Hottest links for Tuesday, January 14th, the late edition (see Monday’s edition here). Get our free daily newsletter (which HAS BEEN RECENTLY UPDATED) and never miss a single linkfest. Also, now if you sign up you will get our new e-book on value investing.

Top stories for today are included below.  Some great ones today, including a very expensive dinner with Goldman Sachs (to the tune of $34 million), a day in the life of a Wall Street Intern, and a comparison of The Wolf of Wall Street to It’s A Wonderful Life.

Hottest Links: Stories

Value Investing

An Examination of Berkshire Hathaway’s Retained Earnings Test

Warren Buffett’s 2012 annual letter to shareholders is a good example of how CEOs should accept accountability.  Mr. Buffett reported on Berkshire Hathaway Inc. (NYSE:BRK.A) (NYSE:BRK.B)’s “subpar” year as measured by criteria he set in advance and predicted that 2013 could also be “subpar” based on the same criteria. [The Rational Walk]

Berkshire vs. S&P 500 Hottest Links

Ten quotes on the question of financial bubbles

As Barry Ritholtz has said we seem awash in a “bubble of bubbles.” As the stock market continued to make new highs throughout 2013 (and early 2014) the idea that the stock market was in a bubble became a popular topic in the financial media and blogosphere. [Tadas Viskanta, Abnormal Returns]

Hope over experience

The phrase “the triumph of hope over experience” is credited to Samuel Johnson.  I thought of it recently when I saw a pie chart in InvestmentNews from a survey of financial advisors who were asked this question: “In 2014, which investment strategy is more likely to produce the highest net returns?” [Tom Brakke, Research Puzzle Pieces]

Klarman’s Margin of Safety: Ch.13 – Part 3

In Chapter 13 (Portfolio Management and Trading) – Part 3 below, Klarman shares his thoughts on a number of portfolio construction and management topics such as risk management, hedging, and correlation. [Portfolio Management Jar]

Should I still be holding Steel Partners LP?

This is the first in my series of reviews about each and every portfolio holding. I’ve started with Steel Partners Holdings LP (NYSE:SPLP) because the unit price is approaching the sell target established when I began accumulating units in the second quarter of 2012. Now that we’re approaching that target price should I be selling or has the intrinsic value of the holding company increased such that I should continue to hold? [Long Term Value Blog]

Broker price scramble kicks off

No longer can the holdouts mask their costs with commission. Over the next couple of months everyone will have to reveal their hand, because trail commission can no longer be paid from new investments from 6th April. [The Accumulator, Monevator]

Funds

Everyone’s Buying Cyclicals (except hedge funds, who are selling everything)

This past week, we see that everyone is buying, save for hedge funds, who are net sellers for the second week straight. Flows are rotating away from defensives and “bond-like stocks” with a clear favoritism for cyclicals, which Bank of America Corp (NYSE:BAC) says should persist into 2014 as economic growth picks up. [Joshua M Brown, The Reformed Broker]

flo2ws Hottest Links

Discount Window Stigma

In this post, we show that during the last financial crisis banks were willing to pay large premia to avoid borrowing from the DW, suggesting that DW stigma is an economically important phenomenon.  [Olivier Armantier, Liberty Street Economics]

Ch1_dw-stigma Hottest Links

What Have We Become? The Wolf of Wall Street vs. It’s a Wonderful Life

One film I was excited to finally share with my children; the other I would never recommend to them. One, a celebration of the best of the human spirit; the other, a caricature of the depths of our depravity. One, a classic story of repentance, redemption, and reconciliation; the other, of outrageous exploitation, manipulation, and hubris. [John Bowman, ValueWalk]

Mr. Market Says, ‘I Was Too Complacent’

The JUMBO CBOE VOLATILITY INDEX (INDEXCBOE:VXB) is ahead by 9.3% late in Monday’s session as the S&P 500 (INDEXSP:.INX) drops 1.3%. Sure, Goldman Sachs strategists’ assessment that U.S. stocks have grown expensive is part of the story. [Brendan Conway, Focus on Funds]

Dinner with Goldman Sachs cost him $34 million

So how did the dinner end up costing him $34 million? In a nutshell: It was dinner with Goldman Sachs Group Inc (NYSE:GS). And it led to a dispute between Oei and the bank that is now at the center of a lawsuit in federal court in New York. [Brett Arends, MarketWatch]

Picking at Country Style Cooking’s Guidance

Truth stranger than fiction department: Shares of Country Syl Ckng Restaurant Chain Co Ltd (NYSE:CCSC), operators of a chain of popular restaurants in China, are sizzling after the company issued a press release today saying it “anticipates” fourth quarter revenue will “slightly” beat guidance.  [Herb Greenberg, Herb on TheStreet]

A Day in the Life of a Wall Street Intern

Shaun Khubchandani’s 10-week internship at Citigroup Inc (NYSE:C) in 2010 didn’t leave him with much free time. [Lindsay Gellman and Shayndi Raice, MoneyBeat]

Citi v Abu Dhabi – Will it Ever End?

Two of the largest financial institutions in the world may again be heading back to court as one of the most toughly fought battles since the financial crisis began looks set for another round. [Elizabeth Pfeuti, aiCIO]

Jones Energy valuation

Since its IPO, Jones Energy Inc (NYSE:JONE) has completed an accretive acquisition in the Texas panhandle. Despite its orphaned status, JONE appears to have an exciting near term event path including the lockup expiration, well results utilizing a new completion design, and 2014 guidance. [Dedwardssays]

Hottest Links: Not The Onion

Cyclist left with 7-week erection after accident

Doctors who treated him first attempted compression with a special dressing for two weeks but this proved temporary and, as a soon as it was removed, the erection resumed. [Belfast Telegraph]