Here is the most recent letter from David Einhorn. According to him, as the game has changed from Beat and Raise to Beat and Lower guidance, the street keeps on the P/E expansion mode.
Do you remember Mauboussin’s classic “Measuring the Moat”article? So he is back at Credit Suisse (skill or luck?!) and republished the updated article. You may find it here.
I suppose a little bit more of Klarman is never enough. So here is an excerpt of his 2012 year end letter. The first part is composed by macroeconomic bearish tidbits. In my view, the best part is the last one, in which he rapidly mention what to focus on. Easy to say, hard to do – that’s why we need processes.
“Investing today may well be harder than it has been at any time in our three decades of existence, not because markets are falling but because they are rising; not because governments have failed to act but because they chronically overreact; not because we lack acumen or analytical tools, but because the range of possible outcomes remains enormously wide; and not because there are no opportunities, but because the underpinnings of our economy and financial system are so precarious that the unabating risks of collapse dwarf all other factors.”