"Investing is inherently about predicting the future. But predictions can never reach 100% accuracy; they can only fall between zero and something approaching 100%. So when we make a judgement, we need a large buffer. This is called margin of safety."
Michael Mauboussin: "Margin of safety can be restated as a discount to expected value. For every stock there is an intrinsic value, and the deeper the discount the stock price is to intrinsic value, the lower the risk." retailinvestor.org/pdf/MarginOfSa…
4/ "What makes outcomes tolerable even when the future doesn't live up to your expectations? Margin for error." Howard Marks
"The best long term margin of safety comes from the value of a sustainable competitive advantage. That’s what quality investing is about.” Thomas Russo
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2/ That writers have the ability to work for themselves creates a wholesale transfer printing problem for the publication. The better BATNA of writers even benefits writers who stay at the New York Times at salary time. Writers will be paid more. That's a very good thing.
3/ "Substack" is bring used as shorthand by intermediaries who feel threatened by writers selling their work directly to customers. Many types of creators in different types of creative arts are eliminating intermediaries from their value chain. The shift to D2C is unstoppable.
Telesat aims to launch its first batch of 298 satellites built by Thales in early 2023, with partial service in high latitudes later that same year, and full global service in 2023. It is estimated to cost half as much as the $10B SpaceX and Amazon Kuiper."reuters.com/article/busine…
"OneWeb plans to have 648 satellites at 1,200 km in orbit to provide a global service. The most recent launch on March 25 took it up to 146 satellites. The fifth launch will be in June, when OneWeb aims to provide broadband to the whole of the UK." businessinsider.in/tech/news/onew…
Craig Moffett: Using Starship for Starlink satellite launches may be important for SpaceX to meet the FCC's 2027 build requirements. The company could increase its rocket launch cadence to 200 Starlink satellites per month, up from the 120 per month." nasaspaceflight.com/2021/04/starsh…
1/ "The value of a financial asset is the present value of future cash flows. If you don’t believe that, please put this aside and resume your normal daily activities." morganstanley.com/im/publication…
The two previous sentences written by Michael Mauboussin apply to this Twitter thread.
2/ "Intrinsic value is the number that if you were all knowing about the future and you could predict all the cash a business would give you between now and judgement day, discounted at the proper discount rate." Buffett
The predicting the future part is what makes this hard.
3/ "It is important to understand that intrinsic value is not an exact figure, but a range that is based on your assumptions."
Jean-Marie Eveillard
"Anytime anyone gives you some simplified formula for figuring it out, forget it."
When I've pointed out the insanity of VaR before some people say: "No one models Gaussian any more." Experience proves that some still do if they want to justify picking up dimes in front of steam rollers. As Munger says: "Show me the incentives and I'll show you the outcome."
"Fat Tony, a Brooklyn street-smart character, builds his success on the paradox that the only prediction one can safely make is that those who base their business on prediction will eventually blow up. So Fat Tony takes the other side." fooledbyrandomness.com/ECONOMIST2013.…
Microsoft was formed 46 years ago today only in terms of the formality.
The magazine Gates and Allen saw in Harvard Square was the January 1975 edition.
BASIC for the Altair PC was sent to MITS in February of 1975
Altair BASIC was released three days from today in 1975.
2/ People get confused about Microsoft history since the unauthorized books on Microsoft are often fictional. Writers make up stories like "BASIC was sold to MITS."
PA: "When our 1975 royalty statement arrived, we were sorely disappointed. Our royalties totaled a mere $16,005."
3/ PA: "By Bill’s calculation, fewer than one in ten Altair buyers were purchasing BASIC. It was hard to fathom, because the machine was next to worthless without it. With the base Altair kit costing ~$400, MITS barely broke even on the machines." Profit was in the peripherals.