Linkfest: May 20, 2018

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What I am reading today

Campbell Soup – No Growth For You! (Trends... Find them, ride them and get off.)
How Disruptive tech. is welcomed in society (Views on Life & on Equity Investing)


*The Radical Fool of Capitalism* (Marginal REVOLUTION)
A series of reversals forces India's newest chief minister from office (Economist: Asia)
Modi's clever politics will dent his clean image (Swaminathan A Aiyar)
10 Tips for Historians from Ancient Writers (History of the Ancient World)
Conspiracy: It has all the right ingredients - sex, lies and videotape (Forbes India Magazine)

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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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