I care very much about our share owners, and so I care very much about our long term share price. I do not follow the stock on a daily basis, and I don’t think there’s any information in it. Benjamin Graham said, “In the short term, the stock market is a voting machine. In the long term, it’s a weighing machine.” And we try to build a company that wants to be weighed and not voted upon.
Fooling yourself
Barry Ritholtz writes a great piece on how investors go astray by telling themselves stories:
It’s clear when emotional storytelling gets in the way of intelligent investing. We can see strategists come up short in their forecasts, and then offer a series of excuses for why. We all have witnessed the investor rationalizing why he was right and the markets were all wrong. How many traders have you seen doubling down on a losing trade, despite the obvious failure of the original thesis, rather than admit the error?
All of this is based on sticking to a story no matter which facts present themselves. “Who you gonna believe — me or your lyin’ eyes?”
I call this the triumph of the narrative over data, ideology over intelligence, politics over facts, emotion over planning.
Getting better
The Economist writes about a worldwide fall in crime:
In 1990 some 147,000 cars were stolen in New York. Last year fewer than 10,000 were. In the Netherlands and Switzerland street dealers and hustlers have been driven out of city centres; addicts there are now elderly men, often alcoholics, living in state hostels. In countries such as Lithuania and Poland the gangsters who trafficked people and drugs in the 1990s have moved into less violent activities such as fraud
Monetization
From Business Insider, Mark Zuckerberg talks about Facebook Inc (NASDAQ:FB)‘s venture into story ads:
One of the things I watch most closely is the quality of our ads and peoples’ sentiment around them. Right now ads on average make up about 5% or 1 in 20 stories in News Feed. We haven’t measured a meaningful drop in satisfaction when we ask people about their experience with Facebook Inc (NASDAQ:FB). We’re comparing that to the result we get when we ask the same question to people using a version of Facebook Inc (NASDAQ:FB) with no feed ads at all.
Booming economy
Check out this crazy video of rush hour traffic in Beijing:
Enjoy your weekend.
The article 8 Fascinating Reads originally appeared on Fool.com is written by Morgan Housel.
Fool contributor Morgan Housel has no position in any stocks mentioned. The Motley Fool recommends Amazon.com and Facebook. The Motley Fool owns shares of Amazon.com and Facebook.
Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.
