Ferg's Finds
This is a short weekly email that covers a few things I’ve found interesting during the week.
Article
If there is a capitalist spectrum, Milton Friedman's essay lies at one end, while BHP's gender equity policies are at the other extreme.
The Social Responsibility of Business is to Increase its Profits
Is BHP discrimining against men?
Equal opportunity is something all societies should strive for, while equal outcome is the road to hell.
Podcast/Video
I’m enjoying keeping tabs on both ends of the recession probability debate: Are Recession Fears Misplaced? | Global Macro 46
Quote
"Economists are excellent at understanding the economy ... and hobbyists when it comes to markets and what to do about that ... they can be right 80% of the time on their calls and not make money."
-Andy Constan
Tweet
Kuppies Tweet reminds me of these two quotes I believe I got from the book: 100 Baggers: Stocks that Return 100-to-1 and How to Find Them by Christopher W Mayer
"The real money to be made in commodity stocks is before there's any data for guys like you to analyze."
“It’s those oil and gas stocks that are up 100 times where you go, ‘Yeah, but the time when it was a 1-2x bagger, there wasn’t anything there for an analyst to dig into."
Charts
While the below may not be a strict example of Jevons Paradox it does illustrate if you based your world view off the chart on the left (Improvements in Fuel Efficiency since 2000), you’d be severely disappointed by the real world outcome.
For example; the average fuel economy of US passenger vechicles from 2008 to 2017 was essentially flat and from 1993 to 2017 it is only a 10% reduction.
Something I'm Pondering
I’m pondering things I could be framing better, to help my process/investing.
A recent example is this piece from Morgan Housel on volatility.
Question: Is that volatility a fee or a fine?
Fees are something you pay for admission to get something worthwhile in return.
Fines are punishment for doing something wrong.
Framing volatility as a fee rather than a fine is hugely beneficial to our mindset as a investor.
I hope you’re all having a great weekend.
Cheers,
Ferg
P.S. If you’re interested in my story and why I started this Substack, you can read the story here.
Hi Ferg, great content! Nice to be here. Following Joel's post, what are your thoughts regarding Lithium as a long term investment?
Thanks mate.
Hi Ferg, I've followed you on Twitter for a few years. Congrats on becoming a father! I have a son myself. I'll try to keep this short. If you haven't taken a look recently at Brunswick Exploration, I think you should check it out. They probably have the largest portfolio of large pegmatites that measure 500+ meters in the world, 800+ including several hundred in James Bay which is now the best place in the world for new lithium discoveries. Bob Wares the mining legend who discovered Canada's largest producing gold mine, owns 25% of the company. It looks like they may have a new discovery at Mirage that could be bigger than PMET's Corvette discovery, once it's drilled. They will drill it in two weeks. They have several other very high potential projects as well. Canada has a lot of low-hanging fruit when it comes to lithium exploration. It's a new thing. Similar moves are likely for some Canadian juniors 20x, 30x, 50x moves, similar to what happened in Australia several years ago during their lithium boom. I'm not trying to pump the stock, but I think you will be pleasantly surprised if you do some DD on this one. Have a good weekend!