vinod1

Thanks for laying out the assumptions. Without knowing one's estimates of earnings, growth rate of earnings and discount rate, it is difficult to know where there is disagreement if any. In the base case as of Q1, 2020, I have normalized earnings as $12.5 per share, excluding any earnings from float. Growth rate of 8.5%. To me, it looks like any differences in IV estimates for BRK really boil down to 1) The value of float. This is harder to assess as it is dependent on interest rates and investment opportunities. One simple and likely very conservative way is to assume that $60-80 billion would always remain in cash and as long term interest rates may remain low for a long time, essentially are not worth much. So we end up valuing the rest of the float or about $50 billion. Or assume it is going to earn some low rate on the total float and it ends up adding $0.5 to $1 per share. 2) The discount rate. So you have ROE of about 8.5% which is consistent with the growth rate assumption as well with 100% earnings retention. If you pick a discount rate of 7%, you have to have to look through 30 years to make it worth 1.5x book value. The question I have for you is, if you assume a growth rate of 6%, why would it be worth even book value unless your discount rate is less than 6%? Vinod For a handful of index funds or index-like investments (aka Berkshire) that I hope to hold for decades I basically just capitalize growth in perpetuity. I know it's inelegant, but one benefit is I can do it in my head. For Berkshire I do break down the groves in a spreadsheet, and slice and dice assumptions a number of different ways before landing on a look through earnings estimate. (FWIW, when making an investment I assign a lot more significance to my look through earnings yield estimate than to my ability to forecast growth. Hence, Amazon hasn't made it into the 'ol portfolio just yet.) I'm definitely comfortable with a long term BRK growth rate over 5%. The ROE, compensation structures, and capital allocation discipline ingrained in the culture give me that confidence. (As an aside, it also doesn't hurt that: a) Buffett pledged to give away 5% of his BRK holdings annually to the Gates Foundation b) he is genetically hardwired to increase his wealth over the long term (with a margin of safety), so if history's greatest investor feels a minimum 5% long term growth rate for his own company is probably a safe bet, I'm more apt to accept that assumption.) I do have trouble basing a long term growth assumption on a historical 8.5% ROE. They clearly can't reinvest organically at that rate, so it all comes down to acquisition prospects. And, a) because the universe of sizable investment opportunities in Berkshire's circle of competence is now down to maybe a few dozen companies globally b) because Buffett spent his entire life teaching/training an army of extremely well capitalized competitors (aka private equity) to do exactly what he does, while they're incentivized to pay higher prices, I can see scenarios where the elephant gun that used to be unloaded every 2 or 3 years, now gets shelved for 5 to 10 (or more) years at a time; leaving the next generation of management no choice but to accept lower growth while buying back shares or paying dividends. I was comfortable with 7% last year. Now I'm more comfortable with 6%. I really really really hope it turns out to be at least 8.5%. Thanks for the detailed response. Lots of good points. What I am asking is what is your expected long term expected return on BRK? This is what people would call "required return". If I understand it correctly, you seem to be saying you would be happy with 5%. Vinod

rb, We can do BRK valuation different ways and I do that too. However, the only valuation approach on which I have confidence is one based on owners earnings. When shit hits the fan, it is the only thing that gives me enough conviction on an investment. Nearly every investment mistake I made is because I misjudged earnings. I see that pattern among Buffett and other greats as well. So my strong bias is to look at the earnings an investment can generate. Above, I am basically looking at all the earnings that BRK can generate (even though some are just look through) that accrue to the owners. Coming back to float, you need to make some assumptions about it. Almost all the other parts of BRK are pretty simple to value. We can nit pick about the multiples a bit here and there, but there is not much ambiguity in most of the business. The thing that drives uncertainty in BRK valuation is float and its reinvestment opportunity. Even if you do not explicitly value float, you are basically making some assumption implicitly about its value. Better separate it out, that way you can change its value if something changes related to it. Vinod

Thanks for laying out the assumptions. Without knowing one's estimates of earnings, growth rate of earnings and discount rate, it is difficult to know where there is disagreement if any. In the base case as of Q1, 2020, I have normalized earnings as $12.5 per share, excluding any earnings from float. Growth rate of 8.5%. To me, it looks like any differences in IV estimates for BRK really boil down to 1) The value of float. This is harder to assess as it is dependent on interest rates and investment opportunities. One simple and likely very conservative way is to assume that $60-80 billion would always remain in cash and as long term interest rates may remain low for a long time, essentially are not worth much. So we end up valuing the rest of the float or about $50 billion. Or assume it is going to earn some low rate on the total float and it ends up adding $0.5 to $1 per share. 2) The discount rate. So you have ROE of about 8.5% which is consistent with the growth rate assumption as well with 100% earnings retention. If you pick a discount rate of 7%, you have to have to look through 30 years to make it worth 1.5x book value. The question I have for you is, if you assume a growth rate of 6%, why would it be worth even book value unless your discount rate is less than 6%? Vinod

Neil Ferguson is a charlatan. Injecting bleach is genius! Trump supporters at their best. I can see why college educated women would not date Trump supporters!

This is an excellent idea. While maybe annoying, is there any reason at all it doesnt make sense to mandate an individual with limited investing experience take a brief online tutorial/course prior to being permitted to open a trading account? Doesnt even have to be pass/fail, just a basic intro of "hey this is what you're getting in to". I think the best argument against it is empirical rather than philosophical -- it wouldn't actually do anything to change people's behavior, but it would allow those who wish to do so to say that appropriate steps were taken and "You were warned. It's on you." In short, it seems to be a symbolic act, rather than a real effort to solve a problem. That being said, my objection could be tested by some type of randomized trial to see if the proposal has any effects. If it actually does change outcomes in a good way, then I see no reason not to do it. You might be right. My thought process is to view it as similar to driving. You can just say people drive the way they want to drive and that self interest should ensure that they would try to minimize accidents. So there is no need for a driving test. I think that making people aware of basic signs, yield, right of way, double yellow line, etc. they become more likely to follow rules than if they have never even been made to go through that written and a driving test. I would think that something similar is likely. Just like we do not eliminate drunk driving or reckless driving completely, we could reduce it. In 1999 I bought two stocks about $1000 each. I think after reading an article on each. :) They went to $6800 before going to nearly zero. I had no idea if I lost money because stock market is a giant gambling machine and I just got the wrong cards, or if there is some approach that I am supposed to follow and did not know about it or something else. That curiosity led me down the path of my interest in investing. Went through all the books of the investing section of the local library twice over the next couple of years. Assuming I am not a complete idiot (may not be a safe assumption), many people new to investing might be similar to me and do not really know much about the stock market. By making them aware of very simple investing knowledge they would be less inclined to do what I did. We are not going to avoid it completely but I would think it would diminish some of errors people make. Just by putting this kind of gate, we can reduce the number of people who get into trouble with single stocks and options. Imagine you set this kind of test at some threshold that requires some basic numerical literacy and understanding of financial concepts, I think that might say not allow some x% who do not meet that standard from being able to even get into trouble as they would be unable to open an account for individual stocks or options. Of course, the remaining 100% - x%, might feel like geniuses for passing the test and trade even more recklessly :) so you might end up being right. Vinod

I agree with educating children on finances. But would even go further. Just like you have a driving test before you drive, have a test with basic information about stocks, biases, etc. and only if they pass they should be able to open a trading account for stocks and options. Else they would only be limited to broad index or active funds. Vinod

OT? I am afraid that our expectations in both of these cases are too high. In fact, I am afraid that our expectations of human behavior in general are too high. Whether applied to young people in their 20s, or people in general, or "highly rational" investment professionals frequenting certain investment forums, or even people at the highest levels of business or politics. Yeah, that makes me a misanthrope. :-\ Also see my signature. This is nonsense....I’ve seen children (first hand) in third world countries have more responsibility and act more “adult like” than your average millennial. Notice the more laws we create to coddle individuals, the softer society becomes and the more coddling it needs. If you have low expectations of society and individuals (and let them know it), you’re pretty much guaranteed to get poor results. I’m a firm believer in the saying “Hard times create strong men. Strong men create good times. Good times create weak men. And, weak men create hard times.” If I had to pick a point as to where modern society is, I would say somewhere in the bottom of the “good” inning. Do not mean to argue with you. It is something, if I remember correctly, Billy Bryson wrote about. He talks about how while he was talking with a parent from some tribe that has not yet been introduced to modern world, the 2 or 3 year old child keeps playing with a very sharp knife and every time the kids drops the knife, the parent keeps handing it back to the child. I am sure by the time the kid grows up to 7 or 8 he becomes an expert at it. But there is a downside to it. Do you know how many children in those countries do not have arms, legs, one or both eyes damaged? Yes it teaches responsibility but you need to be willing to live with the pain, which means you need to be able to say I am fine if my child loses an arm or a leg or his eye. In a rich developed country, your tolerance for that would be low. I grew up in India, so I am well aware of what you are saying. Just pointing what you need to be willing to give up as well. Vinod

cherzeca - Fantastic advice to all parents. Noted down all your comments. Thank you! rkbabang & SharperDingaan - Great advice! Thank you! It is always surprising to me how much good non-investing advice there is on this forum from fellow board members. Vinod

Common sense to a Trump supporter - Injecting with bleach :)

Yup, I know it is absolutely crazy but something like 44% of republicans have been found to believe Bill Gates is planning to implant microchips in everyone via vaccines. Don't know whether to laugh or cry at that one. See https://www.bbc.com/news/52847648 and https://www.businessinsider.com/bill-gates-vaccine-conspiracy-theories-are-stupid-2020-6 for some of the craziness. The bricks come in within all these theories because Bill Gates apparently hates and is scared of Trump (who might expose and counter him as the story goes) and wants to damage him by making the protests violent. That is about as far as I can figure out since they don't make much sense overall (some claim that Bill Gates wants to kill 15% of all people via vaccinations but some don't so there is quite a bit of variation to this nonsense). Pity them. Imagine if someone believes these kinds of things. How are their relationships going to be with their family members? How effective would they be at work? How much anger and frustration must be boiling over in their minds? They are likely frustrated every waking minute. This frustration oozes out of every post they make for example. Count your blessings that you are not them.

For those interested, here is a distilled list of best-evidence that has built up over the last few weeks versus prevention of transmission. https://academic.oup.com/jid/advance-article/doi/10.1093/infdis/jiaa189/5820886 https://www.ecdc.europa.eu/en/publications-data/using-face-masks-community-reducing-covid-19-transmission https://www.thelancet.com/journals/lancet/article/PIIS0140-6736(20)31142-9/fulltext From a humble perspective, a detached and rational approach tends to avoid running into sterile debates and tribal drift but i often feel like an idiot. It's fascinating that this virus, which is somewhat benign from an evolutionary standpoint, stirs so much reptilian instincts and one has to wonder about the host (and its institutions). Maybe i focus too much on governance issues. Here is another one : https://wwwnc.cdc.gov/eid/article/26/9/20-2272_article Runs a bit against my hypothesis that truly asymptomatic (And those that never show symptoms) younger people aren’t likely superspreaders. Well, it seem they can be. Whether one is truly asymptomatic or get some mild symptoms later is not that important. Its been clear for a while that there is asymptomatic transmission, which happens while talking. To some extent masks help but not eliminate small tiny droplets floating in air and its difficult to wear masks continuously. That is why Japanese say "ventilation is key". That makes everyone life easier. And now we know it works. I think we should copy what works. That is not to say not to use masks or stop washing hands or stop safe distance. But no need for enforced lockdowns. About that mask thing... https://www.washingtonpost.com/nation/2020/06/17/pelosi-masks-house-rule-jordan/ You can't even get the leadership of the country to put on a mask. From the linked article: “Can you smell through that mask? Then you’re not stopping any sort of a virus,” Rep. Clay Higgins (R-La.) told CNN last month, an argument not supported by science about the disease’s spread. “It’s part of the dehumanization of the children of God. You’re participating in it by wearing a mask.” To the Russian backed Trump's supporters, this all makes sense along with injecting bleach. Trump, the only American President to run away and hide from people in a bunker, it is a way of making up for his cowardliness.

WSJ article by Peggy Noonan https://www.wsj.com/articles/on-some-things-americans-can-agree-11591313189?mod=hp_opin_pos_1 As to the president, this week he altered his position in the political landscape. Something broke. He is no longer the force he was and no longer lucky. In some new and indelible way his essential nature was revealed. It got out that faced with protests around the White House, he hid. Or perhaps let the Secret Service, which might have struggled with realistic threat assessment, talk him into going into the White House bunker. (Mr. Trump later said he was simply “inspecting” it.) He tweeted that he was protected by the “most vicious dogs” and “ominous weapons.” On Monday, he spoke in the Rose Garden. “I will fight to protect you,” he said. “I am your president of law and order.” This was unsubtle, and seemed more aimed at protecting his political prospects than your safety and property. Then, upset that people might be getting the impression he was a physical coward, he set out to prove he is brave. Protected by a phalanx of police, Secret Service, sharpshooters and what looked like a Praetorian Guard with shields, he marched to St John’s, the church of the presidents. Aides said it was a Churchill moment. And it was just like Churchill during the blitz, if Churchill secretly loved rubble. Upon arrival with his friends, the people who work for him, he brandished a Bible like—who in history?—the devil? In all this he gave up the game and explicitly patronized his own followers. It was as if he was saying: I’m going to show you how stupid I know you are. I’ll give you crude and gross imagery and you’ll love it because you’re crude and gross people. And some would love it. But not all. Not most, I think.

Holy shit! Everyone in the US needs to read and reflect deeply on what Mattis wrote. Mattis is a Republican, a professional soldier, a patriot and has intimate knowledge of who Donald Trump really is as a person and how he thinks and acts as President. This message is not from a partisan Democrat hack. Mattis’ is very clear in his assessment of the situation and the President. Donald Trump is clearly not fit for office (and it is not even close). How anyone with a working brain can continue to support this man completely boggles my mind. No, the alternative is NOT worse. That is a false choice. Read the underlined section below if you still do not understand why he must be defeated at the polls in November. “...Donald Trump is the first president in my lifetime who does not try to unite the American people—does not even pretend to try. Instead he tries to divide us. We are witnessing the consequences of three years of this deliberate effort. We are witnessing the consequences of three years without mature leadership. We can unite without him, drawing on the strengths inherent in our civil society. This will not be easy, as the past few days have shown, but we owe it to our fellow citizens; to past generations that bled to defend our promise; and to our children.“ Dont expect his supporters to change though. They were brain washed to believe that the lockdown is a liberal effort to bring down the president by hurting the economy. By the same standards, Trump supporters must be cheering the violent way in which Floyd was killed and the ensuring riots. Since this is likely to increase support for the Trump just as it did for Nixon in 1968. Trump would be hands down winner for Osama Bin Laden's lifetime achievement award for causing the greatest damage to US by anyone in living memory. Vinod

So there you have it. This was a bureaucratic and regulatory FUBAR that forced the Fed to resume its repo operations (and thus go back to a 'corridor' system from a 'floor' system in terms of controlling the fed funds rate). Nothing more or less than that. It wasn't because the US Treasury was issuing too much debt -- quite the contrary, the cause was actually the opposite - i.e, the US Treasury running a small 3-day surplus. I'm not a conspiracy theorist - but as the biggest bank, did JPM force the Fed's hand here? Was Jamie Dimon chafing at holding too much cash at the Fed and wanted a little loosening of the regulations? I would never want to accuse Jamie Dimon of anything here, but nor would I want to play poker with him. But if I had to bet between the bureaucrats at the Fed vs Jamie Dimon, I know who I would bet on. Once again, sorry for the long-winded response but my wife always jokes that she doesn't want to ask me the time, because I go into explaining how the watch is made. wabuffo This is immensely helpful! Thank you very much. Vinod

This is by far the best explanation of how QE works and its effects on inflation/deflation. Pretty long article, but well worth the effort. https://seekingalpha.com/article/4343574-qe-mmt-and-inflation-deflation It even goes into the Repo spike in 2019 and explains why it happened. Good stuff. An Example of Running Out of Real Borrowers ... But by September 2019, foreigners stopped buying Treasuries again, and became net sellers of them instead. At the same time, most domestic lenders weren't able to buy more Treasuries either. Corporations weren't buying. Pensions weren't buying. Insurance companies weren't buying. Traders and mutual funds were only buying a little bit. Model 1 of domestic government financing started to run out of lenders. ... The U.S. government literally ran out of cash dollar lenders for their Treasury securities; both domestic and foreign. In reality, the root cause was that the U.S. government ran out of lenders. Foreigners, pensions, insurance companies, retail investors, and finally large banks and hedge funds, simply weren't buying enough Treasuries at that point compared to how many Treasuries the government was issuing, at over $1 trillion annualized. They had no excess dollars from which to lend to the U.S. government at those rates. In one alternative world, the repo rate would have remained very elevated, and repo borrowers like hedge funds basically would have had to stop buying Treasuries and even start outright selling them (you can't borrow at a 7% repo rate to hold 2%-yielding Treasuries on a sustained basis). The interest rates on Treasury securities would have had to rise considerably to attract a totally new pool of buyers (such as foreign pension funds), and even that would have probably been insufficient. With interest rates much higher, that would have put massive downward pressure on equity prices and other risk assets, and would have put immense pressure on the U.S. government budget due to higher interest expense and lower capital gains tax revenue. In the real world, since the U.S. is a monetary sovereign, the Federal Reserve stepped in with newly-printed dollars out of thin air, and started buying Treasury securities, due to a lack of any more real buyers at those low rates. For the first two weeks starting the day after the repo spike, the Fed lent newly-created dollars to other institutions to buy Treasuries with (basically nationalizing the repo market to reduce the interest rates), but when that quickly proved insufficient, the Federal Reserve began outright buying Treasury bills with newly-created dollars. In other words, the Federal Reserve allowed the U.S. government to keep funding its domestic spending plans at current interest rates, without finding new real lenders for their rising deficits. They just created new dollars to buy Treasury bills and fill the difference between what the government wanted/needed to borrow, and the dollars that real lenders were able to lend. .... When banks ran out of cash to buy more Treasuries, the Federal Reserve printed up some digital cash and took their place as the primary accumulator of Treasuries. Months before the economic crisis from COVID-19, the Federal Reserve began accumulating Treasuries at basically the same rate they were issued, meaning it was monetizing virtually all net new government debt. ... Imagine, for example, that the Treasury (authorized by Congress and the President) decides to spend a trillion dollars to send every American $3,000 in the next round as a stimulus. The Treasury would issue Treasury bonds to pay for it, primary dealer banks would buy them at auction, and the Federal Reserve would create new digital dollars to buy them from the primary dealer banks and accumulate them on their central bank balance sheet. If we follow the flow from beginning to end, new dollars were created at the Federal Reserve, sent to primary dealer banks, sent to the Treasury Department, and sent to the public, which get deposited in their accounts via direct deposit or mailed checks (which directly increases broad M2 money supply). The Treasury security moves the other direction, from the Treasury Department to the banks and then ultimately to the Federal Reserve's balance sheet. This is an example of QE truly "printing money" and getting that money to the public. Similar capital flow models apply for corporate bonds, mortgage-backed securities, or other securities. If they wind up on the central bank balance sheet, bought with newly-created dollars, it effectively means that money was created from thin air to provide capital funding for a company or the mortgage market, rather than extracted from elsewhere in the economy. New money entered the system. This set of funding doesn't really reach Main Street like it does when QE is used to fund Treasury securities, but it does enter the financial system as it relates to asset prices. So, "does QE money make it to Main Street?" is not the main question because it depends specifically on what securities are bought with QE. When QE is used to buy mortgage-backed securities, corporate bonds, stocks, or other things, it mainly goes to financial markets rather than Main Street. When QE is used to buy Treasuries in a normal sense, it makes it to Main Street in the form of supporting existing government spending (much of it on Social Security, Medicare, and military) that isn't fully supported by taxation or real lenders. If QE is used to buy Treasuries for crisis-level helicopter money (checks in the mail, direct deposits, extra unemployment benefits, negative payroll taxes, or whatever the case may be), then it gets to Main Street more obviously. Vinod

Thanks for taking the time to help me understand. Appreciate your thoughtful response. I need to think some more about this. Vinod

The way I see it, a Government can generate money in 3 ways to fund its expenses 1. Taxes 2. Debt 3. Direct debt monetization (Printing money). I understand the US has legal protections where it cannot do that directly. Treasury sells bonds to primary dealer banks, then the Fed Reserve buys the bonds from the primary dealer banks. Because the Fed intention is that they would only be holding these bonds "temporarily" and would sell the bonds to the public later on, we can go with the assumption and/or pretension that debt is not being monetized. When Govt does #1 and #2, it is taking away money from the public to fund its expenses. So the public has less to spend on other things. QE is helping fund US Govt at lower rates than would otherwise be the case. In addition, to the extent that Fed does not sell the bonds to public at a later time, that part of the debt is directly being monetized. So instead of some other entity (US Citizens, other countries, etc) buying the US Treasuries, it is Fed that is ending up owning these US Treasuries. Point being, this is money that is not being "extracted" from anyone. It is being generated out of nowhere. As to the risks of this, that is a separate discussion. But if you can do this, why would it not be helpful to the economy? At least in the short term. Vinod

Thank you for the explanation and the link to data. My point is that it ignores the distribution of wealth and income across the population. I am not sure about the numbers, but from what I remember the bottom 50% of the population have very little savings. Much of the savings are likely in the top 25% of the population with top 10% owning a lot of these savings. To those in the top 10%, the interest income is unlikely to make any difference to their propensity to spend. Older retirees with modest portfolios would be most impacted, I concede. I would imagine most of the COBF board members would not be changing their spending habits if interest rates on savings are 1 or 2% higher, if they notice them at all. Vinod

QE replaces interest expense from the US Treasury - which flows to the private sector as income. The Fed swaps Treasury debt held by the private sector with reserves held by the banks. While the Fed pays the banks interest on their excess reserves, it stays in the reserve accounts at the Fed and does not flow to the private sector. So QE takes interest income away from the broader economy and doesn't replace it with any other forms of income for the private sector - so its a net loss of income Hi wabuffo, I have limited understanding and hope you would correct me on this, but I think the above might not be true. This is helpful to the economy the way I see it. With QE, Treasury is not borrowing money from the public to pay the interest. So how is the public missing out on the interest income? Public did not lend money and they are not getting interest. So no effect in that regard. Now, instead of borrowing from the public (via selling of Treasuries), it gets money from the Federal Reserve (indirectly via the Banks) and what does it do with the money? It spending it on the public. Especially all the COVID programs. They are spending it without either taxing the money from the public or borrowing from the public. So why is that not massively helping the economy? Yes, the concerns about this seemingly easy way to fund the Government programs are valid, but we cannot say it is not helping the economy. Vinod

I have limited understanding, but I think this might not be right. But, low interest rates punish savers more than they help debtors. How? What is the reasoning behind this to say low interest punish savers more than debtors? I would argue that it could be either way. It might help debtors more than savers and it depends on who is in the most need or the most vulnerable. Take a simplistic case of savers being all billionaires and debtors being all poor households. In this case low interest rates would be of immense help to the overall economy. Take a more realistic case of debtors being more economically vulnerable and savers less so, then it seems more likely that low interest rates help rather than hurt the overall economy. The low rates force savers to save even more, thus cutting consumption, which slows economic growth Again in depends and there is no logical reason to believe that this is true. If savings are concentrated among the higher income population, changes in interest income is not going to drive their consumption behavior. Vinod

I hope you really do not believe what you are writing. You are far too thoughtful and intelligent person for that. I am sure they are nut jobs on both left and the right, but the vast majority of the people of either party just want to do what is best for economy. They are just coming from different angles and I can see the logic in both. For these vast majority if you give them an option of getting rid of the virus and economy getting back to normal on the condition that the party they oppose would win the elections for President, Congress and Senate, they would take that option in a heartbeat. I was in the camp of leaning to vote for Trump (60/40) by end of January. Because on the whole, despite so many negative things, he did get one major critical priority right: confronting China, trying to get back some of the manufacturing back to US, etc. To me his actions since start of March are absolutely unacceptable. I can see both views of keeping an economy open and shutting down. And neither is a simple obvious choice. Pros and cons to both. But once you make a decision, you should proceed forward with that. Look at what Trump has done. He is both for and against lockdowns. What kind of message does that send to people? Fed should have been the primary entity in trying to get PPE and other medical equipment and then distributing to the states. It makes so much sense. We should have had a massive program like the Apollo mission to try to produce PPE in massive quantities once he declared an emergency on March 13. Say being able to deliver a bunch of masks for every family every week. Sanitizing stations every street corner, testing at a massive scale, etc. He defanged CDC and drug approvals at FDA are politicized. It is not that Trump is evil, he is just plain incompetent for this situation. Almost any past President of either party would have done so much better. Just look at Amazon. Read the annual letter if you have not. That is how competent people with power would behave. There are lots of things which are shades of grey and it is difficult to say right or wrong except in hindsight. This is not the case with Trump's actions during the Covid period. They are simply idiotic. People who cannot see that are being blinded by hate towards the other party. It is precisely what you are complaining about with TDS. Vinod

Most asian stores (Chinese or Indian) have KN95 masks, which I am told are quite similar if not same as N95. Bought a few myself. There are kids versions of those masks too. That one I do not trust as much but still likely better than cloth I think. This also has the added benefit that you are not taking away N95 masks from the front line workers. Vinod

fareastwarriors - it is a upper middle class neighborhood. I pick pennies all the time too. Just the virus makes us a bit more cautious. Midas79 - We had a good laugh as well. Jurgis - I was thinking the same. How can I call myself value investor if I do not even pick dollar bills from the street. Vinod

Retail is still - price, selection, convenience. Those that are doing well, Costco, Walmart, Target, TJ Maxx, Ross Stores, Burlington, Five Below all provide goods at very low prices for those particular segments. Amazon wins on all three respects on many items. Macy's, JCP, Bed Bath and Beyond, J Crew, Abercrombie, are not doing well in any one these respects. Previously for some mid-quality brands these used to offer a good combination of price and selection in a reasonable convenient way (mall). Now all that is gone. Employee pay, ambiance, etc I think are more of secondary effects. Vinod

I quite did not follow how the last statement (in bold) follows from the rest of your message. Could you please eloborate? To me it looks like Fed and Treasury seems to be working very well together. Fed is indirectly funding the Treasury. Since Treasury cannot all the bonds that it wants to sell without higher yields, Fed is buying them. My understanding is quite limited, so please excuse my ignorance if something I say above makes no sense. Vinod