Philip Morris IV
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Posts posted by Philip Morris IV
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FWIW I've had a Leesa for just over 2 years and would strongly recommend them. In my view the company delivered what it promised -- a great mattress at a reasonable price -- and the experience is significantly better than a B&M store purchase. Their generous return policies are worth noting.
My only caution with online mattresses is that the sheet industry has yet to catch up with their noticeably shorter heights. Leesa, Casper etc. mattresses are generally around ~10" thick while the vast majority of sheets are made for mattresses 14" and taller. You may have to buy straps to keep your fitted sheets taut.
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Canadian oil patch
Gold
Pretty much everything I own except what should be doing shitty, like bank preferreds.
Just curious, why do you think bank preferreds should be doing shitty?
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Serious question- is anyone aware of how much of FNMA/FMCC Tim Howard owns (he must still own some from his tenure as CFO - he probably was crushed in 2008). Trying to understand incentives here.
According to his blog, he owns varying amounts of common (with "an embarrassingly high basis") from pre-2008 and series N preferreds from Aug 2009. All in Fannie, none in Freddie. No information on amount.
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Fidelity does have an RIA platform, however they have a minimum AUM requirement. Last I recall several years ago it was in the $10 million neighborhood.
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Over the last 15 years, average venture capital returns have been below public market returns. So public market investors are not actually missing out as this piece suggests, in fact they're benefiting from the trend toward fewer public companies.
I hear you, but don't those VC returns include a majority of companies that would never reach the point of going public anyway? The report more or less presumes that the unicorns would go public around the time their success was fairly certain, adding to public returns thereafter.
On another note, the report didn't touch on the effect of valuation which is worth exploring. Given that many of the unicorns aren't GAAP-profitable, the same weighted impact these companies would have on market returns would appear to put downward pressure on market earnings. The return would be greater but the broad valuation would also move higher.
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http://www.wsj.com/articles/dont-hold-your-breath-on-fannie-mae-and-freddie-mac-1480878666
whats the deal with wsj/carney continually writing negative pieces on the gses? do these authors legitimately believe what they're writing and are writing on their own accord or are there subterranean (top down) forces at play? serious question
A few dozen pages ago in this thread, someone speculated that Carney may have source(s) in the Treasury and so to keep them, he reflects their interests. We'll never know but seems like the most likely explanation for his incentives.
It could just be me, but I've noticed the character of his articles has changed over the past several months too: his pieces are more brief now, and contain less analysis/interpretation, more facts. He could see the writing on the wall as well.
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Which set of filings for Paulson shows his position? He has like 20 different reporting companies and the only 13Fs I found don't show the holdings.
Not that I've checked, but it's not likely they appear in any of his filings as they are not 13-F securities. It is for this reason they also do not show on Fairholme's 13F.
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Seems to me that most of the issues created by indexing are all self-solving. If indexing drives more and more capital to fewer and fewer ideas, pockets of value will open up - and there is no shortage of smart people picking the market over looking for them. Capital will, eventually, go where the need (and return) is greatest.
While I agree, is anyone concerned about a potential trade-off between more opportunities and the time it takes for intrinsic value to be realized from them? Finding opportunities is only half the battle.
My understanding is this becomes a double edged sword. I agree with the notion that capital should flow where return is greatest, but as indexing continues unabated, that big capital is increasingly precluded from flowing back and raising multiples. It's like we can't have it both ways. (Unless of course indexing loses favor and sentiment shifts back to active management.)
To the extent that value investing is about finding cheap companies and waiting for them to no longer be cheap, doesn't vast indexing remove a powerful catalyst?
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I have an RIA and highly recommend hiring a compliance consultant for the $2-5k to guide you through registration. Usually the fee also includes a years-worth of consulting, which is valuable come renewal time or when the state regulators want to audit you.
The Form ADV (esp. Part 2A) is difficult enough for someone not trained in compliance, but you also need other contracts (for example your advisory agreement) that one should definitely not write themselves or blindly copy someone else's. States differ in how they like their documents prepared -- when I moved from New York to Texas last year, the Texas regulators required several detailed changes to my advisory contract, and later came to my office to perform an audit. My compliance guy helped me through this.
Sionnach, feel free to PM if you would like a referral. Otherwise good info here.
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what is your thesis on this company? doesn't look like it has been to profitable and debt load looks a bit above average (but has been coming down). 3-4x ev/ebitda on my very rough numbers
There's an AIQ thread in the ideas forum that is quite thorough and provides a very clear thesis. The GAAP earnings figure is rather fictitious with this one.
http://www.cornerofberkshireandfairfax.ca/forum/investment-ideas/aiq-alliance-healthcare/
I am with tombgrt and have been buying more here. If it weren't for the illiquidity this would be in my top 3 holdings (am concentrated).
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Thanks again merkhet for all your work here and the updates.
Seems there is big volume on several of the preferreds today. Looks like someone picked up 3.9M shares of FNMAP.
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One thing that I am surprised about is that if you don't charge a management fee, i.e. 0,6,25, people are weary to give you money. They are worried that if you have sub 6% performance for 2 years, you won't have any income to live on. So, I would encourage that you charge 1, 6, 25.
This is a good point in favor of having a management fee. Another is that without one, it incentivizes the manager to really crank up the risk. With 0/6/25, the manager has to break 10% (and possibly HWM) to make just 1%. With 1/6/25 there isn't the constant pressure to swing so hard or act hastily when downward volatility strikes.
WRT lockups, something I don't see mentioned yet is a 'soft' lockup. In other words, a 2-3% redemption fee that expires and/or scales down to 0% over time. This I believe accomplishes the best of both worlds in a way -- discourages early withdrawals yet mitigates their impact anyhow, and still allows LPs the option, for a price. When payable to the fund, it also rewards the more patient LPs, as the exiter's loss is their gain.
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Shake shack started in a literal shack (maybe 15sqft) in Madison park in NYC. To this day there are lines which span the south end of the park during lunchtime. The burgers are as BG2008 mentioned succulent and juicy.
No idea about the investment qualities as I haven't read the S1 but just in case people wanted some color.
I can recall in 2010-11 several times waiting in that exact line for up to an hour. It was worth it. When they opened a closer one to me in Westport CT, that one always had a long wait as well. Their whole menu and execution of quasi-upscale fast-casual is very good.
Props to BG2008 for pointing out the shady proceeds purposes. It'll be funny to see how little that will probably be mentioned in the eve and wake of the offering.
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So, are there legal tools aside from a pre-nup that can be effective at protecting pre-marital assets in the event of divorce?
Do posters have insights into perhaps: Trusts? Irrevocable/DAPT/other? Corps? _____?
Or do we just accept that we either bear the full risk or none at all.
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My understanding with trusts is that for them to be effective for this purpose, they have to be irrevocable. But then, doesn't that defeat the purpose?
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I agree that generally these trends are priced in and speculative. For me, this cuts too close to the first-level thinking of "investing in what is the future" for lack of a better phrase -- for example, how people discuss and bid up 3D printing or solar stocks. It's not the same but close enough.
The most this mentality does for me is provide some added comfort that, at least I'm not in a melting ice cube. AIQ comes to mind here: they will benefit from those demographic trends if they occur, but it is a sideshow to the central thesis.
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It's been confirmed he does not have to report the holdings and no longer is. It states this on his latest 13F cover page. If you look back a few pages here there is some talk on it.
Ackman was just on Bloomberg TV and spoke a bit about FNMA. Nothing new if you've listened to the latest Pershing call, but always good to see strong resolve. Clip will probably be on their website in the next few hours.
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I suspect for many here TII was probably their first kiss with value investing, maybe after flirting with a few BRK letters. At least insofar as the concepts of margin of safety and Mr. Market. For me, those two came at the tail end of a college education filled with CAPM, EMH, Swensen/Yale model etc. In one fell swoop, they replaced that with a totally new foundation and so imparted a kind of pivotal legacy.
You/Munger make good points and many have alluded to them in this thread. I agree, the influence speaks more to psychology than valuing methods that are better explained in other books. My favorites have been mentioned but one I'll add is Manual of Ideas (John Mihaljevic) which does a great job dissecting the methods of different types of value investing/investors.
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QVAL was discussed here:
http://www.cornerofberkshireandfairfax.ca/forum/books/quantitative-value-gray-carlisle/
That's interesting, thanks.
I'm surprised they launched an ETF with such low AUM. I imagine regulatory costs would preclude profitability at <$3M AUM? But good for them if they can get more inflows.
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If you are just going to do a simple quant strategy, why not buy an ETF like this one:
Or a DFA fund based on P/B?
Where did you find valueshares? Their QVAL ETF inception was this past Wednesday 10/22/2014 with assets of $2.6M. Cool idea, be interesting if that takes off for Wesley Gray.
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Well its interesting what happened....
The big tobacco companies started to threaten them with vertical integration which injected some heavy fear into management When Im dealing with a duopoly and the supply demand situation is in your favour I expect you to raise prices. AOI refused to raise pricing as per their conference call because it may lead to the large tobacco companies further taking away business with more vertical integration (why the large companies want to be in this low margin business is beyond me? But that seems to be their fear) Couple that with high debts and unstable political situations in some of the areas they operate and this has been a disaster SO much for the power of duopolies.
My thoughts exactly, on the surface that threat is laughable. Big Tobacco enjoys superior, capital-light/high-ROC economics -- why ruin that by entering this business. Besides, they spend more on buybacks every quarter than these two firms combined.
Do you see potential, provided they can get interest expenses/debt under control? AOI looks like it is priced to die.
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Alliance one and universal corp
There are extra lessons to be learned with these two as you will see that having a duopoly is no guarantee of great returns
Whoa, what the heck happened to Alliance One? All-time low and tobacco is not declining (worldwide).
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Boeing & Airbus
Western Union & Moneygram
Fannie & Freddie? ;D
If the RAI-LO merger goes through, Altria & RJ Reynolds
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Cute kid! Congrats Sanjeev.
Well Run Banks
in General Discussion
Posted
Bank of Hawaii (BOH) has always stood out to me. They consistently churn out great numbers -- even through the 2007-2010 period -- and trade at a significant book value premium to the sector and Hawaiian comps, at 2-3x BV (3x today).
Hawaii is unique for the US in that the Big Four (and all other mainland banks) are absent there. The banking market is almost entirely controlled by BOH, First Hawaiian (FHB), Central Pacific (CPF) and American Savings (a subsidiary of Hawaiian Electric - HE). It would appear this insulates them from mainland/asian competition, but of course their geography naturally limits growth. This is very obvious on their 10yr financials and I believe reflected in their below-market earnings multiples.