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As opposed to creating fake zombie companies like MoviePass or Jet.com or WeWork? Railroad investment seems like a far more long-term driver of everyday everym

As opposed to creating fake zombie companies like MoviePass or Jet.com or WeWork? Railroad investment seems like a far more long-term driver of everyday everyman quality of life than pop up companies that try to take our attention and suck down a $billion while failing to do so.

toomuchtodo 3y ago
They can both be symptoms of a suboptimal system configuration.
- Obscurity4340 3y ago
  I guess I just feel like idle capital is the devil's plaything. While it could be available for R&D, isn't it more likely to go towards lobbying and bending or breaking the law while maintaining a war chest to discourage prosecution/accountabillity?
  - deleted 3y ago
    [deleted]
  - guidoism 3y ago
    That “idle capital” is pretty central to the Ben Graham way of doing things. You keep it around waiting for a great investment. Weird things happen like when silver crashed in price for a couple of days in 2020.
    - Obscurity4340 3y ago
      Nobody's arguing against the capitalist perspective in the sense that I don't question their methods to access and grow more/their existing capital. I'm saying I believe it is bad for pro-social ends and society and that we should be striking a better balance in ensuring we keep the money moving in a trickle up fashion if at all
      - Obscurity4340 3y ago
        Or bubble up. Whatever the medium that is implied by this example should be viscous and sticky as shit tho.
  - Obscurity4340 3y ago
    Saying nothing of corporate buybacks of company stock
seydor 3y ago
Still better than sitting still. It's a twisted way to do some wealth redistribution
burkaman 3y ago
Why would it be opposed to that?
- dragontamer 3y ago
  Generally speaking, you can only spend your money on one thing. VCs, and the Silicon Valley style culture in general, is a different investing culture than what Berkshire Hathaway is doing here. The underlying current of this discussion is which investing culture is better. There's a lot of benefits to patiently waiting for an opportunity, rather than spending money as soon as it comes up. SV is surprisingly short-term in its thinking and culture. That's the lesson IMO for the past decade or two, SV is always about keeping up with your neighbors as opposed to thinking about the long term stuff that matters. In the SV mindset, idle money is awful, you should have spent it on the latest-greatest recent whatever. 5 years ago that was maybe VR, 10 years ago maybe Internet of Things. Just 2 years ago it was cryptocurrency. Guess what? If you spend your money on dumb things, you don't have money left over when the important revolutions happen. Patiently holding money is slower, but still valid form of investing.
  - burkaman 3y ago
    Can you really not think of any worthwhile uses of money other than investing in MoviePass or sitting in a cash pile and "waiting for an opportunity"? I can think of quite a few.
    - dragontamer 3y ago
      $160B is really small for Berkshire Hathaway. You're looking at a literally $Trillion++ company. This $100B is literally pocketchange for a rainy day for them. They've got the vast majority of their assets invested. Saving some money for later is more than just "patience", it also involves thinking about the overall picture of the company in question. ------------ In any case, "Cash" earns 5.25 to 5.5% right now (Federal Funds Rate), meaning all companies with a PE Ratio worse than 19 is a worse investment than cash. And there's a _LOT_ of companies that have less than a PE Ratio of 19. EDIT: I'm not saying that they're always going to be a worse buy. But a $1 Billion company needs to make 0.0525 Billion/year to be comparable against cash right now, or at least make an argument why this next year of investment is worth more than the 52.5 million that could be easily obtained from a (state-tax free) 1Y Treasury.

toomuchtodo 3y ago

They can both be symptoms of a suboptimal system configuration.

Obscurity4340 3y ago
I guess I just feel like idle capital is the devil's plaything. While it could be available for R&D, isn't it more likely to go towards lobbying and bending or breaking the law while maintaining a war chest to discourage prosecution/accountabillity?
- deleted 3y ago
  [deleted]
- guidoism 3y ago
  That “idle capital” is pretty central to the Ben Graham way of doing things. You keep it around waiting for a great investment. Weird things happen like when silver crashed in price for a couple of days in 2020.
  - Obscurity4340 3y ago
    Nobody's arguing against the capitalist perspective in the sense that I don't question their methods to access and grow more/their existing capital. I'm saying I believe it is bad for pro-social ends and society and that we should be striking a better balance in ensuring we keep the money moving in a trickle up fashion if at all
    - Obscurity4340 3y ago
      Or bubble up. Whatever the medium that is implied by this example should be viscous and sticky as shit tho.
- Obscurity4340 3y ago
  Saying nothing of corporate buybacks of company stock

seydor 3y ago

Still better than sitting still. It's a twisted way to do some wealth redistribution

burkaman 3y ago

Why would it be opposed to that?

dragontamer 3y ago
Generally speaking, you can only spend your money on one thing. VCs, and the Silicon Valley style culture in general, is a different investing culture than what Berkshire Hathaway is doing here. The underlying current of this discussion is which investing culture is better. There's a lot of benefits to patiently waiting for an opportunity, rather than spending money as soon as it comes up. SV is surprisingly short-term in its thinking and culture. That's the lesson IMO for the past decade or two, SV is always about keeping up with your neighbors as opposed to thinking about the long term stuff that matters. In the SV mindset, idle money is awful, you should have spent it on the latest-greatest recent whatever. 5 years ago that was maybe VR, 10 years ago maybe Internet of Things. Just 2 years ago it was cryptocurrency. Guess what? If you spend your money on dumb things, you don't have money left over when the important revolutions happen. Patiently holding money is slower, but still valid form of investing.
- burkaman 3y ago
  Can you really not think of any worthwhile uses of money other than investing in MoviePass or sitting in a cash pile and "waiting for an opportunity"? I can think of quite a few.
  - dragontamer 3y ago
    $160B is really small for Berkshire Hathaway. You're looking at a literally $Trillion++ company. This $100B is literally pocketchange for a rainy day for them. They've got the vast majority of their assets invested. Saving some money for later is more than just "patience", it also involves thinking about the overall picture of the company in question. ------------ In any case, "Cash" earns 5.25 to 5.5% right now (Federal Funds Rate), meaning all companies with a PE Ratio worse than 19 is a worse investment than cash. And there's a _LOT_ of companies that have less than a PE Ratio of 19. EDIT: I'm not saying that they're always going to be a worse buy. But a $1 Billion company needs to make 0.0525 Billion/year to be comparable against cash right now, or at least make an argument why this next year of investment is worth more than the 52.5 million that could be easily obtained from a (state-tax free) 1Y Treasury.