Intelligent_Investor
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Posts posted by Intelligent_Investor
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I love Warren as much as anyone, but Charlie was the guy that I really connected with and modeled my investing after. Rest in peace Charlie, your legacy will live on in the thousands of value investors you inspired
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I think they should do away with special treatment of LT cap gains for people with a net worth over a certain threshold.
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Starting to liquidate mine and rolling into short term treasuries
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GGLL and AMZU. Went long 1.5x etfs on GOOGL and AMZN when they were trading in the 80s and low 90s, taking profit now on the leveraged positions, but not selling actual GOOGL and AMZN shares
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I like using a reverse DCF to sanity check my assumptions.
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53 minutes ago, no_free_lunch said:
China HAS developed over the past decades. The issue is investors haven't been getting wealthy there, at least not from index funds. Not worth the risk. I have to worry a out corruption plus investment risk.
That's because Chinese index funds for a long time were very heavy on shitty, low margin, commoditized industrial businesses or cyclicals that aren't conducive to buy and hold. If you invested in consumer/tech you would've made a lot of money over the past several decades. Buffett and Munger have both made a killing in China picking individual stocks, and I think that's the way to go with China, although the indices are probably cheap enough now that forward returns are decent.
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Pentagon saying they don't believe the plane was shot down...looks like initial reports of a missile may be inaccurate/misinformation
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20 hours ago, rogermunibond said:
Anyone have thoughts on super long date debt? 2040-2050 notes are yielding as much as 5.8-6% from fairly good A credits.
20 year GSEs at 6%, but at that holding period I would want equity like returns.
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The major catalyst is western economies slowing, thus slowing their exports and causing prices at the factories to fall (oversupply of stuff that isn't being bought by the west due to economic issues). China's consumer spending isn't that bad, but exports are falling as the US and other western countries grapple with economic strain. China will likely not be a purely consumption based economy anytime soon, because culturally the Chinese are savers/hoarders, and have been for thousands of years. This is also why western style economic stimulus doesn't work as well in China vs the US. In the US where the average American spends most of his money, direct stimulus actually flows into the economy, in China it flows into bank savings/real estate investments/housing, not the general economy and thus has much less impact.
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Assuming that we are the only intelligent life out there is arrogant because you are assuming we are the ultimate outlier: there are over 200 billion stars in the Milky Way and there are over 200 billion galaxies in the known universe. That is 40 sextillion stars, if the possibility of life is even one in one trillion, then there are still over 40 billion star systems out there with life. The scale of the universe is so large that the probability of life would need to be so miniscule that we would have needed to overcome a greater than 1 in 40 sextillion chance for us to be the only life ever. If assuming we or our planet is special enough to overcome those odds isn't arrogant, then I don't know what is
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I think 2 things can both be true: we are not the only intelligent beings in the universe (I think it would be extremely arrogant to assume we are the only intelligent species in all of time and space), and that even if 1) is true, we have never been visited by them and the "UFO" sightings are other phenomenon
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Yeah the illiquidity would be a problem. I don't think Berkshire minds being most of the volume if there is high liquidity. IIRC Charlie stated that when they were buying Coke, they bought almost all the daily volume for months.
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As they say: "The fastest way to become a millionaire is to be a billionaire and invest in NFTs"
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16 hours ago, crs223 said:
Presumably Buffett likes to purchase stock in undervalued businesses. Buffett knows BRK well and has been buying BRK stock. I ASSume Buffett understands FFH.
I’m wondering aloud why Buffett purchases BRK instead of FFH. Either 1) Buffett does not purchase businesses similar to BRK 2) Buffett does not understand FFH 3) Buffett does not think FFH is cheap.
I had been assuming (1) until a few hour ago when @Xerxes noted that Buffet thinks the Japanese businesses are similar to BRK.
Maybe as you suggest it’s 4) FFH has no cross section of operating non-insurance investment that Berkshire does not already own… but i would think if it’s cheap enough WEB would not care about the “cross sections”. After all, WEB buys BRK…
Its because FFH is too damn small for Berkshire. A 10% stake in FFH is less than $2B, even if FFH doubles, that barely even moves the needle given Berkshire's current size
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The other thing to take into account is that for many top companies that have a large net cash position where that net cash position is growing, P/E is misleading because it is generally overstated relative to EV/FCF simply due to the fact that the large net cash position inflates market cap. So you might see one of these companies with a P/E of 35 but an EV/FCF of 22.
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I think some of the great Chinese companies have a chance plus there's a margin of safety due to the geopolitical uncertainties right now. The top American companies are trading at a premium so not exactly a margin of safety. Tencent I feel is probably the best bet for a relatively longer term compounder with an almost impenetrable moat.
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A lot of it is simply the math of compounding. If a company is able to compound equity at 20% a year for decades, its damn near impossible to overpay for it based on near term multiples. 35x earnings on a company that compounds at high double digits for several decades is not expensive, if the moat doesn't collapse.
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The issue is that there is a Washington pun right now, which is much more powerful than any Fed put. If we get into a recession Washington will just print another couple of trillion dollars to get us out of it. Congress hasn't shown any willingness to temper spending and their solution to every crisis seems to be just print their way out. This implies 3 things: 1) Long term monetary devaluation 2) Higher required return on gov't debt 3) Consumer spending and thus corporate earnings will likely have a floor making equities more attractive. We are very much TINA right now
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As Munger has said before the best time to sell is when your thesis has changed/no longer is likely to be true. For a net-net that will likely be in a few years, but for a compounder like Coke that might be decades.
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4 handle on the 30 year
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Buying more SIG, probably gonna start stretching maturities on bonds sooner.
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Treasury yields are popping, 30 year bond now at a 4 handle, this could be very good for FFH
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20 hours ago, brobro777 said:
Oh yea I wouldn't be surprised if these big cap tech companies continue to grind higher. Why not 40X?
But over the long term like a decade.... One guy I've been reading for years has an interesting thought experiment - will AAPL bonds maturing in 2033 with yield of 4.35% produce higher returns than the AAPL stock in the coming decade? https://divestor.com/?p=11763. Maybe!
They won't, AAPL FCF growth is like 6-7%, at a 3% FCF yield you are still looking at high single digit % return for AAPL
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The striking down of the student loan forgiveness should help somewhat with inflation. Less money in people's pockets = less spending
what are you selling today?
in General Discussion
Posted
Probably gonna start selling my position in SIG if they hit the 105-110 range again. I was out of the country when they got to 107 last month. 105-110 is close enough to fair value that it won't be worth trying to squeeze out a few more bucks per share, so I'll take profits at that range