The Sunday Drive - 08/18/2024 Edition [#124]
Musings and Meanderings of a Financial Provocateur
đđŒ Hello friends,
Greetings from Saratoga Springs, NY. Letâs enjoy a leisurely Sunday Drive around the Internet.
đ¶ Vibin'
This past week, I had the great pleasure of spending time with some amazing colleagues at our semi-annual gathering. Our organization is largely remote, so when we get together in real life, itâs a wonderful and productive occasion. I am exceedingly fortunate to be a part of this outstanding team.
While we were together, I was reminded of a song from the 1983 film, The Outsiders which was directed by Francis Ford Coppola. It featured an amazing ensemble cast which included Matt Dillon, Ralph Macchio, C. Thomas Howell, Tom Cruise, Emilio Estevez, Rob Lowe, and Patrick Swayze (RIP). When a talented team comes together and forms a strong bond, incredible work can be done. Thatâs how I feel about my colleagues.
So this week, Iâm vibinâ to Stevie Wonderâs Stay Gold from the movieâs soundtrack. Enjoy.
đ Â Quote of the Weekâ
âYou can become two things as you get older: An elder, or elderly.â
â Brent Beshore
đ Â Chart of the Week
Itâs Alabama weekend at the Saratoga Race Course, the second biggest race week of the 7 week regular track season. Next weekâs Travers is the biggest race of the season.
I was recently having a conversation with some friends about horse racing and the associated gambling that is an integral part of the Sport of Kings. One of them asked me if I like to bet on the horses.
My answer (with tongue firmly in cheek) was, âOh no, I donât need to. I get paid to gamble with other peopleâs money for a living.â A joke of course. The point however is that I am a professional investment manager and have been for over 35 years, and I take my job very seriously.
Many people conflate investing with gambling. To the uninitiated or casual investor, itâs easy to see why.
This weekâs Chart shows that in the short run it is difficult to distinguish between the range of outcomes from investing or gambling. Returns can be positive or negative for either so investing feels a little like gambling.
However, given the passage of enough time, investing and staying invested will almost certainly yield positive returns.
On the other hand, if one gambles long enough, the outcome is virtually guaranteed to be negative.
Betting on the horses can be fun, and itâs certainly a social and entertaining experience. But I would offer a reminder that itâs best to gamble with entertainment dollars and not with dollars that should be reserved for investing. #PSA đđđ
đ Interesting Drive-By's
đ€ Mental Models - Merton/Real Options Framework for Debt and Equity - from Michael Kao [Link] Note: My first job in the investment management business was at a boutique firm that used the Black-Scholes Option Pricing Model to value stocks for their portfolios. If youâd like to indulge your inner math geek, this article is for you. đ
đ âPeople and Process Make this Whole Thing Happenâ - excerpt from an Interview with Keith Dawkins, President of the Harlem Globetrotters [Link]
đ€ Can an AI Health Coach Fight Chronic Disease? - from Ben Krauss [Link]
đĄ Solar Energy Breakthrough Could Reduce the Need for Solar Farms - from the University of Oxford [Link]
đ° Ben Franklin: Americaâs Richest Printer - from Frederik Gieschen [Link]
đđŒ Parting Thought
If you have any cool articles or ideas that might be interesting for future Sunday Drive-by's, please send them along or tweet 'em (X âem?) at me.
Please note that the content in The Sunday Drive is intended for informational purposes only, and is in no way intended to be financial, legal, tax, marital, or even cooking advice. Consult your own professionals as needed. The views expressed in The Sunday Drive are mine alone, and are not necessarily the views of Investment Research Partners or Cache Financials.
âI hope you have a relaxing weekend and a great week ahead. See you next Sunday...
Your faithful financial provocateur,
-Mikeâ
If you enjoy the Sunday Drive, I'd be honored if you'd share it with others.ââ
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