When I write about VALUEx Vail I always catch myself sounding just like Tim Cook: “This is the best iPhone ever!” As the iPhone incrementally improves every year, so does VALUEx Vail. We don’t put any incremental R&D into our private value investment conference, but it gets better for one simple reason: We all become closer and closer friends (we had only five new attendees out of 40 this year). We heard 30 presentations over three days.

I just finished a ten-page quarterly letter to clients and am taking refuge here to write about anything other than stocks. This scribble will be about a topic that I have been thinking about the last six months. I am somewhat embarrassed about it, because it’s a bit “me”-centered, and I am going to go into areas that (I am acutely aware) lie far outside of my circle of competence, but that is how we grow. I promise to write about the stock market, stocks, and the economy in the future. Just not today.

I Don’t Eat Desserts

Be Kind

I am back from TX. In Dallas my brother Alex and I had the pleasure of spending four hours with John Mauldin. Our visit with him started in John’s apartment in downtown Dallas and continued in a bar at a nearby hotel. A lot of my readers are familiar with John, but for the few who aren’t, let me introduce him. John is an economist, a thinker, and an incredible writer. He has written half a dozen books, and he writes probably the most popular (free) investment newsletter in the world – it’s read by millions.

General Electric’s collapse should have served as a reminder that buying a company based solely on past reputation and dividend yield is a dangerous endeavor. GE is also a great example that dividends are not paid out of earnings, especially massaged-to-death non-GAAP earnings, but from free cash flows. GE’s non-GAAP earnings were double its dividend payment.