jhg-
I usually stay out of the mudslinging, but you are suffering from 20/20 hindsight, to put it politely.
You ask: "What is it about?" [Buffetology]:
Have you bothered to read the book? And have you studied Buffett at all? Does he only speak of brand names?
No, Buffett sees the value of great brands, but they are far from the only toll bridges out there. If it were as simple as picking brands, then Buffett would be just another Warren.
Your success with a few great tech stocks has made you brash and rude. I'm glad you had a good 1998. I did too, and I wasn't anywhere near Dell, AOL, etc. I had AMZN on my watch list a couple years ago, but it never had any margin of safety, not then, not now. Does passing up AMZN (or AOL per your post) make a me a lousy investor??? NO! Of course not.
(actually, plenty of other things are there to make me a lousy investor, but we won't go there...)
There is nothing wrong with failure in investing as long as you can look back and say that your methodology made sense, that your logic was sound. Failure is good in the sense that it forces you to look closely at your decisions: Did I move too fast? Too slow? Was I patient enough? When I was SURE, did I follow my convictions with enough cash? And success begets the toughest question of all: Was I really smart or did I get lucky? Was my "smart move" repeatable in other times, other fields? (If not, why bother staying in the game?)
If you completely turn over your methodology with each passing fad, you are just another follower, another lamb waiting to be led to the slaughter. On the other hand, one must adjust his methodology over time or he is not learning. The key is to base it on sound logic.
What really galls me about your post is that it takes aim at people who are willing to look at their past decisions and lay out the good, the bad, and the ugly results of those decisions. It takes a bit of moxie for a person to look back at what made them NOT buy a stock (AOL), and what they would do differently. James said that he missed AOL when it was sitting under his nose a couple years back, but that, while he wouldn't buy it now because of price, he'd buy it at the right price. For that piece of introspection, you bait him and spit on his methodology, which incidentally is quite sound.
It is foolish to think that because you have ridden one big kahuna wave you are a master of the universe.
I missed AOL. I missed a lot of stuff. I am looking forward to missing a lot more "obvious" stuff next year. But so long as I know exactly why I bought what I bought, I think I'll be more comfortable than if I just follow the obvious trends.
Getting back to Buffettology: The part that you are missing is all about price. It is not often noted, but Warren Buffet is much like a human financial calculator. And while I don't pretend to know all about Warren, I do know that PRICE is a critical factor in his decisions.
I have read many of James Clarke's posts. PRICE is a critical factor in James' decisions. He follows Graham's 2 biggest rules: #1: Don't lose your principal. #2: See rule #1.
I have read many of jhg_in_kc's posts. PRICE is rarely mentioned, except in hindsight.
Guess who I think makes more sense?
For what it's worth, jhg, I am long on TLAB, long on BRKA, as well as long on many value stocks. So I understand something about your world of tech-growth, Buffett, and value. I just don't appreciate or respect the way you present your methodology.
To all: Sorry to vent here; The recent discussions regarding AOL and DELL have generally been good useful discourse, even as related to why they might NOT be Buffett stocks (beyond the obvious fact that they are techs). Thanks and a good 1999 to all. |
