Macro
A rare but always welcome interview by Charlie Munger embedded inside, courtesy of Stanford University’s Law School. Some highlights inside as well. The main theme is the economic/ financial crisis (what else?).
Buffett used the Thriftsville vs. Squanderville metaphor in this brilliant article back in 2003. Now it’s Charlie Munger’s turn with a parable on the wealth of a nation and how to lose it. It’s a fun read.
We worried about implied expectations for 2010 in our Q4 2009 report and said that we were increasing the percentage of cash in our funds. Enter Greece and other European peripheral countries. Macro issues are not our core by any measure, and our point is just that volatility, that friend of the long-term investor holding a lot of cash, is on the rise. The post collects, as food for thought, interesting FT articles on Greece’s and Europe’s woes.
The first 4-5 pages in GMO’s Q3 2009 letter are entertaining for their irony, but it’s hard to disagree with Mr. Grantham’s conclusion: concentrate your portfolio in quality U.S. stocks with a global earnings mix. We’d extend that to some non-US quality stocks with diversified earnings sources, of course.