C&B Notes

Investing is a discipline built on cumulative knowledge, and it requires a continuous evaluation and assessment of new information. The purpose of C&B Notes is to pass along the ideas, concepts, stories, and information that are informing, influencing, and updating our worldview. We use them to build on our “latticework of mental models” that help us make better decisions.

326 articles in list

New On Our Bookshelf – Nomad Letters

Nick Sleep and Qais Zakaria’s Nomad Investment Partnership Letters to Partners 2001-2014 offer a treasure trove of great insights. One idea worth highlighting is their concept of “scaled economies shared.” This idea of scaled economies shared lies behind the success…

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China’s Modern Propaganda Machine

Xi Jingping’s consolidation of power in China is not new news.  The ruling party’s re-versioning of history through a modern propaganda effort is both petty and chilling, particularly with the backdrop of widespread human right atrocities in the northwestern part of the country.  Xi’s re-embrace of Mao, rejection…

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Commodity Correlation in LatAm

One of our favorite and most informative sources of information are the charts delivered by The Daily Shot; we would recommend it to you. This chart caught our eye – Gavekal Research shows a strong positive relationship between commodity price…

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From Spud to Sale

We are big fans of Russ Roberts and his EconTalk podcast – it should be on your regular rotation if you like the podcast format.  We recently listened to one from deep in Roberts’ archive.  This interview with a Frito-Lay…

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Origins of Quarantine

Quarantine was first widely used in Venice in the 1300’s as the city-state grappled with the Black Death.  The term itself is derived from quaranta, the Italian word for 40.  General policy of Venice was to keep visiting sailors and…

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Higher Ed Hangover

Like many of you, we have kids at home participating in e-learning.  While COVID-19 is unlikely to fundamentally transform primary and secondary education, at least in the short-term, it could shake the foundations of higher education.  Colleges will face immediate…

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The Dollar Saves Venezuela

Thankfully and mercifully, daily life in Venezuela is evolving.  We did not expect this level of relief without a leadership transition, but the Maduro administration has quietly allowed free market reforms to take shape.  The country is now essentially dollarized,…

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Not Really a Weakness

We know of no company other than Daily Journal Corporation that could publish this statement of material weaknesses and not have shareholders worry about the veracity of the financials.  It is a testament to the reputation that Charlie Munger and…

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Euro Cash Piles

A very strange, unintended consequence of negative interest rate policies. German banks are stuffing vaults with money to help offset the mounting cost of negative interest rates, and some of them are running out of space. The physical cash holdings…

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EBITDA Definition Danger

EBITDA calculations vary widely across businesses and industries, and loosey-goosey “adjusted” EBITDA definitions exacerbate risk for lenders who are already offering covenant-lite terms.  As this recent study reveals, 5.0x debt-to-EBITDA ratios are not all created equal when the denominator is…

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Well, That Didn’t Work…

In April 2017, we ran a note about a strategic effort by Adidas to add “Speedfactories” to diversify its global supply chain.  It evidently didn’t work, which leads to some interesting questions about the inevitability of automation to kill lower-wage…

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If You Can’t Beat ‘Em

We have visited hundreds, if not thousands, of “mom and pop” stores throughout Latin America, as they account for a large portion of retail sales in the region.  Kiranas, which are akin to Latin American bodegas, are of similar —…

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