LC

https://www.wsj.com/articles/inflation-is-already-herefor-the-stuff-you-actually-want-to-buy-11601112630 If it feels like the price of everything you buy has been soaring, that’s because it has—even as central bankers everywhere worry about the danger of deflation. The gap between everyday experience and the yearly inflation rate of 1.3% in August is massive. The price of the stuff we’re buying is rising much faster, while the stuff we’re no longer buying has been falling, but still counts for the figures. Economists will be relieved that the laws of supply and demand are still working, at a time when so much in the discipline is in doubt. But for investors it hangs a veil over the outlook for perhaps the single most important issue for the markets: whether we’re headed for a future of inflation, deflation or a continuation of the past decade’s lackluster price rises.

Originally uncovered, of course, in a whitepaper entitled: "Efficient methods for optimal dust extraction and collection"

I think in the long term equities will outperform RE, but you’ve gotta live somewhere...to be fair my wife has a knack for real estate markets so this is partly her doing.

About a week ago I sold a whole bunch of stuff, essentially as bridge financing on a home purchase. So now I am sitting at around 45% cash at least for the next month. This is the second time I have sold a significant portion of equity investments to fund real estate purchases, before what seems to be a market pullback. I will have to update my forum signature and update the board when I plan on any future RE purchases :)

There is no strong evidence when predicting the future of COVID. We have mixed evidence: a virus with some flu-like characteristics (which may gain viral strength during traditional flu season) ; a "second-wave" which hit the US in June-Aug ; a lack of a "second wave" in most of Europe ; vaccine progress which to date seems mixed (historically vaccines require aprox 18 months to develop, if at all possible) When presented with conflicting evidence, usually the responsible decision is to "play it safe". At least that is my perspective, yours may differ.

There is speculation (see the prior 2 posts I have made in this thread) that there is a mutated strain of SARS-CoV-2 which is less deadly than the initial strain in Mar/Apr.

Additionally, two studies show the furin cleavage site may not be as important as Yan’s work implies: https://www.nature.com/articles/s41392-020-0184-0 https://www.frontiersin.org/articles/10.3389/fgene.2020.00783/full Since all the mutations were identified from live viral strains in COVID-19 patients, our results revealed that the furin cleavage site may not be required for SARS-CoV-2 to enter human cells in vivo, which agrees with the in vitro experimental results showing that SARS-CoV-2, with deletion of the furin cleavage site, could still enter the cell lines of humans, African green monkeys, and bay hamsters (Walls et al., 2020). Therefore, we speculate that our observed mutants may represent a new subgroup of SARS-CoV-2 coronavirus with reduced tropism and transmissibility, which requires further experimental validations. Analyzing clinical symptoms and infectiousness of the COVID-19 patients with those mutant strains may be also important in future studies. If tropism and transmissibility of those mutant strains were indeed reduced, they might serve as potential live-attenuated vaccine candidates

Her claim is as follows: SARS-COV-2 has a "furin cleavage site" (I am getting far out of my depth here) which the closest previous coronavirus (SARS-COV) did not have. Here is a decent explanation: https://www.virology.ws/2020/02/13/furin-cleavage-site-in-the-sars-cov-2-coronavirus-glycoprotein/ This is the relevant portion: Examination of the protein sequence of the S glycoprotein of SARS-CoV-2 reveals the presence of a furin cleavage sequence (PRRARS|V). The CoV with the highest nucleotide sequence homology, isolated from a bat in Yunnan in 2013 (RaTG-13), does not have the furin cleavage sequence. Because furin proteases are abundant in the respiratory tract, it is possible that SARS-CoV-2 S glycoprotein is cleaved upon exit from epithelial cells and consequently can efficiently infect other cells. In contrast, the highly related bat CoV RaTG-13 does not have the furin cleavage site. Whether or not the furin cleavage site within the S glycoprotein of SARS-CoV-2 is actually cleaved remains to be determined. Meanwhile, it is possible that the insertion of a furin cleavage site allowed a bat CoV to gain the ability to infect humans. The furin cleavage site might have been acquired by recombination with another virus possessing that site. This event could have happened thousands of years ago, or weeks ago. Upon introduction into a human – likely in an outdoor meat market – the virus began its epidemic spread. Dr. Yan asserts that this cleavage site was introduced into a lab (see her report, pg. 13) as there are no known other coronaviruses which contain both (1) this cleavage site and (2) a similar-enough sequence identity. She claims the closest coronavirus with this furin site has no more than 40% similar sequencing, referencing a whitepaper ("Furin, a potential therapeutic target for COVID-19", preprinted on chinaXiv). I could not access this whitepaper. The article I reference above suggests this furin site could have been acquired in some other (i.e. naturally-occurring) manner. I simply don't have the expertise to discern between the two, perhaps another forum member can pick it up from here. Here are some references which may be useful: https://jvi.asm.org/content/84/7/3134 https://academic.oup.com/cid/article/71/15/884/5781085 https://www.sciencedirect.com/science/article/abs/pii/S0966842X16000718 https://advances.sciencemag.org/content/6/27/eabb9153

On this, I don't disagree.

Not probably, definitively: http://www.healthdata.org/sites/default/files/files/Projects/COVID/briefing_US_09.03.2020_Page_10.png

Trump does not have the nation's interest at heart. Any actions to that end are purely coincidental. If he was truly concerned with preventing national hysteria, he would have made efforts to meet BLM protesters in the middle, rather than stoke that fire. His actions to protect national interests are inconsistent, because that is not his goal. His actions to protect Trump interests are absolutely consistent, because that is his goal.

Lol. Deflect, Deflect, Deflect. I'm just here to enjoy the mental gymnasts at work--surely politicizing masks, downplaying the threat, and holding indoor gatherings in no way affected R0 in the U.S.A.! There are no levers that Trump pulled the wrong way, surely! Oh, I don't doubt that Trump pulled every lever that he had as badly as it could possibly be pulled. Don't get me wrong about that. But, his levers were far from the most influential. It's funny that the right wing rails about how some of the northern state governors are dragging their feet on re-opening, while the left wing rails about the neglect of the southern state governors in implementing control measures in their state, and then the incurably partisan participants blame the whole works on the president, despite an obvious difference in the outcomes between the two groups of states. SJ Two things. Reducing or eliminating testing is just plain dumb. No two ways about that. Trump could have influenced millions to alter their behavior but he deliberately chose not to.

And why not? Answering that question is a big part of this thread's topic. MSFT, AMZN is not a "value" company? It's like the one true scotsman. These two companies have created some of the most value, globally, in the last decade. If anything, they are two of the most "valu"-able companies to ever exist!

To double click on the idea of "adjust to the world around you" and metric of value, I've been thinking of this idea that in tech with proven earnings a P/E of 30 might be the equivalent of P/E of 10 in traditional industries. Reason: In proven tech companies with earnings, the total addressable market (TAM) is unknown because they open new markets. This does not happen with traditional commodities & industries - ie a pulp producer is unlike to evolve to clothing apparel retailer. With tech, a computer company (like Aapl) can become a music company and then a services company and then may become a health company. So if Aapl, Goog, FB are ever trading at a PE of <30, could be the equivalent of traditionally buying at PE of 10. Does that make some sense?? I think of it similarly, not in terms of TAM but longevity. MSFT for example I think has good odds of being around for the next 10-20 years, with reinvestment opportunity. Long time horizon plus reinvestment opportunity is a winning formula. Unknown time horizon (short) plus lack of reinvestment opportunity is the opposite. I’ll also play in the middle, the broadband providers I think have a long runway but not the best reinvestment opportunities. So here the initial investment price is a determining factor of final returns.

The big question with Sears was, "who the hell wants these crap properties? And they were mostly crap. So who is going to pay 100% on the dollar for them? Are you?? In terms of value investing in general; of course it works - but you need to adjust to the world around you at some point, and stop waiting for the world to adjust to you (it's a balance). Low interest rates have made things difficult - we have boosted terminal values at the expense of near-term cash flows. Much harder to estimate at time zero. If your definition of value investing is buying under 5x ebitda or 10x PE or 1x book, well unfortunately you are fishing in a cesspool of mediocrity. So I definitely agree it is harder. Life is easy when you only need to estimate a few years of cash flows to earn your keep. With rates so low, now you have to estimate out 7, 10, or more years. This is a much more difficult task!

You've quoted global model assumptions. The following is what is driving their US based forecast: Emphasis mine. Seasonality I do not have insight on. Public vigilance we can estimate. First, we can see that US population has become more mobile post-April: http://www.healthdata.org/sites/default/files/files/Projects/COVID/briefing_US_09.03.2020_Page_10.png From -50% average mobility, to only-20% average mobility rates. Second, we can see that US mask-wearing has stabilized around 42.5%: http://www.healthdata.org/sites/default/files/files/Projects/COVID/briefing_US_09.03.2020_Page_11.png The question is this. Mobility and mask wearing have both dramatically increased after April 2020. Daily COVID deaths have drastically decreased over that timeframe. So in terms of the virus, one of these two factors is driving DOWN deaths. Yet if you look at their forecasts of daily deaths: https://covid19.healthdata.org/united-states-of-america?view=daily-deaths&tab=trend You see that the universal (95%) mask-wearing forecast essentially maintains the current mortality rate. So does increased mask-wearing (as we saw in May->Aug) decrease mortality rate, or not? Or is the seasonality component assumed to be so significant that even with 95% mask usage, we see no reduction in deaths? The same holds true of mobility. Mobility increased in the Mar->Aug period, but deaths per day decreased significantly. Again, if they assume "declining vigilance" which I presume indicates higher mobility, will that further lead to decreased mortality rates? Or not? Or are these two factors insignificant? If so, why not express that seasonality is the main component here. And furthermore, why not provide justification to support such a drastic forecast driven solely by seasonality - for which we have zero evidence? Their model is not intuitive, which is usually a sign it may not be a good model. For what it's worth (nil) I presume the virus will behave like other flu-viruses, with the fall/winter months being worse. Also for what it's worth (lessthannil), the flu appears to be 15-20% more severe based on seasonality: https://upload.wikimedia.org/wikipedia/en/6/6f/CDC-influenza-pneumonia-deaths-2015-01-10.gif Which would indicate around 1,200 deaths-per-day if we translate that to COVID-19. The question is, "how much worse" and "how effective will public awareness and therapeutics be"

Projecting higher daily deaths come November versus the peak of April? I think that would require a lot of explaining.

There is a tendency to view social proof or groupthink or herd-following (or whatever you want to call it) as bad; or at least suspicious. First, social proof is sometimes quite good. As a herd of elephants or water buffalo will show you, there is safety in numbers. Humans developed this way for a reason: nature can be cruel and unforgiving, and it is easier to survive as a group. In most cases, we are greater together than alone. Secondly, there is an embedded act of selfishness in questioning the group activity, or as you put it, "does this make sense for me". You may in fact find alternatives which are best or better for you, but overall may be worse for the group. I would suggest that if everyone were to behave in this manner all the time, it would make for some sad society. Better is to find alternatives that aren't just better for you, but are better for the marginal groupmember. That is, you create more overall value with a new approach than you destroy by dismantling the old approach. This is where questioning the herd can be beneficial for both yourself and everyone else. Finally, I would also argue in some instances, it is simply not smart to sit back and question the group. Imagine if handfuls of soldiers put down arms and questioned the approach during the storming of Normandy on D-day. Maybe not a perfect example, but you get my point. Sometimes following an imperfect solution is better than waiting to machinate a perfect solution. Just food for thought!

You could own it through some type of trust which would limit your access.

If you rent it to your folks, does NYC consider you “having access” to the apartment?

Indicating you think the sell down is temporary? I am still holding my substantial Visa and Brk LEAPs, but trimmed about 50% of my "Tech" holdings yesterday (Google, MSFT, etc) along with some minor sales (let's call it "pruning") of other stuff. Sadly the main tech stock we own - a 15% position (Will remain nameless) was in a blackout period so I could not sell that. ;D

At this point, the Trump administration has zero credibility - so we're in the "put up or shut up" phase. Which is not to say the vaccine does or doesn't work, but the evidence must prove it - not Trump's word. So why not take a scientific perspective: Do we have phase 3 trial results? Have they been independently confirmed? Is anyone qualified to medically opine on the probability of a successful vaccine of this sort?

Primary (upgrade). May keep current property as an investment, not sure yet.

I too did some trimming today although not as much, and also going thru closing on a piece of property. Interesting times!

Concern is not price data but fundamental data. And in fairness, problem is not with you guys but the vendors who provide this data (Cap IQ etc.). Their line items descriptions are never 100% accurate, particularly during transitions such as before-after mergers, or sub-items/one-time items which are not accurately described or transcribed from the actual 10k/q to the CapIQ database. In other words, I'll be looking at some company's financials, it will say something like "one time item" or "other" which contains maybe 4-5 different line items summed together, and then I will still have to open the company filing to understand what the nature of these items are. And it's annoying and I sit there thinking why do I bother with this, I should have just opened up the 10Q in the first place.