Linkfest: January 15, 2018

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What I am reading today

Why Hasn't the World Been Destroyed in a Nuclear War Yet? - Facts So Romantic (Nautilus)
A Child Abuse Prediction Model Fails Poor Families (Wired)


Disrupting the Car Insurance Industry (Insead)
Hold the line on the fisc (IDFC)
In Some Countries, Facebook's Fiddling Has Magnified Fake News (New York Times)
John Sculley: Why AI Is the Tech Trend to Watch in 2018 (Knowledge@Wharton)
Matt Badiali's Freedom Checks Exposed! (Daily Reckoning)
Meet Caihong Juji: The Shimmering Show-Off Feathered Dinosaur (Discover Magazine)
My Plan for Hyperbitcoinization (Elaine Ou)

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Warren Buffett's 2017 Letter: Takeaways for Indian Investors

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Warren Buffett's shareholder letter for the year 2017 was released a few days back. I am going to take some of the themes in this year's letter and provide an Indian context and takeaway. (For a collection of past shareholder letters organised and annotated around major themes, please check - ' The Essays of Warren Buffett ' by Lawrence Cunningham ). 1. Valuations are expensive. So Buffett didn't do any big deals last year. Others may ignore the level of prices and pay any price to do deals. But not the Oracle of Omaha. - Indian valuations are stretched too. The Sensex P/E currently stands at 23.xx. High PEs tend to foreshadow lower returns in the next few years, till valuations moderate. A wonderful table compiled by Stableinvestor.com  shows this trade-off very well. With a starting PE of 24+ (which is very close to current levels), the 3 year return has been -5% historically. The takeaway for Indian investors is: valuations are stretched. The thing to do now...
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