[Mark1808]

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David,

I've read your response and believe I understand it fully, but let me point out that in no way does it directly rebut my points. If your scenario is true, then you should be able to describe why mine is false. Unfortunately the converse is not true, I can't yet rebut your scenario, and I will actually be working all week so I might not come up anything soon.

Is it time for a letter to Buffett?

[/ QUOTE ]

Dear Warren Buffett:

I know you have turned $100,000 in to $50 billion in the stock market. A guy who has written books on poker thinks he can improve on your methods. Basically if Martians had to bet on stock prices with a Warren Buffett Martian they couldn't do very well but if one of the Martians had contact with an earthling who knew the actual prices he could beat you. What do you think?

DC

Dear DC:

There are no Martians. Stock prices represent the collective vote as to the value of a company. I am good at determining when that vote does not accurately reflect what a knowledgable buyer would pay for a comapany as a whole. I stick to companies with a durable competitive advantage which means they grow earnings at consitant above average rates and are very unlikely to have nasty suprises in the future.

Can you ask David a question about poker for me? The average poker player loses money and Dave is a winning player. Sometimes Dave may advise a move that loses money, such as paying to draw to a flush at 8 - 1 when the flush doesn't hit. Since his advice is not perfect is there a way I can go counter to his advice when his advice differs dramatically from a random play and hence improve on his performance? For intance if a losing player always draws to a flush no matter what the odds, wouldn't a random pick as whether to draw be better than the average player? Since that random pick will sometimes do better than David's advice shouldn't I sometimes shade my move towards the random pick?

Warren