Capital Allocators Monthly (July 2018)

 

A great month to catch up on reading and listening.  My favorite reads this month triggered mentions of others – lots of books to choose from.

Reading
1. Chris Voss, Never Split the Difference. Chris spent 24 years as a hostage negotiator with the FBI. His book is the best one I’ve ever read on negotiation. In an analogy to our world, Roger Fisher’s well-known Getting to Yes is to efficient market theory, as Voss’ work is to behavioral finance.  In other words, one works in theory; the other actually works.

Chris’ book helped me round out a mental model for conducting conversations that started with two other books.

2. Robin Dreeke, It’s Not All About Me.  Robin spent 21 years in the FBI (also), and was the lead instructor at the FBI’s Counterintelligence Training Center.  The book is an imminently readable checklist on how to build rapport.

3. Harville Hendrix, Getting the Love You Want. Taking almost identical principles, relationship-expert Hendrix describes how couples can communicate together. Read these three and you’ll have a new understanding of how to build connection and communicate effectively.

4.  Moneyball 2.0.  McKinsey wrote a terrific article about their alum, Jeff Luhnow, the GM of the World Series Champion Houston Astros.

The article refers to the recently released Astroball by Ben Reiter that chronicles the Houston Astros rise to last year’s World Series Championship. It’s the 3rd in a line of books that together comprise version 2.0 of Michael Lewis’ seminal Moneyball.  My favorite is Big Data Baseball, about the PIttsburgh Pirates in 2013.  Lastly, Tom Verducci’s The Cubs Way is a fun read about the Cubbie’s long-awaited championship.  Each describes different methodologies for successfully investing for the long-term, creating an edge, and integrating culture and implementation.

5. Economic Opportunity Zones.
In our podcast conversation, Manny Friedman mentioned a new tax break that is likely to foster massive investment and opportunity in certain areas of the U.S. in the coming years. Shortly after we recorded, this article came out in Forbes.  Stay tuned…

Listen
Capital Allocators
1. Charley Ellis, talks about indexing, the retirement problem, and institutional investing.

2.  Manny Friedman, founder of EJF Capital, looks back at the globalization of markets and the financial crisis and forward at regulation, economic opportunity zones, economic stimulus, technological changes, and philanthropy.

3. Anthony Scaramucci, yes, that Anthony Scaramucci, discusses Washington, hedge funds, leadership, and entrepreneurship.

4. Peter Troob, co-founder of high yield hedge fund and family office Troob Capital, navigates the interchange of high yield, CDS, and ETFs, and discusses his family office investing approach.

Best of the Rest
1. Talks at GS.  A friend referred me to a Talks at GS podcast with Malcolm Gladwell, about podcasting, and I immediately after tuned in to hear the top brass at Goldman interview David Robinson, Ed Norton, Bob Iger, Jeremy Lin, and Paul Tudor Jones.  Goldman has access to a phenomenal array of guests, and I can’t wait to listen to the rest.

2. Bethany McLean on ILTB.  Noted author of Enron: The Smartest Guys in the Room and the recently released a deep dive on fracking, Saudi America, Bethany’s interview with Patrick is just fantastic.  Great insights into investigative research, the value of short sellers, and getting to the truth.

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Enjoy the rest of the summer,
Ted

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