Spekulatius

While the propaganda machine is working overtime and without question many believe the narrative that Putin is spouting out, it’s also clear that many people, especially younger ones won’t. Usage of VPN is way up in Russia since the invasion and we know why. The Internet, ubiquitous cellphones, cameras and social media make it very difficult to hide stuff. Back during WW2 in Germany, my grandma listend to BBC radio (they transmitted in German as well) on long wave radio to get some less biased news. There is no question you can inform yourself much easier in Russia now, if you care.

If I had to make enz. guess, I think crude prices go back to where they were before the invasion, give or take a few $. This is probably around $80/ brl. The reason is simple - crude is fungible and someone can and will buy russian crude for a discount presumably, similar to what happened with Iranian oil. I don’t expect a crisis here. Russia can’t afford not to pump because they do need the money. NG for Europe is trickier and harder to replace. The Europeans will have to replace the Russian gas with LNG amongst other things. Germany alone will build 2 de-liquefaction plants on their shores, but the stuff has to come from somewhere. If Biden wants to help out Europeans, he should promote NG drilling, pipeline and LNG infrastructure build to allow for LNG exports. I think CVX and RDS have a huge integrated LNG business and might benefit. I should probably take a look at RDS as it has not done that well so far. Forget about oil, I think NG is the more important strategically for energy independence in Europe and the US.

@RedLion Good Point on the difference between SPO, KKR etc and hedge fund sponsernd insurance cos. I would point out that alternative asset managers need cheap credit more so regular asset managers or investment banks.

Peronally, I am not trying to predict political what is going to happen, I just want to avoid trouble. I do think that the US is the save heaven and to a lesser extend Europe. China is toxic right now and goes to the too hard pile. I think there is a lot of cheap stuff right here in the US if you like tech, there is no reason to go straight into the hornets nest with BABA and the like. I do think that a directional bet with LEAP or even short term option may makes sense (on KWEB probably). As for Ukraine, if you see that Russia is asking China for help 19 days into the invasion , you know they are in deep trouble. China will probably do a little, but not really significant, because they don’t like to side with a loser and Putin sure looks like this. In addition, he is a Pariah of course. You do see reports on CNN and Fox News that Russia may only be able to support their war machine for about 10 more days, but these could be long ten days.

I figured if it wanted to move, it would have done so by now. I made a bit money on this (because I averaged down), but nothing to write home about. Feels very much like dead money here.

Both insurance cos founded by hedged funds that I am aware off ( TPRE, merged and Greenlight Re) were a big busts, so I think running a great insurance/ investment cos is much more difficult than it seems. In both cases, it seems those were high fee permanent capital vehicles in an insurance umbrella and both the insurance part (underwriting) as well as well as the investment part (in Greenlights case at least) sucked wind.

Sold AJRD and PAH3.DE

Added a bit FB the other day. Today, its a starter (restarter actually ) in ADSK, PINS and a few adds here and there.

Danaher / DHR is not a conglomerate imo. It's a life science rollup playing in a slightly different business lines than TMO. A conglomerate would typically operate in different unrelated business. That's not the case with TMO or DHR.

@Viking If anything bad happens anywhere in the world, you want to be in USD and US assets and perhaps gold. Almost anything else wills suffer. US stocks might decline too, but they sure will do better than virtually any stock market anywhere else. This has been true forever ( at least since the 1980’s) and it is true now.

Putin feeling threatened by the NATO and trying to rebuild the Sowjet Union are not mutual exclusive. You could almost say, it’s the same. If you want to rebuild the Sowjet Union, and the states you want to annex to do so join the NATO beforehand, then the NATO is a threat of course. Theoretically, it is plausible that Russia would join the NATO as well in an alternative history where Russia becomes a democracy and there is no Putin. There is nothing to prevents Russia from doing so fundamentally.

Is Zyn made from tobacco derived nicotine or from synthetic nicotine? Asking on behalf of all Swedish Match shareholders here.

Thanks for sharing. I had no clue and it’s also interesting how these totally unrelated things get snug in bills that probably not many will read. Yes, this indeed looks like a bull to benefit big tobacco.

@changegonnacome As for Putins nukes, he can always makes the threat to use them, but that’s nothing new. I don't think I would be too scared of this threat. I grew up in Germany 10 miles away from a major army base and 15 miles away from a nuclear missile depot. I know what it means to live under a nuclear threat. Those things would be (and probably still are) primary targets in a first strike scenario, You should be concerned about these things but never afraid. I would also assume that Putin is rational , otherwise there is no point assuming or discussing anything here, Imo. His regular army isn’t much of a threat to NATO at all, that’s for sure and it will get weaker as he loses a lot of material and the financial and tech/trade embargo diminishes his ability to replenish it. At some point, even the Russian people will know that he did a grievous mistake as the bodies bags come back as well as the veterans from this war will tell their story. I don’t think it will remove him from power (although it increases the probability of this occurring) but it will weaken his position even within Russia.

Unfortunately, with inflation at 8% you are losing purchasing power even if you don’t lose money. I have some gold (a few percent as Cash substitute) , but I think my allocation may be way too small. Gold may or may not work out well, but just cash won’t do well either if we get a 70’s style scenario. I am in my mid fifties and don’t like the prospect of large losses either, so am am staying very diversified. I do this because reducing risk is more important than maximizing gains. I don’t think that staying in cash is the answer though.

I think Mearsheimer makes good points, including that Putin likely wills survive this. I do think he is wrong about sanctions though. The goal of the sanctions is not to overthrow the Russian government, it is to ruin their economy to such an extend that they are financially and economically not able any more to keep their military complex running. This alone will be a great benefit and make Russia much less dangerous. The other lesson from history is that the sanctions against Russia here are very likely to stay, even if a peace deal or some sort will occur. There are direct investment implications for this because of you think we will be back to normal after some sort of truce will be reached, I think you are very wrong, at least based on how this has worked in the past,

I actually think that many Americans are really that dump. Just look at his car dealer sell you a monthly cost rather than the price of a car. I also got aware early on that many can’t conceptualize that interest cost matter much more so than the monthly cost of a loan. That’s why car deals stretch out the payback duration more. Thats also the reason why credit cards in the US are a bigger and better business than literally anywhere else.

The end likely will be ruined Russian economy, Ukraine be destroyed and depopulated and Europe will become much less dependent on Russian energy. The Iron curtain will raise again. I think we might get a recession in Europe in the near term, caused by higher energy costs, pot. Energy shortages as well as supply disruptions and less trade with Russia. Yes, war is almost always precedent by diplomatic failure although I would argue that sometimes it is inevitable, if you you get someone like Hitler showing up, WW1 was a diplomatic/policy failure WW2 was not. I am still not sure which camp Putin is in, he might just be one of those guys that are looking to get into a fight when they think it’s opportune. You certainly also can take the other side that there has been a series of policy failures dealing with him from Obama, Trump to Biden (before the invasion). I think Biden did one crucial mistake since the Invasion telling Putin that he will not get US troops involved. This is a mistake because you never want to paint a red line to your opponent and tell them where it is. You rather want Putin guessing what you might do, even if you have no intention whatsoever to actually put boots on the ground. This was an unforced mistake, imo. They also made an mistake not getting the deal with the Polish MiG-29 ‘s done. They should not have talked about this and just call it “donation of NATO surplus to the Ukrainians” if they must. We are supplying weapons to the Ukraine so I am not sure why we paint another red line for ourselves here.

Fully agree. I actually think the reporting from the MSM is quite good. I watch NBC News / Sky (cause I have free Peacock with my new TV) and they have people on the ground and do seem to do sober assessments. Using the arguments “It’s their own fault- they poked the bear” is like saying, a school bully can kick in another kids teeth and crush his skull with a hammer because that kid looked at the school bully funny and made a wrong joke.

By most accounts, the semiconductor related shortage should subside in the second half of 2022, but now we have to deal with other shortages. The German car manufacturers are hit by disruption of cable assemblies from Ukraine, which will take 2-3 month to work through fully by some accounts. Then we have issues steel (high prices and perhaps shortages of some qualities as well) and a host of other things. I still think that towards the second half of this year some stuff will subside but who knows. I would hate having to buy a car in this environment.

Yes, plug in hybrids save more gas, but you also need to account for the electricity cost to charge them. I am pro hybrid, but I think driving a relatively high mileage ICE car the way to go. I never could make the numbers work for a hybrid, much less and electric car. My next car is likely a Subaru as well, these cars drive like trains in the sometimes icy backroads here in MA where I live. My wife loves her Forester.

I wonder if the issues were on the long or the short side. The short sides seem to get quite tricky, because at times all the junk and suspect stock frauds become correlated and can run against you, leading to risk management issues. On the long side, we have seen very quick and sudden factor shifts. If you invest with a longer time frame, the you can look at very severe underperformance at times.

Your numbers are way off. A hybrid does not save 70% on gas, as you imply, it’s closer to 30%. A typical car will go perhaps from 30 miles/ gallon vs 40 miles/ gallon for a hybrid. So, if you do 15k/ year, the savings will be 15k/30-15k/40= 125 gallon/ year. At currently $4/ gallon that’s ~$500/ year in fuel savings. Now let’s look at Subaru Crosstreck (I like Subarus). MSRP for the Crosstrek is $35.8k. ICE model (Limited, which has more power than the hybrid) is $28.5k. So you pay 7k extra to save $500/ year on gas. Even more, if you step down a model (the hybrid has many extras I don’t care about) you can save 10k outlay and pay $500/ year more in gas cost, which I think you might not get back during the lifetime of the car.

@oscarazocar Great summary on GHC and I fully agree. GHC‘s Management is at best mediocre. I owned this for a while and they do some talk that sounds good, but their capital allocation is below average and capital allocation is what it's about with a conglomerate.

Same here. This decline gets annoying. I also bought some LNR.TO / LIMAF (Starter)