Gustavo Ballvé on March 30th, 2012

Richard Branson’s Virgin is used to disrupting business models everywhere – telecom, airlines, you name it. Now they’re turning their attention to banks, as per this long Bloomberg Markets magazine article. Always very interesting to challenge our notions of “stable business models”, but Virgin’s very history shows that sometimes it’s harder than they initially thought it would be (Wal-mart’s experience in the US comes to mind).

Read more about Virgin’s bank: disruptive models

Gustavo Ballvé on March 28th, 2012

Fair and balanced look at the NetJets vs. IRS case by NYT’s Dealbook. While the amounts involved are not that relevant for Berkshire, they are quite relevant for their bizarre “nature”: the charge wasn’t there, now it’s there – and retroactive… A warning about tax codes, and not just the USA’s.

Read more about Buffett and taxes: NetJets

Gustavo Ballvé on March 26th, 2012

What does an article about the fringes of Physics – that “unexplored territory where truth and fantasy are not yet disentangled” – have to do with investing? Not much, but that’s OK for this blog as long as there are some building blocks or models to be taken away. In this case, the importance of balancing both an abstract imagination and a rigorous experimental discipline seems to apply to investing as well as science.

Read more about Boundaries of knowledge

Gustavo Ballvé on March 23rd, 2012

The Crowdfunding Act has passed a vote in the US Senate. It allows people funding companies directly to finally become owners, as compared to models such as KickStarter that are “donation”-based – you can get rewards, but not ownership. While we’re definitely seeing more of a start-up culture in Brazil, it is still way too hard to do anything new here

Read more about Crowdfunding Act passed

Gustavo Ballvé on March 21st, 2012

Quick post with two updates: (1) Greek CDSs will pay out (roughly) as if the country defaulted, but for a while it seemed as if CDS holders might be “forgotten” in the settlement (highlighting instrument risk). (2) Alice Schroeder seems to be taking her personal bias against Warren Buffett to new levels…

Read more about FUPs: Greek CDSs and Alice Schroeder

Gustavo Ballvé on March 19th, 2012

Wells Fargo is now the US’ largest bank by market value and Apple will pay a huge dividend and repurchase shares. Microsoft and perhaps even Google can now be called “boring”, stable companies. Just a reminder of how limited our forecasting and modelling “mindsets” usually are. Also a reminder for keeping our minds open for positive surprises.

Read more about Evolving businesses

Gustavo Ballvé on March 15th, 2012

A Goldman Sachs executive quits via an scathing editorial in the NY Times, generating all sorts of reactions – reminding us of the need to always analyze things from all sides while keeping one’s head cool. Make sure you know what level of confidence you can live with when dealing with each counterparty in your business and personal dealings, and don’t depend on anyone’s “moral fiber” in all occasions (it’s hard enough to know your own limits).

Read more about Goldman Sachs’ “culture”

Gustavo Ballvé on March 12th, 2012

Interviews with Ray Dalio of Bridgewater and Ken Griffin of Citadel show how different people apply different ideas, frameworks and principles to different situations – be it investing, management, politics and life in general. But much more important is the question of how we can learn from other people while not making their ideas our own?

Read more about Ray Dalio and Ken Griffin

Gustavo Ballvé on March 9th, 2012

Education is a huge topic for me, especially now that a few HBS classmates and I are looking for ways to do charitable projects in the area. Taken together, the 3 articles in here paint a very interesting picture of the power of incentives in education, parenting, living in society, coping with expectations and prejudices and so on. And if it seems “soft”, “fluffy” and off-topic, try changing “education, parenting and living in society” for “preparedness, leadership/motivation and networking” for your business life.

Read more about Education and failure

Gustavo Ballvé on March 6th, 2012

This 2007 article by Malcolm Gladwell is about puzzles vs. mysteries: while one needs more information to solve puzzles, mysteries are more open-ended (some may not even have a “solution”), requiring several methods and angles and, in some, more information can actually harm your ability to solve the mystery. While the parallels to investment research are pretty clear, but I’d suggest one more application for this article: market regulation.

Read more about Enron and Dodd-Frank

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