Libs
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Posts posted by Libs
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Stahleyp - taking on the atheist mob. Props for the effort (a lonely one for sure).....even though no one's gonna change their mind.
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I am fortunate to enjoy gambling without having any addictive issues with it. It truly adds spice to life if done in small doses.
That said, I'm deeply skeptical of beating the horse races. Overcoming the 20% take seems impossible, frankly, unless you are an insider like a trainer, and bet large amounts on the rare occasion you have a big edge.
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The problem is Baffert's horses get massively overbet. He wins a lot, but not enough to justify getting 3/5 odds all the time.
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Some PBR
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If I may add a word about Wabuffo.
On the old yahoo finance BRK site (Chuck's Angels?) we'd have an annual stock-picking contest. Of course he came up with the most eclectic, interesting stuff. I recall a tiny BK liquidation play where he calculated the inventory, concluded it was legit, and basically bought like $2.50 in distributions for $1. It was kind of jaw-dropping to a newb like me. Of course he killed it in that contest, and he's just kept dropping gems ( macro and stocks ) on us ever since.
I think he's a little uncomfortable with accolades, so I'll stop there.
GFP was there too. Another tireless contributor for a very long time.
I also thank the prominent posters named above. This site is pure gold.
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ILPT April calls. Piggy-backing on Pupil's work.
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Her best role was in Seinfeld, as a fire - breathing prima donna. Classic.
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3 hours ago, gfp said:
He's pretty adamant that you don't hold on to someone else's stuff.
I've never understood this money management philosophy. I see it my business ( RIA). For instance I've taken over accounts with massively appreciated MSFT stock. Why the hell would I stick the client with a big tax bill, just so can put my imprint 100% on the portfolio? But that's what happens, over and over again.
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Sold the $12.40 HQI shares I bought in June, for $22 today. Shameless brag. Still own a ton of it.
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On 2/8/2023 at 2:27 PM, Viking said:
Below is an interesting presentation regarding the energy transition. I am starting to wonder if ‘energy transition’ is not similar to the US housing bubble around 2005 or 2006. In terms of how completely wrong/unrealistic the dominant narrative is/was. And as reality sets in both will have/had enormous impacts on the global economy.
The housing bubble bursting almost took down the global economy in 2008. The ‘energy transition’ is going to result in prices for metals/energy to spike to unheard of levels and that will have an equally enormous impact on the global economy.
The energy transition (as its currently constructed) looks to me like a slow motion train wreck. Using basic logic, it is pretty much an impossibility when you look out just 2 or 3 years. What should an investor do?
1.) buy oil stocks. Oil is going to be needed in INCREASING quantities for decades. But we are massively underinvesting in it. The ‘energy transition’ is going to happen much slower than people currently think (due to shortages of raw materials).
2.) buy metal stocks. Prices are going higher than people can imagine. Bringing new metal supply on stream is even more difficult than oil (takes 5-7 years). The ‘energy transition’ is going to be much, much more expensive that people currently think.
3.) elevated inflation will be the new norm (with lots of volatility). Unheard of prices for metals and oil will drive global inflation.4.) geopolitical strife will increase. China has enormous leverage, especially in processing of metals. At some point they will play that card.
Bottom line, the world over the next 10 years will be very different than the world of the past 20 or 30 years. Not worse. But very different.
—————Humanity is going to continue to invent. Machines need to eat too…
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If anyone comes across a video/presentation that provides a counter argument (to the thesis Mark lays out in his video below) please attach it. I remain inquisitive and open minded
Thanks for posting this, Viking. Do you have ideas on how to play the metals side of this thesis?
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On 1/27/2023 at 3:52 AM, dealraker said:
The cloud is perceived an eternally astronomical PE sector. I disagree with this idea 100%, the same with cyber security.
Dang it, Deal. This is some serious contrarian thinking. If you are right, there will be Cisco-esque stock massacres coming in these two areas.
I remember the Cisco debacle vividly. They were an unstoppable beast, and everyone's darling....until they weren't. (To his credit, Chambers at one point did note the absurdity of his stock's valuation).
As an aside, this sort of thinking - call it the generalist approach- is more important in my opinion than the 'spreadsheet approach,' to use Gregmal's derisive term. It doesn't matter how well you crunch numbers if you miss the big picture.
I think about this issue a lot. If you are a good generalist, you can do very well without having deep technical skills. The reverse is not true.
Of course, the true greats do both. Like Buffett. Some of the contributors here are in that camp, I dare say.
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8 hours ago, Luca said:
In late October, when Xi Jinping consolidated his hold on China’s communist party at its five-yearly congress, the world cringed. Xi seemed determined to push China back to the age of Mao Zedong, his role model. Hardline ideology would tighten its grip on the world’s second-largest economy, with dire implications for the rest. The last thing anyone expected from a strongman president entering his 11th year in power was a sudden about face. Yet within weeks, Xi’s government has reversed its efforts to control Covid-19, Big Tech companies, the property market and more. It has shown signs of reduced support for Russia’s war in Ukraine while easing tensions with the US and in its territorial disputes in the South China Sea. This softening seemed so uncharacteristic of Xi, some even speculated that he no longer set government policy. That’s unlikely — at the congress Xi had purged enemies and installed allies throughout the party. Yet the 180-degree turn on multiple policy fronts was unmistakable and raises doubts about everything the world thought it knew about Xi, the unbending hardliner. Was he now bending to pressure from worried officials, the public, the deteriorating economy? The answer may be all of the above. Xi’s Covid policy, the tech crackdown and the property bust had brought the economy to a standstill in 2022. The economy appears to have contracted in the fourth quarter, which is likely to bring growth for the year down to 3 per cent. That is according to official Chinese data — the reality was probably worse. China has not grown this slowly since the late 1970s and is growing no faster than the rest of the world, also a first since the 1970s. A performance that weak was a serious threat to an authoritarian state that rests its legitimacy on promises to restore China’s prosperity and its global stature. As the slowdown fuelled street rallies against the pursuit of “zero-Covid”, some protesters dared to call for Xi to step down. Officials in his own government were reportedly urging him to save the economy. Still, few if any China watchers thought the paramount leader would change course. Those who last more than 10 years in power often grow less flexible, and have worse effects on the economy over time, even in democracies. Many dictators, from Cuba’s Fidel Castro to Mao, have been snowballing disasters. The rare, steady reformers include the likes of Singapore’s Lee Kuan Yew, and Deng Xiaoping, who dumped Maoism for pragmatism and set China on the road to prosperity after 1980. Xi now appears to have moved into a grey area on the spectrum of ageing leaders — willing to reform, at least in the depths of a crisis. Aiming to revive the economy after the congress, Xi’s government started sounding less Maoist. It has dropped the “three red lines” on borrowing by developers, and announced that the “rectification” campaign against fintech firms is nearly complete. After tightening state control for years, it is sending out messages of support to the private sector, even offering details of its new global data market that suggest respect for private data ownership. The irony: Xi may be trying impractically hard to revive growth. His plans to build “a modern socialist economy” imply an annual gross domestic product growth target of 5 per cent, which is no longer possible. China’s population growth has slowed sharply, as has productivity growth. With fewer workers and slumping output per worker, the country’s potential growth rate is 2.5 per cent. Beyond this year, when spending by Chinese consumers released from lockdown may temporarily boost growth, 5 per cent is an unrealistic target. And more debt-financed spending will only increase China’s already massive debt load. Global investors, who so often blow hot and cold on China, have again flipped — this time to embrace the new Xi. Before November, the country’s stock market was tanking with the economy. Fund managers were launching emerging market mandates excluding China. Now, they are bullish on hopes of a post-pandemic “reopening” bounce and have been pouring money into Chinese stocks. The benchmark MSCI China index is up a staggering 50 per cent since the late October lows. Yet the questions about China’s policy direction remain. Xi’s pivot is a pragmatic course correction, but it raises doubts about his steadiness. His impulse to control may reassert itself when the economy starts to recover — a reflex much more common in ageing leaders than a full rebirth as a steady reformer. Still, we should celebrate this new Xi, if he lasts — he’s a lot better for the world than the old one.This is a superb summary. Thanks. More evidence of the need to be humble about predictions....at least in my case. I'm stunned at XI's reversals.
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Took a solid drubbing. -16.6%. CASH, JOE, and HQI - big positions all- were down 20% +. I was fully invested when the downturn hit- d'oh. A tough year. International Petroleum (IPCO.TO) was the bright spot, up 100%.
Kudos to those who made money this year- well done.
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14 hours ago, Gregmal said:
Still doesn’t outdo Napoleon Einhorn. I forget what year it was, but the guy managed to be short 2-3 of the top 10 performing long stocks while simultaneously long 2-3 of the top 10 worst performers in the S&P.
Greg, you really hate that guy! It's hilarious.
The Cathy Woods of the world are easy to spot and avoid. But Einhorn seemed legit. And so did Berkowitz. I recall seeing a picture of Berkowitz with an open shirt and sort of night-club look- in an official photo- and thinking, whoa, something is wrong here. What happened to the nerd Berkowitz? And sure enough, he had lost his way. Burry seems like another one who's gone a bit bonkers.
All of this is fun but not meaningful. The ideas posted and debated on COBF offer far more opportunity than culling the ideas of the 'gurus.'
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Man. That's hard do even if you tried.
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As usual, Wabuffo is on to something. Prof Siegel says it too. Housing costs are being overstated, which massively distorts the picture.
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https://thepoliticalinsider.com/report-41-of-small-businesses-cant-pay-rent-this-month/
This is hard to believe - 41% of small businesses can't pay rent?
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1 hour ago, EBITDAg said:
My favorite quarterly commentary on energy (and commodities more broadly) is out. http://gorozen.com/research/commentaries
Thanks. Great perspective.
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XI has seemingly boxed himself in, not wanting to lose face by reversing the 0- COVID policy. It's a lose-lose scenario: open up, and the health care system is ravaged ( they are way short on hospital beds); or, stay closed, and infuriate the public / crush the economy. Two terrible choices, driven by bad policy.
Buy maybe that's too easy of a narrative. Even China is capable of pivoting. Thus, this Asia Times article rings true. China is not so stupid as to continue this policy indefinitely.
So.......over the next few months:
Loosen controls
Import working vaccines for the elderly ( see the German connection)
declare the current wave 'just another flu'
declare victory
https://asiatimes.com/2022/11/protests-hasten-chinese-exit-from-zero-covid-policy/
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2 hours ago, Munger_Disciple said:
If you are using LIFO accounting during inflationary times (reported profits are lower, taxes are lower), it looks like your working capital is going up even if unit volume stays flat. Buffett is saying you need to adjust for the effects of LIFO in that situation and not confuse with increase in working capital not related to LIFO. I think he is referring to a high turnover business where you hold the inventory for a relatively short period of time such as See's Candies or Costco?
<The goal of investing is to have intellectual purity. >
No wonder Buffett likes Combs so much.
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Down 20%, call it 6 out of 10 on the pain scale. 20 years ago, I wouldn't have flinched. Would have been 1 out of 10.
This morning I convinced myself my holdings can't go much lower- they're on average probably 50% undervalued. Famous last words!
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2 hours ago, wabuffo said:
CB - I don't care about the politics of central bank "independence".
What I care about is how the US monetary plumbing works. In order to do that, one has to view it from the angle of a consolidated sovereign fiat currency issuer. That means that the Treasury and the central bank are part of the sovereign's money creation apparatus with each playing a role in that process.
Too much attention is paid to the central bank in an outsized manner relative to its limited role (mainly as inter-bank payment clearing system manager). Unfortunately, this also applies to central bankers who actually believe that they play an outsized role in the management of the economy.
The only central banker in my lifetime who understood this was Greenspan. Volcker and Bernanke did not.
Bill
Bill:
Could you clarify one more thing.
Your central premise, I believe, is that federal budget surpluses (or insufficient deficits) lead to recessions. Is that your prediction now? It seems these conditions are in place to create that recession; yet you feel we are 'talking ourselves into one,' i.e., it doesn't need to happen. What do I have wrong?
Thx for all the green eyeshade work, it's very interesting.
Is The Bottom Almost Here?
in General Discussion
Posted
Bingo.
This is timely because I suddenly find myself 95% invested in 'really good companies.' I'm incapable, somehow, of holding back when these opportunities present themselves. Even though I'm also 95% sure we're gonna have a recession!
This sounds like it's in conflict, but if I'm honest with myself, I've been a lot more accurate with the first prediction ('really good company') than the second ( fill in the blank, any macro call).