Emergency Inbound and DEEP VALUE Investing (Lesson 1)

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Emergency Inbound Please JUST LISTEN (not watch) to the audio. Ignore the skill of the pilot. What do you notice AS UNUSUAL? How does this relate (if at all) to Deep Value Investing?

Emergency Inbound Simulation with Audio The two-minute video—please WATCH along with listening carefully to the Captain.

Full Simulation If you don’t grasp the situation (you are in a 50-ton aircraft that flies like a tank with wings once power is lost-the aircraft holds 155 passengers and several tons of fuel, you are over a DENSELY populated area.), watch that seven-minute video. Thoughts about the Captain? What was he thinking and doing? Any lessons here for us as investors?

Was he thinking about this? FEARLESS

Was his reaction similar to this? Here’s JOHNNY!

I used to be a pilot of small aircraft so I am biased. Is there any connection between how the pilot acted and investing? The situation and investing? Was the pilot lucky? Was the pilot a hero? Would the pilot consider himself to be a hero? Why don’t we give parades to mothers who don’t kill their children?

Take a break and go back to the first link. Before listening again, think about what you would do as the pilot. How many decisions do you have to make and how much time do you have to decide? What would you be fearful of? Why? How should we handle fear? Why are we the enemy?

Don’t hesitate to disagree, contradict or point out other questions. Do you think that personality has a lot to do with how the person responds–the nature vs. nurture argument? Buffett said that once you have over a 125 IQ then success is a function of temperament and character. Do you agree? What about this guy: Do You Love the Virgin Mary?. Can you work around temperament? By the way, have you ever noticed any similar traits among Seth Klarman, Warren Buffett, Ben Graham, Walter Schloss?

One goal of this post is to reinforce the power of emotions in terms of your readings from lesson 1.

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