´´ Value Investing Japan

Tuesday, December 6, 2016

Value Investing: The Wisdom of the Samurai (2)

Make no mistake dear reader. Stock market investing is a form of war. The enemy is the market, especially financial institutions and institutional investors. They have to be fought ruthlessly over a long period of time. But in order to take advantage of financial institutions, and crush the market over the long- haul, you need not only to have a sound process but also a strategy.

Sunday, December 4, 2016

Value Links of Interest

Behavioral research phenomena such as loss-aversion, overconfidence, and lottery preference, account for the value of “cheapness” much more directly. These behavioral approaches suggest that value strategies that focus on undesirable, boring, ugly, and hence, “cheap” areas like distressed securities deserve special attentions, and are likely to continue to be successful as long as the underlying behaviors persist.

Value Investing's Long Run by Bruce Greenwald (Columbia Business School)

Tuesday, November 8, 2016

Did Korekiyo Takahashi Save Japan?

The Showa Depression of 1929-1932 wreaked havoc on the Japanese economy and society. Its main consequences can be described as follows. The macroeconomic downturn was felt primarily in falling prices and not so much in output contraction.

The Japanese society as a whole was hit hard by the Showa depression, especially in rural areas. Rural impoverishment became severe around 1931. During the Showa depression the Japanese public became greatly frustrated with the deflationary policy of the second Wakatsuki Cabinet and, finally, the government was removed and was succeeded by the Inukai Cabinet in December 13, 1931. (Ohno)

Value Links of Interest

Despite years of research we haven’t been able to come up with a reliable measure of the discount rate — the so-called cost of capital — and the long-term growth rate for these models is anyone’s guess. Cost of capital estimates are speculative, and that inherent uncertainty is only magnified by hypothetical growth rates.

Can We Better Account for Value? by Jame Steinberg (Columbia Business School)