Author: Mayur Gudka

Failing to Prepare

I found this in my archives. Sadly, I do not know who wrote it. Certainly wasn’t me.

After a series of searches, I could not find the poem online. So, no attribution. Let’s just call the author Anonymous. Here it is. Enjoy


If you founded your house on the movable sand,
And have failed to secure a firm hold on the land,
Take advice from the Lord and His biblical tale,
If you fail to prepare, you’re preparing to fail.

If you squander your time on the tricks of the trade,
On discovering just how shortcut is made,
You’ve neglected to work and your skills are but frail.
If you fail to prepare, you’re preparing to fail.

Can you fathom a sailboat alone on the sea,
And the storm and the waves dancing violently?
Like a crew that’s untrained for the tempest and gale,
If you fail to prepare, you’re preparing to fail.

If a cross country runner trains only a stint,
And he practices simply by running a sprint,
He will make it part way down the arduous trail.
If you fail to prepare, you’re preparing to fail.

Any seeds that are sown will not vanish or spoil,
If they’re spread on the tilled and the fertilized soil.
It’s a soil that’s prepared for the seeds in the pail.
If you fail to prepare, you’re preparing to fail.

If you want no excuses, no worries or frets,
If you want peace of mind, ever void of regrets,
Let the wisdom sequester you far from the wail.
If you fail to prepare, you’re preparing to fail.

13 Quotes from Charlie Munger

If you think your IQ is 160 but it’s 150, you’re a disaster. It’s much better to have a 130 IQ and think it’s 120.


We recognized early on that very smart people do very dumb things, and we wanted to know why and who, so we could avoid them.


Invest in a business any fool can run, because someday a fool will. If it won’t stand a little mismanagement, it’s not much of a business. We’re not looking for mismanagement, even if we can withstand it.


Obviously if you want to get good at something which is competitive, you have to think about it and practice a lot. You have to keep learning because [the] world keeps changing and competitors keep learning. You have to go to bed wiser than you got up. As you try to master what you are trying to do — people who do that almost never fail utterly. Very few have ever failed with that approach. You may rise slowly, but you are sure to rise.


You’ll do better if you have passion for something in which you have aptitude. If Warren had gone into ballet, no one would have heard of him.


What do you want to avoid? Such an easy answer: sloth and unreliability. If you’re unreliable, it doesn’t matter what your virtues are. You’re going to crater immediately. Doing what you have faithfully engaged to do should be an automatic part of your conduct. You want to avoid sloth and unreliability.


Life will have terrible blows in it, horrible blows, unfair blows. It doesn’t matter. And some people recover and others don’t. And there I think the attitude of Epictetus is the best. He thought that every missed chance in life was an opportunity to behave well, every missed chance in life was an opportunity to learn something, and that your duty was not to be submerged in self-pity, but to utilize the terrible blow in constructive fashion. That is a very good idea.


Well, opportunity cost is a huge filter in life. If you’ve got two suitors who are eager to have you, but one is way better than the other, you’re going to choose that one rather than the other. That’s the way we filter stock buying opportunities. Our ideas are so simple. People keep asking us for mysteries, but all we have are the most elementary ideas.


Generally speaking, envy, resentment, revenge and self-pity are disastrous modes of thought. Self-pity gets fairly close to paranoia, and paranoia is one of the very hardest things to reverse. You do not want to drift into self-pity. … Self-pity will not improve the situation.


I met the towering intellectuals in books, not in the classroom, which is natural. I can’t remember when I first read Ben Franklin. I had Thomas Jefferson over my bed at seven or eight. My family was into all that stuff, getting ahead through discipline, knowledge, and self-control.


Students learn corporate finance at business schools. They are taught that the whole secret is diversification. But the exact rule is the opposite. The ‘know-nothing’ investor should practice diversification, but it is crazy if you are an expert. The goal of investment is to find situations where it is safe not to diversify. If you only put 20% into the opportunity of a life-time, you are not being rational. Very seldom do we get to buy as much of any good idea as we would like to.


The liabilities are always 100% good. It’s the assets you have to worry about.


Ben Graham was a truly formidable mind, and he also had a clarity in writing, and we talk over and over again about the power of a few simple ideas thoroughly assimilated, and that happened with Graham’s ideas which came to me indirectly through Warren, but some also directly from Graham. The interesting thing for me is that Buffett the former protégé — by the way Buffett was the best student Graham had in 30 years of teaching at Columbia — became better than Graham. That’s the natural outcome — as Milton said, ‘If I’ve seen a little farther than other men, it’s by standing on the shoulders of giants.’ So, Warren stood on Ben’s shoulders, but he ended up seeing more than Ben. No doubt somebody will come along and do a lot better than we have.

Accidental Success vs. Deliberate Success

Let me first share some examples of each, and then I’ll share some thoughts on this.

When Michael Jordan shoots a ball and it makes it in the hoop, that’s deliberate success. He’s practiced the skill a million times before.

When I shoot a ball and it makes it in the hoop, that’s accidental success. Anyone familiar with my basketball skills will concur.

Sticky notes were an accidental success. The engineer who created it didn’t set out to make sticky notes. He accidentally discovered a glue that you could use to stick and peel, many times over.

Berkshire Hathaway is a deliberate success.

So, what’s the difference between the two?

One requires planning, hard work, and determination. Other is a pleasant surprise.

One can be replicated many times, in any field(s) of your choosing. Other offers no such guarantee.

5 Things I require before I purchase a stock

Every time I’ve been strict about following these requirements, I’ve made money. It’s true 100% of the times.

Other times, I’ve lost money.

Apply these requirements to your investment selection process, and see how it works for you.

Also, I apologize for the ruthlessness of the following sentences. These are absolute necessities for my investing methodology. Any leeway is these matters is inconceivable.


I require my investment to either produce a product, or deliver a service.

When a business produces a product, or delivers a service, the value of the business is no longer hypothetical. It relies on the quality of the product or service delivered. This requirement automatically eliminates all commodities and cryptocurrencies from my radar.


I require the business to be profitable before I invest in it.

Companies that continue losing money for more than 5 years after inception in the name of growth, do not interest me. The senior management in such businesses is made up of incompetent folks.


I require the business to be self-sustainable.

The business has to operate on little to no debt. Businesses that heavily rely on debt for its operations do not deserve a place in my portfolio. As soon as the river of debt dries up, the operations take a nosedive in such businesses.


I require businesses to have increasing revenues and higher profit margins.

Combination of these two factors fortify a business. It gives it a moat. Longer the sustainability of this moat, better the business.


I require the business to be on extreme sale before I invest in it.

When a high-quality business is being offered at a significant discount compared to its intrinsic value, the odds of losing money are almost non-existent, and odds of making money are greatly in my favor.

19 Bear Market Indicators from Bank of America

On a regular basis, I go through all my files, clippings, etc. Most things I save “in the moment” turn out to be useless shortly thereafter. So, those get chucked.

One of the interesting things I found saved from earlier was a list of bear market indicators from Bank of America. Sharing them here with you.

  1. Federal Reserve raising interest rates
  2. Tightening credit conditions
  3. Minimum returns in the last 12 months of a bull market have been 11%
  4. Minimum returns in the last 24 months of a bull market have been 30%
  5. Low quality stocks outperform high quality stocks (over 6 months)
  6. Momentum stocks outperforming (over 6 to 12 months)
  7. Growth stocks outperforming (over 6 to 12 months)
  8. 5% pullback in stocks over the last year
  9. Stocks with low price-to-earnings ratio underperform
  10. Conference Board’s consumer confidence level has not hit 100 within 24 months
  11. Conference Board’s percentage expecting stocks go higher
  12. Lack of reward for earnings beat
  13. Sell side indicator, a contrarian measure of sell side equity optimism
  14. Bank of America Fund Manager Survey shows high levels of cash
  15. Inverted yield curve
  16. Change in long-term growth expectations
  17. Rule of 20, trailing price-to-earnings ratio added to CPI is above 20
  18. Volatility index spikes over 20 at some point within the last 3 months
  19. Earnings estimate revisions rule

I found many of these to be interesting, and useful.

5 simple tips that I learned to improve my writing

Writing is an amazing habit. I try to write everyday. Most days, the writing is average or below average. Once in a while though, the stuff that comes out makes me wonder … did I really write that?

Regardless, writing on a daily basis is a habit I recommend everyone ought to cultivate. You don’t have to write lengthy prose. Just write anything that comes to your mind. There are so many benefits to writing. Just google “benefits of writing“.

But, there are 5 tips I learned, from many different sources, that improves my writing. Hope it helps your writing also.

#1 – Delete the word “that”

You believe that I’m sleeping, but I’m not.

Now, let’s try again without “that”.

You believe I’m sleeping, but I’m not.

#2 – Avoid words that end in “ing”

The food I am eating is usually very disappointing. What are you eating?

Now, let’s try it without the -ing.

The food I eat usually disappoints. What do you eat?

#3 – Remove the words “I think”

“I think, this computer is faster” becomes “this computer is faster.”

The words, “I think” add no real value to the sentence.

#4 – Short Sentences, Shorter Paragraphs

Write short sentences. Write shorter paragraphs.

This tip is from Ernest Hemingway. Most classics have long sentences, longer paragraphs. Not Hemingway. His style came from being a journalist from Kansas City Star.

His best example about short sentences and shorter paragraphs is this:

For sale: Baby shoes. Never worn.

Ernest Hemingway

A powerful six-word story.

#5 – Be positive, not negative

Another tip from Hemingway. Write what is, not what isn’t.

Instead of saying, this is painless, say, this is comfortable.

Instead of expensive, say economical.

In conclusion …

That’s it. Writing is a muscle. More you work it, stronger it becomes.

When I first discovered these rules, I had trouble committing them to memory. I still forget many. So, I created a printout I can keep on my desk for easy recall.

Download your copy of 5 Simple Tips that Improved My Writing. (no email required). Share it with others without changing anything.

Hope these tips are beneficial to you

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