[00:01:59] Patrick Donley: I am happy to have you here. I’ve been following you for quite a while. It seems like on Twitter. I love your content.

[00:02:05] Patrick Donley: I’ve learned a lot from you. So I just want to dive into your history. I want to start off with your early years and specifically, and just hear about your journey into value investing, like how you got turned on to it. And then The books, the teachers that influenced you, things like that. 

[00:02:21] Value Stock Geek: Sure. The main influence for me has been Ben Graham.

[00:02:25] Value Stock Geek: I think a lot of advanced investors tend to roll their eyes at some of the Ben Graham concepts because they’ve become cliches, but I think everything really goes back to that and, Discovering Ben Graham was a major moment for me. I got interested in investing in the late 1990s during the internet bubble and the discovery of Ben Graham was a major revelation for me.

[00:02:48] Value Stock Geek: It was in 2000 when I first came across the Intelligent Investor. I was 18 at My graduation party and a family friend said, Oh, if you’re interested in investing, this is the book you should read. And then I checked it out and I realized, wow, everything that’s going on right now is pretty insane.

[00:03:02] Value Stock Geek: And it was a major wake up call for me. And then just seeing the concepts of margin of safety, the idea of thinking of a, Value and the price are two separate things. Those were all kinds of major wake up calls for me. And then that led me down the whole path of learning about Warren Buffett and value investing and everything else.

[00:03:23] Patrick Donley: Yeah, I wanted to hear a little bit about you’re 18 years old. That’s a pretty young age to get started in investing. Did you have a family member, like a father or an uncle? You mentioned a family friend, but like, how did you first get started? You said it was like the dot com era. I presume you got started investing prior to getting in, like getting into value investing.

[00:03:43] Patrick Donley: So tell me a little bit about that. Like your early years, like at the dinner table, for example, and maybe talking about investing. 

[00:03:50] Value Stock Geek: Yeah, so my parents are like 401k investors. But they were never picking stocks or anything like that. So it was never something that was discussed around the dinner table during the internet bubble, even if even for a high school or everything was just in the air, everybody was talking about the market.

[00:04:05] Value Stock Geek: Like you would turn on the TV and, Everything was about that. And then I was always a computer user. So I was on the web, when I was pretty young, like 95 or so, we were on that. So I was very much in the mindset that the internet is going to change the world. And, maybe we should invest in this.

[00:04:22] Value Stock Geek: And then I had a little bit of money and my parents helped me open up a brokerage account to encourage this interest. And I mostly bought internet stocks and I was You know, very much into the bubble and I didn’t know anything about the market and one of the stocks I owned was Cisco Systems. And all I knew was, Hey, it’s going up and this is great.

[00:04:43] Value Stock Geek: And it’s benefiting from the internet. And then, yeah. And then people heard that, Oh, he’s really interested in the stock market. And I learned, What I could. And yeah, I had a family friend who did pick stocks and he called that at my graduation party. And then he said, Hey, you should check out the intelligent investor.

[00:05:00] Value Stock Geek: And I had never heard of it before. And I said, okay, I’ll check that out. And I thought it made a ton of sense and it really spoke to me. And then, yeah, from there I went on to read books about Buffett. I read Buffettology. That was a good one from Mary Buffett who wrote that book talking about some of his methods.

[00:05:15] Value Stock Geek: And then I started to get into. the Buffett letters and reading some other books. So very quickly, I was indoctrinated with value investing. And then as I saw the internet bubble implode throughout college, it really resonated with me. I’m like, Oh, they were right about everything. It definitely makes sense.

[00:05:34] Value Stock Geek: The people who looked at stocks as ownership shares of businesses did a lot better than people who were just playing this gambling video game that was happening in the late nineties. 

[00:05:46] Patrick Donley: Yeah. So those early investments, did you end up losing money on them? Cisco’s and whatever other internet companies you ended up buying?

[00:05:55] Value Stock Geek: So by 2000, I was all in on Cisco systems, which was, I had my little brokerage account in Cisco systems. And then I actually read the Intelligent Investor and that prompted me to sell Cisco systems. 

[00:06:08] Patrick Donley: So you got out in time?

[00:06:10] Value Stock Geek: I got out, it was a few months after the fact. I, this was like June 2000, May 2000, something like that.

[00:06:17] Value Stock Geek: So it had already been down quite a bit, but yeah, I missed a bulk of the decline. And with that said, it wasn’t much money anyway. So it’s not like I saved a fortune by getting out of Cisco one time. It’s like I saved a couple summers of lawn mowing money. 

[00:06:32] Patrick Donley: It sounds like it’s a great lesson though. I think early losses can be a great lesson to investors.

[00:06:37] Patrick Donley: Having a big win as your first investment can be, sometimes that can be, you think that’s to be expected and that’s definitely not the case, but I wanted to hear a little bit about getting out of college. I understand you had a little bit of debt. I wanted to talk about that, like how you work your way out of debt.

[00:06:54] Patrick Donley: I know you’re into the FIRE Movement, which we’ll get into. So talk to me a little bit about just graduating from college and having a little bit of debt and getting out of it. 

[00:07:03] Value Stock Geek: Sure. So yeah, I struggled a lot getting out of college. I had some financial debt. A lot of that was related to just a toxic relationship with debt.

[00:07:12] Value Stock Geek: life and money. And a big part of that was drinking right now. I’ve been, I haven’t had a drink since 2008. I’ve been sober the whole time. That was a major part of cleaning up my finances and things like that. I got a good job out of school, but I had a bad attitude about it. I was like I have a good job, so I need to go get a cool car and Oh, and I need to go out tonight and Oh, I’ll probably get a raise next year and get a good bonus this year.

[00:07:36] Value Stock Geek: So that’ll take care of that. And yeah, eventually that just led me to one day I realized. Oh my God, I have this mountain of debt that I need to get out under. So at that point I discovered Dave Ramsey. That was my introduction. So I went from learning about the market and I majored in finance in college.

[00:07:52] Value Stock Geek: And then I needed to learn about personal finance. Because clearly all of that head knowledge isn’t really helping me right now. And I think the key thing that he gets is, he’s wrong about a lot of things, but I think the core thing he gets is that personal finance is all about behavior.

[00:08:07] Value Stock Geek: It’s not really about all that head knowledge and all of that math. And I use the debt snowball, which I admit doesn’t make any mathematical sense, but he’s right in terms of the way that it gives you momentum going forward. You list your debts, smallest to largest, and then you attack them one at a time.

[00:08:22] Value Stock Geek: And as you eliminate them, you develop. psychological momentum and you feel like, Oh, I’m really making progress towards this. And I did extreme things like he’s talking about, like the rice and beans kind of thing, like dramatically cutting your expenses. I lived in an unfinished basement for cheap rent.

[00:08:41] Value Stock Geek: I lived on 25 worth of food expenses a week. So I went all out. And then I was out of debt within a couple years. And then I kept that mentality going for a while. And that helped me, really save up the first when I start to have more substantial sums of money where I could get much more serious about this hobby I had when I was younger.

[00:09:03] Value Stock Geek: And that’s what led me to investing. Once I got all the debt cleaned up and I had some money and then I started investing, that’s when my second journey began. 

[00:09:11] Patrick Donley: Yeah. Were you into it, it sounds like you were pretty extreme in cutting your costs. Were you into Mr. Money Mustache or there was another book called Early Retirement Extreme or something like that years ago that’s kind of popular in the fire movement.

[00:09:26] Patrick Donley: Were any of those influences for you? 

[00:09:29] Value Stock Geek: They weren’t around yet, so later on, I discovered them, but yeah, for me, like my late 20s, it was really about getting out of debt. And then by the time I was 30, this was like 2012. That’s when I started to get more into investing all over again. Like I, I wanted to reawaken that hobby.

[00:09:46] Value Stock Geek: And then around that time, I discovered Mr. Money Mustache. And I have read about early retirement. That’s a wild book that takes it too far. I think 

[00:09:55] Patrick Donley: I do too. Yeah. I think that guy lives on seven or 8, 000 a year or something like that is what I want to say. And it’s an older book, but still pretty extreme.

[00:10:05] Value Stock Geek: Yeah. And for him, for his perspective to defend him a little bit, yeah. For him, it’s not just about saving money and being financially independent. For him, it’s like a moral choice about the environment and that type of thing. And then living a life that more reflects his values. That said, I can’t live like that.

[00:10:23] Value Stock Geek: So I don’t do that. But yeah, I discovered the fire movement. Yeah, in my 30s. And that’s when I started really pursuing that aggressively. I wish I had gotten my act together much earlier and then, and I’d be further along in that journey, but yeah, I had discovered it and I think they, they make a lot of sense.

[00:10:41] Patrick Donley: So you got yourself out of debt. You’ve been influenced by Ben Graham and Warren Buffett and these value investors. When you started investing, did you continue to apply value investing principles or did you veer off at all? Or I want to hear about that once you were out of debt and started your investing journey in earnest.

[00:11:01] Value Stock Geek: Yeah, so at that point, I decided to really start buying stocks again, buying individual stocks. And at that point, I was more, I’d say I did more of the Warren Buffett kind of thing. And I actually started there. And then I went more towards Ben Graham after that I started buying a lot of individual stocks.

[00:11:20] Value Stock Geek: And I would have a pretty concentrated portfolio and then I started to realize this has some hits. This has some misses. Some things are working pretty well. Some things aren’t. And I said, I really need to get better at this. So that really led me down to going deep into quantitative value investing.

[00:11:39] Value Stock Geek: And that’s when I first came across Quantitative Value by Wes Gray and Toby Carlyle, and then I read Deep Value, and then I started to apply, and Joel Greenblatt, and I started to move towards more of a quantitative value kind of strategy, and I really started doing that around, I’d say, probably 2013, 2014, something around that.

[00:12:01] Value Stock Geek: 2014 sounds about right. And that’s when I started applying more of that. And I started to, and I had developed my own approach at the same time. And I also started to do a lot of my own backtesting. Like I would use different screeners to develop my own strategies, backtesting them and what I ultimately do.

[00:12:17] Value Stock Geek: Decided upon was this quantitative strategy based on Ben Graham’s simple way methodology, where you would buy stocks basically with low PEs and low debt to equity ratios. And you would form 20 stock portfolios based on that. And then I went in and I added some, a lot of things that like enterprise multiples, like Toby Carlisle suggested, I’d looked for earnings consistency.

[00:12:37] Value Stock Geek: And then I also started to dig into the companies a little bit and start to do some qualitative work to weed things out of there, but for the most part, it was like a deep value, quantitative approach. And then around 2016, I decided I’d like to start interacting with some other people that are out there, whoever is out there and.

[00:12:55] Value Stock Geek: on the internet out there in the value investing community who maybe I could learn from and interact with. And then I started a little blog where I tracked my personal portfolio. And that’s how this whole thing got started. It was just a little blog where I was posting about my personal portfolio.

[00:13:11] Value Stock Geek: And then that’s when I really started to get on Twitter and move on from there. 

[00:13:16] Patrick Donley: So were you in, you mentioned Joel Greenblatt, were you into his, I forget what it’s called, like the magic formula? Were you applying some of the, it sounds like to some degree, you were applying some of his principles. 

[00:13:28] Value Stock Geek: Yeah.

[00:13:28] Value Stock Geek: That was the first quantitative oriented value investing book I ever read. It was the little book that beats the market. And then I moved on to quantitative value and deep value. And I love the little book that beats the market. And I think it’s a great way to think about investing, but there are serious limitations to the magic formula approach.

[00:13:49] Value Stock Geek: Toby Carlyle has actually, his books are all about how the ROIC metric actually detracts from returns. And I think the reason is that when you mechanically buy stocks with high ROIC, you find a lot, especially if they’re in a value kind of bucket, you’re finding stocks that are in a temporary cyclical boom.

[00:14:08] Value Stock Geek: especially if you’re only looking at things on a trailing 12 month basis. And you wind up buying a lot of value traps. And ironically, pure value tends to work a lot better than combining value with ROIC. 

[00:14:22] Patrick Donley: So when you say ROIC, that’s Return On Invested Capital, correct? For our listeners that might not be familiar with that term.

[00:14:30] Value Stock Geek: Yes, that’s correct. Yeah, and I think, so right now I, Look for businesses with higher ROIC. My approach has evolved past quantitative oriented. I’m much more qualitative now. And in the past few years, but initially, yes, I was trying to mechanically find those. And I think what’s missing from that magic formula approach is that Warren Buffett, like the idea is, okay, Warren Buffett buys value, but he also buys quality, which you’re defining as high ROIC.

[00:14:58] Value Stock Geek: But the thing that Warren Buffett is looking for is sustainable high ROIC. He’s not just mechanically buying stocks that have the highest ROIC and like a value bucket. And that’s a much more difficult kind of qualitative endeavor. And I don’t think that you could really replicate that in a simple screen.

[00:15:16] Patrick Donley: So you mentioned Toby Carlisle. Are there other people in the value investing community that have made a big impact on your current approach? 

[00:15:24] Value Stock Geek: Yeah, absolutely. So I did more of this quantitative value kind of thing where I’m looking at very depressed value situations. And yeah, there was a lot of that going on like in the late 2010s.

[00:15:38] Value Stock Geek: And then what I found was during COVID, it was pretty terrifying to own, for instance, a bunch of energy companies and small retailers. During COVID, I had to sell a lot of those. And fortunately, I avoided like a 60 percent drawdown by getting out a lot of those positions around March, but then I didn’t get back in on time.

[00:15:57] Value Stock Geek: And then I started thinking, is this really how I want to do things? Do I want to obsess about macro and try to get out of things before they completely collapse. And I said if I’m going to continue to pick stocks, I need to find basically businesses I’m more comfortable holding for a longer period of time and through sessions, things that can actually perform well throughout an entire economic cycle.

[00:16:17] Value Stock Geek: So that led me into a lot of the work of Pat Dorsey, Who’s written a lot, who’s like the gold standard on notes. That was a huge influence on me. And then I actually went back and I reread the buffet letters, which I hadn’t read since I was in college. And that made a huge impact on me, where I started to realize, oh, I started to get me more back into that Warren Buffett mindset.

[00:16:39] Value Stock Geek: Another one I read that was very influential was Robert Hagstrom’s book, which I thought was very interesting. 

[00:16:45] Patrick Donley: Which one was that? The Hagstrom book. Was that 

[00:16:47] Value Stock Geek: The Warren Buffett Way? 

[00:16:49] Patrick Donley: Yeah. Yeah. That is a really good one. Deep value. I’m not familiar with deep value books. You mentioned, tell me more about that.

[00:16:55] Patrick Donley: Like what was your takeaway from deep value? 

[00:16:58] Value Stock Geek: Deep value is a great book because I think a lot of value investors tend to think of it more in terms of like you’re buying something with this intrinsic value and you’re buying below that intrinsic value. And what that book is really all about is that mean reversion isn’t simply mean reversion in price.

[00:17:14] Value Stock Geek: It’s mean reversion in business performance. So you, So the whole idea that he’s Explaining in that book is that the reason that this works is because there’s fundamental mean reversion that’s happening there. I don’t want to put words in Toby’s mouth, but if I were to take away something like the key lesson of that book, that’s what you’re looking for.

[00:17:34] Value Stock Geek: You’re not really looking for this perfect situation where it’s at a discount to intrinsic value and that’s a fixed amount. You’re really trying to get situations where the business has been through some difficulty and then you’re trying to catch some mean reversion. in the actual fundamental business performance.

[00:17:52] Patrick Donley: I want to talk a little about Motes. Was it Pat Dorsey? Is that who you took a lot of your thoughts on Motes from? 

[00:17:59] Value Stock Geek: Yeah. I learned a lot about Notes from reading his books and he has a very good one that is the little book that builds wealth. That’s like the cliff notes version of a lot of his Motes research.

[00:18:09] Value Stock Geek: And There’s a lot to learn from that. And basically what you’re really thinking about, I’d say if I were to boil it down to this is how easily can this business be disrupted? How easily can this business’s returns on capital fall? And if there’s some attribute to the business, whether it’s. Network effects are one of them.

[00:18:29] Value Stock Geek: There could be regulatory things that keep a business in a strong competitive position. Brands are obviously another source of moat. There’s all these little sources of moats and, but I think at a high level, the way to think about it is to just consider how easily this business can be disrupted. And that’s really how I think about it.

[00:18:49] Value Stock Geek: So right now, what I really do is I apply all those things I learned from quantitative value investing. I’m still using those, but I’m applying them towards a universe of companies that I’ve preselected and that I’m comfortable holding for a longer period of time. 

[00:19:06] Patrick Donley: So it sounds like you’re doing individual stock selection because you love it.

[00:19:10] Patrick Donley: I can tell you just love the research and learning, but you’re also doing this weird portfolio idea, which I want to get into. So tell me, tell our listeners what the weird portfolio is. We’ll get into the allocations of it, but tell me just how you came about with that idea and started implementing the weird portfolio.

[00:19:29] Value Stock Geek: Yeah, this weird portfolio is really my take on Harry Brown’s permanent portfolio. So I learned about Harry Brown’s permanent portfolio. And for those who aren’t aware what the permanent portfolio is, it’s a portfolio. It’s a very simple portfolio, 25 percent stocks, 25 percent long term treasuries, 25 percent gold, 25 percent cash.

[00:19:48] Value Stock Geek: When you test this strategy, it delivers a decent rate of return. Like you’re going to underperform, obviously a hundred percent stocks, but it still gives you a pretty nice rate of return. And the incredible selling point is just the minimal volatility of it. So for instance, in 2008, this portfolio was only down 2%.

[00:20:05] Value Stock Geek: So I said, I want my own version of a permanent portfolio, but I want to add some things to it. So I added, I made it a global portfolio. It’s not simply U. S. stocks. It’s globally diversified. I got rid of the cash component because I have plenty of cash in, for instance, my emergency fund. And I wanted to have more of a pivot to value, to small cap value, a more systematic approach towards value investing.

[00:20:28] Value Stock Geek: I didn’t want as much exposure to large cap bubbles. So that’s the methodology behind that. Now, why I developed that was really My growing frustration with macro. So around 2017, 2018, I started to realize macro was really unpredictable. So going back through my own history, I had some good macro calls and that gave me the false sense of confidence that I had a knack for predicting macro.

[00:20:53] Value Stock Geek: Like I told my family in 2007, this real estate thing is a bubble. You should probably underweight stocks right now. And then when 2008 arrived, I thought, Oh my God, I did it. Then in 2009, I actually emailed my dad near the bottom of the market. And I’m like, you should go all in because of this Shiller peas at this level.

[00:21:12] Value Stock Geek: And I think the market’s attractively valued. So then I’m like, okay, I’ve got this nailed. I’m great at macro. So then, but then the rest of the decade unfolded and I thought QE would cause inflation. Never happened. I thought Fang was a bubble. Didn’t happen. I thought Unemployment. In 2010 it came down faster than it actually did.

[00:21:30] Value Stock Geek: And over again, I’m learning, Oh, I actually suck at this. And then as I started to learn more about macro minds that are out there and I started to research them, I started to realize they’re full of crap too. Like they’re always wrong. Like anytime you actually write down their predictions and then see what actually happened, they’re almost always wrong.

[00:21:50] Value Stock Geek: So I said, I need an approach that. For a portion of my money, where it is just macro agnostic, where I can really just set up a systematic approach, put this to the side, and know that I have some protections for different environments. That was the impetus behind developing the Weird Portfolio.

[00:22:07] Value Stock Geek: And then finally, I started investing that way in 2018 ish, around then, 2017, for a portion of my money, and then when I saw how wrong I was about COVID, where I thought, for instance, I’m like obviously, all these companies have all of this debt, and the economy is shutting down right now. The Buffett metric and the Shiller P are at all time highs.

[00:22:29] Value Stock Geek: Obviously this is the beginning of the end and this is going to be just like 2008 and then that didn’t happen either. So that’s when it, I like half believed macro was unpredictable around 2020 and then COVID happened and I’m like, macro was completely unpredictable and I need a process to insulate me from all of this and the weird portfolio was a key part of it and then with my stock picking a focus of more on companies that could be held for longer periods of time was another.

[00:22:54] Value Stock Geek: piece of the focus. And the whole thing is to just get away from that kind of macro prognostication, right? 

[00:23:01] Patrick Donley: So how do you break it down with your own portfolio? How do you delineate or what kind of allocation are you making towards individual stock selection versus what you allocate towards the weird portfolio?

[00:23:11] Value Stock Geek: So I don’t want to get into specific percentages. Like I’m this weird. I’m this percentage stock, but basically I’ve taken my stock money and I’ve said, Hey, I have it in a tax advantage account because with turnover, you want to reduce taxes. ETFs are a lot more tax efficient. So I set that aside and I said, I’m going to buy businesses just because I love it so much.

[00:23:34] Value Stock Geek: I love researching companies. I love learning about companies. I love trying to figure out how a stock is going to turn around. I love learning about businesses. I didn’t want to give that up. And then the rest of my money is in this weird portfolio situation. And with that, it’s nice because it’s more mechanical.

[00:23:49] Value Stock Geek: I can just take, for instance, every time you get paid, it’s going into a weird portfolio and I’m expanding that. And I can just systematically buy whatever lightweight ETFs every two weeks. And both portfolios helped me in different ways. So the stock picking portfolio really gives me a way to scratch the itch.

[00:24:06] Value Stock Geek: So I don’t screw around with the weird portfolio and change the allocations based on what I’m thinking. And then the weird portfolio gives me confidence to take risks with my stock picking strategy where it’s like, Oh I have this money to the side that is like my fortress of solitude that is safe.

[00:24:22] Value Stock Geek: And that gives me some bandwidth to go out and really try to pick stocks and try to learn about them and try to learn about the market. 

[00:24:30] Patrick Donley: That completely makes sense. Let’s get more into the Weird Portfolio, how you break it down. There’s certain percentages you have, and I want to get into that a little bit and why you chose those specific asset classes.

[00:24:41] Value Stock Geek: Sure. So the Weird Portfolio is 20 percent US small cap value, 20 percent international small caps, 20 percent real estate, 20 percent long term treasury, and 20 percent gold. So the idea there is basically taking Harry Brown’s concept, like I discussed earlier, Increasing that stock allocation, making it globally diversified, pivoting that to value, having some gold in there.

[00:25:06] Value Stock Geek: And the gold is really there for inflationary environments or currency crises or things like that. The long term treasuries are there for recessions and depressions because during recessions and depressions, the Fed tends to cut interest rates. And for instance, in 2008, long term treasuries were up 20 percent while the market was down 37%.

[00:25:25] Value Stock Geek: And my thinking there was, I knew that small cap value and value investing in general helps to avoid major bubbles. It tends to deliver a more consistent rate of return over the long run, but at the same time, it’s not immune to recessions and crises and things like that. And having been You know, so deep in the macro weeds when I was younger, I think about that stuff way too much more than I should.

[00:25:50] Value Stock Geek: So I wanted some protection there. And the key protections in that portfolio are the long term treasuries, which, like I said, would perform well in an environment like 2008 or the early 1930s. And then gold also helps. And gold is there like a safe haven asset if things really go to hell. But it also tends to perform well during the long term.

[00:26:09] Value Stock Geek: Inflationary environments. It doesn’t have an exact tick for tick tracking of the CPI, if anything’s going on like that, but in environments like the 1970s, it did pretty well. And it’s actually done okay since 2019, since we’ve had a bad inflationary situation in the United States. And then it’s also, there’s just like a safe haven asset if everything else likes it, for instance, say the U.

[00:26:32] Value Stock Geek: S. treasury defaulted. I’m pretty sure my stocks would get annihilated. My treasuries would get annihilated, but gold would probably still be worth something. And I would still be alive. I’d still be in the game. 

[00:26:42] Patrick Donley: So to speak and gold, gold, you mentioned Harry Brown. It’s also Dalio’s portfolio, isn’t it?

[00:26:51] Value Stock Geek: Yeah, so Ray Dalio, he has his own version of a risk parody style portfolio like this that he outlined to Tony Robbins in a book, Money Master of the Game, and his version is the all seasons portfolio. That portfolio is that I had issues with both approaches, with Harry Brown’s approach and with his approach.

[00:27:09] Value Stock Geek: I thought that Ray Dalio’s portfolio was way too heavy in the long term treasury bonds. I think 40 percent of the portfolio is there. I didn’t think Harry Brown had enough in stocks. So I settled on my own interpretation of it. 

[00:27:22] Patrick Donley: And you’ve chosen small cap value both in the U. S. and internationally, right?

[00:27:28] Value Stock Geek: Yeah. I thought global diversification was very important. I didn’t want to have a lot of home country bias. I’m definitely in the kind of Jack Bogle mindset where, and this is ironic because Jack Bogle was only a U. S. investor, but that said his whole philosophy, don’t buy, the needle by the haystack and just, you’re going to, everything’s going to work out if you just own.

[00:27:47] Value Stock Geek: So I think the same, your Logic works for countries as it does for companies. So you don’t know which company is necessarily going to outperform. So you own all of them in an index fund for a global investor. You really don’t know which country is going to perform the best. It’s often the United States, but it’s not always the United States.

[00:28:03] Value Stock Geek: So I wanted some global diversification there. And then with the pivot to value, that’s really about avoiding major bubbles. So small cap value, while it draws down in a nasty way during the initial kind of bear market, it can still deliver a decent rate of return over, say, like a decade. Because it’s more of grinding out a return.

[00:28:22] Value Stock Geek: You’re selling companies that are depressed. You’re selling them when they’re stronger. You’re collecting dividends across the way. So it tends to deliver a kind of more smooth rate of return than the boom and bust that you see in large cap growth. And you saw this in places like Japan after the Japanese bubble imploded.

[00:28:39] Value Stock Geek: If you were a small cap value investor, you still, it hurt. You didn’t do great, but you were way better off in a systematic value strategy than you were just buying large cap stocks.

[00:28:50] Patrick Donley: So are you also, did you say 20 percent of that is in real estate? Did I hear that correctly?

[00:28:56] Value Stock Geek: REITs. Yeah, specifically REITs. And that’s also about inflation protection. So that’s more about like Real estate values at the very least should increase with the cost with replacement costs over time. REITs can collect rents from whatever industry they’re in, whether it’s an office REIT or whether it’s a residential REIT, and rents should increase over time with inflation.

[00:29:17] Value Stock Geek: If you plug it into a backtest, REITs tend to just perform like small cap value, but I thought it was important to have a very specific allocation to that to try to have an added layer of inflation protection in there. 

[00:29:31] Patrick Donley: Outside of this, the Weird Portfolio and your individual stock picking, are there any other investments that you do or do you just primarily focus on?

[00:29:40] Value Stock Geek: That’s it. So I have the Weird Portfolio, which is my main asset allocation strategy. And then I have cash, which I keep in T bills and a high yield savings account, which is my emergency fund. And then I have my stock picking, which is my real, my real passion. 

[00:29:55] Patrick Donley: Your love. Yeah. And you analyze a company a week, right?

[00:29:59] Patrick Donley: And write up a report on what you, on your findings. Is that right? Looking at 10 Ks. 

[00:30:04] Value Stock Geek: Yeah, that’s right. And that was really inspired by Warren Buffett. So Warren Buffett, he said, if I were you, I would be like, he was, I forget who he was talking to, but he was talking to someone. If I were you, I would learn about every business in America.

[00:30:16] Value Stock Geek: He said, that’s how you should start investing. And they said there’s a lot of companies. And he said, we’ll start with the A’s. So that was Warren Buffett’s advice. So I really took that to heart. And I said if I want to really perform well as a stock picker, that’s the direction I should take. I should really stop trying to perfect a back test.

[00:30:34] Value Stock Geek: And I should really focus more on, and then trying to figure out what’s happening with macro. And I should really apply that. I should really start learning about businesses consistently. And then the nice thing about that substack is it forces me to do that every week. I need to get out an article and whether I feel like it or not, I spend a week researching that company, learning about it.

[00:30:56] Value Stock Geek: And basically what I’m trying to determine, first of all, is this a wonderful company? Is this actually a company with a boat that I think can sustain high returns on invested capital? And I learned about them. And the nice thing about that is in the past, when I was more of a deep value kind of investor during a big crash, the screens would all change.

[00:31:15] Value Stock Geek: And I’d have to start from scratch and start, Oh, here’s 20 stocks on the screen. And I have to research all of them. And I realized that was very limited because first of all, that crash could end very quickly. By the time you’re done all your research, you could have. missed out on all the opportunities. So I wanted to say I want to watch a list of companies I like, and they may not be attractive right now, but you know what?

[00:31:35] Value Stock Geek: I’m going to understand them. And if they ever are available at an attractive price, I’m going to buy them. And that’s been a great way of going about this. And I’ve also learned so much just by going through a company every single week and digging into it and trying to figure out the economics of it.

[00:31:49] Value Stock Geek: I’m just learning so much about all of those businesses and just about the world in general. by going through that practice every single week and doing that. Yeah, it’s such a great practice. 

[00:31:59] Patrick Donley: I think I remember listening to a talk that Lee Liu gave and he, it was, I think at Columbia to some students and he recommended that they get ValueLine and go, same thing, go through these, start at a, or I think it started at one, there’s like thousands of companies listed in ValueLine and go through all of them.

[00:32:17] Patrick Donley: And he did, I think he actually did do that practice. Buffett probably did. Is ValueLine something that you utilize? 

[00:32:23] Value Stock Geek: I’ve checked it out before. It’s not the key thing that I use. The main resources I use right now, I use quicktest. net a lot. That’s a great website where you can download like over 20 years worth of financials, export it to Excel, and then you can go through and you can, that really tells you a lot about the company.

[00:32:40] Value Stock Geek: And then I will go into the public filings and then I start there, check out the economics. Is there something about this that interests me? Does this look like it’s possibly an interesting opportunity? And then I go into the SEC filings and I try to understand them. And I try to find out how this business makes money.

[00:32:56] Value Stock Geek: Is there some kind of secret sauce that they have going on that is a source of moat that allows them to earn these high returns? And then the last piece is Valuation, which is always in a state of flux. Often when I go through these companies, if it is a good company, it’s usually not at a good price.

[00:33:13] Value Stock Geek: And then I’ll add it to a watch list and move on. In a lot of situations, I thought when I was looking at the company, there’s no way this is ever going to get cheap. And then it happens sometimes. It happened to me with Meta. I looked at Meta a long time ago and I said this will never be in the value bucket.

[00:33:27] Value Stock Geek: And then Within a year was so yeah, it’s a great exercise to go through and learn about these companies and pretty much all of them are at some point going to be available at an attractive price. 

[00:33:37] Patrick Donley: What else is in your, like your tech stack or your toolbox that you’re using to do your analysis? Is it pretty straightforward?

[00:33:44] Patrick Donley: You, I wasn’t familiar with the website that you mentioned with all the historical financial data, but tell me more about your tech stack. 

[00:33:52] Value Stock Geek: Yeah, it’s not that sophisticated. It’s quickfs. net. That’s a great website. It’s not, my methods aren’t sophisticated. Quickfs. net is a sophisticated tool.

[00:34:02] Value Stock Geek: But yeah, you can go in there. You can quickly bring up any company and if you pay, you can download all of these financials. So I don’t have any affiliation with quickfs. net. I just like the tool, but yeah, I download it and you can get, look at 20 years worth of financials in terms of companies that pick.

[00:34:17] Value Stock Geek: I tend to go through a lot of different sources to just get ideas for companies I should look at. I look at a lot of big investor holdings, an investor I respect is Terry Smith, for instance. I’ll look through his holdings. He often pays, he pays higher prices than I would ever pay, but he has a very good eye for quality.

[00:34:34] Value Stock Geek: So I’ll go through his holdings. I go through a lot of ETF holdings. I mentioned Toby Carlisle. I look at his Zig ETF. I see what he’s up to. I look at QVAL. That’s Wes Gray’s ETF that’s based on Toby’s work. I’ll look at some quality ETFs like QAL. That’s an iShares product. I’ll look at that. The Wellesley fund, they have a lot of very interesting, like dividend paying companies that I’ll take a look at.

[00:34:56] Value Stock Geek: And then, a lot of major sourcing of ideas is like just driving around and looking at things. Like I stumbled into a tractor supply and I’m like, what’s this place like? And I’m long tractor supply now, but yeah, just. Yeah, just saying Hey, that parking lot looks full. I’m going to check that out.

[00:35:12] Value Stock Geek: I do less of the mechanical screening. Like I used to run very specific screens, restrict my universe to that. But now I’ll look at anything I just want to learn. I’ll learn about any business. And if it’s not at a great price right now, okay, I’ll move on to the next one and keep an eye on it and someday it will be at an attractive value.

[00:35:33] Patrick Donley: Yeah, I like the cloning idea. You mentioned Terry Smith and just looking at investors that you admire and maybe copying them to some degree, there’s a great, do you ever, have you ever been on Data Roma? I think it’s called D A T A R O M A and it shows the holdings of all the top value investors.

[00:35:50] Patrick Donley: Have you ever come across that website? 

[00:35:52] Value Stock Geek: Yeah, I use that. And yeah, that’s where I used to see what Terry Smith is up to. You can see what Pat Dorsey is up to. You can see, yeah. Any big investor, Monish Babrai, anyone you can think of, you can go on there and you can see what they’re up to. And that’s always a nice thing to look at.

[00:36:08] Patrick Donley: Yeah, it’s great. It’s a little delayed because, it’s whatever a quarter late or something like that, but it’s such a great source of information,

[00:36:14] Value Stock Geek: I think. Yeah, absolutely. I love going on there and seeing what a lot of big investors are up to. I would say to that, though, don’t simply follow an investor into an idea.

[00:36:25] Value Stock Geek: Definitely. do your own work. And it’s not just about maybe they’re, they’ve made a bad investment. That’s possible. But the key thing is you need to develop your own conviction about things. Like once something goes wrong, if you just copied an investor, you’re not going to be able to stick to it.

[00:36:38] Value Stock Geek: You’re not going to be able to hold it. You need to have some conviction yourself and have some understanding of the business you’re buying, rather than just follow an investor into it. That said, it’s a great way for idea generation for companies to look at companies and research. It’s a great starting point, I think.

[00:36:55] Patrick Donley: And I like the idea of just driving around. That’s a Peter Lynch idea, right? Look around you what businesses are doing well? It’s, you can, you keep your eyes and ears open and you’ll be able to figure it out. 

[00:37:04] Value Stock Geek: Yeah, totally. And I’ve gone through an experience with Peter Lynch’s ideas where I’ve looked at, That in the past like, oh that’s naive.

[00:37:11] Value Stock Geek: Like just buy what you know, that’s ridiculous. But then thinking about it, I’m like, if I just bought stuff I liked, like dominoes and home Depot and Amazon and stuff like that, I probably would be much more wealthy if I went back. And then all the other weird things I bought, if I just did stuff like that, so yeah, trust your own judgment.

[00:37:28] Value Stock Geek: If you see a business you like, that’s a great starting point. I’m not saying. Just buy stuff you like. Neither does Peter Lynch. He advocates you do research beyond that, but it’s a good starting point. If you’re into something or someone in your family is into something, you see them going to a specific store or website all the time.

[00:37:45] Value Stock Geek: It might be worth looking into it and seeing what’s going on there. 

[00:37:48] Patrick Donley: There was a tweet that you had recently, and you asked what’s the most overrated investment book? I wanted to hear what your findings were. What were some of the things that, what you think, what some of the, your followers thought?

[00:37:59] Value Stock Geek: Oh, that’s a controversial question. I think there’s a lot of people trolling and saying the Intelligent Investor by Ben Graham. I disagree with that. I do agree with them in the sense that it is a very dense book and it is a bad place to get started. I think a much better starting point for an investor would be something like the little book that beats the market by Joel Greenblatt, which is extremely accessible.

[00:38:21] Value Stock Geek: You can sit down and read that in like an afternoon. That’s a great starting point to learn the basic principles of value investing. So yeah, some people said that they said Ben Graham’s work. I said, I disagree with that, but I understand what they’re saying. Their margin of safety came up a few times by Seth Klarman.

[00:38:37] Value Stock Geek: I like margin of safety. I think it’s fine. I think it’s a decent book. I wouldn’t pay 1, 

[00:38:43] Patrick Donley: Yeah, I was going to say, it’s a thousand dollar book, at least without, I looked it up on Amazon recently. It was like, Whoa, I don’t think I’m going to be buying that anytime soon. 

[00:38:52] Value Stock Geek: Yeah. I think that the limited supply of it has increased its reputation maybe beyond where it’s deserved, but I still think it’s a pretty good book.

[00:38:59] Value Stock Geek: I don’t have any major issues with it. They mentioned Principles by Ray Dalio, which is, which I thought was, I thought it was a good one. You read about these, he’s written all about all of these principles he has. And, there was a book that just came out, The Fund, which is all about Bridgewater and a lot of things, what that’s actually like in practice.

[00:39:18] Value Stock Geek: And most people can’t really handle it, like the radical transparency and all that. And I don’t know if it’s really a great way to run a business to have all that radical transparency where people are, sharing brutal feedback with each other. And yeah, I thought that kind of ranked highly up there, but yeah, it was a fun little tweet.

[00:39:35] Patrick Donley: Yeah, that is fun. I also wanted to hear a little bit about your podcast that you’ve been doing. Talk to me about some of the guests that you’ve brought on and just have any of them, I don’t know, changed your thought process at all? Or is it not an echo chamber, but are you bringing on guests that will challenge your own thinking at all?

[00:39:51] Value Stock Geek: Oh yeah, I have people from all kinds of different persuasions and stock strategies. Yeah. Like I’ll talk to, like I mentioned, I don’t include macro in my process, but I talk to a lot of people about macro and I’m always interested to hear from successful macro investors and hear what they’re doing, hear their perspective on things.

[00:40:11] Value Stock Geek: Yeah. And I have people from all kinds of different persuasions. So I’ve had JL Collins there. He’s a 100 percent stock indexing investor. That was a great interview. I don’t invest in 100 percent stocks, but I think there’s a lot you can learn from him and a lot from that strategy. And that was an excellent interview.

[00:40:27] Value Stock Geek: His book is called The Simple Path to Wealth. The Simple Path to Wealth. And I’d say if you are starting out and you just want to learn the basics of investing, buy that book, follow the plan, and it’s probably going to work out over the long run. So yeah, so that’s a great book. I have macro guys like I had Citrini on.

[00:40:44] Value Stock Geek: That was a great conversation. We talked about GLP ones. We talked about artificial intelligence. I have people that are like more of a Buffett persuasion. I’ve had them on like the science of hitting. He had a great interview. I talked to him about a lot of different things. I’ve talked to Toby Carlisle.

[00:41:00] Value Stock Geek: I’ve talked to Lawrence Hamtil. He has a very interesting perspective. It’s very oriented towards industries and sectors, and he’s interested in a lot of very cool businesses. I’ve had very deep value guys like Evan Blecker. He does exclusively net nets. So I had him on the podcast and that was a great interview.

[00:41:20] Value Stock Geek: I’ve had some long, short guys, like I don’t short stocks, but I’ve had for instance, George Lovatos from Upslope Capital. That was a very interesting interview, but yeah, overall, it’s just a cool opportunity to have really interesting conversations with investors that I respect. And they’re from all kinds of different persuasions and ideas.

[00:41:38] Value Stock Geek: And yeah, I learned something new from all of them and they’re really cool conversations that I have. 

[00:41:43] Patrick Donley: What about, you’re into the small cap stuff. What about Ian Castle? He’s more like micro stuff, micro cap, but have you ever had him on? 

[00:41:49] Value Stock Geek: I’m trying to get him on. I approached him a couple of times.

[00:41:52] Value Stock Geek: He’s been busy, but I’m sure he’ll come on eventually. But yeah, I love Ian Castle. He’s a really entertaining guy. 

[00:41:58] Patrick Donley: He’d be a good one. I want to touch a little bit on movies. I know you’re like a movie guy and I am too. So I wanted to hear some of your top money, investing movies that you love, like something you’d watch year after year.

[00:42:11] Value Stock Geek: Investing movies. You got to go with trading places, right? That’s a no. Fantastic movie. Hilarious. Eddie Murphy in his prime. That’s an amazing film to watch. Another one I like is Other People’s Money. That’s a pretty funny one with Danny DeVito. That’s a very good movie. It’s, he’s a corporate raider and he buys like, it’s actually, the company he’s buying sounds like Berkshire Hathaway.

[00:42:31] Value Stock Geek: Like it’s New England, like they do wire and cable, New England wire and cable. They’re getting destroyed competitively. It’s like a dying business and he wants to go in and liquidate it. And what I really like about that movie, so there’s Wall Street, which I feel like is almost like a, it’s a cool movie, but it’s almost like only giving you one side of the argument, like a very Marxist side of the argument, like capitalism is evil and these guys are terrible.

[00:42:54] Value Stock Geek: Other people’s money gives you the other side of the argument for the corporate raider. So he’s Hey, this company sucks. It’s. Bleeding money. Why don’t we just end this enterprise? And then he actually gives a great speech at the end of the movie where they’re meeting with the shareholders trying to decide whether or not to liquidate the company.

[00:43:10] Value Stock Geek: Like they’re going to elect his board and liquidate the company. And yeah, Gregory Peck is the CEO of the company. He gives this very inspirational Gregory Peck style speech of why this needs to be saved and how it’s about more than the company. It’s about saving America and all this cool stuff.

[00:43:26] Value Stock Geek: Any other movie, they would just end it there and he’s right. And the corporate raider is wrong, but they actually have Danny DeVito come up and give the other side of the argument and it’s compelling. It’s like, where, why are we keeping this thing in business when it’s not making any money for anybody, take the money invested in something with a future rather than trying to keep this thing that’s already dead alive.

[00:43:45] Patrick Donley: I’ll have to check it out. I’ve never seen it. I’ve heard of it, but I’ve never sat down and taken the time to watch it. 

[00:43:50] Value Stock Geek: Yeah, it’s a good one. And then there’s the gambler. That’s a good movie with Mark Wahlberg. The famous has the famous F you money speech in it from John Goodman. That’s a great movie.

[00:44:00] Value Stock Geek: Yeah, I like that one. Recently, I re-watched The Color of Money. That’s a good money movie, more of a gambling movie, but that’s about. Is that Paul Newman? Yeah, Paul Newman and Tom Cruise, they’re pool hustlers. That’s a good film. But yeah, those are some good money movies, I think. 

[00:44:16] Patrick Donley: I want to talk a little bit about investing in love stories.

[00:44:18] Patrick Donley: Is there anything right now in your investment that you’re really particularly fond of that holds a special place in your heart? You love checking the price action on it and just following it. Do you have anything like that right now? 

[00:44:29] Value Stock Geek: Yeah. Yeah, I’m really having fun. I invest in Taiwan semiconductor. So I picked that in December 2022 is that a P of 12, the expectation was we were at a bad point in the semiconductor cycle.

[00:44:41] Value Stock Geek: It’s been perpetually cheap since then, because everyone’s worried about an invasion from China. My attitude is that if China invades Taiwan, your portfolio doesn’t matter that much because we’re in World War III. It’s my thinking there, but yeah, great company. They manufacture the chips for companies like Nvidia and Apple.

[00:44:58] Value Stock Geek: They’re really like the engine of everything that we’re seeing right now with AI that is really made possible by TSM’s manufacturing methods. And it’s still, it’s not as cheap as when I bought it, like right now, I think it’s around 18 EV bit, something like that, but it’s a fantastic business and I like owning it and I like following it.

[00:45:16] Patrick Donley: I want to actually ask you with all these podcasts guests that you’re having on, do you fall prey to shiny object syndrome where they’re talking about ideas and you’re influenced by them and you’re changing your own strategy? Do you have flexibility there? Are you pretty, this is your, I want to hear 

[00:45:32] Patrick Donley: about that a little.

[00:45:33] Value Stock Geek: I’m pretty set in my ways. So yeah, I don’t really have that syndrome. But I do talk to people and learn about what they’re doing, but no, I haven’t really changed any of my investing practices. When I talk to stock pickers, I can get some good leads there. Like I’ll have a stock picker on and they’ll mention a company I’ve never heard of.

[00:45:52] Value Stock Geek: George Lovatos, he tipped me off to Ball Corp. That was an interesting one that I looked into. Yeah. Ball Corp. Is that what they do? They make aluminum cans for Bud and Coke and Pepsi. And that, that’s a pretty fantastic business. I don’t think so. When I looked into it, I didn’t think it was necessarily at the right price right now, but I think it’s a great enterprise.

[00:46:12] Value Stock Geek: It’s got a great moat. Often they have their manufacturing plants set up right next to the brewers. So I think it’s a great little business. 

[00:46:22] Patrick Donley: I wanted to hear if there’s like a younger listener that’s listening right now, what would you tell yourself or what would you have done differently?

[00:46:29] Patrick Donley: Looking back on things in your own investment journey and process. 

[00:46:33] Value Stock Geek: Sure. I’d say if you’re younger, you want to really focus more on your career and your personal finances than necessarily like stock picking or that kind of thing. This is a Harry Brown thing. He says that your career is your most important source of your wealth and he’s right.

[00:46:49] Value Stock Geek: You want to really focus as much as possible on your career in those early stages so you can get yourself a good income in the future. You don’t necessarily want to Spend all of your time buried in 10 Ks and then neglecting your actual job. You want to really focus on advancing your career because that’s where a bulk of your capital is going to come from saving towards your career.

[00:47:08] Value Stock Geek: I’d also say you want to really focus on personal finance. Like I mentioned, I had to go back to basics. Like I was a finance guy in college. I had learned all this stuff about the stock market, but I found myself in a bunch of debt. And I think if you talk to me, A lot of people, like even people in the financial industry, if they may not admit to it, but there’s a lot of them that are in tons of debt and are in atrocious shape with their personal finances.

[00:47:32] Value Stock Geek: So I’d say the key thing is to establish those habits early on where you’re doing things like avoiding bad debt, you are saving a fixed percentage of your income, you’re automating your investments. You’re very conscious about your spending. You’re just not going out there and mindlessly spending money.

[00:47:49] Value Stock Geek: You want to establish those good personal finance habits early on. I’d also advise that if you do get into stock picking and that type of thing to really write down and keep an investment journal. So you don’t necessarily have to do it publicly like I do on a blog, but If you just keep an investing journal, that will really help you out later on.

[00:48:09] Value Stock Geek: So when you ultimately go ahead and sell it and say the investment didn’t work out, you can say what I thought two years ago about that? Or even what did you think about macro macroeconomic situations? You might say Oh, I think there’s going to be a recession next year. And here’s why.

[00:48:23] Value Stock Geek: Write that down in your journal. And I think over time that will start to reveal to you that you’re probably wrong about a lot of things because people tend to be very selective about what they remember. They remember the wins and they don’t remember the losses. And then from that, you can really learn a lot.

[00:48:39] Value Stock Geek: So I would just say that’s a huge thing. Take rigorous care. Bye. notes on what you’re doing and keep a journal and monitor your investments and that type of thing. And then overall, I’d say like at that stage of the game, you’re not dealing with enough money where your specific allocations and portfolios matter too much.

[00:48:57] Value Stock Geek: Say you’ve saved up 20, 000, you lose 10 grand. If the market crashes 50%, that’s painful, it’s not. You have 40 years to continue to make money. And in the long term, that’s going to be a drop in the bucket compared to what you’re going to have someday if you stick to an investment program.

[00:49:14] Patrick Donley: Yeah, those are all really good pieces of advice. I want to do a quick fire round if you’re up for it. Do you have time? 

[00:49:19] Value Stock Geek: Yeah, sure. Let’s do it. 

[00:49:21] Patrick Donley: Cool. The first question I had was, what’s been your best investment so far? 

[00:49:25] Value Stock Geek: My best investment so far? In my current portfolio, it’s Meta. I’m up about 125%, something like that, on Meta from where I bought it.

[00:49:34] Value Stock Geek: Yeah, so that was a really good one. That one worked out really well. 

[00:49:37] Patrick Donley: So at what point did you buy that a couple of years ago, then a little after COVID or when? 

[00:49:42] Value Stock Geek: I bought it in the middle of 2022. So I was actually early to it. It kept falling through December. And that was a good situation where it was a really good company.

[00:49:52] Value Stock Geek: And if you looked under the hood and you looked at the actual financials, you saw revenues were growing. If you looked into their investor presentations, you saw that the daily average users were increasing. It was an ideal value situation. It also taught me not to move so quickly. Like I, I think I was a little bit too eager to buy it.

[00:50:09] Value Stock Geek: So I bought it, like I said, early, like the middle of 2022. I should have probably waited a little bit for more of a blowout, but still worked out and still worked out. Okay.

[00:50:18] Patrick Donley: I want to hear, if you want, your thoughts on Bitcoin. Love it? Hate it? 

[00:50:23] Value Stock Geek: My thoughts on Bitcoin? I’m not really a huge fan of Bitcoin. From an investment standpoint, my view on it is that there’s the risk that the government can make it zero.

[00:50:34] Value Stock Geek: That’s my main concern with Bitcoin, where I feel like if you read about a lot of the use cases for Bitcoin right now, a lot of people are. It’s used by human traffickers and terrorists and North Korea has their own mining operations because they’re an impoverished society trying to make money in any way, but I’m pretty sure.

[00:50:57] Value Stock Geek: If we go to war with a rogue state or there’s a terrorist attack and then they tie the funds back where it was moved via Bitcoin, I could see them ending it. The US government has already, in the past, ended private ownership of gold. It was crime owned gold in the 1930s.

[00:51:13] Value Stock Geek: And I think if they have the incentives there, they could absolutely do something that could potentially make Bitcoin a zero. So for that reason, I still look at it as pretty. Speculative kind of investment, and I’m not really sure if we know what the use cases are for Bitcoin right now. I think that it doesn’t really work too well as a medium of exchange like a currency because I can make a deal with you today to do something in Bitcoin and if I say I’m going to pay you one Bitcoin for this task it could rise a hundred percent.

[00:51:44] Value Stock Geek: It could decline 50%. I know that the proponents of it say that volatility will slow down over time as there’s wider adoption, but I don’t know. So for that reason, I considered it more of a speculative thing, but that said, I need to get some Bitcoin people in my podcast who can maybe open my mind to that, but that’s where I’m at right now.

[00:52:04] Patrick Donley: Yeah, no, thanks for sharing that. I wanted to hear too, like you go back to your, when you were 18 and somebody gave you Ben Graham’s book to your 18 year old self, what book would you give to somebody that’s 18 and just starting to get interested in investing and showing the sparks of the love of investing.

[00:52:21] Value Stock Geek: I would give them the simple path to wealth by JL Collins. And I would say, this is great, this is a great place to start. Like the place to start is more on the, I think the indexing side of things and keeping things simple. And if you do that, you stick to this, it’s going to work out over the long run.

[00:52:38] Value Stock Geek: Then I would say, if you are interested in stock picking and you want to get more into that side of things, I think a good starting point would be. The Little Book that Beats the Market by, by Joel Greenblatt, and then I’d say you should also go in and read a lot of the Buffett letters. Another great Buffett resource is a book called Tapdancing the Work, which is a collection of, like, all of his best articles.

[00:52:58] Value Stock Geek: That would be another place. 

[00:53:00] Patrick Donley: Yeah, that’s a good one. Do you read many biographies like snowball or different biographies on investors that you love? 

[00:53:06] Value Stock Geek: Oh yeah, I’ve, I actually just recorded a podcast about the snowball. I just reread it. So myself and the Canadian dividend investor got on and talked about it.

[00:53:14] Value Stock Geek: But yeah, that’s, the snowball is an incredible book. 

[00:53:17] Patrick Donley: Yes. Yeah. Alice Schroeder, I think the author. Yeah. I remember reading it when it first came out. It’s dense, but it’s so good. It’s yeah. It’s a page turner for sure. 

[00:53:26] Value Stock Geek: Yeah. A little controversial because Warren Buffett doesn’t really, he doesn’t seem to like it too much because probably a lot of it.

[00:53:33] Value Stock Geek: hit pretty close to home. To his credit, he opened himself up to this biographer and he said, write the least flattering version. And I think that would be a tough thing for anyone to do. If someone interviewed everybody in your life and wrote the least flattering version of it, that would probably be a hard thing to read.

[00:53:48] Value Stock Geek: I get where he’s coming from, but it’s a great book. 

[00:53:51] Patrick Donley: Yeah, for sure. Value Stock Geek, this has been a lot of fun. I really enjoyed this. Thank you for your time. Before we sign off, is there anything that you wanted to talk about that we didn’t get to touch on? And how can people find out more about you, learn about what you’re up to and things like that?

[00:54:06] Value Stock Geek: Yeah. So you could check out my sub stack. That’s where I publish a company right up every week. I publish a podcast every week. So that’s the best place to learn about my content right there. It’s a security analysis. org. You could go to valuestockgeek. com that also redirects there. That’s really where I’ve got everything.

[00:54:24] Value Stock Geek: I’ve got all of my write ups, updates on my portfolio, and then all of these podcast conversations that I’m having. 

[00:54:31] Patrick Donley: Nice. And then you’re fairly active on Twitter as well, right? 

[00:54:35] Value Stock Geek: Yeah. I stay active on Twitter. The handle’s at value stock geek and yeah, I try to post something at least once a day. So I try to keep up with that.

[00:54:41] Value Stock Geek: And I meet a lot of cool people there. 

[00:54:44] Patrick Donley: Cool. Yeah. We’ve connected through Twitter. So it’s a great tool. I will put all this in the show notes. So all those links will be there and people can find out more about you, but thanks a lot for your time today. This has been a lot of fun. 

[00:54:54] Value Stock Geek: Yeah. Thanks. I enjoyed this as well.

[00:54:56] Patrick Donley: Okay, folks, that’s all I had for today’s episode. I hope you enjoyed the show and I’ll see you back here real soon.

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