Spekulatius

A COVID-19 vaccine is not a binary event. First of all, I expect traditional vaccines to win out eventually rather than RNA vaccines (Moderna etc) because they don’t need to be stored and transported at low temperatures (-4F) and possibly work more reliably. one of my holdings - MRK works on a vaccine that gets orally administered and should work well on older people too. The first vaccine may work, but are likely not perfect in terms or efficacy, cost and ease of application etc. I think this COVID-19 epidemic is a huge boost for any company in the vaccine business as even flu vaccinations and possibly others will get a large boost.

Covid risk calculator from Everest health. It calculates the risk to get admitted to the hospital, get upgraded to an ICU room and come out with the feet first. Enjoy: https://calculator.covid-age.com/ Mine are roughly 5% / 1.5% /0.22%

Covid tracker seems to be correct (they add up data from individual states). https://covidtracking.com/data/charts/us-currently-hospitalized It clearly does show rising hospitalization rates. The CDC website is hard to navigate and really doesn’t have well made trend charts. My state MA also has good granular data (down to a town level - the town I life in had 4 new cases last week after being without cases since about late March) but again trendlines are missing. The best tracker I have found for Germany is from the Tagesspiegel newspaper: https://interaktiv.tagesspiegel.de/lab/karte-sars-cov-2-in-deutschland-landkreise/ As we all know from investing, momentum is real and it is even more real when looking at epidemic KPI’s and we need to look where the puck is going not where it is right now. Or at least we need to see if the elevator is going up or down, as Munger would say.

It seems like they get income from other tokens (both 5% yearly “maintenance”) and 0.5% withdrawal fees. This sounds like a frocking expensive checking account for users to me. Thank you for the explanation. So it seems more like participating in arbitrage than In a crypto checking account via this token. Then the question really is why do those opportunities exist and how likely they exist in the future, because if you put a PE ratio as a valuation mark, you do assume that there will be cash flows in the future.

It seems like they get income from other tokens (both 5% yearly “maintenance”) and 0.5% withdrawal fees. This sounds like a frocking expensive checking account for users to me.

Ok, October is German month in Netflix - Barbaren and Oktoberfest: https://www.imdb.com/title/tt9184986/ https://www.imdb.com/title/tt10244612/

Again, the fallacy of CASES! OMG! What a disaster...these people are total idiots. As I posted earlier...UF GAME CANCELLED BECAUSE OF COVID OUTBREAK......(tiny print) All 21 players are either asymptotic or show minor symptoms... Can we please create some place where a certain percentage of the population lives where there are high taxes, shutdowns every time one catches the flu. and absurd rules around things like soda, plastic bags and police officers doing their jobs...and another where there are no taxes, and people just live their lives?? If you read the article - one of the main reason for the shutdown is that the coaches fail to cooperate with the contact tracers and even went to so far to told the team to ignore calls from contact tracers. So it is likely that more clusters were created by these activities that we don’t know about. Our governor Charlie Baker is Republican.

Earnings have been pretty good for defense contractors. LMT, NOC and LHX all best their earning targets. I was just looking at LHX’s numbers which reported earnings gs today. Looking back, Harris was a ~$6B company with close to 20% operating margins. L3 was a bit more than $10B revenue company, but their operating margins were much lower - 11%. Now, if we revenue weigh this we expect to see ($6*0.2+$10.2*0.11)/($6+$10.2)=14.3% margin. LHX in the last quarter achieved a 17.9% operating margin already. The quarter before were 18.2%, 17.5% and 17.3% respectively. Seems like things are generally moving in the right direction. Defense is an area where economies of scale are very real. As a small contractor , working in defense can be a fairly trough business, because awards can be lumpy and the bigger guys can be squeezing you on margins.But once you are a prime contractor and have your lobbyist working for you Etc. so you understand which way the wind is blowing in thr Pentagon and economies of scale, then things get much much better.

Pretty typical microcosm of what is happening: https://www.boston.com/news/coronavirus/2020/10/28/why-did-massachusetts-shut-down-ice-rinks-charlie-baker-says-blame-the-adults

Nice start. QQQ's down about 1% a/h. As described, the MSFT experience indeed with FB, AMZN and AAPL. Google was super impressive but not really one of the stocks I view as having been put on steroids by the covid situation, so a bit different than some of the others. Well, it depends on when you bought them. The puts that I am looking at are still down significantly for the day, but bounced back a little after hours. If you bought them at the peak of today, then you are in the money.

^ The problem with puts is if they are adequately priced? To me the prices paid right now seem very high, as you would expect with a VIX of ~36. As mentioned before, the VIX never really got below 25 even in a steadily rising market. VIX 25 is a fairly high number, historically speaking.

In Europe at least and I suspect in the US many new cases are do ing from family and friends get-togethers. Also note that in Europe restaurants and bars (the differences tend to be more marginal in Europe) have been open. In neither occasions, people wear masks. We have Thanksgiving coming up, which likely will cause another spike in cases.

I am not too keen on HII, they aren’t good operators and in addition to being lousy operators, what they are doing is not really technologically advanced work ( shipyard) and that’s where defense spending is going, imo. I had a small position, it reconsidered and sold out about flat. GD is performing quite well and they seem to operate much better in business comparable to HII (Electric boat) and they are also doing some more technologically sophisticated work in other business lines.

I agree with RB that INTC vs AAPL is a different situation, but then again no situation is exactly the same. INTC could well go wrong - they never get their process fixed, never decide to make a leap to TSM is that’s the case and get rolled over on the chip design side by Apple, and and NVDIA and the like. This could well happen. However, if INTC works out, I bet earnings and earnings multiple will be higher I could see INTC trading at a 20x earning multiple again, in line with other semiconductor companies. That should yield a very nice return - probably a triple from current prices. As of today, I bought some FAF, MO and added to RTX and some RHM.DE. Topped up NOC and LHX a little too.

If someone gives you 10 reasons for something, he came up with the thesis first and the reasons later.

Hmm. According to BBC, the citizen seeking freedom are: I guess one just has to distinguish between peaceful protestors and rioters. https://www.bbc.com/news/world-europe-54701042 Maybe there is more too it. I think the lockdown 2.0 will be more targeted towards known transmission vectors and in hotspots and less broad.

+1 For those who like Thinkpads, this is a pretty good deal: https://slickdeals.net/f/14460524-lenovo-thinkpad-x13-gen-1-laptop-ryzen-7-pro-13-3-1080p-16gb-ddr4-128gb-ssd-833-50?page=7#comments You can go through Rakuten and get another 10% cash back off. I ordered one today to replace my 2012 Dell XPS13 which is running on Windows 7 and while going strong, some software (TurboTax) is just not going to work any more. Cancelled my order for thr Thinkpad. I figured out how to update my 2012 XPS13 from the obsolete Windows 7 to Windows 10, so it should be good for another 1-2 years. Once a value guy always a value guy. My wife is rolling her eyes.

Sold $EIX and $SRE ( price target reached)

Adding to INTC

Europe got complacent. Cases here are rising too - in all regions. I think we will crack 100k cases/ day very quickly. Hospitalization is the one metric to look at. The last waves topped out at 60k COVID-19 hospitalization. Once we get to this number, the hospitals system becomes strained, we are going to have local restrictions again. Edit: another indicator - my wife went to Costco today and noticed that several items like paper, wipes were sold out, just like during the first wave. Apparently people are getting ready for things to come. Hording confirmed from my wife‘s sources in the Bay Area ( Asian people tend to be early). Long lines in grocery stores & Costco, some paper goods and Ramen noodles sold out etc. We have seen this before.... So, it wasn’t just me. Animal instincts are much earlier on display in a Walmart than in Wegman‘s: https://finance.yahoo.com/news/walmart-ceo-consumers-are-stocking-up-again-as-coronavirus-rages-on-174308762.html

Very few people in Wegman's store Saturday morning. No lines to get in, not many people in store, and very short lines at registers. Last time we went to Wegman's (I think in June/July) there were lines to get in, store was crowded, and huge line at registers. Saturday nobody was hoarding at all. Huge selection of toilet paper, paper towels, etc. We bought some since hey Spekulatius told us to hoard 8), but we were the only ones buying. Some guy even made fun of our paper towels pack on the cart. ::) Got to get in before the rush. Wegman‘s is a rich people‘s store and doesn’t have the right vibe for the horders. Try a Costco or even better a Superwalmart next and see how it goes. I bet gun an ammo sales are up too to get ready for the election riots.

Europe got complacent. Cases here are rising too - in all regions. I think we will crack 100k cases/ day very quickly. Hospitalization is the one metric to look at. The last waves topped out at 60k COVID-19 hospitalization. Once we get to this number, the hospitals system becomes strained, we are going to have local restrictions again. Edit: another indicator - my wife went to Costco today and noticed that several items like paper, wipes were sold out, just like during the first wave. Apparently people are getting ready for things to come. Hording confirmed from my wife‘s sources in the Bay Area ( Asian people tend to be early). Long lines in grocery stores & Costco, some paper goods and Ramen noodles sold out etc. We have seen this before....

This second wave comes at a terrible time for retailers and malls - looks like Black Friday is entirely cancelled and will be replaced with online deals. No wonder $AMZN stock is up in a down Market.

The data in this website is not correlating with other websites. https://covidactnow.org/us/south_dakota-sd?s=1200292 is giving south dakota positivity rate with 15.4% Also the website is giving Florida positivity rate 16.3%. But the Florida state website report is giving 4.71% as of Oct 24 and ranged from 3.6 to 6.7 in last two weeks. http://ww11.doh.state.fl.us/comm/_partners/covid19_report_archive/cases-monitoring-and-pui-information/county-report/county_reports_latest.pdf Could well be. Those guys use data feeds from the state websites that can get disrupted when they change something. The SD Gov website also shows 15.4% positivity ( which is still pretty high) and that’s for a 14 day average.

What? Here in Texas the property taxes are insane because they are used to fund the school districts. I don't have kids but many of the public schools in local middle class neighborhoods seem very modern and well funded. During the recent pandemic friends with children have mentioned their transition to remote learning was smooth because all of the students already had standard issue: laptops, iPads, and hot spots from their public schools. I'm sure there are areas where they are high and schools are good. I'm speaking as a presumptuous Yankee. There's areas in the NorthEast where property taxes are lowish as well, but generally, if you're a tri-state area/New Englander, lets say you have modest HH income of $250k and a modest house, maybe $500k..you're at like 7% state income tax and 2.5-3.5%ish annual taxes on the value of your home...thats $30-40k in taxes; then you go take a peak at Florida or Texas and the same house carries 1-2.5% property taxes(or lower in some places) and state income is 0 and there's an epiphany of sorts. Now imagine if your income/house are more than "modest"...its a total money grab. I am a European transplant aas most of you know and have lived and my teenage son went to school in CA, NY (Long Island) and now MA. All three areas had actually pretty good schools imo(since I bought my house in good school districts). 1) In CA (North Bay Area) schools were underfunded, but high parent engagement and a strong social fabric made up for it, 2) Long Island school had excellent funding and subjectively it was the best school (teachers)with great activities (sports, music). My son loved this school, but the social fabric was a big issue. It is shocking for me to see a school with a security guard and metal detector. Bullying was an issue, drugs (opiates etc), weapons (knives), cyberbullying. lots of spoiled kids, imo. This was in a good area (Commack, 40% jewish). We learned later that one of our sons playmates down the street committed suicide with his dads gun (broken household, divorced) 3) MA, outer Boston suburb. School is well funded and but extra curricular activities can’t match the school in LI. It’s a smallish school district. Intact social fabric is the biggest plus. There are issues, but not the point that metal detectors are needed. This school has struggled with the transition to remote learning this spring, but the current hybrid schooling works well, imo. Not sure what to take from this, but for me it’s clear that what goes on outside the school walls is just as important than what’s happening inside. I can’t really speak to the private school experience (my son went to a private kindergarten in CA, but all later schools were public) but I think there is value in kids seeing the whole (or at least a larger part of the social spectrum) rather than the gilded part that goes to private schools. There is a fine line between protecting your kid from some very nasty experiences and going too far and protecting the of how real life looks like.