Spekulatius

I have been listening to a lot of value investing podcasts and most practitioners seem to believe that price /book has stopped working for some time ago. Quite a few others believe that even PE or even any quantitiave metric has stopped working, at least for mid and large caps. I think there is evidence that this is probably correct in most market segments. There are probably pockets in the market (microcap) or countries where these old heretics for value stocks still work. It is probably more important to understand and evaluate the business now, rather than looking at metrics. looking at metrics now is really easy, but understanding the business is harder and there is a better chance that a business is misunderstood rather than a business with great great value metrics is overlooked.

Well, Detroit went through a bankruptcy in 2013, and the Pensions obligations took a much smaller haircut than other debt obligations. Buffet wrote about this and clearly stated that moving a company to location with a pension problem implies a liability for the company or their employees and needs to be considered. Buying a property or house in such a Location is pretty much the same.

I am betting on tequila via CUERVO.MX. Tequila is underpenetrated anywhere but in Mexico and the USA, imo. Supply constraints for Algarve hurt in the short term, but should benefit an integrated company like Becle ( CUERVO.MX) in the long run. Family business and a good balance sheet are additional positives. I think the most important attribute in spirits is brand building.

I found this article about trend following quant funds interesting. It’s turns out they didn’t do too well in 2018. Apparently the culprit is that there is too much money invested in the same strategy: https://www.bloomberg.com/news/articles/2019-03-01/one-of-wall-street-s-most-popular-trading-strategies-is-now-failing

Interesting article on beer. I was surprised to see that even craft beer brewers are hurting. It’s a bear market for beer :o https://www.ccn.com/millennials-killing-us-beer-next-victim-is-heineken The trend to spirits is mentioned as well. Heineken is the Budweiser of Europe, imo. the stock looks pretty overvalued too, but I think they are better run than Ambev.

Added to FCAU and bought a starter in WBA

My guess is the fact that this deal is in the news means is that the rumour likely is false. BRK has been very good at keep on their plans secret in the past.

The earth has reached the carrying capacity 20,000 years ago. Then the humans invented agriculture. I think the concept of a fixed carrying capacity is incorrect as it has static variables as an input, but humans are highly adaptable.

Good point. I too am ignorant on the specifics. I didn't mean to impugn Metro Bank management, but to respond to Cubsfan's comments and assessments as I understood them. Falling victim to a charlatan is the worst case scenario that we all are trying to avoid, but there are many lessor risks in evaluating manager skill and honesty. One heuristic I developed (in a costly manner) was to always sell any financial stock that has a run in or problem with a regulator. I have several experiences with these issues and one I remember vividly was that AIG in one of their filings around September 2008 noted a disagreement about valuation with their auditor , as I recall. I thought about this for a while, my position was already in the hole at that time. I decided to sell, because I thought if their management can’t agree with their auditor about valuation of some assets, who am I to value this stock? It turned to be the correct decision. I had several other experiences like that with banks and none of them would have worked out. It’s a bit different with Industrials or non-financials, but with financial the rule to to sell first is probably right in the vast majority of the cases.

A 10% efficient system that captures energy at 2c/kwh needs an input of energy with a <0.2c/kWh cost to work at the given value.

I second what Read the footnotes stated. My impression is that Metro’s management lacked the ability ( to exactly understand the rules governing banking in the UK) and were not necessarily dishonest, but I could be wrong. I haven’t followed this story too closely however.

Hi. I've been looking a bit into that. Seems very interesting. Have you seen a decent writeup anywhere or mind to share a couple of points? What's obvious is the deposit growth, which is incredible. The culture is based on the Commerce Bank model, that Vernon Hill "invented" in America. The culture is real - I can tell you that. Both customers and employees love this company. You have 56 "stores" going to 100-130, roughly in 5-6 years. The "store model" is totally repeatable - and UK will eventually support, perhaps, 200 stores. There are structural reasons for the growth - by that I mean - the UK banking sector is being forced to shrink (I mean the legacy banks) as the UK regulators and the public's interests have not been served. (RBS is still 65% owned by gov). So some assets are being dispersed, the market is opening up, and legacy branches have closed at a fast rate due to cost cutting and poor locations. So there are significant industry tailwinds for the growth of "challenger" banks. Metro is the best of them all. It's the fastest growing bank I have ever seen in my life. Looks like Metro Bank is blowing up. Risk weighting for mortgages off - they had RWA for commercial mortgages at 50% rather than 100%. Did they forgot to read the manual for bank accounting in the UK? Looks doomed to me, or at least has to raise capital. On then surface, it still looks adequately capitalized, but I stay away from financials that can’t get their accounting right - a lot of them become doughnuts. https://finance.yahoo.com/news/british-lender-metro-banks-2018-072746266.html Dumpster fire continues - cash call: https://finance.yahoo.com/news/metro-bank-slumps-shareholder-cash-081129938.html

Is anyone here qualified to do so? The presenter certainly isn’t. He has Nobel price in physics based on work done in the 60’s and knows very little about Meteorology, nor is he expert in statistics. To debunk climate change , he would need to go into much more detail than he did in this talk, publish some peer review work in this field etc. To my knowledge, he hasn’t done this. FWIW, i have a PhD in physics but that doesn’t make me an expert in other fields. So, what are you doing here in an investment forum discussing investments when you do not have the appropriate educational qualifications? If only the people who can discuss climate change are climate scientists, why are politicians discussing climate change? Dismissing someone's argument because of their lack of expertise is one hell of a condescending manner that would turn off anyone who might genuinely want to participate in a healthy discussion otherwise -- wasn't that the point of democracy? Of course, maybe the goal is to simply shut down all types of discussion around climate change. I didn’t know what there is an qualification needed to sign up for an investment website. The lack of expertise of this presenter is a fact. He is not an expert in climate science and doesn’t really have peer reviewed publications as far as I know. He is consdescenting to the scientist working in this field as he claims they are faking data for example. The global warming theory has been existing since the 1960’s and slowly more and more evidence has been generated . That’s almost 60 years of science. Name me a case where the science consensus with a huge body of work has been wrong for 60 years in recent times. Also, science is not a democracy - the best data and theory wins, not the one with the most votes. I think the real discussion that the public and politicians should be having is what to do with the data. just acknowledging the clime change problem does not necessarily mean that we should abandon all fossil fuel sources. This is a decision that the public needs to make, not the experts, The experts should, provide the input for the decision, but the decision needs to be made by the public. That’s where the politics come into play and where imo some scientists overstep their boundaries. Politicians that state they believe this or that without having a clue about anything are overstepping their circle of competence, imo and are hence not credible.

Bought a little bit of GNRC. I might get this one cheaper , but I like the sector and the brand equity. I also believe this sector has secular growth, even though near term results can vary, based on weather patterns.

Is anyone here qualified to do so? The presenter certainly isn’t. He has Nobel price in physics based on work done in the 60’s and knows very little about Meteorology, nor is he expert in statistics. To debunk climate change , he would need to go into much more detail than he did in this talk, publish some peer review work in this field etc. To my knowledge, he hasn’t done this. FWIW, i have a PhD in physics but that doesn’t make me an expert in other fields.

A part of GE for sale would have been my guess as well. WEB knows GE well and has lent them money before. We also know that GE just announced the sale of their biopharm business to DHR for $21.4B, which is the size of a whale for BRK. I suspect though that GE may have tried to sell other assets to BRK than to DHR (DHR has Medical tech focus) but than settled with DHR instead. All the above is pure speculation of course.

I never saw the material, it remained at school. I have no clue what they actually wrote, although I can suspect. My lesson to my son was simply to understand the motivation of the author and who pays for the material, which is easy nowadays with a simple search using Google. Incentives matter, as we all know. What surprises me is that this institution actually have the funds to sent unsolicited material to schools free of charge. MAGA $ at work.

Yes, most companies have better things to do, but over time, companies do change their systems. Then there is also natural attrition from mergers etc. , where the merged companies typically pick the cheaper system/application/SAAS system and the dinosaur application will get sunsetted.

Heartland Institute rings a bell. They unsolicited sent “study material” to my sons middle school science teacher study material that was refuting climate change. The teacher forwarded some of the material to the students to discuss. My son ask me about this and I told him to follow the $ trail and find out who funds and pays these guys. Yeah, the same Heartland institute refuted health issues with second hand smoking, funded by Phillip Morris...

Yes, the CoBF lynch mob can put the pitch fork back into the shed. It’s too bad that he couldn’t fire off the elephant gun and he missed the opportunity to add to equities, but things can happen. Warren will now more likely return money to shareholders via buybacks unless he has another elephant in his crosshairs, which seems unlikely in the near term.

It’s harder to go from 100k income to $20M in assets than from $10M in income to $2B in, because with $100k, you living expenses will eat up most income and your investible free cash flow will be a much smaller part of your gross than with $10M in income. Well for some people, the expenses just rise with income admittedly, but for most of us, it would be easier to save $5M out of $10M income than $50k out of $100k. I agree that Wertheim’s track record is quite extraordinary, as he has probably beaten 99%+ of his peer group in wealth creation, even from his $10M income point in the early 80’s. Weather he beat the index or not doesn’t really matter - he kept compounding his wealth at a pretty good clip, while most investors either underperform or blow up (when concentrated) over the course of 40 years.

Sun Hing vision 125.HK looks good to me. I haven’t bought it yet, though.

AR or VR has been suffering from hardware deficiencies. The high end optics are very hard integrate into wearable elements like glasses. GOOG, FB and Apple all are hiring optical engineers to work on this and other problems but some fundamentel breakthroughs may be needed, to build the devices that will truly enable the technology.

The left coast would do well as one state. I think Texas would want to do go it alone too.the North Eastern New England state fit together well and I would include NH :-). The Rocky Mountain states have a lot in common. The south would probably come together under a confederate flag. The rest - who cares :o.

Germany also has a balanced fiscal budget. Same idea.