#37 - The Chinese Mother and the Camel

The Chinese Mother

Oups, I did it again. I fell in love.

This time it’s with Naspers, Bob van Dijk, and Koos Bekker. Motherfucking Jacobus Petrus Koos Bekker. What a gangster (a bit of backstory on Koos Bekker from Mohnish Pabrai here, who describes Koos Bekker as “Nick Sleep on steroids”).

As I was binging on everything I could find on them, I stumbled on a video where Koos Bekker talks about the Chinese mother and compares her to the European mother.

He just blew my mind 🤯. Western people might find what he said offensive, but as far as I’m concerned, his thinking felt like a sharp dagger cutting through the noise and going straight to the heart of the issue.

Imagine someone being asked to say a few words on emergent markets. They might talk about population growth, evolution of GDP per capita, manufacturing vs service-focused economies, globalization and all that, right?

Koos Bekker talked about the Chinese mother. She is, in his mind, the single fundamental reason why China will overtake the United States to be the first global economy. Think about how crazy that is, to reduce such a huge outcome to one simple cause. I get the chills just thinking about it.

In a nutshell, he says that the Chinese mother pushes her children so hard (and all her friends do the same) that those children and their children will eat Europeans for breakfast.

Here’s the full clip (he starts talking about this topic at 10m15s):

Munger on the Chinese

Listening to the clip above, I was reminded of a talk that Munger gave in China, with Lilu, where he was asked about why he likes the Chinese so much. And his answer was very much in the same vein as Koos Bekker’s, except he talked about the observable effect, not the cause.

Specifically, he described how successful the Chinese children that were adopted by American couples in every big American city turn out to be: doctors, lawyers, business people, etc. Or how, when you go listen to an orchestra, every hard-to-play instrument is played by a Chinese musician. He even claimed that American parents, having realized this, would prefer to adopt a Chinese girl over an American one (not sure if this is true, but it’s typical Munger).

I don’t doubt for a second that this observation is correct, but it is different from Koos Bekker’s in the following respect: those Chinese adopted babies were not raised by Chinese mothers! And I can’t imagine that they were pushed to work like mad in the same way that Chinese children in China are pushed by their Chinese mothers. So where did the Americanized Chinese children acquire their work ethic from? Is it genetic then? Or do they feel the competition with their mainland cousins despite being an ocean apart? I don’t know what the answer is, it’s a weird phenomenon.

Here’s the full clip (Charlie starts talking about this topic at 16m10s)

The Story of Li Lu

If you don’t know who Li Lu is, here’s a teaser:

If that wasn’t enough to make you curious about the guy, please get the fuck out of here and never come back.

Otherwise, you need to watch this. It’s 100x better than any Netflix bullshit movie you’ve ever watched. Massive thanks to StockCompounder Brad for sharing this:

I had no idea Li Lu was such a force of nature. What are the odds of going from an abandoned, unloved, and underfed Chinese child, to leading the 1989 Tiananmen student protest, to becoming Charlie Munger’s friend and trustee and dining with him every week??? It’s just insane…

The Definition of Intelligence

On the most recent episode of Value After Hours, Tobias had a fantastic quote from Andrew Lo’s book Adaptive Markets (added to my whishlist):

Intelligence is the ability to generate accurate cause and effect descriptions of reality.

I think that is exactly what Koos Bekker did with his Chinese mother explanation.

I also think that Munger’s bet on Alibaba is a bet on China outperforming the US economically in the next decade, amplified by a huge discount on top of that.

The Camel Metaphore

In the Value After Hours episode mentioned above, Jake Taylor had one of his now famous animal metaphors, and I really enjoyed this one. It was about the Camel. What made the most impression on me is the part where he described how the camel really optimizes how it spends its energy, really doing nothing when it doesn’t need to, because it knows that sooner or later it will have to go weeks without any water or calorie input.

I want to be a Camel 🐪.

It made me think of Connor Haley’s latest endeavour with Hasbro $HAS. You can learn more about it on his twitter timeline, here or here: Part 1, Part 2. AltaFox’s target price on the stock is $200, a double from here, and they even created a website called freethewizards and created a 100-page presentation to support their thesis.

While I know that Connor has a great track record, and I don’t doubt this will ultimately be a successful investment, it seems like an un-Camel-like effort. All this for a double? I can find plenty of as-likely doubles in the market right now, without all the fuss.

That being said, more power to AltaFox - what they’re doing benefits the Hasbro, their shareholders and their customers.

Pabrai on Facebook

Brad Kaellner, the Stock Compounder (him again) has shared a video commenting on Mohnish Pabrai’s skeptical take on Zuckerburg chances to bring the metaverse to the mainstream.

I’ll put the video down below, but as much as I am a fanboy of Pabrai, I think he is out of his depth when it comes to AR & VR.

I’m also surprised to see how little credit is being given to the Zuck-man. Or maybe he’s the only one who learned the critical importance of owning the physical gateways: rails for the geographical world, mobile phones for the online world, and…