rukawa

Sorry I must be a moron but hotels go for 260K a room?! Really. Wow. And that is considered cheap? I would have never imagined that.

I would love people to share undervalued investments that they believe have be affected by the expectation of large Corona outbreak. The underlying idea being that a large corona outbreak is unlikely to do permanent damage to any company so why not buy companies on sale.

I always wonder what the role of FPGAs is in all this. Seems like dynamically having the ability to alter your logic on the fly and customize it to your application in real time should be some sort of advantage but I've never seen anything like that.

Really interesting and honest account of self-driving tech:

Buffett and Grahams approach is the opposite of yours. THe point Graham was making in Chapter 8 was that massive money could be made if one knew how to time the market which was the obvious thing to do if you KNEW how to do it. But that this naive strategy was in practice impossible though it was incredibly seductive. The Intelligent Investor was to AVOID the approach you are advocating.

I don't really understand this argument and I think its wrong. I've heard both Buffett and Graham argue the exact opposite repeatedly. As bond yields rise, earnings mulitples contract (and earnings yields rise) and current stock prices go down which increases future returns but depresses current returns. On the other hand when bond yields go up, earning yields go up and stock prices go up which improves returns looking backwards (from historical time point to present) but depresses returns looking forwards (from present to future time point). This makes sense as its the bond yield which competes with stocks. Higher bond yields tend to attract people away from stocks and lower bond yields tend to push people towards stocks. Incidentally this does not really contradict the return premium argument since return premiums are about future stock returns and not current ones. A higher bond yield means a greater required future return on stocks which means stock prices now must be lower. Similarly a lower bond yield means a lower required future return on stocks which means stock price now must be higher. Lower bond yields therefore should have led to higher stock prices in Europe.

Unrelated question...what broker did you buy this stock with?

Reminds me of this joke...read first comment: https://www.youtube.com/watch?v=HnDjtNW58nA&t=2s

Why are profit margins important? It seems like profit margin is more a reflection of business strategy or industry structure and as those change profit margins change. Returns on equity should be the important. They are at 14% which is on the upper end of the historical range of about 10-15% but definitely not unusual. http://investorfieldguide.com/wp-content/uploads/2014/05/img4.png

I disagree. There is no reason why production costs should be the same for different commodity producers. You may for instance have land that has different characteristics than another producer eg. Saudi Arabia vs US. Also in industries with many producers its usually the case some producers are vastly more effective and efficient than others because they are smarter and better at what they do. Rockefeller for instance was more efficient than most commodity producers of his day. Economic theory assumes everyone has the same information. Even if they do its irrelevant. Some producers are horribly incompetent and stupid. Even if they had the same information they would still mismanage things. The Theory of Perfect Competition requires as its assumptions that the things being bought/sold is a commodity, firms can enter/exit without cost, perfect mobility of factors of production, buyers/sellers have perfect information, etc. If all the assumptions hold than perhaps you will have some theorem about economic profit being zero. In this theory all firms have the same production cost curve....but in reality this is least likely to happen if the industry is filled with lots of small producers.

It’s interesting that this ETF is near the 2009 low, yet nothing looks really cheap. I looked at BCH and it trades at around 11x earnings and a 2x P/B. I think I‘d rather buy WFC. If I were a millennial, I would say “meh”. How do you invest though...just ETFs I expect and perhaps some ADRs. Seems like to really do anything you would need to setup a brokerage account there which is probably difficult. List of ADRs is here: https://topforeignstocks.com/foreign-adrs-list/the-full-list-of-venezuela-adrs/

Not related to your question but I work in TO in the finance industry. Here is what I heard on the grapevine: CIBC makes most of their money on interest margins. Lower interest rates really hurt them. Other banks are more diversified...make more money off investment banking or other things less tied to interest rates. Fear of interest rates going down in event of another recession is why CIBC trades low. CIBC is a horrible internal culture. Everyone I know says this...I personally never experienced it.

No we don't have these algorithms. Your wrong and the paper you demonstrated doesn't show this. It shows that significant progress has been made on particular problems with particular numerical schemes. They have taken a relatively simple and easy benchmark problem with close to laminar (smooth) flow for an incompresible fluid because their purpose to compare the efficiency of numerical schemes. They are really saying "Hey guys isn't it crazy that our discretization of the compressible Navier-Stokes works better on incompressible fluid problems than the discetization of the incompressible Navier-Stokes". Its like saying isn't it crazy that this guy who trained in basketball is actually better in volleyball than guys who trained specifically for volleyball. But there is no ability to deal with the general problem for arbitrary geometries and flows and there probably won't be for a very long time. The paper discusses performance on a particular reference problem where Reynold number is 1600...atmospheric Reynold numbers can go up to 1 billion. Their purpose is to compare performance on incompressible fluids...the air is not an incompresssible fluid. None of this will work for Reynolds number of lets say 100,000. Here is a diagram showing where the smooth regime ends and the turbulent regime begins (note that cumulous cloud formation occurs at Reynolds numbers of 250 million!): https://physics.info/turbulence/ If what you are saying is true why can't climate models predict when and where a hurricane will happen with this perfect accuracy you spoke of? Not even climatologists believe what you are saying. The IPCC itself states: The IPCC proposes that though they can't predict climate states, they can obtain probability distributions for climate states using an ensemble of models/model runs. The analogy they are implicitly invoking is thermodynamics where its possible to obtain very accurate predictions of statistical averages using ensemble methods even though you have no clue about the actual specific motions of the particles. This works in thermodynamics...its doesn't mean it works for a climate system. Feynman wasn't interested in talking about stability and uniqueness proofs. He didn't care because he didn't value mathematical proofs (a bias of his). He was talking about solving the Navier-Stokes equation in a practical manner that was actually useful for real world predictions. Here is a fuller context: You can read this thread whether they talk about this more: https://physics.stackexchange.com/questions/15738/have-we-figured-out-how-to-analyze-turbulent-fluids I was in academia more than a decade ago. When I was in grad school, a friends paper was being presented at a conference. A plagiarized paper with the same idea as my friends' paper was presented just before my friends by a graduate student working for a relatively powerful professor. We knew it wasn't a coincidence because my friend had a specifically chosen resistor value (e.g. 6.23k) and the plagiarized paper used exactly the same value. Naturally my friend could not present. We knew there were certain places we could not publish because they were controlled by our plagarizing competitor. You would often get situations where a two page paper would get ridiculous unrealistic reviewer comments designed to be impossible to satisfy in order to spike the paper. We complained about the plagarism through back-channels but my professor was very careful because he knew the competing professor was extremely powerful and had many powerful friends. I followed up on the field years later after I graduated and I found out that there were these older professor very critical of the fad field we were working in (meta-materials) and they pointed out that all the stuff we had done had been done years earlier under other names (filter theory). These guys could never get published. So finally one of them wrote a book that was published after he died, where he basically tore into the whole meta-material field and complained about how peer review was used to prevent his papers from being published. Mostly he was right. As far as I'm concerned Academia is a cesspool filled with shit. You said your experience was not like my experience. Every single time I meet someone in Academia I ask them about their experience. I ALWAYS get a bunch of stories like mine which are completely unsolicited (plagarism, peer review spikes, peer reviewers forcing you to cite their papers etc). My cousin parrots the same line as yours about climate change and when I asked him about his research experience I was shocked at how bad his stories were. I found that online I always encounter people like you that I never encounter in person. People who have experience that run completely counter to anything I've seen in the real world. I'm not saying you are lying but I am saying nothing in my experience relates to yours. We are living in very different worlds.

That isn't the way science currently works. If you go against the prevailing consensus you will not get published PERIOD. And most likely you will be black-listed from future publication especially in the case of sensitive areas like climate change or nutrition. There is also no way to "prove" anything regarding climate since the theory is in such a poor state that no one can demonstrate either that something is true or that it is false. The fundamental problems in climate are related to the understand of clouds which can't be modelled and fluid dynamics which also can't be modelled. Here is Richard Feynma's quote on the Navier-Stokes equation which governs climate and is in fact what most climate models spend all their time trying to solve: In GCM's typical cell sizes are 100kmx100km. They discretize equations of physics on the grid cells...meaning that they convert a differential equation into a difference equation. In essence think of it as something like the pixels of a television where there is only one color for each pixel. In GCMs the "pixels" are the 100kmx100km cells where there is only a single value along the whole cell for the direction and speed of the wind. Thus the assumption of a GCM is that in a 100km x 100km cell the wind blows in only one direction at a specific speed. A tornado, for instance, can't be modeled the air changes direction and speed very dramatically over a distance of 10's of meters in this situation. The question is whether a grid size of 100km x 100km is sufficient for climate predictions. Nobody knows...because no one really understands the equations of fluid dynamics. One thing that is known though is that the equations are highly non-linear. There is coupling between low and high frequency modes. Think of a low frequency mode as something that changes very slowly over long distances and a high frequency mode as something that changes rapidly over short distances. This means that you can't simulate the low frequency modes independently of the high frequency modes. Of course its impossible to simulate high frequency modes if your grid size is 100km x 100km...there is no way to model them. But this implies the low frequency modes can be modeled properly either since there is no way to simulate low frequency independently of high frequency modes. So than how do climate models work...well I would say they can't work and they don't work. Separating out low and high frequency modes is a bit like a surgeon splitting a baby in half. You might have some ambitious surgeon tasked with splitting a baby in two (not talking about Siamese...just normal baby). He might find artificial ways to support one half a baby...maybe he uses a pacemaker for the heart and he simulates the circulatory system using a complicated apparatus. Does the "half" a baby act and behave like the real thing...its freaking absurd and ridiculous to think it would. Climate models are basically like half a baby...they cut a baby in half and now they are trying to artificially simulate the other half and pretend they have a real baby...What the actually have is a monstrosity. The way they simulate the other half the baby is the dark arts known as sub-grid scale parameterized models....which aren't real physics...they are essentially some curve-fitted statistical garbage. Christopher Essex (a skeptic) and Tim Palmer (a believer) both provide good descriptions of the problems in climate models: Essex: Palmer:

I've met one rich asshole. I've met plenty of middle class assholes. And I've met even more poor assholes. And in most cases I've seen the richer people get the less assholish they become and vice versa. As my friend has gotten poorer he has become a bigger asshole. My cousin on the other hand has become much less of an asshole the older and richer he has gotten.

Morgan must be familiar with Kurzweil's Law of Accelerating Returns (https://www.kurzweilai.net/the-law-of-accelerating-returns). I'd be curious why he doesn't recognize accelerating technological change (https://en.wikipedia.org/wiki/Accelerating_change) as the *single* most important force? Thanks. I would say we have seen a huge deceleration of technological progress. 1960-2019 we saw smart phones, computers and internet. 1870-1930 you would have seen railways, automobile, telephone, electricity, light bulb, Steel (Bessemer process), petroleum as a fuel, Fertilizers, cheap textiles. In some ways its kind of shocking...invention should be much easier today now that billions of people are rich and educated and have ridiculous access to all the information they need. Also there is huge amounts of government funding. Contrast this with the 19th century and its pretty amazing how much more people were able to accomplish despite vastly greater obstacles. Edison barely went to school. Faraday is a similar story. My view is that this is connected with a massive increase in bureaucracy throughout our society. Interestingly computers have massively increased the ability of bureaucracies to increase their power and scope. Everything I see points to this trend getting worse. The size of government is one obvious indicator of this but bureaucracies are increasing even in corporations and universities. We are a culture in decline and this isn't unprecedented. This exact thing has happened repeatedly in human history.

How long have you been doing that and have you tracked how your list has performed? I also compile lists from various sources of companies that appear on first look to be cheap. I've never systematically tracked the performance of those companies so I cannot compare it to my actual portfolio returns. It wouldn't shock me if all further research/thinking that I do adds nothing to my returns (or even hurts them). I'm not sure how long I've been doing it. More than 4 months but less than 1 year...maybe 6 months. I haven't tracked how its performed. Time period is too short anyways.

I have a commuting habit where I read valuelines, try to guess price and if stock is a lot lower than I record it. These are stocks I thought were cheap on an earnings basis: Sally Beauty (edited after original posting...too much debt) DXC Technology Tupperware E-trade financial Hanes CIBC Seagate capri holdings

For Japan this is good but there isn't a stock screener: https://www.kaijinet.com/jpexpress/

I guess the question is what does "restrained supply" actually mean? If there is a mad rush to buy homes as fast as possible and the owners of raw land are slow to sell then you will have restrained supply regardless of the regulatory environment. You could also ask what is the capacity of the homebuilding industry to build new homes in the Toronto market? There is always going to be some kind of bottleneck somewhere in the production process. There is a limit to how many homes can be built in one year given the amount of construction labour you can draw on and other constraints. My understanding is that there is close to a record number of homes being built in the GTA now. Restrained supply is fully explained in the following article: https://business.financialpost.com/real-estate/regulatory-overkill-is-driving-biggest-canada-homebuilder-south Why would a developer complain about regulations and threaten to move if his real problem is a lack of labour. Why would developers fund Ontario Proud: https://www.cbc.ca/news/canada/toronto/ontario-proud-election-advertising-spending-1.4941210 I think its extremely odd that its easier to make money in Florida, North Carolina and Arizona when home prices are less than half what they are in the GTA. But its easy to explain if the problem is excessive red-tape. Developers are complaining because the regulatory burden is high. And if the burden is high than it is definitely supply-constraining.

There is a simple way to determine whether supply is a problem...rental rates. In a situation with lots of speculation there should be high prices and low rental rates. From what I've heard Vancouver did have this situation at one point. But Toronto never did. Toronto has high real estate prices and high rental rates. There may be a case to be made though for houses in the suburbs like Mississauga where rental rates are very low and house prices very high.

There is nothing bizarre about the housing market. What is truly bizarre is that people seem to have literally zero concern for housing supply on this forum and in general. There are many moves to reduce demand which have had limited effect because as it turns out people actually need to live somewhere. There are a multitude of rules put in place to reduce supply. Zero discussion anywhere about this and zero concern. THAT IS BIZARRE. What is even more bizarre is the number of people who claim to understand economics and don't get that supply is an issue. Its so invisible its crazy. You have these community associations populated by 80 year olds that are actively trying to reduce supply with municipal politicians fighting as hard as they can: https://www.thestar.com/news/city_hall/2019/05/27/residents-pack-city-hall-as-return-of-omb-looms.html And crickets....that is all I hear. The one person doing something about supply is Doug Ford and no one is paying attention. Its the weirdest thing. But everyone loves to talk about mortgages and interest rates. Threaten to increase supply and you have municipal politicians screaming about affordable housing, sustainable communities, planning process and giveways to wealthy developers. This is what I find bizarre.

Not completely sure what the multi-generation model is. Anyways right now Doug Ford has already loosened regulations: https://www.thestar.com/news/city_hall/2019/06/05/province-to-change-development-rules-for-toronto.html There is already advocacy on the left for reforming zoning as a solution (the yellowbelt): https://www.theglobeandmail.com/opinion/editorials/article-the-secret-to-lower-housing-prices-its-all-in-the-zoning/ https://urbantoronto.ca/news/2019/03/wheres-progressive-coalition-zoning-reform And on the right there is advocacy for getting rid of the greenbelt: https://business.financialpost.com/opinion/doug-ford-was-right-toronto-housing-wont-be-affordable-unless-we-develop-the-greenbelt What is consistent though from both the Left and the Right is basically advocacy for deregulation. As far as I can see what Doug Ford has literally done is to allow real estate developers to dictate policy: https://www.theglobeandmail.com/canada/article-we-need-good-ideas-on-housing-even-if-they-come-from-doug-ford/ And of course there is the interesting fact that Doug Ford's campaign received significant support from Ontario Proud, a group that was funded by real estate developers. https://www.canadalandshow.com/ontario-proud-mostly-funded-by-developers/ This is getting political which I apologize for. But what I'm trying to convey is the political dynamics currently at play. Housing affordability is now an issue to be addressed and both left and right have to provide solutions. But if you look carefully almost all the solutions end up being give aways to housing developers.

Fortunately I haven't endured that 10 years. The mechanical strategy is quite new to me. I've been at it for a few months. I'm following it because it makes sense to me. But I'm not completely mechanical....I don't invest in all stocks satisfying Graham's criteria. For instance if a stock has a history of losses and only recently has great earnings I won't touch it. Most stock screens don't look at 10 years of earnings but thanks to valueline I am able to. And a more accurate description might be "loosely based" on the strategy. What I actually do is look at Valuelines one by one. I attempt to guess the price of the stock I'm looking at. If I register surprise at how much lower the price is than my guess ( usually this is when the stock price is 50% of what I guess or something like that) than I will consider it provided is satisfies in addition Graham's PE criterion (<10p/e and preferably less than 7 pe) and equity/assets > 50%. However even if it satisfies all these criteria I may decline if I think the recent earnings are not reflective of its history (e.g. it current year earnings are anomalous or it had losses for many years and than a few good ones). I usually will also verify that the most recent 10K agrees with Valueline. This is something that makes sense to me and I feel comfortable with. If after a while I conclude it doesn't work than I will just start investing in sp500 as I'm doing with all my parents money.

I probably should do that. Net-net stuff is pretty straightforward. Run the the screen, go through each one at a time. Invest. Mostly in Japan. Part of the reason I don't post is I'm already at capacity for net-nets and it happened pretty fast. I want from zero to fully invested in less than a year. There isn't a lot for me to do there. The rest of my money is in registered Canadian accounts which have restrictions on small foreign stocks and only really allow US or Canada. In those accounts recently I've been investing in a few low PE, mid to large caps. Its basically the strategy described by originally by Graham and can be found here: https://www.brokenleginvesting.com/grahams-simple-way/ The low PE stocks I like so far are mostly auto-part companies: Magna Lear Linimar LyondellBasell Part of the reason I don't post much about single names is that I don't really think the analysis provided here is valuable for what I do. I basically invest in cheap stocks...I don't really try to analyze them in detail. I just invest based on financial metrics and diversify. I'm not trying to be a "great" investor. Cheap stocks though are pretty easy to find. Run a metric screen and go through them one by one. Or just go through valuelines one by one. If a stock is cheap and doesn't have any disqualifiers: not a real business, chinese, not truly cheap, massive stock issuance than you can invest in it. For me its pretty much irrelevant what the future prospect of the business are. And I don't try to read between the lines when it comes to accounting. If its difficult for me to figure out I skip it. If you are looking for net-nets though they are here: http://www.cornerofberkshireandfairfax.ca/forum/general-discussion/japanese-basket/ And there are some guys I follow: http://www.nonamestocks.com/ https://www.elementaryvalue.com/ I've thought about doing something like what nonamestocks does and searching for dark/illiquid companies. But I've realized I can't really do what he does where he concentrates heavily, use technical analysis. Just doesn't make sense to me. Elementary Value is more my style...he also invests in dark companies but is way more value oriented. I might try it sometime...but I'm not really motivated because there are other thing in my life which are more important right now.