Are you a Warren Buffett phoney?

Buffett has often said, “I could improve your ultimate financial welfare by giving you a ticket with only twenty slots in it so that you had twenty punches – representing all the investments that you got to make in a lifetime. And once you’d punched through the card, you couldn’t make any more investments at all. Under those rules, you’d really think carefully about what you did, and you’d be forced to load up on what you’d really thought about. So you’d do so much better.”

There are plenty of people out there who call themselves Buffett acolytes – and as far as I can see they are all phoneys. Every last one of them. 
Find any investor who models themselves off Warren Buffett and look at what they do.
And look at their investments against a twenty punch card test. 
They fail. They don’t even come close. Several big-name so-called Buffett acolytes have made more than three to five large investments in the last three years and at prices that can’t possibly meet the twenty punch card test. Most phoney Buffett acolytes have been turning stock over faster than that.
Warren Buffett’s two juniors (Todd Combs and Ted Weschler) have turned over many stocks in the past few years too – and at prices that don’t reconcile with any twenty-punch-card philosophy. They are phoneys too. Just a little less egregious than many other so-called Buffett acolytes.  
Many so-called Buffett acolytes (phoneys, all of them) have imbibed that a concentrated portfolio is a good idea. And so they present as having five to twelve stock portfolios and are prepared to take 30 percent positions. 
But the stocks often don’t meet the twenty punch-card test. And so these investors wind up with large positions in second rate investments. When one goes wrong it is deeply painful. When three go wrong simultaneously it is devastating. 
The lesson here is easily stated: “if you are going to fill your portfolio with crap, it better be diversified crap”. 
Several of my favourite phoney Buffett acolytes have been posting catastrophic losses. It was due. The phoney Buffett acolytes still here are just waiting for their turn to have catastrophic losses. –wrote John Hempton

We are in a Big Fat Ugly Bubble

Now, look, we have the worst revival of an economy since the Great Depression. And believe me: We’re in a bubble right now. And the only thing that looks good is the stock market, but if you raise interest rates even a little bit, that’s going to come crashing down.

We are in a big, fat, ugly bubble. And we better be awfully careful. And we have a Fed that’s doing political things. This Janet Yellen of the Fed. The Fed is doing political — by keeping the interest rates at this level. And believe me: The day Obama goes off, and he leaves, and goes out to the golf course for the rest of his life to play golf, when they raise interest rates, you’re going to see some very bad things happen, because the Fed is not doing their job. The Fed is being more political than Secretary Clinton-said Donald Trump in the first Presidential Debate

Linkfest: September 27, 2016

Some stuff I am reading today morning:

Vodafone values Indian arm at Rs.93,400 Crores (Quint)

Deutsche Bank shares fall to lowest level since 1980s (Guardian)

Sunil Mittal Vs Mukesh Ambani-Round 2 (Mint)

Customer Feedback on a few brokers (Subramoney)

The complete list of Mutual Fund Returns (FreeFincal)

The dubious rise of Monthly Dividend Plans in Equity Schemes (MFCritic)

Comments on Investment Philosophy (Bronte Capital)

The Fight to keep it Simple (CS)

Bull Markets are the hardest part (PragCap)

Instant lending made this college dropout a Billionaire (Bloomberg)