Steve Hely's Blog, page 38

Courteney Cox snack

mark us down as intrigued. Via LAT.

Munger speaks, 2022

The Daily Journal annual meeting gave Charlie Munger an occasion to hold forth.

Getting rich is gonna get harder:

It is hard. It’s going to be way harder for the group that’s graduating from college now. For them to get rich, stay rich, and so forth is going to be way harder than it was for my generation.

Think what it costs to own a house in a desirable neighborhood in a city like Los Angeles. I think we’ll probably end up with higher income taxes too, and so on.

I think the investment world is plenty hard. In my lifetime, 98 years, it was the ideal time to own a diversified portfolio of common stocks that updated a little by adding the new ones that came in like the Apples and the Alphabets and so forth. I’d say people got maybe 10 or 11% if you did that very intelligently before inflation and maybe 8 or 9% after inflation. That was a marvelous return. No other generation in the history of the world ever got returns like that. And I don’t think the future is gonna give the guy graduating from college this year nearly that easy an investment opportunity. I think it’s gonna be way harder.

He’s not that worried about global warming (his term):

I’ll be very surprised if global warming is going to be as bad as people say it’s going to be The temperature of the Earth went up, what, one degree centigrade in about 200 years. It’s a hell of a lot of coal and oil that was burned and so forth. It was one degree. I’m just skeptical about whether it’s as bad as these calamity howlers are saying.

On his weird dorm:

Question: What was it specifically that prompted the idea for windowless dorm rooms? Please walk us through this decision. This is in regards to your design for student housing.

Charlie Munger: Nobody in his right mind would prefer a blank wall in a bedroom to a wall with a window in it. The reason why you take the windows out is that you get something else from the design considered as a whole. If you stop to think about it big cruise ships have huge shortages of windows in bedrooms because too many of the rooms are either below the waterline or they’re on the wrong side of the aisle. So in the very nature of things you get a shortage. You can’t change the shape of the ship. You have to do without a lot of the windows to have a ship that’s functional. That’s required by the laws of hydrodynamics.

So we get the advantage of a big ship but it means a lot of the rooms can’t have windows. Similarly, if you want a bunch of people who are educating each other to be conveniently close to one another, you get a shortage of windows. In exchange, you get a whole lot of people who are getting a lot of advantage from being near one another, and they have to do without a real window in the bedroom. It doesn’t matter. The air can be as pure as you want and the light that comes in through an artificial window can mimic the spectrum of daylight perfectly.

It’s an easy trade off. You pay $20,000/week or something on a big cruise ship to have a room with an artificial window. For a long time on a Disney cruise ship, they had two different kinds of window rooms, one with a window and one without a window. They got a higher price in rent for the one with an artificial window than they got for a real one. In other words, they reduce the disadvantage to zero. In fact, they made it an advantage.

So it’s a game of trade offs. That poor pathetic architect who criticized me is just an ignoramus. He can’t help himself. I guarantee the one thing about him is that he’s not fixable. Of course, you have to make trade offs in architecture.

Emphasis mine.

You’re lucky if you’ve got four good assets.

Some of his:

Question: How will this all play out? And what’s the best advice you have for individual investors to optimally deal with the negative impact of inflation other than owning quality equities?

Charlie Munger: Well, it may be that you have to choose the least bad of your options. That frequently happens in human decision making. The Mungers have Berkshire stock, Costco stock, Chinese stocks through Li Lu, a little bit of Daily Journal stock, and a bunch of apartment houses. Do I think that’s perfect? No. Do I think it’s okay? Yes. I think the great lesson from the Mungers is that you don’t need all this damn diversification. You’re lucky if you got four good assets. If you’re trying to do better than average, you’re lucky if you have four things to buy. To ask for 20 is really asking for egg in your beer. Very few people have enough brains to get 20 good investments.

He’s anti gamer:

Some of the games are kind of constructive and social and others are very peculiar. Do you really want some guy 40 hours a week running a machine gun on this television set? I don’t. But a lot of the games are harmless pleasure. It’s just a different technique of doing it. I like the part of it that’s constructive but I don’t like it when people spend 40 hours a week being an artificial machine gunner.

Speaking (admiringly) of the history of modern China. (tw if you find abortion to be nasty):

China could never have handled its life with a government like ours. They wouldn’t be in the position they’re in. They had to prevent 500 million or 600 million people from being born in China. They just measured the women’s menstrual periods when they came to work and aborted those who weren’t allowed to have children. You can’t do that in the United States. It really needed doing in China. And so they did what they had to do using their methods. I don’t think we should be criticizing China, which has terrible problems, because they’re not just like the United States. They do some things better than we do.

Agony:

If you stop to think about it, what makes capitalism work is the fact that if you’re an able-bodied young person and you refuse to work, you suffer a fair amount of agony. It’s because of that agony that the whole economic system work. The only effective economies that we’ve had that brought us modernity and the prosperity we now have, they imposed a lot of hardship on young people who didn’t want to work

Finally a stock pick:

But I would argue that if I was investing money for some sovereign wealth fund or some pension fund with a 30,40, 50-year time horizon I buy Costco at the current price. 

full transcript put up by Oliver Sung of Junto Investments.

so the caves are the stars?

Christopher Reynolds writing about Pinnacles in the LAT, “Why are so many people heading to California’s newest national park?”

Hello on the Steps of Friendly Greetings

Francis Ford Coppola profiled in GQ by Zach Baron:

But he has made a lot of money: first in the film business and then, spectacularly, in the wine business. His second fortune has allowed him to spend most of his time here now, he said, reading things like the 18th-century Chinese novel Dream of the Red Chamber, one of the longest books ever written. “They spend their time inventing poetic names for things,” Coppola told me about the characters in the novel. “For example, if I were to say hello to you, I should have met you on the Steps of Friendly Greetings and greeted you there. And when I say goodbye to you, I should take you into the Pavilion of Parting. And it’s the sort of attitude of making everything in life beautiful and a ritual of a kind. And you can do it! I’ll say goodbye to you in the Pavilion of Parting—you’ll never forget it.”

The Nineties

This was a decade of full-on metacognition, when people spent an inordinate amount of time thinking about why they were thinking whatever it was they were thinking.

This book was absolutely fantastic, I was riveted. The Nineties ran, for me, from age 11 to age 21. It’s kind of neat to have your life decades synced up to the actual decades, although as Klosterman describes in this book and related interviews, the Nineties might be the last time we think culturally in terms of decades: there’s no reason why we have to.

Chuck Klosterman is seven years older than me (if we believe Wikipedia). Some of his obsessions (Motley Crüe, Guns n Roses), even the idea of manically chasing to their endpoint the meaning of obsessions with a rock band, are just a click or two beyond of my own experience with pop culture, so some of his earlier books, although intriguing, I just never got the activation energy to read. Then I got this text from my buddy Sgro, who I met around 1994:

How about this:

A football game in 1995 bore no resemblance to a football game from 1945. The greatest pro basketball player from the fifties, George Mikan, could not have made an NBA roster in the eighties. The physical and technical evolution of football and basketball had been so dramatic that the past wasn’t comparable with the present. That wasn’t true with baseball. Baseball had evolved less. The aesthetics and physiology were more similar than different, and it was not remotely unreasonable to suggest that the greatest player of all time was still an overweight alcoholic who’d retired in 1935. Part of what made baseball historically compelling was its ability to transcend time. The skills of hitting and pitching were static, frozen in amber. It was the rare game where statistics from the past were comparable with statistics from the present.

And then Brady Anderson hit 50 home runs on one season.

Klosterman points to a pivotal moment in Seinfeld. George, who’s been working with Jerry on a pilot for a show about nothing, is confronted by NBC executive Russell Dalrympe:

“Well, why am I watching it?” asks Dalrymple.

“Because it’s on TV, replies George.

A related fact:

The Kirstie Alley vehicle Veronica’s Closet, when packaged in NBC’s Thursday night lineup, could sustain a weekly audience of 24 million viewers. When it was moved to Monday, its viewership dropped to 8 million.

(last week, by comparison, the most popular non-Olympics broadcast show, FBI, got seven and a half million viewers. I don’t think any comedy came close to even 5 million viewers).

On the OJ trial:

It is a hinge moment in U. S. media history, ostensibly for its effect on race and celebrity but mostly for the way it combined tragedy and stupidity on a scope and scale that would foretell America’s deterioration into a superpower that was also a failed state. It was a TV show that proved everything that had always been feared and suspected about the medium of TV.

Within a brilliant riff/exploration on Bill Clinton and the much-imitated (though only once actually said) “I feel your pain”:

Without even trying, [90s Americans] could dissect a broadcast like Clinton’s Oklahoma City address with the acuteness of self-taught media analysts. And within those conditions – within the context of grading a speech’s sincerity as much as feeling that sincerity – Clinton was unstoppable.

This is an error:

Proof:

But, I forgive! I thought Klosterman’s analysis of Garth Brooks/Chris Gaines alone was worth the price of admission.

It’s interesting how we talk about a writer having a voice: Klosterman literally has a distinctive speaking voice (as do Sarah Vowell, David Sedaris, who else?)

Supreme

James Jebbia, founder of Supreme, has said that the red box logo with “Supreme” in white Futura Heavy Oblique was taken from the work of Barbara Kruger. Kruger herself commented on this issue on the occasion of a recent lawsuit between Supreme and a women’s street clothing brand that used the Supreme logo to make a “Supreme Bitch” logo that was printed on T-shirts and hats. In response, Kruger said, “What a ridiculous clusterfuck of totally uncool jokers. I make my work about this kind of sadly foolish farce. I’m waiting for all of them to sue me for copyright infringement.

Emphasis mine. Reading up on the streetwear brand whose store is a center of gravity in the Melrose/Fairfax region of LA.

How to skate a 10k

We were intrigued by this WSJ story:

He Broke Every Record. Then He Told His Rivals How to Beat Him.
After Swedish speedskater Nils van der Poel took Olympic gold in the 5,000 and 10,000 meters, he published his entire training plans so others could copy it

Nils van der Poel could have easily kept his training program a secret.

No one needed to know about the months of aerobic work, the endless laps of a speedskating oval, or the allowances for beer, ice cream, and the odd skydive. The eccentric 25-year old from Sweden could have collected his two Olympic gold medals and quietly left Beijing.

Instead, van der Poel did something unthinkable in a sport where every marginal gain is guarded like a state secret: the double Olympic champion posted his entire training program online, all 62 pages of it. It was the speedskating equivalent of Bill Belichick publishing his playbook the day after the Super Bowl.

Sure enough, you can follow the link to Nils van der Poel’s thoughts on training and detailed training plan.

On the mental aspects:

The media:

This round of Olympics seemed bleak to us, the women’s figure skating finals in particular were like a horrible accident we couldn’t look away from. But this kinda thing is what it’s all about.

He knows that the training manual can’t be for everyone. For the van der Poel method to really work, you not only need the freakish van der Poel lungs and commitment. You might also need the van der Poel touch of crazy.

“I often wished that I would’ve had company,” he writes, “but no one else wanted to join my lifestyle.”

Peabody

Came across a story about coal company Peabody Energy, and went looking into the founder of the company, Francis S. Peabody. (Is he the Mr. Peabody mentioned in John Prine’s song Paradise? Think so).

There are prominent Peabodys in the history of Massachusetts but this Mr. Peabody was from Chicago.

And how does a coal baron die? He died of a heart attack during a fox hunt on his own estate.

Only a year after Mayslake Hall was completed, Francis Peabody died of a heart attack during a fox hunt on his property. He was 63.

(source for that photo: MichaelBNA on Wikipedia)

Andes

When I was a kid I loved Andes candies, which I feel like I sometimes got at like Italian or steakhouse type restaurants, and maybe sometimes on holidays. I dreamed they would make something like this, a full-sized candy bar Andes, and didn’t understand why they didn’t. Now, they do. And I have access to them whenever I want at Ralph’s. And I think I’ve bought them like once a year tops. That’s adulthood for you!

Coaches, Super Bowl 56

Vlad in Chico, CA writes:

Heels will you be doing a writeup on the Super Bowl coaches in advance of this year’s Big Game, as you did in the past?

We failed to make the time for a deep dive on Sean McVay of the Rams and Zac Taylor of the Bengals. We note that both coaches are younger than us: McVay is 35 and Taylor is 38. Younger coaches are becoming a phenomenon in the NFL. Taylor used to work for McVay, which is interesting. We can’t find an easy stat for how often former colleagues have coached against each other in the Super Bowl. Mina Kimes would probably know.

In Seth Wickersham’s It’s Better to Be Feared about the Belichick/Brady era Pats, we learn that Belichick gained from his frequent experience in Super Bowls:

With its overwrought introductions and halftime show, the Super Bowl was at least an hour longer than most games. The drawn-out nature of the game his the defensive line hardest, draining the pass rush in the fourth quarter. Belichick had robbed himself of the ability to rotate in fresh legs. He never repeated that mistake again, and he exploited it when opposing coaches committed the same error against him in future Super Bowls.

McVay has Super Bowl experience and is playing at home. Our prediction is the Rams will win decisively, beating the current line of -4, but we’re not betting on it. This is based on vibe speculation, not technical analysis, and here in LA it’s possible my viberead is tainted. We don’t have any information or indications that wouldn’t be priced in. There’s some evidence that homefield advantage can be underestimated systematically in sports betting, but it’s not strong enough to be significant.

Sports betting is not legal in California, although we’ll have an opportunity to change that on the 2022 ballot, if we pass the California Solutions to Homelessness and Mental Health Support Act, which is sponsored by DraftKings. There may even be multiple sports betting propositions on the ballot. We believe the gains here for legalizing the incredibly popular activity of sports gambling and extracting revenue for the state would exceed the social cost in ruined lives from gambling addiction and coarsening of the pure spirit of sport, but we’ll see how the ballots shake out. This feels like a “don’t put law on people if it’s not in their hearts” situation.

Here’s hoping for a great game!