We Study Billionaires - The Investor’s Podcast Network TIP764: The Art of Buffett w/ Tobias Carlisle
Tobias Carlisle, founder of Acquirers Funds and author, dives into Warren Buffett's investing strategies and the wisdom of The Art of War. He reveals why the General Re deal was a strategic triumph and how Buffett's investment in BNSF defies conventional logic. Carlisle contrasts Buffett's successes with IBM's setbacks and showcases Apple as a hallmark of shrewd investing. He also discusses the significance of ethical behavior and adaptability in finance, arguing that Berkshire Hathaway is a less risky investment compared to the S&P 500.
01:30:53
Why Buffett Bought BNSF Railroad
- Tobias describes Buffett's 2009-10 purchase of BNSF, a capital-intensive railroad that seemed un-Buffett-like.
- He shows Buffett saw irreplaceable moat, Pacific-facing geography, tax and regulatory benefits, and quick capital recovery.
Demand An Overwhelming Advantage First
- Conduct rigorous analysis before acting and seek an overwhelming advantage like Sun Tzu prescribes.
- Only commit when your evaluation shows a large, asymmetric edge; otherwise avoid the position.
Apple: Buffett's Greatest Trade
- Tobias contrasts Buffett's IBM disappointment with his later Apple stake and calls Apple perhaps his greatest trade.
- Buffett treated Apple as a consumer franchise, profited from buybacks and product cycles, and earned ~4x quickly.
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Intro
00:00 • 2min
The General Re Deal Was a Strategic Masterstroke
02:19 • 15min
Why The Art of War Still Matters for Investing
16:52 • 12min
Why Buffett Bought BNSF Despite Capital Intensity
28:35 • 7min
Balancing Wins and Failures: IBM and Apple Contrasted
35:38 • 12min
Net-Nets, Management Incentives, and Winning Without Conflict
48:03 • 10min
Ad break
58:21 • 2min
Buffett’s Japan Investments: Cultural Alignment and Positive Carry
01:00:50 • 11min
Why Ethical, Durable Behavior Is Strategically Advantageous
01:11:41 • 16sec
Staying True to Value While Adapting to Change
01:11:57 • 4min
Is Berkshire Less Risky Than the S&P 500?
01:16:22 • 9min
Long-Term Perspectives: US Concentration vs. Global Diversification
01:25:28 • 8min
Second-Order Thinking and Pricing: Why Markets Are Hard
01:33:40 • 19sec
Outro
01:34:00 • 1min
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A Soldier's Fortune
James Salter
James Salter's "A Soldier's Fortune" is a novel that explores the experiences of a young man navigating the complexities of war and love.
The novel is set against the backdrop of the Korean War, offering a visceral and unflinching portrayal of combat and its impact on the human psyche.
The protagonist's journey is marked by both physical and emotional challenges, as he grapples with the realities of war and the search for meaning in his life.
Salter's prose is characterized by its precision and elegance, creating a powerful and unforgettable reading experience.
"A Soldier's Fortune" is a testament to Salter's ability to capture the essence of human experience with grace and intensity.
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The Art of War
Sun Tzu
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Em "Changing World Order", Ray Dalio analisa a história econômica e política global, buscando identificar padrões e ciclos que moldam a ordem mundial.
Ele argumenta que a compreensão desses padrões é crucial para navegar os desafios e oportunidades do cenário internacional.
Dalio apresenta uma perspectiva ampla e interdisciplinar, combinando economia, história e política para explicar as mudanças na ordem mundial.
A obra é uma síntese de suas experiências e reflexões sobre a economia global, oferecendo uma visão única sobre os desafios e oportunidades do século XXI. A obra de Dalio gerou debates e controvérsias, mas continua sendo uma leitura fundamental para entender as complexidades do desenvolvimento humano.
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David L. Dodd
First published in 1934, Security Analysis is a seminal work in the field of finance that lays the intellectual foundation for value investing.
The book, written by Benjamin Graham and David L. Dodd, distinguishes between investing and speculating, emphasizes the importance of thorough financial analysis, and introduces key concepts such as the 'margin of safety.
' The sixth edition includes commentary from leading Wall Street money managers and a foreword by Warren E. Buffett, who has praised the book for its enduring relevance in modern markets.
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Elroy Dimson
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Paul Marsh
This book provides an authoritative account of a century of investment returns in sixteen countries, including the U.S.
, U.K. , Japan, France, Germany, and others.
The authors present a clear and consistent analysis of total returns, including reinvested income, and address issues such as survivorship bias and the long-term equity risk premium.
The book is essential reading for investment professionals, financial economists, and investors, offering insights into the broader tendencies of equity markets over the long term.
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Buffett
The Making of an American Capitalist
Roger Lowenstein
This book provides a comprehensive and detailed account of Warren Buffett’s life, from his early days to his ascension as one of the most successful investors in history.
Written by Roger Lowenstein, the book is based on three years of research and includes interviews with Buffett’s family, friends, and business associates.
It explores Buffett’s investment strategies, his long-term philosophy of buying undervalued stocks, and his role in transforming Berkshire Hathaway into a highly successful corporation.
The book also delves into Buffett’s personal life and the influences that shaped his investment approach, including his mentor Benjamin Graham and his partnership with Charlie Munger.
In this episode, Stig Brodersen speaks with Tobias Carlisle — founder and managing director of Acquirers Funds — about Warren Buffett’s timeless approach to risk. Drawing from Tobias’s new book, Soldier of Fortune, they explore how ancient wisdom, especially from The Art of War, reveals the deeper logic behind Buffett’s biggest and most misunderstood investing decisions.
IN THIS EPISODE YOU’LL LEARN:
00:00:00 - Intro 00:02:03 - Why the deal between General Re and Berkshire Hathaway was a masterstroke 00:16:48 - What the ancient text of the art of war can teach us about today’s financial markets 00:27:28 - Why did Buffett buy BNSF when it’s highly capital-intensive 00:36:28 - Why Apple was – perhaps – the best trade Buffett ever made 00:56:04 - Why Buffett’s investment in Japan is in total alignment with the culture of Berkshire Hathaway 01:12:36 - If Berkshire Hathaway is more or less risky than the S&P 500 And so much more!
Disclaimer: Slight discrepancies in the timestamps may occur due to podcast platform differences.
BOOKS AND RESOURCES
- Join the exclusive TIP Mastermind Community to engage in meaningful stock investing discussions with Stig, Clay, Kyle, and the other community members.
- Tobias Carlisle's book, Soldier of Fortune – read reviews of this book.
- Tobias Carlisle's podcast, The Acquires Podcast.
- Tobias Carlisle's ETF, ZIG.
- Tobias Carlisle's ETF, Deep.
- Tobias Carlisle's book, The Acquirer's Multiple – read reviews of this book.
- Tobias Carlisle's Acquirer's Multiple stock screener: AcquirersMultiple.com.
- Tweet directly to Tobias Carlisle: @Greenbackd.
- Related books mentioned in the podcast.
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