Investing should be a leisurely activity

Investing is not easy neither it needs to be difficult. How do you invest wisely? An interesting interview by Steve Forbes with Monish Pabrai gives a point of view on how investing should be done. Monish Pabrai is a leading investment manager and a managing partner at Pabrai Investment Funds, based in Irvine, CA. An interesting interview - watch the fulll interview at

http://www.forbes.com/2010/04/09/pabrai-buffett-munger-intelligent-investing-video.html

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India's incoming urban population explosion

An interesting report from McKinsey on India's Urbanization explosion. Some of the figures it mentions in the report are amazing. But my point is, with realty in cities becoming out of reach for all but the rich and the poor paying heavy for high food prices, I wonder if crime will not catch up. The mixing of zhoparpattis (local Marathi language slang for small make-shift huts) by the urban poor with expensive towers, will it not make some of our cities crime prone.

Here is an excerpt from EquityMaster.com's "5 minute update" newsletter -

"Here's a quiz: By 2030, Mumbai's GDP is expected to exceed that of Thailand and Hong Kong. Is that a good thing or bad? Bad, in our view. It indicates that India's economic growth is going to be extremely urban centric. In fact, as per a recent McKinsey report, Indian cities will expand massively. Urban population will surge by 74%. India will have 68 cities with a population of more than 1 m, 13 cities with more than 4 m people and 6 mega cities with populations of 10 m.

Cities will also create 70% of the new jobs. All this will put huge pressure on the infrastructure of cities. And India spends just US$ 17 per head on infrastructure in its cities. That's about 15% of what China spends. The report says we need US$ 2.24 trillion to build the city infrastructure. That's an incredible figure. Our track record at focused and sustained spending on infrastructure is rather weak. Hence, in our view, we must also find ways of spreading economic progress beyond the cities."

McKinsey Global Institute report titled, 'India's urban awakening: Building inclusive cities, sustaining economic growth', can be downloaded from here.

Air space over Europe after the Volcano Cloud restrictions were lifted.

Airspace Rebooted from ItoWorld on Vimeo.

Quants: the Alchemists of Wallstreet

10 Investing Rules

Hat Tip to Barry Ritholz, I follow his blog like a madwoman in love with an ugly hairy Yoga-loving Godman. Neither of which is true. I couldn't care what Barry looks like unless he is a nice looking lady, which he isn't. But he is a smart guy and communicates lots of sense, which is why he will find mention in my blog a few times.

10 Investing Rules - Taken from Barry Ritholz's Big Picture Blog

An earlier comment stream led me to these ten ideas; ignore them at your own risk:

• Whether a premise is fundamentally true or false is irrelevant as to whether it is actionable. If enough fools believe something is so, it will impact the markets.

• Always be conscious of the cognizant biases and selective perceptions you bring to investing. Recognize the same bias in the crowd, the media, and Wall Street. Avoid the herding effect.

• After a a 55% market sell off, most of the terrible structural news that existed before the collapse is reflected in prices. (Let it go).

• You must acknowledge when the data gets stronger or weaker, regardless of your current market posture. Be skeptical, but not rigid.

• Variant perception is a rarity; Identifying the moment when the crowd figures out they are wrong is rarer still.

• Market Pros simply cannot afford to sit out a 75% rally; Individuals that miss that sort of move should reconsider their investment strategies immediately.

• Cheap markets can get cheaper; Expensive markets can get dearer.

• Every thing cycles: Recessions turn into recoveries; bull markets give rise to bear markets. Every rally that there ever was or there ever will be eventually ends. Adapt to this truism or lose all of your money.

• One of the hardest things to do in investing is to reverse your thinking. It is even more difficult to do after a certain approach has been successful for long time. The longer the period of successful thinking, the more importnat the reversal will be.

• The markets frequently diverge from the macro economic environment. This can be both long lasting and maddening; Your job is to be aware of how wide the gap between the two is.

For those of you fighting the tape, the data and the mere idea of a recovery, ignore the above at your own risk . . .

http://www.ritholtz.com/blog/2010/04/10-thoughts-on-psychology-valuations-adapative-investing/