Principles from "Influence" by Robert Cialdini

1. Reciprocity - People tend to return a favor, thus all those annoying address labels charities send out as a fundraising ploy.

2. Scarcity - Perceived scarcity fuels demand. “Only four memberships are left” prompts action!

3. Authority - People will tend to obey authority figures. What expert can attest to the value of your organization?

4. Consistency - If people commit to an idea or goal, they are more likely to follow through. It’s why pledging is a great option for people who aren’t ready to take action.

5. Liking - People are easily persuaded by other people whom they like. That’s why you want your champions spreading the word about your cause among their friends and family.

6. Consensus - People will do what other people are doing. That’s why it’s great to show who is taking action for your cause - others are likely to conform.

In this clip, Buffett's asked how the rest of us can find a job that has us tap dancing to work. Here's his advice:

"Find your passion. I was very, very lucky to find it when I was seven or eight years old... You're lucky in life when you find it. And you can't guarantee you'll find it in your first job out. But I always tell college students that come out (to Omaha), 'Take the job you would take if you were independently wealthy. You're going to do well at it.'"

And if Buffett hadn't found his passion for investing?  He says he might have been a journalist.

buffettt on buying a house 10/22/2012

Warren, do you —do you still think a single family home is one of 

the best investments around? And have you actually tried to figure out 

a way to invest in that? You'd like to buy 100,000 —you've said that 

you'd like to buy as many as you could, but they're impossible to 

manage and you can't really do it. Have you figured...

BUFFETT: Yeah.

JOE: Have you tried to figure out a way to do it?

BUFFETT: Yeah. And I've had a lot of suggestions from people after I

made that statement. But it's not really feasible, certainly, compared 

to other things we can do with money. They're —it's just too big a 

problem to deal with small units like that and management problems 

and human problems. So I think that anybody that knows where 

they're going to want to live, has a reasonably assured income. I think 

they're making a terrible mistake if they don't buy a single family 

home now and get a mortgage at these rates. And they should get a 

30-year mortgage. It's a —it's a —really a golden opportunity. It was a 

little bit better six months ago, but it's still wonderful now. You're not 

going to see a chance like this five years from now. I'll guarantee you 

that.

BECKY: Five years from now it's going to be a different picture, and 

that's interesting.

BUFFETT: Yeah. Rates will be higher and all kinds of things. I mean,

this is —this is the time to buy.

BECKY: And you think prices will rebound, too.

BUFFETT: If you know where you want —you've got to want to live 

there, I mean, and a home's a wonderful thing.

BECKY: Hm.

BUFFETT: But I wouldn't buy one if I was going to move in six months 

or something of the sort. And I wouldn't buy one if I was terribly nervous about my 

job.

BECKY: Ted Weschler and Todd Combs talked about what they've 

been doing as an investment cycle. 

How much of that is yours? How much of that is theirs?

BUFFETT: Very little of it's mine. I mean, if it's Wells Fargo or IBM or 

Coca-Cola, I mean, I've got four stocks that aggregate over 50 billion 

that I manage. And then I've got a bunch of other things, too. But the 

action is with Ted and Todd. And they're building up portfolios, and 

they will buy $500 million at a time of something. And they're probably 

more prone —one of the two is more prone to move around in 

securities than I would be. But there's a lot of styles that work. So I 

am enormously pleased.

Greenblatt on investing

"When we buy things, we like companies that generate large amounts of cash flow relative to the price we're paying.  On the short side, we would like to be short, high-priced, cash-eating companies."

"If you don't lose money, most of the alternatives are good.  Even if you don't know what the upside is - if you just know there's upside - you can create scenarios where you have an excellent risk/reward.  Positions with limited downside are the types of positions that I have loaded up on in the past.  Not the positions with the biggest payoff.  I could buy a lot knowing that I wouldn't lose much and that there were good possibilities that it was worth a lot more over time."

my fave quotes from quora

Nobody tells this to people who are beginners, I wish someone told me. All of us who do creative work, we get into it because we have good taste. But there is this gap. For the first couple years you make stuff, it’s just not that good. It’s trying to be good, it has potential, but it’s not. But your taste, the thing that got you into the game, is still killer. And your taste is why your work disappoints you. A lot of people never get past this phase, they quit. Most people I know who do interesting, creative work went through years of this. We know our work doesn’t have this special thing that we want it to have. We all go through this. And if you are just starting out or you are still in this phase, you gotta know its normal and the most important thing you can do is do a lot of work. Put yourself on a deadline so that every week you will finish one story. It is only by going through a volume of work that you will close that gap, and your work will be as good as your ambitions. And I took longer to figure out how to do this than anyone I’ve ever met. It’s gonna take awhile. It’s normal to take awhile. You’ve just gotta fight your way through.” ― Ira Glass


 "Be who you are, and say what you feel, because those who mind don't matter, and those who matter don't mind." - Dr Seuss.


 Steve Jobs's 2005 Commencement Address"Your time is limited, so don't waste it living someone else's life. Don't be trapped by dogma — which is living with the results of other people's thinking. Don't let the noise of others' opinions drown out your own inner voice. And most important, have the courage to follow your heart and intuition. They somehow already know what you truly want to become. Everything else is secondary."


 People are often unreasonable, illogical and self centered;Forgive them anyway.
If you are kind, people may accuse you of selfish, ulterior motives;Be kind anyway.
If you are successful, you will win some false friends and some true enemies;Succeed anyway.
If you are honest and frank, people may cheat you;Be honest and frank anyway.
What you spend years building, someone could destroy overnight;Build anyway.
If you find serenity and happiness, they may be jealous;Be happy anyway.
The good you do today, people will often forget tomorrow;Do good anyway.
Give the world the best you have, and it may never be enough;
Give the world the best you've got anyway.
You see, in the final analysis, it is between you and your God;It was never between you and them anyway. -Dr. Kent M.

Wsj 2012

12/4/12
ISM index of non manufacturing activity - above 50 signifies expansion. They expect it to be 54 in November. This is the 35th consecutive month above 50, that dignifies expansion. A number closer to that line or below it would be due to a weak economy or fiscal cliff worries. Services.
In jan 2008, a streak of 57 consecutive months of expansion was broken when the index plunged to 45. The great recession started that month.


11/21
-open source animation software
Dreamworks open vdb
Disney render man 2000
Sony alembic

-vivendi owns canal plus



largest ng Producer in us is xom, next is Chesapeake.
Suncor those producers who mine bitumen and produce synthetic crude from it , the break even threshold is $100 a barrel. Most efficient oil sands producers need $50
Us n Dakota oil output is threatening Canada's boom. Lower prices.
10/30/2012
Housing starts have risen to 872k.
During the peak of new home construction in 2006, the us built 1.6M homes. Today's 872k annual rate of homes is short of average for past half century. On average, buildrrs hVe started construction on about 1.5M new homes a year since 1959

Samsung mobile business accounts for more than half of revenue

Telefonica has highest debt 57b. Difficult to refi



Buffett thinks sfh is a great buy right now compared to 5 yrs from now.
Us is doing better than Europe. Asia slowing some as is global economy.
Loves wfc and IBM
Doesn't think ng will be exported from us. Should not be anyway for benefit of future generations.
Acquisitions happening at high multiples dues to cheap money.
He thinks European banks still have too much leverage



3M only 30% revenue from north America. A good bellwether for global economy. Same as Dow chemical?

Natural gas is 70% of fertilizer cost


Hotel companies
Accor and ihg largest in china
Hilton Waldorf Astoria doubletree
Marriott ritz renaissance courtyard
Accor Sofitel Pullman mgallery mercure
Novotel ibis etap
Ihg intercontinental holiday inn crowne indigo

College housing firms- American campus communities, education realty trust, landmark properties
Warehouse firm- prologis
Mall company Simon property group

Bp estimate of reparation to us is 5-21B

Caterpillar promotes from within
Total eni at discount due to Europe
Avoid realogy iPo
Worlds no 2 retailer by sales Carrefour.

Projected Costs per megawatt hour 2017
Ng 66
Hydro 88
Wind 96
Coal 97
Geothermal 98
Nuclear 111
Biomass 115
Solar photovoltaic 152
Solar thermal 242

10/7
Fox news corp
Abc Disney
CBS CBS corp
NBC Comcast
Focus features a unit of comcasts NBC universal
Image nation - financing of movies. Partially owned by Abu dhabi
Xom, cop and chevron defend tracking as safe
-Monsanto requires growers to use seeds only for a single crop and they can't save the 2nd generation seeds from the harvest. Seeds are called roundup ready and produce crops resistant to weed killer.
-
10/1
Drought has sent crops skyrocketing but south America and us should increase plantings next year. Should benefit fertilizer companies like mosaic, potash corp, cf industries. Rock wood holdings, .

- metals could drop almost 40%. Current bhp and rio shares trade at 15 times earnings at current metal prices.
-seadrill, noble and transocean deep water drillers may benefit as oil reserves become more difficult to reach
-nat gas is 2.8 per mbtu, up from 1.91 but well below average of 10 yrs $6.
Companies that benefit from cheap gas: mosaic, lyondellbasell. Both use nat gas as inputs.


9/29

-Anglo American lot of project delays, lagging gold and problems in Africa.
-Ford gm Peugeot etc struggling in Europe
-modest debt and improving profits in financial statements.
-make money in diverse ways
-consolidated Edison
-at the moment priciest shares based on forward p/e are steady consumer staples, telecom and utilities
-one time share buy backs are I'll timed. Consistently buying back shares companies outperform a bit. Eg autozone, resmed. Also those who pay a dividend and repurchase shares.
-a basket of stocks with the highest investor yield: high dividends + large buy back yielded 6.6% more
-highest investor yield: duke energy, triumph group and Polaris industries.
-biggest buys : susp 20.50 7.2m$, agco 5m 45.56 Natr 3m 15.90,
-bac Merrill acquisition have good profits but country wide was disaster. Overpaid for Merrill.
-avoid Sony Olympus sharp renesas.
Sony 4 yrs of losses,
-

-Leslie Michelson CEO of private health management co.ultra high end health care. Manages patients care by coordinating multiple best doctors, research etc.

9/27
-proctor gamble concentrated on upscale products. Pampers, charmin, Gillette, Tide, Pantene, Olay, Old spice,
-tempur pedic has 13% of us market, sealy has 22%.
-fiat got 92% of first half profit from Chrysler.
-premium metallurgical coal was trading 330 per metricyon, now 170 per ton. Chinese sales down.
-honhai net margin from 12% in 2000 to 2.4% in 2012
-


Rim us market share has dropped from over 50% 2008 to under 5% in 2012.
-airlines hand out iPads instead of tv screens.
- dishtv to roll out broadband service for rural areas. Directv also next quarter. These 2 are competitors. Echo star is sibling of dishtv that launched a high speed satellite. Cable and phone companies offer 305 mbps max vs max 5-10mpbs for 39$ to existing customers or 49$ per month. for new. 19 million market?

9/23

-the launch pad- book on ycombinator. Where apps are hatched.
-where have all the cowboys gone? Old fashioned individualism.

-exelon nuclear plant operator. Dominion resources. AES corp gas fired units.

- Delhi dazzler- the story of my assassins. Tarun tejpal

-unh being added to Dow. Intuitive surgical makes robots for surgery. Richly valued. Varian medical a better bet, radiation machines to precisely target rumors. Cerner's systems digigitize patient records. Perrigo is maker of store brands of OTC medicines. Gilead sciences has an HIV treatment that can replace multiple pills with single. Also has a hepatitis c drug with promising results. Insurers have uncertainty with future overhaul but unh has a good history of helping customers cut costs. Merck Pfizer also decent.
-denbury sold bakken assets to Exxon. More interested in old oil fields instead of shale. Gas accounts for less than 10% of output compared with 2/3rds for the sector. If you're betting on a gas rebound in 2013, denbury is not for you. Denbury made the highest margin per barrel. Unlike a shale field much of the investment is made upfront in securing co2 supplies and pipelines. They pump co2 into mature oil fields to force more oil out. Once this initial spending is done, less spending required to maintain output. Also lives within its means, capex at denbury is equal to cash flow compared to 160% at peers.


-Liberty global 2nd largest csble subscribers after Comcast. Operates 13 cable companies in Europe. In Europe cable business more regulations and different appetites for expensive cable. Libertys monthly arpu is$24 in Germany vs nearly $150 in the us for Comcast. But libertys per subscriber content costs are $5 per month whereas they are about $40 for us companies.
Liberty has raised profits even during economic turmoil and aggressively bought back shares. If Europe consolidation can occur, it may benefit.



9/22
Last 5 yrs, gold has risen 142%, miners of gold gone up only 20%. Gold deposits harder to develop. While gold prices doubled so did costs. Also miners profligate spenders. Over last decade, they made operating cash flow combined of 68b but spent 89b on acquisitions and capex. Dividends meanwhile wee less than 10b even as shareholders were diluted to help fund expansion with the share count jumping 151%. Acquisitions have irked investors at barrick gold, kinross. Canadian b2gold dropped 12% after saying it would pay 26% premium for Cga mining. One route miners could try is what oil majors did in late 1990s: mergers with no premium paid.


-Pernod 2nd largest company- makes chivas absolut among others. Diageo is number 1
-brown Forman jack Daniels no.3 spirits group by sales.
-beam
-ikea catalog graphics 3 interns
-virgin owns 51% of Singapore
-royalty trusts depletion means income may go to zero. Also no principal returned
-syartups bar code for tracking where food is from. Chegg is textbook rental
-best buy 91% profit down
-sales force yet to turn a profit
-lowes overcapacity too many stores

-in us car sales 1.2M per month. 240 gm, 196 ford, 188 tm, 148 Chrysler, 131 Honda, 98 Nissan. Shortage of Hyundai due to strike.

-85M pc shipments in 2nd quarter worldwide. 4m in brazil 5th largest market.

-national oil well varco and Cameron make oil rigs and parts for them. Transocean runs the drilling rigs. Bp etc own the oil coming out.

-globally, 69% of planets fresh water used in agriculture, 23% in industry and 8% in municipal uses.

-Monsanto making drought resistant crops. Droughtgard

From eat pray love

I have been thinking that I need to consciously divert my mind from negative thoughts and focus on things that move my life forward. Iam ruining my own potential by corrosive thoughts.

- as smoking is to the lungs, so is resentment to the soul
- god dwells within you as you yourself, exactly the way you are.
-to know god, you need only to renounce one thing -your sense of division from god. Otherwise, just stay as you were made, within your natural character.

Oil companies

Oilfield services companies: 3 flavors
Some make Snd sell expensive kit for use on drilling rigs or seabeds. Fmc, Cameron and national oil well varco.

Some own and lease out drill rigs. Transocean, seadrill, noble and rown

3rd group carries out most tasks in finding and extracting oil; schlumberger, Halliburton, baker Hughes and weatherford.

Ofs companies do not own reserves.
Oil companies outsource the drilling. This looks like a bad deal for them. Hostage to ofs. Global production from mature oilfields falling 2-6% a year. More innovative drilling needed.

Lot of state owned oil companies are coming up now. Worse for oil companies like Exxon. This leads to competition for ofs and allows state owned oil companies to claim and pursue best oil acreage.

Ofs balance sheets are smaller, do not own reserves and do not want to compete with customers. Choosing where to explore is tricky.

I also believe in the below :

From :
http://www.jamesaltucher.com/

WHEN IS AN IDEA NO GOOD

Jon Velez ‏ @jmvelez08 what makes u lose interest in an idea? Are u looking for something that is built and running, or do u consider working w. ideas

ANSWER:

Believe it or not, most things in life should be very very easy. The reason why it seems we must encounter such great difficulties until we find success is because most people carry with them the mistaken belief that we need to “pay our dues” – that things should be hard and it’s through this persistent fighting in the trenches that you come out the other side the victor.(probably not a good idea)

But the reality is, the reason persistence works is because it takes time to realize that things that work out well are actually the things/ideas/companies/endeavors that are easy.

For instance, if a company is great then it’s easy to raise money, make money, and then sell your company. But if an idea or company is not so great, then it’s a lot of work to set up, its very hard to raise money, and its very hard or impossible to get customers and sell the company. And might take years. Then you shut it down and start the next company and it feels like persistence.


I lose interest in an idea then when what I call the “conspiracy number” goes too high. If too many things have to conspire together for the idea to work for me then it’s no good. For instance, if a product has to be built, customers have to be found, money has to be raised, and (as is the case with most companies) the product has to be re-worked, then it has a conspiracy number of 4. For me, 2 is high enough. 3 or higher becomes stress. Stress increases the risk of heart disease, strokes, Alzheimers, and cancer.


HOW DO YOU ACHIEVE CLARITY OF THOUGHT

Richard Ball ‏ @rballe33 How does one achieve pure clarity of thought?

ANSWER: You can’t achieve pure clarity of thought. Achieving something makes me think of a race.
We already have clarity of thought at the beginning of the race. But by the end, we’re so tired that we lose all the things that prevented us from realizing it in the beginning.



So intstead of thinking about achieving, think about erasing. How do we erase the clutter, the sticky brown residue that’s built up over the years in the crevices and myriad little etchings in our mind that prevented us from just reveling in our original clarity of thought.

Every day pick one thing to erase. I have a grudge against my mother. I will erase that today. How can I erase it if it’s built up over memories and years. Just everytime I think of the grudge I will think to myself “this is not useful. It will prevent me from being happy.” I want to be happy. There’s no deep analysis needed. I’m not burying the grudge. I’m just simply not wasting time thinking about it.

I regret losing a lot of money 10 years ago. This is also not a useful thought. It’s the past. It’s done. Not useful. Today I will do what I can to move forward, during the spare moments when I’m not driving my kids around on their various activities. They have a much tighter daily schedule than I do.

I want to write five novels and be a best selling author. I want all my investments to work out. I want ,maybe to do another startup or two and make a lot more money. Ok, that’s fine. But anxiety about it won’t get me there. I can maybe take one step forward on one goal today. That’s what I will do. I don’t need to do the rest. I won’t die today if I don’t do the rest. So I’ll erase goals that are unobtainable today.

Just keep erasing everything that is not useful. What happens when you are done erasing.

You have a blank piece of paper. Enjoy doodling on it.

It's easier to identify buying opportunities at times of extreme pessimism than it is to spot market peaks, which are more likely to be accompanied by complacency than by obvious euphoria. The Common Sense system sidesteps these issues by imposing purely mathematical criteria: When the market falls 10 percent from a previous high, it's an occasion to buy, as is every subsequent 10 percent decline. When the market rises 25 percent, it's an occasion to raise cash by selling.

What percentage of a portfolio to buy or sell at a trading opportunity is a decisions best left to individual investors. But one simple approach is to rebalance a portfolio divided between stocks and fixed income and cash on the other. At buying opportunities, when stocks are cheaper, you buy stocks to restore to a target ratio, such as 70 30 or 60 40, of stocks to fixed income. When there's a selling opportunity, you do the opposite.

The Common Sense system yielded a return of 20.8 percent over the decade we studied. That was five percentage points better than strict buy-and-hold

I think there are really 4 questions you answer before buying any stock:

1. Is it safe?
2. Is it a great business?
3. Am I getting a great price?
4. Can I hold this stock for as long as it takes?

The ideal stock would get 4 “yes” answers.

http://finance.fortune.cnn.com/2012/02/09/warren-buffett-berkshire-shareholder-letter/?section=money_topstories&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+rss%2Fmoney_topstories+%28Top+Stories%29&utm_content=Google+Feedfetcher

Hilarious comparison of gold and alternate productive assets!

Today the world's gold stock is about 170,000 metric tons. If all of this gold were melded together, it would form a cube of about 68 feet per side. (Picture it fitting comfortably within a baseball infield.) At $1,750 per ounce -- gold's price as I write this -- its value would be about $9.6 trillion. Call this cube pile A.

Let's now create a pile B costing an equal amount. For that, we could buy all U.S. cropland (400 million acres with output of about $200 billion annually), plus 16 Exxon Mobils (the world's most profitable company, one earning more than $40 billion annually). After these purchases, we would have about $1 trillion left over for walking-around money (no sense feeling strapped after this buying binge). Can you imagine an investor with $9.6 trillion selecting pile A over pile B?

Beyond the staggering valuation given the existing stock of gold, current prices make today's annual production of gold command about $160 billion. Buyers -- whether jewelry and industrial users, frightened individuals, or speculators -- must continually absorb this additional supply to merely maintain an equilibrium at present prices.

A century from now the 400 million acres of farmland will have produced staggering amounts of corn, wheat, cotton, and other crops -- and will continue to produce that valuable bounty, whatever the currency may be. Exxon Mobil (XOM) will probably have delivered trillions of dollars in dividends to its owners and will also hold assets worth many more trillions (and, remember, you get 16 Exxons). The 170,000 tons of gold will be unchanged in size and still incapable of producing anything. You can fondle the cube, but it will not respond.

Admittedly, when people a century from now are fearful, it's likely many will still rush to gold. I'm confident, however, that the $9.6 trillion current valuation of pile A will compound over the century at a rate far inferior to that achieved by pile B.

http://money.cnn.com/2012/01/13/technology/sal_khan_best_advice.fortune/index.htm

FORTUNE -- "One of the powerful things Bill Gates told me is 'Learn to say no.' You don't have to make everyone happy. I've also learned by observing how deeply he goes into anything he cares about. How well he knew the nuances of my product was a huge signal that no manager should feel they're above the pay grade.

"But one piece of advice that's driven me the most came from a commencement speech by then-MIT president Charles Vest. He said to keep on moving. Cheesy, but it's amazing how true it is. Don't talk about stuff. Do it. When your organization is paused, and when the spirit of just seeing what happens dies, that's when you should be worried. Before I make a video for Khan Academy, I don't think, Let me go talk to some people and do focus groups. Obviously you have to have some learning, but if it's ruining the tempo of activity, you have to rethink things. At the end of the day, what matters is whether your product works and whether people like it."

Buffett Time article :

-He believes CEOs of publicly bailed-out companies should be on the hook for everything if their companies go bust.

-He'd like to see private schools banned so that rich families would be forced to invest in public schools

-His views are the opposite of the trickle down theory, echoing those of William Jennings Bryan "if you legislate to make the masses prosperous, their prosperity will find its way up and through every class that rests upon it".

- Howard Buffett was and is a hero to his son, because he operated by his inner scorecard. He was the least back-slapping Congressman to ever represent his state. He once turned down a raise because his constituents had voted him in at a lower salary. His picture hangs on Buffett's office, along with the Dale Carnegie course certificate , a 1973 Pulitzer and the Presidential Medal of honour.

- His other hero is his first wife. I've never felt my wife was remotely done justice to, she was just an incredibly wise and good person. She didn't do things with a metric attached to them. Warren's mother Leila was a difficult woman prone to hysteria and vicious verbal attacks on her children. Susie headed her off and managed her needs so that Warren could be left to do what he was good at - making money.

-"It may be true that the law can't change the heart" said King, "but it can restrain the heartless".