Spekulatius

Tried to listen to the record, but can’t connect to it. He sounds like Ed Sheeran after stepping on a Lego. Unrelated, prime has a series of movies about classic Albums and how they were recorded, I found the one about the in comic “So” record from Peter Gabriel to be very well made. i remember too well when it came out in 1986 - almost every song is a classic. https://www.primevideo.com/detail/Peter-Gabriel-So-Classic-Albums/0RIETTR5NSJAGVBOOGGDWJR28A

US energy production is at record levels again, despite ESG. I think it’s the Saudis reducing production that is pushing energy prices higher right now. They do need to be careful that other countries like Venezuela or Iran of Guyana don’t take share or substitution of alternative energy sources eventually starts to bite.

More WSJ coverage on this matter: https://www.wsj.com/finance/stocks/japan-has-a-long-history-of-disappointing-investors-why-this-rally-might-be-different-f3b36615?mod=series_stockmarket I think there are some real changes happening on inflation as well as capital allocation that makes this rally different. I guess we will see.

I did not sell WTW because it is underperforming. That was clear to me from the get go. I’m sold it because it was a different business than I thought it was when I bought it. Specifically, I did not quite grasp that some of WTW business (Transact) are much less FCF generative than the brokerage business. I also think that Management is working towards KPI’s that are not likely to generate that much shareholder value. My lightbulb went off when I read the latest VIC comments, specifically regarding the Transact business, the last CC transcript and the summary listed by @dealraker from Wells Fargo. It is one thing to buy a business that is temporarily underperforming and think can be fixed, but another where the business is really a different one than you think it is.

The CEO of Northrop Grumman is a woman (Kathy Warden). Former Lockheed Martin CEO was Marylin Hewson until the current CEO took over in 2021, I believe. GD’s current CEO is a woman too Phoebe Novakovic. https://www.politico.com/story/2019/01/02/how-women-took-over-the-military-industrial-complex-1049860 Anyways, what’s the point. The most successful Chinese companies are all run by Chinese men.

Thx. I have small positions in 4290, 7605, 9928. Found those via a combo of Twitter and screening. I carefully look for companies that have shown organic growth in the past, which is rare in Japan. I have build a screener around that too. My biggest concern with Japan is value traps and I had plenty of those, but it seems like the ground is slowly shifting with better capital allocation. I don’t see anything special with 4503 (Astellas)I think the Japanese Pharma were left behind when the research went from chemistry to biological 30 years ago. I would rather buy BMY if bottom fishing for cheap pharma stocks, but have no deal insight here.

After reading about this, and the ~10x energy density advantage of Silicon anodes, I am fairly sure that where the tech is headed. Looks like the likely solution is micron or nano materials. I think the cost problem is going to be resolved over time, because a 10x energy density advantage is just too juicy to pass up. I am not sure if those two startup companies are going to be winners, because it seems to me that right technical path to implement Si cathodes is still pretty much in the air.

After the foreign minister notes missing, the defense minister Li Shangfu goes missing too: Then XJP did not attend the Brics meeting. I am sure all is well in Beijing but probably not everyone is.

Looks to me like inflation is picking up again due to rising energy and commodity prices. I think it's well possible that we have seen the bottom in inflation or are close to it.

Stocks really fail if there is political strive. All the stock markets that failed did so because politics in the country failed. Latest example is Russia, then there is Argentina, Egypt etc. The US has been safe from political strive but I think it has become more likely and a bit comparable to the late 60's situation. By the way, inflation is also a result of political failure.

Reduced GOOGL and sold NXST

@DinarYou forgot tort reform. The US legal system is probably the largest vampire after health care and in realty those two vampires are pretty much intertwined. here is a table for Schmerzensgeld (lit. Pain money) for medical malpractice: Death from to heart attack due to mal diagnosis - 10K Euro. Paralysis due to mistake at surgery 220K Euro. Good luck finding a lawyer to take your case unless you pay yourself.

The Chinese health care system is strange. It's sort of socialized, but you have to bribe doctors and pay extra buy various means to get good treatment (like medicine). there are also a bunch private clinics. I think buying worthless saline solution may just be one way to bribe doctors and if that's the case, there will be other means to facilitate a transactions. I honestly have no idea how it works, but one reason for the high savings rates are health care expenses. People are afraid they are left to die when they get seriously ill without the monetary means to buy or bribe to obtain a decent treatment.

Whatever you do, do not less tax consideration guide your investments decisions too much, the tail should not wag the dog. If you like the winner at current prices, let them run. If you think they are overextended or fundamentals are not that convincing any more and you can do some tax moves that make sense, I think reducing or selling them makes sense.

I think higher real interest rates over time will reduce wealth inquality. It will over time bring asset values down and lead to higher earnings yield which makes it easier for savers to acquire them. This is good for those starting out but not so good for those owning assets. Other thing is divergence between management pay and average worker pay. There is very little rationale for top management pay increasing much faster than workers pay. There is for example very little correlation between stock performance and management pay and excessive pay has shown to be detrimental to shareholder returns in studies that I don't remember.

@nwoodman What is your rationale for this buy?

1. I think it does make sense to crystalize tax losses in general. You can sell and buy back the same position after 31 days to avoid wash sale rules , unless you think that a large move is likely in 31 days. You can also buy a similar or correlated stock in the meantime. 2) I would sell the position with the highest tax base.

No wonder so much just seems momentum driven.

I actually think the Lockheed Starfighter f104 designed in the 50’s was faster than the F-35.

I think the competition to equities isn't treasuries, but Investment grade debt - take BBB debt for example, which still has way lower risk than equites. BBB debt yields 6.08% and I think it will outperform equities but at much lower risk. https://ycharts.com/indicators/us_corporate_bbb_effective_yield#:~:text=US Corporate BBB Effective Yield is at 6.08%%2C compared to,long term average of 5.25%.

I agree. this is quite an epic quality issue or manufacturing escape. There is of course more to the story than what Greg Hayes is telling in the CC. Sonic is a fairly common method to find voids in solid parts. they talk about an orthogonal scan not picking up what happened there and they are now doing angle scan. the facility was in operation since 2015 which begs the question why it occurred starting in 2020 and not from the start. Not knowing the details it sounds to me like they had a shadowing problem that would mask some areas (or perhaps something along the lines). I am sure some people in engineering and quality are going to be in hot water , but from my experience, it is often management that brushes of concerns from engineering because they think it's overkill or wastes time and resources. In any case, I think there is some financial risk that the parts that share in the process and in principle share the cost of the recall and customer compensation will bark at P&W and demand that they take on a larger share, because this is solely their fault. That's what I would do, if I were in their shoes.

Interesting observation on the gold standard and I agree it was a major infliction point. I think some folks rightly point out that abandoning the gold standard was like ripping off a band aid. Unfortunately if you are bleeding from a wound and rip the band aid off, the bleeding increases. There is also the theory that abandoning the gold standard let to the first oil crisis in 1974 as the Arabs then got aware that they were getting screwed over inflation and decided to put the squeeze on. FWIW, they are doing the same right now, just piece meal with supply reductions, while also trying to dump $50B worth in Aramco stock. They definitely have gotten smarter over the years.

Looks like both ships are completely destroyed. https://x.com/UKikaski/status/1701890251306762666?s=20 Yes, for the Russians it must feel like the Ukraine uses a cheat code when using western weapons.

USB down ~4% today. I did not see any news, except an unchanged dividend. I think USB used to raise their dividend in the third quarter almost every year and this year they apparently didn't. Maybe that has spooked the market, or is there anything else going on? Even $C has raised this year and so did $BAC. $PNC, $JPM.

Looks like Storm shadows have damaged a newer Submarine and a larger Landing ship in Sebastopol harbor. Crimea is strategically worthless for Russia now; https://x.com/UKikaski/status/1701894717615546754?s=20