Gustavo Ballvé on July 1st, 2016
Corporate Governance, Food for thought, Home, Risk management

After a very public fraud issue with insurance licensing – and US states take these very seriously – Zenefits is taking steps to re-adequate its financing and shareholder base. Yes, it is in exchange for a promise of no legal action, and no, not everyone is happy – but it seems as interesting as it is unusual. At least it can serve as a lesson for other companies in crisis management / survival mode.

H/T Business Insider’s Finance twitter feed.

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Gustavo Ballvé on May 18th, 2016
Food for thought, Home, Mental models, Signal or Noise

And such are the times in Brazil.

Here’s Seth Godin on the ageless dilemma: the short run and the long run.

“Add up the short runs, though, and you’re left with the long run. It’s going to be the long run a lot longer than the short run will last.

Act accordingly.”

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Gustavo Ballvé on May 17th, 2016
Corporate Governance, Corporate Strategy, Food for thought, Home

Very interesting article on The Case for Activist Investors. The first book highlighted in the article – “Dear Chairman” – sounds like a great read, as it compiles now-classic investor letters to Board members and to the executive teams of companies they invested in.

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Gustavo Ballvé on May 4th, 2016
Food for thought, Home, Mental models

A few weeks ago I posted about coach Claudio Ranieri’s letter regarding his team – Leicester City – and the chance that they would become Premier League champions in England. The odds were 5,000 to 1 in the beginning of the league. They were crowned champions on Monday, for the first time in the team’s history, when Chelsea tied its match with Tottenham (the runner-ups).

Congratulations, Leicester City fans!

Some curiosities:

Pretty understandable reaction by Leicester City players when the Chelsea x Tottenham match ended.

– Some are calling it the most unlikely sporting feat ever. A Brazilian ESPN reporter calls it the biggest feat in world soccer history (in Portuguese).

– Coach Ranieri watched the game in Italy – he had gone there to have dinner with his 96-year-old mother (respect, man). His reactions here.

– Leicester City goalkeeper Kasper Schmeichel won his first Premier League in the same day (May 2nd) as his father Peter – a legendary goalkeeper – won his first, only 23 years apart.

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Gustavo Ballvé on May 1st, 2016
Food for thought, Home, Portfolio Management, Risk management

The meeting has been over for a few hours now. I wonder whether coming here was worth it, even though I have just reassumed coverage of Berkshire Hathaway for my company. It is still good fun and this year the Brazilian team here was pretty sizable. However, since the webcast appears to have worked well, the expense and long travel times (for Brazilians at least) make coming back here more of a luxury.

Here are some pictures taken by me on Friday, in the exhibit, and in the Saturday annual meeting. It’s also the first time I try out the photo gallery feature, so please let me know if it doesn’t work for you.

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Gustavo Ballvé on April 30th, 2016
Food for thought, Home, Portfolio Management, Risk management

You can watch it LIVE, for the first time, through Yahoo Finance. Let us hope for good questions!

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Gustavo Ballvé on April 29th, 2016
Food for thought, Home, Portfolio Management

I am in Omaha, NE, for my fourth Berkshire Hathaway annual shareholders meeting. Stay tuned for more.

2004, 2005, 2009 and 2016. Should still be a blast!

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Gustavo Ballvé on April 10th, 2016
Food for thought, Home, Mental models

It is highly unusual for an investing blog – albeit one with a focus on “soft skills” and “building blocks” – to post two stories based on sports in any given week (here’s the other). Just a coincidence.

Perhaps you’ve heard this story before: the underdogs, the forgotten players, the “outdated” coach and the little guy vs the established, richer, perennial favorite teams. When it goes well, it is the type of story that becomes a feel-good, teary-eyes Hollywood film (well, maybe not given it’s a soccer story) or – OK, maybe AND these days – a HBS case study (and associated HBR article).

Leicester was 4 victories away from mathematical certainty of a British national soccer title, which the team has NEVER won. In fact, it was promoted back to the elite division in the 2013-2014 season. Some of their players held day-time jobs and played in 3rd or 4th-tier championships (read: “amateur”) not so long ago. Its coach, Claudio Ranieri, who does not have the most prolific winning career and is 64 years old – which nowadays is confused with “outdated” – has just written an open letter called We Do Not Dream. Great stuff. It’s been translated to Portuguese already.

Go on. Make your day a little bit better. I know there are already more than a few interesting analyses of Leicester’s success this year; you can google it after the letter gives you a reason to do it.

And oh: Leicester just won again today (Sunday, April 10th). 3 more victories and history is made. 2nd-place Tottenham also won, keeping them 7 points behind, so a title will not come easy.

Nothing ever did for this team.



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Corporate Governance, Corporate Strategy, Food for thought, Home

Quoting Buffett, Munger and Klarman – and others of different areas – is sure to get our attention. When that letter is written by an NBA head coach as a send-off from his job, that is simply impressive.

Good weekend reading – sent by Fabio Carvalho of Alianza (thank you!)

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Gustavo Ballvé on February 27th, 2016
Capital goods, Corporate Governance, Corporate Strategy, Food for thought, Home, Insurance, Investment Themes, Portfolio Management, Risk management

I have just finished reading Berkshire Hathaway’s 2015 10-K. The letter to shareholders by Warren Buffett (edited by Carol Loomis) is brilliant, as usual. I have written here (2009) and here (2015) about how these two “walk their talk” (Buffett and Munger), and this 51st letter to Berkshire shareholders is another fine example.

I usually don’t highlight anything from the letter in fear that it increases the chance of readers NOT reading it in full. Even so, it is worth mentioning that he seems to be getting more proficient at explaining how he and Charlie Munger value Berkshire, and to separate out the signal from the noise in terms of such metrics.

Another part that’s mandatory reading – especially in Brazil, a country in which the political debate around economic policy is insanely retrograde, with some ancient ideas still receiving far more media attention while simple, poor Algebra is ignored for political gains – is the section on Productivity. Such logic, laid out with such concise and simple prose without any loss in its impact, should convert the open-minded or at least make them more curious to read more of what this person has to say. They would be surprised!

Which makes this next bit the most ironic: Buffett’s fellow “capitalist”, Charlie Munger, has sponsored a very interesting initiative that, again, highlights the pair’s consistency of purpose. The Munger Residences at the Univerity of Michigan is a multidisciplinary charitable accomplishment that deserves lots of praise.

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