Patrick’s Recommendations
The Hidden Life of Trees / Peter Wohlleben
Although the book is a study in biology, the lessons for investing were abundant how rapid growth condemns a tree to an early death, how trees that are stressed are healthier than ones with always ideal conditions. The most important lesson for me was how a tree in a forest will survive much longer than a tree in the open, even though it must compete for sunlight. This is because the ecosystem of the forest has many hidden benefits including root networks, helpful fungi and wind protection.
Plain Talk / Ken Iverson
In a world that celebrates the Leader, the Capital Allocator, the Visionary (and pays nosebleed multiples for their stocks), this was a great reminder that having a best in class culture can often make you just as successful. Investing in an electric arc furnace steelmaker seems like it should have been just about the worst strategy over the last few decades (maybe edged by public telephones), and yet Nucor has made it work.
Quality Investing / AKO Capital
The book details some of the tried and true sources of competitive advantage that help compound wealth over time. Some of the examples touted, like Rolls Royce, in retrospect reflect how things that look too good to be true often are. The overall message of the book is a powerful one –businesses with sustainable advantages will tend to do well over the long term and often enough, their shares may look pricey in current terms, but with the effect of compounding into the future, they are in fact bargains.