Saving the first dollar you earn, versus saving what is left after you spend, is always a smart way to go. And making it automated is key. Set it and forget it!

A new smartphone app, Stash allows you to automatically save as little as $5/month and then immediately invest the same in Berkshire Hathaway Class B shares. They’ll even buy fractional shares with no trading costs. The B shares are changing hands these days at about $164/share. If you send Stash $5, then they’ll buy you 5/164th of a B share. Stash does charge $1/month or 0.25% annually, whichever is higher.  

Another one, Acorns, rounds up your credit card purchases to the nearest dollar and saves the difference. You can have the pennies that Acorns vacuums up go into a savings account. And you can have Stash periodically move those savings into Berkshire. 

My friend, Jason Zweig, wrote an interesting piece on Stash, Acorns and a third one, Digit in his column “The Intelligent Investor” in the Wall Street Journal past weekend:

http://jasonzweig.com/inching-your-way-toward-wealth-with-your-phone/
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When you buy that latte at Starbucks for $4.27 every day, it adds up. Taking those 73 cents every day and automatically investing them is such a no-brainer.
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I thoroughly enjoyed my talk to the University of Puerto Rico MBA students in San Juan, Puerto Rico on Sept. 26,2016 where I discussed three mental models in the spirit of Charlie Munger’s latticework of mental models.

The three models include

• The Power of Truth: Commit to candor, however painful or uncomfortable it may be. Being relentlessly truthful (and avoiding “white lies”) will strengthen your relationships with those around you in the long run. 
• Compounding is the 8th Wonder of the World: Resist the temptation to pull money out of compounding accounts like 401(k)s; instead, leave them and let them compound over the longest runways possible.
• Dhandho Entrepreneurship: Take advantage of extracurricular time at your full-time job to first test your start-up ideas before quitting your day job to become the next Elon Musk. If you fail, you’ll still have a job. Heads you win, tails you don’t lose much! 

Enjoy!
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https://www.youtube.com/watch?v=FO5V7jcBNMM

I very much enjoyed doing this podcast with Preston Pysh and Stig Brodersen. Both are great guys who do a great service to the Value Investing Community. Thanks guys!

In this second part interview, Preston and Stig discuss some of the finer details of my investing approach.  Recently, the airline industry has had enormous amounts of market consolidation and a few stocks seem to have favorable valuations.  We had discussions on these potential opportunities and what are the long term prospects of these opportunities.


In this episode, we talked about:

• My recent investment in Southwest Airlines.
• My biggest investment mistake, and how I made more than $100 million because of it.
• If Warren Buffett and Charlie Munger consider any macro decisions in their investment approach.
• Why the airline industry is a terrible sector, but might still be a great investment at the moment.

https://www.theinvestorspodcast.com/tip121-pabrai-funds/

Enjoy!​​

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I very much enjoyed my chat with Latha Venkatesh at The Charles T. Munger Hall in Bengaluru for CNBC – TV18.

It covers Buffett, Trump, Dakshana Foundation, Demonetization, Investing in India and what to look forward in 2017. 

https://m.youtube.com/watch?v=6fkDLax_RmM

https://m.youtube.com/watch?v=IfzgWbyAE4Q

Enjoy!

Here is the transcript of the interview​:

http://www.moneycontrol.com/news/market-outlook/see-trump-making-deals-that-benefitworld-mohnish-pabrai_8170961.html

I co-wrote an article in Forbes on an investment strategy called "The Uber Cannibals."

Uber Cannibals are  companies that aggressively buy back their own stock. I will publish the list of the top Uber Cannibals for a particular year on my blog on March 18 each year.

If you choose to pursue the strategy of investing in Uber Cannibals, you can either start with these 2016 Uber Cannibals now and then rebalance at March 20, 2017, or wait until March 20, 2017 to start investing in the new list of 2017 Uber Cannibals then.  

The Uber Cannibals for 2016 are:

1. AutoZone (AZO) 
2. Magellan Health (MGLN) 
3. Marriott International (MAR) 
4. NVR (NVR)
5. Lowe’s (LOW)

This is a "set it and forget it" strategy. I'd suggest not putting more than 10% to 20% of your nest egg in this strategy. It only makes sense if you intend to follow it for at least a decade or two or longer. The ideal straetgy is in your IRA. That way, there are no realized gains to worry about. 

You can view the article here: 

http://www.forbes.com/sites/janetnovack/2016/12/22/move-over-small-dogs-of-the-dow-here-come-the-uber-cannibals/#2c38ff233dea 

I co-wrote the article with Yingzhuo Zhao, a talented quant at ​Dhandho Funds. 

Enjoy!

Note, anyone who invests in any strategy needs to do their own research/due diligence and are themselves fully responsible for the outcome. 

I thought you would be interested in the following story from Barron's. 

Mohnish Pabrai Thinks GM, Fiat, Southwest Air Look Like Bargains 

http://www.barrons.com/articles/why-mohnish-pabrai-likes-gm-fiat-and-southwest-air

Enjoy!

It is given that, over the course of a fifty-plus year career, one may end up having a dozen or more employers. The law requires all employers to continue to administer your 401(k) even decades after you’ve left the company – at little to no cost to you. However, it is a best practice to rollover your ex-employer’s 401(k) into a Rollover IRA soon after you leave. Some reasons why this makes sense:

1. It’s just easier to have assets in less than 5 bank/brokerage accounts versus a dozen or more.
2. Your IRA gives you far greater choices (at far lower costs) of mutual funds, stocks or ETFs to invest than any 401(k) ever will.
3. Your 401(k) may run afoul of regulations if your ex-employer goes bankrupt or undergoes financial stress. 401(k)s need administrative fees to be paid annually by the employer to file the Form 5500 and allow the administrator to do their job. They may not be healthy enough to pay these fees.
4. Many employers focus on providing 401(k) that minimize the cost to the employer. This usually comes at the expense of higher-fees and limited investment choices for the employees. With IRAs, there are formidable market forces at work to get you the low frictional costs coupled with stellar service. Free-market capitalism works.
5. If your employer’s 401(k) plan is old (which is typical), it may not have been updated to offer low-cost ETFs and newer offerings that may be in your best interest.
6. You may move, or your email address may change etc. It may be hard for your 401(k) plan administrator to get you statements etc.

 
You could choose to roll all your 401(k)s into the same IRA for simplicity. That way, these all important assets are in one place, fully in your control. Once your IRA account value is over $100,000, Interactive Brokers may be your best/cheapest option. Further, you can invest these assets in super low-cost diversified ETFs.

Let’s consider the real-life examples of a wonderful couple I have known for over a quarter century. Prakash and Shoba were among the very first employees at my first business, TransTech. They both joined TransTech in 1991 and left in 1995. I sold the business in 2000. Amazingly, TransTech is still around and thriving, but has had three different owners over the last 25 years.

Not only did Prakash just leave his 401(k) untouched at TransTech since his departure over 21 years ago, both of them have left every 401(k) they participated in with every employer! Between them, they have nine 401(k) accounts scattered amongst a diverse range of employers. The good news is that both did participate in 401(k)s at every employer. And even though they did not maximize what they could have contributed in the early years, the value of these assets today is seven figures – a meaningful portion of their networth.

I counseled them to take a little time and move all these orphaned 401(k)s into rollover IRAs. They have promised to do so, which is great. However, they are not alone. A few days back, The Wall Street Journal ran a great story, entitled, “What Ever Happened to that Old 401(k) You Had?”

http://www.wsj.com/articles/whatever-happened-to-that-old-401-k-1480302720

The WSJ did a great job of providing resources to getting control over these all-important assets that you left behind at some employer that no longer exists decades ago. Participating in 401(k)s and maxing the employer match is important. Of nearly equal importance is the rollover of these assets when you say goodbye to your employer.

Finally, KISS (Keep it simple, stupid), is a great way to go – as our mythical hero Sonia Patel did:
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https://www.youtube.com/watch?v=sk2gJ3TCNSQ