My Opinion

Letter to Investors Q2 2014 (Hedgehog Capital)

In: Investing • September 3, 2014

Both equity short sellers and precious metals investors have been in despair. This proves again that investing is not a craft for merely smart, intelligent people. The emotional skill set that one needs to endure market folly is just as necessary a prerequisite. I gladly recall the famous words of Jesse Livermore, a notorious speculator in the era of the Great Depression: “It never was my thinking that made the big money for me. It always was my sitting. Got that? My sitting tight!” Apparently, [...]

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The Fatal Flaw of 100% Reserve Banking

In: Economics • August 4, 2014

There is a huge divide between theorists of two allegedly opposed monetary doctrines: the 100% reserve bankers and the free bankers. Although I do contend that both postures have more in common than many at first sight think, the fatal flaw of 100% reserve banking can be boiled down to one very simple error. When we take this fatal flaw away, nothing stands in the way to reconcile both doctrines.

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The Curse of Countercyclical Marketing

In: Investing • August 3, 2014

Procter & Gamble tried it and it utterly failed. The CEO at the time, Bob McDonald, was promptly removed from the board. Under his command, P&G became the world’s largest advertiser, with annual advertising expenditures exceeding $10 billion dollars. Bob McDonald never budged. He relentlessly refused to cut advertising costs. Yet by his refusal, he unwittingly signed his own death sentence. Would he have been blessed to read this text earlier, he might have saved himself from this corporate (and [...]

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Letter to Investors Q1 2014 (Hedgehog Capital)

In: Investing • April 20, 2014

Most of us remember the exuberance of the stock markets at the height of the dotcom bubble. Much, however, has apparently been forgotten. Then, back in 2000, internet companies that were planning to sell door knobs (but hadn’t sold one yet) were given a valuation that wouldn’t even be justified if they sold all door knobs in the world, let alone the ones bought over the internet. Their business models were weak, their revenues non-existent. Prices departed from value to [...]

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Why I’m Short Netflix: a Tale of Exuberance and Excess

In: Investing • March 23, 2014

It’s 2001 all over again. Netflix is being bought just because everybody’s buying. Netflix shares sell like hot cakes, even though they’re not generating a dime. Likewise, Facebook’s acquisition of WhatsApp was received euphorically by investors, with its stock price rising despite a 10% dilution of shareholder capital. Although Facebook is already a loser’s game, its small cousin (WhatsApp) was bought at an even more irrational valuation. It’s exuberance and excess again, just as in 2001; price doesn’t matter and [...]

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Does Living Healthy Mean Depriving Yourself?

In: Biohacking • December 31, 2013

I often get the question why I “deprive” myself by not eating certain things. Or why I make it myself “so difficult” when it comes to eating. Why I am “so hard” on myself. I even heard things like “it can’t be that bad”, with “it” referring to corn, soy, soda, cereal or even pizza (they have vegetables on them, you know).

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Psychological Biases & Investing Part I: Precision Bias

In: Investing • March 10, 2013

In this series, I will discuss one psychological bias at a time and its ramifications for investors. How does this bias affect our decision making and how could we mitigate its negative consequences? This week we’ll discuss precision bias.

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The Name Is Dell, Michael Dell

In: Investing • February 14, 2013

As an investor, Dell never really attracted my attention. Previously, it was one of Wall Street’s favorites and its start-up story a future bestseller. It thrived on a well thought-out business model based on an ancient-old trick: cut out the middleman.

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How Not to Throw Away Your Life Sleeping

In: Lifehacking • February 5, 2013

What do Leonardo da Vinci, Albert Einstein, Benjamin Franklin, Thomas Jefferson, Michel Angelo and Thomas Edison have in common? Two things.

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Why You Must Read the Vincent van Gogh of Economic Science

In: Economics • January 23, 2013

When is someone considered a genius? The German philosopher Schopenhauer described a genius as a marksman who hits a target others cannot even see. In other words, a genius will often be acknowledged only in a distant future that extends beyond his own life, when others finally see the target the genius aimed at.

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