Below is our “Top Podcast” episode with our curator, Colby Donovan!
Today we have a great value investing episode, Cullen Roche breaking down the Federal Reserve, a must listen from Michael Lewis on mastering your inner voice, and Jim Mattis’ leadership lessons.
- ***Must Listen*** The Meb Faber Show: #221 — Chris Davis, Davis Advisors — As Human Beings, We Don’t Welcome Fear And Panic…As Investors, We Welcome The Bargain Prices That Those Emotions [Tend To] Produce. This is a fantastic episode on the markets and value investing with Chris Davis, a portfolio manager for the Davis Large Cap Value Portfolios. He starts with the idea of deferred gratification and the importance of compounding, and provides some great book recommendations (see below). He then talks about how he and his firm have handled 2020 well so far by focusing on high quality and durable companies and emphasizes the importance of focusing on stocks that have been beaten down now because of uncertainty for what they’ll make in the next year, but you can remain confident they’ll make it through that without relying upon external financing (United Technologies, Berkshire Hathaway, and the banks). He loves banks since they’ve had to endure stress tests from the government and views them similar to utilities but are trading at 7x earnings vs. utilities at 20x earnings. He then talks about oil companies and says you want to own companies that can withstand low oil prices and make it to the time when oil reaches $50-$70. [May 18, 2020–1 hour, 13 minutes] iTunes Podcast | Spotify | Overcast | Google | Breaker | Website Link
You got a new heart — when you went for your heart surgery, did you hit the cheapest doctor? In a profession, costs have something to do with professional duty and fiduciary duty, but it’s not the same thing. Our view very early was that managing a client and managing behavior was different than managing a portfolio.
- The Pomp Podcast: 294: Cullen Roche Explains The Ultimate Breakdown Of The Federal Reserve. Roche is the Founder at Orcam Financial Group and joins the episode to discuss the monetary policy events over the last couple of months. He gives the most concise and simple explanation of the Fed that you will ever hear — he explains both how it supports the banks (which he views as a big positive) and how quantitative easing works. He also talks about the potential for future inflation, which he thinks if it does happen will be a result of the Treasury department instead of the Fed, the effect of government programs in both the short term and long term, and his thoughts on gold and bitcoin. [May 14, 2020–1 hour, 35 minutes] iTunes Podcast | Spotify | Overcast | Google | Breaker | Website Link
- The Long View: Rick Rieder: Nobody Has Ever Seen Anything Like This. Rieder is the manager of BlackRock Global Allocation Fund and addresses how COVID-19 impacts their allocation and investing. He begins by saying the three things he analyzes are asset leverage, liquidity, and cash flow. He likes the idea of selling call options for things like technology and healthcare equities to generate some income and likes high quality assets in spaces where there can be huge changes like office and retail. He then addresses negative rates, which he thinks are a horrible idea, especially in a place like Europe with really bad demographic trends. He thinks Europe should focus more on R&D and technology innovation instead and really hopes the U.S. does not have negative rates in the future. He finishes by covering a variety of thoughts: he thinks interest rate exposure is generally less attractive right now but favors the long end of the curve, he thinks people underestimate the convexity of technology and it’s impact, loves the demographic trends in favor of healthcare, thinks the consumer will do well because of the recently stimulus, and thinks the three previous trends make it hard to be bullish on value. [May 20, 2020–50 minutes] iTunes Podcast | Spotify | Overcast | Google | Breaker | Website Link
- This Week in Startups: E1062: News Roundtable! Acquired.FM Co-Hosts Ben Gilbert & Dan Rosenthal. The co-hosts of the Acquired.FM podcast join Jason Calacanis to talk about some of the more recent news, including Clubhouse raining $10 million from a16z with an atypical structure, the impact of Spotify paying Joe Rogan to be exclusively on their platform, the general business model of podcasts, the potential Uber and Grubhub acquisiton (Jason thinks Uber should be Dominos!), and Facebook’s acquisition of Giphy. [May 20, 2020–1 hour, 57 minutes] iTunes Podcast | Spotify | Overcast | Google | Breaker | Website Link
- The Meb Faber Show: #222 — Dakin Sloss, Prime Movers Lab — Power Law Is The Key To Understanding Venture Capital. Sloss is the Founder and General Partner of Prime Movers Lab. He starts the episode with his career before Prime Movers Lab: OpenGov, which provided software to local governments, and Tachyus, where he built the leading prescriptive analytics company in the oil and gas industry. Then they dive into Prime Movers Lab, which focuses on six industries: energy, transportation, human augmentation, infrastructure, manufacturing, and future of computing. He says he will only invest if there is some type of intellectual property so he has downside protection. The four things he looks for in a deal are: 1) unbelievably resilient founder, 2) founder with a growth mindset, 3) $10 billion or more market opportunity, and 4) simple and quantifiable value proposition. He finishes the episode explaining how he screens ideas, reviewing his recent investments in two companies (Momentus and Covaxx). [May 20, 2020–1 hour, 13 minutes] iTunes Podcast | Spotify | Overcast | Google | Breaker | Website Link
The amount of time from when an investor meets the founder to giving a term sheet has shrunk from 90 days to nine days over the last 10 years.
- Capital Allocators: Daylian Cain — Master Class in Negotiations. Daylian Cain is a Senior Lecturer in Negotiations, Leadership and Ethics at the Yale University School of Management. This episode focuses on topics he covers in his negotiations course, mostly in the framework of business and job negotiations. He covers a lot in the episode — tactics for successful negotiating, when to go first and how that can backfire, the importance of learning about the person across the table from you beforehand, handling your emotions during the negotiation process, differences in genders, and what he’s found most difficult for his students to learn: the ability to walk away or take a step back during a negotiation. [May 18, 2020–1 hour, 4 minutes] iTunes Podcast | Spotify | Overcast | Google | Breaker | Website Link
- Against the Rules with Michael Lewis: The Coach in Your Head. Michael Lewis interviews Tim Gallwey, the author of The Inner Game of Tennis: The Classic Guide to the Mental Side of Peak Performance, a book that’s now sold over two million copies and is about way more than tennis. Gallweys’ idea is that we need to calm our mind to perform best and has applied that idea to all sorts of teams and corners of the world, from tuba players to firemen to pro teams (Seattle Seahawks head coach Pete Carroll wrote the forward to the book). Gallwey tries to encourage people to stop thinking, trust your reactions, and avoid judging ourselves based on outcomes. The book is a quick read (134 pages) and I highly recommend it. [May 19, 2020–53 minutes] iTunes Podcast | Spotify | Overcast | Google | Breaker | Website Link
- Coaching for Leaders: 440: Leadership in the Midst of Chaos, with Jim Mattis. Mattis is a former 4-star general in the U.S. Marines, the 26th Secretary of Defense of the United States and author of the book Call Sign Chaos: Learning to Lead. He offers an incredible amount of leadership advice, including how to communicate with lower levels in your organization, how and when to choose to fire someone who may be great but not for a specific role, and when you have to follow orders you don’t agree with. He also talks about the mission to get Osama Bin Laden, the difficulty of decision-making and leadership in the middle of war and the fact that you’re made an officer but your troops are the ones who determine whether you are a leader. He finishes by emphasizing leaders should read and study history (he has around 7,000 books in his personal library) and gives a few book recommendations below. [November 10, 2019–38 minutes] iTunes Podcast | Spotify | Overcast | Google | Breaker | Website Link
“You may not like some things but that’s why they’re called orders and not likes.”
Jim Mattis (26th Secretary of Defense of the United States):
- Meditations by Marcus Aurelius
- The Complete Personal Memoirs of Ulysses S. Grant by Ulysses S. Grant— Shows the doubts of a leader and how he grows into his job.
- Long Walk to Freedom: The Autobiography of Nelson Mandela by Nelson Mandela
Chris Davis (Portfolio Manager, Davis Large Cap Value Portfolios):
- Moneyball: The Art of Winning an Unfair Game by Michael Lewis
- Titan: The Life of John D. Rockefeller, Sr. by Ron Chernow
- Ship of Gold in the Deep Blue Sea: The History and Discovery of the World’s Richest Shipwreck by Gary Kinder — All about people who brought a rigorous, disciplined, analytical framework to an industry that was really characterized by speculation, old wise tales, and rules of thumb.
Scott Lynn (Founder, Masterworks):
- Competitive Strategy: Techniques for Analyzing Industries and Competitors by Michael Porter
Cullen Roche (Founder, Pragmatic Capitalism):
- Man’s Search for Meaning by Viktor E. Frankl— The entire Frankl story in Auschwitz, and the thing that had a big impact on me is that no one else can determine your mindset about things. No matter what your circumstances are, you still have the ability to choose a certain perspective about how good or bad things are.
Mike Maples (Founder & Partner, Floodgate):
- Superforecasting: The Art and Science of Prediction by Philip Tetlock — It provides a lot of frameworks for how to deal with uncertainty.
Hamilton Helmer (Managing Partner & Chief Investment Officer, Strategy Capital, Author of 7 Powers: The Foundation of Business Strategy):
- The Road to Reality: A Complete Guide to the Laws of the Universe by Roger Penrose
Patrick O’Shaughnessy (CEO, O’Shaughnessy Asset Management):
- The Systems Bible by John Gall — He bought it thinking it would help him design good systems and it ended up making him think he shouldn’t have systems at all.
Tobi Lutke (CEO, Shopify):
- The Talent Code: Greatness Isn’t Born. It’s Grown by Daniel Coyle
- A Guide to the Good Life: The Ancient Art of Stoic Joy by William Irvine