Whitney Tilson’s email to investors discussing Charlie Munger‘s Daily Journal annual meeting & my lunch after; How Not To Be Stupid; Myriad Genetics; Marc Cohodes; phone holder.
1) Charlie Munger’s Daily Journal annual meeting is coming up in 4½ weeks on Thursday, Feb. 14th at the DoubleTree Hilton in downtown Los Angeles. It starts at 10am with brief formalities and then Charlie takes questions from the 1,000+ people in the audience for a couple of hours.
Charlie is brilliant – always full of incredible insight and wisdom – so it’s well worth the trip (and at age 95, he’s not getting any younger, though he’s still razor sharp)! It’s open to the public – you do not have to be a Berkshire or Daily Journal shareholder to attend.
If you come, I hope you’ll join me at the lunch I’m hosting at a lovely outdoor patio at the hotel immediately afterward. A free meal, good company and stimulating conversation – what’s not to like?! Just click here to register.
PS—You can do this as a day trip (with no redeye) from NYC: just take the 5:30am JetBlue flight from JFK, returning on the 4:10pm flight (currently priced at $385).
Stupidity is overlooking or dismissing conspicuously crucial information.
When it comes to overloading our cognitive brains, the seven factors are: being outside of your circle of competence, stress, rushing or urgency, fixation on an outcome, information overload, being in a group where social cohesion comes into play, and being in the presence of an “authority.” Acting alone any of these are powerful enough, but together they dramatically increase the odds you are unaware that you’ve been cognitively compromised.
3) Roddy Boyd with his usual excellent work, this time on Myriad Genetics (MYGN) (the stock is down 40% from its Sept. high, but still trades at 3x revenue, 20x EBIDTA and 43x trailing earnings). Article 1: This Company Has Great Difficulties Telling the Truth. Excerpt:
Myriad’s staging of the May session was clever in that executives could claim to have shared the trial’s findings at an APA conference, though it was just at a poster presentation, where Dr. Greden talked to whoever walked by. This is scarcely what one would expect after a study of a genetic test that a public company has repeatedly hailed as a “landmark” achievement.
The reason for the dodge might be that from a scientific standpoint, GeneSight is a bust (although it is Myriad’s most important source of sales growth.) In an 1,167-patient trial whose findings the company announced on Nov. 2, 2017, (and published Jan. 4, 2019, in the Journal of Psychiatric Research), GeneSight failed to meet its primary endpoint of demonstrating superiority over established treatments and did not achieve 23 of its 25 secondary endpoints.
Article 2: It’s Good to Have a Pal in the Senate. Excerpt:
Late that June 2013 afternoon, the Supreme Court ruled 9-0 in the plaintiffs’ favor, with Justice Clarence Thomas writing that the act of “separating [a] gene from its surrounding genetic material is not an act of invention.” He bluntly added, “Myriad did not create anything.”
By the time Myriad’s executives arrived home that evening, the company’s entire business model had been upended, with three companies announcing their entrance into the hereditary breast cancer screening business; more followed.
…To meet the new challenge, Myriad did two things: It went on a five-year, nearly $900 million shopping spree in a bid to diversify its business line and started pleading for help in Washington, D.C.
The latter route appears to have been the most effective one.
… For most companies, gaining legislative support or regulatory breaks in Washington can take years. But Myriad found relief in six months. To be fair, it had the advantage of being headquartered in Salt Lake City, squarely on the turf of a long-serving and powerful senator, Orrin Hatch. Until his retirement last week, the Utah legislator had chaired the Senate’s Finance Committee, which oversees the Food and Drug Administration’s budget and programs, including Medicare.
4) I enjoyed these two Real Vision interviews with famed short seller Marc Cohodes:
5) In the past 14 months, six (!) of my friends and relatives have been in serious car accidents in which their car was totaled, resulting in two tragic deaths and multiple concussions. This surge in accidents is mostly a statistical anomaly, but I’m convinced that it’s also likely due in part to increasing electronic distractions. It’s so easy for drivers these days – myself included on occasion, I’ll confess – to take their eyes off the road because of an incoming call or text, looking at Google Maps, etc. Our smartphones are constantly ringing, chirping and vibrating, which is an irritating distraction most of the time – but when you’re driving, it can be deadly!
To mitigate this danger, I highly recommend getting a new, safe car if you can afford it (I wrote about this last May: Why you should get a new car), but in the meantime here’s a quick, cheap, easy tip: if you don’t have a phone holder in your car and/or don't travel with one when you’re renting a car, you’re making a big mistake – it’s SUPER UNSAFE to hold your phone when following Google Maps (or, heaven forbid, doing anything else) while you’re driving.
In our car, we have this $25 phone holder that attaches with a suction cup to the windshield, and when I travel and rent a car, I bring this small $20 one with me that attaches to the air vent in any car: