Spekulatius

This is incorrect. Europe brought a ton of alternative supplies to their market in a very short timeframe. Of course the milder winter helped as well.

I think you just need to account for the cost of the future debt and make some assumptions about interest rates to do so. Should be pretty simple.

I believe there is a bias for tech to employ younger people and new grads, For employment with foreign companies it’s mostly about language (English mostly ) skills which also favors younger people. In any case, a tough labor market always hits new entrants the hardest and those will be younger people and/or new graduates. Just to give you an idea about the reality in some case. My friends from town here working for an US company which used to operate in China but closed shop there and moved to the Philippines told me a sad story about an female employee there who was pregnant and felt she had to get an abortion due to her loss of job. that’s not the saddest part though - she was afraid she would lose her health insurance (through her job) before she even could get her abortion done. I am not exactly sure about there circumstances there but the public health care in China isn’t exactly great unless you have supplemental insurance ((through employers) or you pay extra. Sad story, but you can see how the birth rates won’t recover unless they fix the youth unemployment, because it’s the younger people who have kids and with 20% unemployment and a bleak outlook that’s not likely to happen. These are all anecdotes, but may give me an idea what’s happening at the micro level and how one things (youth unemployment) ties into another. ( birth rate). FWIW, the birth rate in China has dropped like a stone since COVID-19 and the longer this situation persists, the harder it’s going to reverse, since birth rate trends are very persistent. .

ERIE has since 2011 increased the dividends by exactly 7.2% every year. The current dividend yield is 2.4% , so if they keep this up and the valuation stays exactly the same, you get an 9.6% total return.

US subs of foreign banks always looked very strong in stress tests. I guess they are overcapitalized in their US subsidies.

Depends on how you look at it. PNC and USB started out with a low capital base because of recent acquisitions. PNC lost only 1.1% of their equity ratio, USB 1.8%. TFS lost 2.3%, MTB 3.4%, CFG a whopping 3.6%. C and COF also lost quite a bit (credit cards). On the other hand BAC looks great.

Results are here. I noticed that CFG, TFS don’t look that great. https://www.federalreserve.gov/publications/files/2023-dfast-results-20230628.pdf

Even if true, how does it matter for investing purposes. If true such a productivity would be priced in. Mostly the rate of change would matter. I don’t even think it’s generally true. I worked in China at a US company manufacturing sub and the engineer and workers would all work 8-5pm to the point, because that’s when the company bus brought them in and out. Prior to that (pre GFC) I visited a Chinese company the company I worked for had bought and the strange thing there is that they had a junior looking person looking over the shoulder of the person doing the work for pretty much any job. We jokingly called them “shoulder lookers”. Even the manufacturing workers had these shoulder looking a as well as engineering. We asked about them and they were “in training”. I never seen anything like this. Then you read in articles that the younger generation in China does not like these 9h work days 6 days a week any more. I am pretty sure what you describe does exist, especially in tech , but I don’t think this is the norm. Even Japan is changing with their late note office culture. In any case, I don’t think these anecdotes are of much values as an investment thesis. In my former job I travelled a lot as I was involved in tool run ins / qualifications and the differences from company to company matter much more than the country or location.

Japan is super interesting right now and not just based on this article. Cheap stocks, weak currency and mildly inflationary environment after decades of deflation is an interesting potential infliction point for equities. Much more interesting than China, imo.

I tray to do more of these tax loss swaps. Selling a losing position in A and buy a correlated stock B with proceeds. Maybe cycle back into A after 31+ days. I did this a while ago with some high cost shares in Porsche, putting proceeds into VW3 Did a similar thing with USB shares (tax loss sales) and bought BAC. I like my initial positions better, but I think it's unlikely that they outperform the correlated equities I picked much in a month.

That's a good background. Since Putin came up - there is a parallel that his original agenda was about fighting corruption as well. This quickly seems to morph into eliminating political adversaries for both Xi Jinping and Putin. I remember a significant bear market for luxury business around 2015 when Xi Jinpings first go around with his corruption fighting agenda, which took down the market for ultra luxury cognacs and expensive watches and similar goods in China. I guess this market is back - does it mean corruption came back? I have honestly no idea but it's interesting to see how these things go in cycles.

I am just surprised people think inflation is slayed. I don't think we can be sure. It takes more than a year of low or below 2% inflation to be sure it's slayed. I still see inflation in my daily job. It's not the high single digit any more but more like ~5%. Used to be 0-2% per unit for decades, except short periods like 1999/2000.

Ouch.

He is screwing the younger people by scaring away foreign investments from China (the preferred employer for many younger people) and holding back growth in the tech sector in favor of a more government controlled economy. This makes it harder for younger people to get well paying jobs.

Has anyone looked at $ERIE? ERIE is not an insurance broker, they basically act as a GP of an mutual insurance exchange, if I understand this correctly. https://seekingalpha.com/article/1883371-erie-indemnity-this-complicated-company-is-worth-understanding Complicated structure and I think it is similar to insurance brokers by way of getting a cut on premiums (from the exchange). the stock looks very pricy to me, but it has shown consistent organic growth over decades, so it seems very durable. I wonder if somebody understand this business correctly and has a view on valuation. Shares have come down somewhat, so it might get interesting at some point. I think I would be interested at 20x earnings which is ~$160/share.

@Viking I think there was a lot of confusion about what the sanctions and the Ukraine war would or would not do. It has disrupted NG flows to Europe, but has not affected crude supply and demand balance that much. Europe was able to replace the lost NG supply from Russia for the most part, to the surprise of many. I like energy plays with large cash distributions. I hold PBR-A (medium sized) and have a small position SU (bought recently ). Both are mostly dividend plays for me and great for tax deferred accounts.

Fixing the birth rates problem in China is very hard and with the economy in the doldrums and youth unemployment exceeding 20% is not going to happen in the near future either. The young generation is screwed by XI Jinping policies (suppressing and controlling tech industry, high housing costs, public school system requiring expensive tutoring to get a good education etc). Not all of it can be blamed on Ci Jinping, but his policies certainly have not been helping. Japan has a better chance at fixing their demographics than China, because they can boost emigration (which is slowly happening already). China is too large and not many want to move there anyways and more people are going to move out of China than emigrate.

The Saudis cut and the Russian flood: https://seekingalpha.com/news/3983473-russia-poised-to-surpass-saudi-arabia-as-chinas-top-oil-supplier

I never lived in China. I have family from my wife’s side who lived in Hongkong and some of her friends and extended family still liver there but most have left. my wife speaks Cantonese. I have worked in China for a couple of weeks at a time with a few tours from 2010 to 2015. I love Chinese food - Szechuan, Hunan and Cantonese (favorite is Dim Sum). I am hardly an expert but sort of tied in through my wife’s family who are ethnically Chinese. It doesn’t make me an expert but more an interested person. Most Chinese are pretty dismayed by what’s going on in China and even more so in HK. It is not widely know, but Xi Jinping wants to normalize the multicultural China into one culture (Han / Mandarin), so they try to eradicate other cultures like Uyghurs or even Cantonese (Cantonese use is discouraged now in Guangdong and even Hongkong) to make it all the same and more homogenous. So I am not the typical China hater, but I hate to see what’s happening there. I think @tnp20 in his first post captures the situation fairly well, I am much more skeptical in terms of investing then he is and would only for into Chinese equities for a trade.

@Luca If you like the Chinese system so much, you really should take your money and move there. Won't be the same thing if you keep your passport though.

The last thing we want is Pringles running Russia. He is worse than Putin as far as we know. But as far as coup is concerned, I don’t mind Wagner and the Russian army shooting at each other. It beats Wagner or the Russian army shooting at Ukrainians. The weakness that Wagner coup shows is that a relatively small army of a few thousand can roam for hundreds of kilometers in Russia with very little resistance first and apparently even enjoys some popular support. Even more importantly there was no public resistance. It shows the brittleness of Putins regime. If he falls, it will be quickly and unexpectedly and nobody really will do much to intervene.

Wagner is being disbanded and I expect there will be purges. Prigozhin will pay the price. Putin rarely drops names and I think it is not an accident that he did not directly address Prigozhin. He is already a dead man walking anyways.

India is a democracy, China is an autocracy. That’s the big difference. I also think that India is much more likely to become a superpower than China, mostly because of demographics, but also because a democratic system over the longer term beats autocracies.

I bet this buy wasn't Buffett but T or T. I don't know if it matters though.

@lnofeisone thank you for the feedback and something to ponder. I like the business but you are correct that the AI may not be the catalyst I thought, at least not short term. The fact that investment in AI probably exceeds the cash flow from AI activities is probably true for many business in the short term (Except NVDA).