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#1
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"Let's say I offer you a bar of gold. You know, for a fact, that it is 100% real gold. I hand you the bar of gold, which is about as big as your phone, but you are not allowed to weigh it or in any other way attempt to determine its mass, volume, etc. Then I tell you that I'll sell you the bar for $50. Now do you care what the hell it's worth?" [/ QUOTE ] Definition of what makes a great investment... |
#2
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[ QUOTE ]
[ QUOTE ] "Let's say I offer you a bar of gold. You know, for a fact, that it is 100% real gold. I hand you the bar of gold, which is about as big as your phone, but you are not allowed to weigh it or in any other way attempt to determine its mass, volume, etc. Then I tell you that I'll sell you the bar for $50. Now do you care what the hell it's worth?" [/ QUOTE ] Definition of what makes a great investment... [/ QUOTE ] I'm not following. Is this sarcastic, serious, something else? |
#3
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[ QUOTE ]
[ QUOTE ] [ QUOTE ] "Let's say I offer you a bar of gold. You know, for a fact, that it is 100% real gold. I hand you the bar of gold, which is about as big as your phone, but you are not allowed to weigh it or in any other way attempt to determine its mass, volume, etc. Then I tell you that I'll sell you the bar for $50. Now do you care what the hell it's worth?" [/ QUOTE ] Definition of what makes a great investment... [/ QUOTE ] I'm not following. Is this sarcastic, serious, something else? [/ QUOTE ] Probably sarcasm. Also, "I hand you the bar of gold, which is about as big as your phone, but you are not allowed to weigh it or in any other way attempt to determine its mass, volume, etc." If you hand me the gold, I can still guesstimate its weight, look at what the market is paying per ounce, and determine if $50 is a bargain or not. So of course I care how much it is worth. Maybe the analogy was just a figure of speech and wasn't meant to be taken seriously? [img]/images/graemlins/confused.gif[/img] |
#4
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[ QUOTE ]
[ QUOTE ] [ QUOTE ] "Let's say I offer you a bar of gold. You know, for a fact, that it is 100% real gold. I hand you the bar of gold, which is about as big as your phone, but you are not allowed to weigh it or in any other way attempt to determine its mass, volume, etc. Then I tell you that I'll sell you the bar for $50. Now do you care what the hell it's worth?" [/ QUOTE ] Definition of what makes a great investment... [/ QUOTE ] I'm not following. Is this sarcastic, serious, something else? [/ QUOTE ] I'm baffled shouldn't this bar of gold be well into the five figure range? I mean if every case was this easy, I'd just take free money that people are handing out and sit around all day. |
#5
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Wow, sometimes I guess you really have to spell it out.
HERE WAS THE POINT OF WHAT I SAID You can tell it worth a lot, and more importantly, a lot more than you're going to have to pay for it. You don't know exactly what it's worth and you could easily be off by 20% or more if someone asked you to fill in the value of the purchase. However, those limitations notwithstanding, it is still an obviously good idea to buy the gold. |
#6
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Wow, sometimes I guess you really have to spell it out. HERE WAS THE POINT OF WHAT I SAID You can tell it worth a lot, and more importantly, a lot more than you're going to have to pay for it. You don't know exactly what it's worth and you could easily be off by 20% or more if someone asked you to fill in the value of the purchase. However, those limitations notwithstanding, it is still an obviously good idea to buy the gold. [/ QUOTE ] Sorry, you know... Text has limitations with stretched examples and I kinda glossed over when I read through that Wynn stuff. Rereading it makes it very easy to understand. Me: -1 |
#7
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Wow, sometimes I guess you really have to spell it out. HERE WAS THE POINT OF WHAT I SAID You can tell it worth a lot, and more importantly, a lot more than you're going to have to pay for it. You don't know exactly what it's worth and you could easily be off by 20% or more if someone asked you to fill in the value of the purchase. However, those limitations notwithstanding, it is still an obviously good idea to buy the gold. [/ QUOTE ] I wasn't being sarcastic. The best investments are easy decisions that don't require lots of data to support them. They are "obvious". |
#8
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[ QUOTE ] [ QUOTE ] "Let's say I offer you a bar of gold. You know, for a fact, that it is 100% real gold. I hand you the bar of gold, which is about as big as your phone, but you are not allowed to weigh it or in any other way attempt to determine its mass, volume, etc. Then I tell you that I'll sell you the bar for $50. Now do you care what the hell it's worth?" [/ QUOTE ] Definition of what makes a great investment... [/ QUOTE ] I'm not following. Is this sarcastic, serious, something else? [/ QUOTE ] highly doubt thats sarcasm. you made a great point and DC si agreeing. good analogy; gold=stock easy to value gold and while you acan't determine exactly what it is worth, you know for a fact (given your assumptions) that it is worth well more than $50. Barron |
#9
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To add the obligatory Buffett quote..
"It is better to be approximately right than precisely wrong." Also, Gladwell's Blink seems to be very relevant to this discussion. He talks about how thin slicing can be more effective than people with more information in the examples of determining divorce, diagnosing heart attacks, hiring employees, etc. There are two things that Gladwell talk about that I think are important with investing. One is thin slicing exemplified with Buffett where he ignores the vast majority of information available to him. The other is snap judgements and the subconscious where experience investors like Soros thrive. He used to say he followed the "theory of reflexivity", but then later said that the theory was bogus and could be ignored. His son Robert said, "My father will sit down and give you theories to explain why he does this or that. But I remember seeing it as a kid and thinking, Jesus Christ, at least half of this is [censored]. I mean, you know the reason he changes his position on the market or whatever is because his back starts killing him. It has nothing to do with reason. He literally goes into a spasm, and it's this early warning sign." |
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