(no subject)

This past Wednesday I had an interview with a hip tech company based in the UK, which was an interesting experience. I applied more or less on a whim, but I'm pretty sure I can do the job. The question is whether I want to leap six time zones to do the job.

I'd be off in a shot, but it's awfully far from my folks, which is a concern as they get older. Mum's not happy about the idea of both her sons being overseas, even if Glasgow's a sight better than Australia (and I'm not a rampaging asshole married to a narcissist, which helps). Also it's a for-profit company, which means I give up my PSLF qualification and have to pay ALL my student loans. But the salary might cover that better, I don't know what they pay.

Otherwise the week's been uneventful, as I hold onto sanity with my fingertips until next week, when I have a week's vacation starting Tuesday.

In the meantime, I made a bunny. Aww.

(no subject)

Once in a while my studies take me strange places.

I'm reading a book by Seth Klarman called "Margin of Safety". It's a tough book to get your hands on; Barnes and Noble has one copy for over a thousand dollars. Not many copies were printed and even fewer were sold. This may be because it is an excruciating technical examination of US stock market trends and investment theories in the 70s and 80s (it was written in 1991).

But Seth Klarman called some shit right and got rich, and Margin of Safety became a collector's item. I don't know how true it is that it's considered a "standard business school text" as some websites assert, because if it's basic enough for me to grasp then I can't imagine future MBAs want much to do with it, but I suppose stranger things have happened.

I don't know that I'm learning a lot about investing from the book because while on the one hand it's a deep dig into investment strategy in the late 20th century, it's also over 25 years old and

a) A lot of what it factors into investment strategies no longer applies
b) Nothing about it is anything I didn't learn at my mother's knee

Granted, my mother's a savvy woman, but still. The essence of the book is a case for value investing, which is very simply put, investing in a company that is undervalued in the marketplace. Buy a stock at $10 when you know it should be worth $20, and wait for the market to catch up. Essentially: buy low, be patient, sell high. Don't look at the market, look at the company. If you are a value investor you're spending more time honing your ability to valuate a company than you are watching stock prices. You don't need to watch the market; you should be finding undervalued companies and buying their stock regardless. (Something my current job actually teaches me to do, so, hooray for that. Also this was my thesis behind investing in GrubHub before reading the book, which is very validating.)

ANYWAY, Seth Klarman makes a few intriguing assertions in his book. First, that Warren Buffett (a well-known value investor) is a god among men. No argument here, the man has lived to be 85 on Coca Cola and Utz potato sticks. Second, that investing in index funds is pointless and stupid. (What an index fund actually is or does is immaterial. But if you want to know, Planet Money has a great podcast about index funds and Warren Buffett's bet here.) Klarman, without outright saying it, cast Warren Buffett as a champion of value investing against the very idea of the index fund.

Here's where it gets awkward. Eight years ago, Warren Buffett asserted that hedge funds were not good investments because they were too volatile, and he made a bet that over ten years, anything he picked would do better than a hedge fund.

And he picked an index fund.

AWKWARD! So awkward for poor Seth Klarman!

Buffett isn't necessarily advocating for index funds with this move. He's advocating against hedge funds -- he's saying the simplest, dumbest index fund can still outperform a hedge fund. But I would have killed to have been in the room when Seth Klarman heard that Warren Buffett was putting a million dollars on an index fund's ability to perform.

I feel like I should write a one-act play about it. It'd end up sounding more like a college economics lecture than a drama, but I think it'd be worth it to write the stage direction

[KLARMAN does a spit take. BUFFETT smiles beatifically.]