sales, of course that market is growing, but the competition is heating up. The Porsche Taycan and the Jaguar iPace are already grabbing lots of market share from S and X sales worldwide and the model 3 is competing with the LEAF and the KIA e-Niro, which both are a lot cheaper, but offer a similar experience. I watched youtube videos on the "Autopilot" feature from the KIA e-Niro and it looks similar to that of a model 3. The only current advantage TSLA still has is the charger network, but since most people charge at home and charger stations are shooting out of the ground like mushrooms, the advantage diminishes quickly. I think that TSLA has also destroyed its brand value for luxury cars with the model 3 quality, at least i would prefer a car from another company now that i know how bad the quality of their cars really is. (And wait 4-8 weeks for a repair?? no way!) And they just ended their referral program, are they really getting more revenue without this cheap advertising? I think this was part of their success, lots of youtube guys post videos of the greatness of TSLA cars and than add their referral code at the end of the video. That all might be right. Or maybe not. People have been saying this is about to go bankrupt since IPO, so I don't know if they can kick the can down the road a while longer, or actually make structural improvements at some point and fix the biggest issues... ¯\_(ツ)_/¯ Very little return-on-brain-damage in this name so far. But you never know.