8 Fascinating Reads

Good reads, short quotes.

Jul 25, 2014 at 11:00AM

Here are 8 great articles and pictures I read this week. 


An anonymous writer says he made $15 million by the time he was 30 and it wasn't even all that great:

Being rich does come with some downsides, though. The first thing you are thinking reading that, is, "cry me a river". That is one of the downsides. You are not allowed to complain about anything, ever. Since most people imagine being rich as nirvana, you are no longer allowed to have any human needs or frustrations in the public eye. Yet, you are still a human being, but most people don't treat you like one.

Smart money

Ben Carlson shows the returns and volatility of the world's largest college endowments vs. a simple index fund. It's sad: 


Pay for performance-ish 

Vox plotted CEO pay against shareholder returns. There's basically no correlation at all: 



ESPN writes about one of Lebron James' secrets: He has a wicked memory: 

  • One of LeBron's childhood friends says that when you play the Madden videogame against LeBron, you can't be the same team twice because he'll remember which plays you ran.
  • In February of 2014, after making a game-winning shot in Golden State, he recalled a game-winning shot he made against the Warriors in 2009, noting small differences: "That one was probably about six feet closer to the baseline and inside the 3-point arc. It was over Ronny Turiaf, I stepped back on him but I crossed him over first and got him on his heels. I'm sure of it. It was down the sideline a few feet. It was a side out-of-bounds play; this one we brought up."
  • During a game against the Pacers, he suggested that they run a certain play "like we did in Game 3 against Dallas" — a three-year-old game.
  • He remembers the jersey number Kevin Ollie wore for the Cavaliers in 2003-04.
Here's an amazing story about hacking the markets:
Hackers broke into Nasdaq's network four years ago with custom-made malware that had the potential to spy and steal data. But it could also cause digital destruction, potentially disrupting Nasdaq's computer system.

It's still unclear who the attackers were. A federal official briefed on the investigation said the FBI has not developed enough evidence to conclude a foreign government was responsible behind the hack.


The latest Dalbar study shows how bad the average investor is at timing the market:

  1. Over the past 20 years, "equity fund" investors achieved an average 5.02% annualized return, which is 4.2% less than the 9.22% that he/she could have achieved by simply investing funds in an S&P500 index-tracking fund. This gap expanded in 2013, for only the third time in ten years.
  2. Over the bull market of the past three years, "equity fund" investors achieved only an average 10.87% annual return, lagging the average annual S&P500 return (16.18%) by 5.31%.
  3. Investors in "asset allocation funds" did even more poorly. Their 20-year average annual return was only 2.53%, lagging the S&P500 index (9.22% per annum) by 6.69% per annum.
  4. Investors in "fixed income funds" did more poorly still. Their 20-year average annual return was an abysmal 0.71%, fully 8.51% less than the S&P500 index, and 5.03% per annum less than the Barclay's Aggregate Bond Index (5.74% per annum) over this time.
  5. Not surprisingly, investors show little evidence of skill in "market timing." The DALBAR report notes that in the six best months of 2013, when the market was up sharply, there was no evidence that individual investors moved more than average amounts into equity funds.
Sad because it's true
Andy Borowitz sarcastically writes about decline:

MINNEAPOLIS -- Historians studying archival photographs from four decades ago have come to the conclusion that the U.S. must have believed in science at some point.

According to the historian Davis Logsdon, who has been sifting through mounds of photographic evidence at the University of Minnesota, the nation apparently once held the view that investing in science and even math could yield accomplishments that would be a source of national pride.


Here's a fascinating video about Benjamin Graham: 

Have a great weekend. 

Risk-free for 30 days: The Motley Fool's flagship service
Tom and David Gardner founded The Motley Fool over 20 years ago with the goal of helping the world invest...better. Their flagship service, Stock Advisor, has helped thousands of investors take control of their financial lives and beat the market. Click here to sign up today.

Contact Morgan Housel at mhousel@fool.com. The Motley Fool has a disclosure policy.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

Click here to learn about this incredible technology before Buffett stops being scared and starts buying!

David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

©1995-2014 The Motley Fool. All rights reserved. | Privacy/Legal Information

Compare Brokers