bizaro86
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Posts posted by bizaro86
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2 hours ago, TwoCitiesCapital said:
The primary reason would be just the simplicity and access. Most domestic brokers don't trade in foreign markets OR they charge exorbitant fees to do so.
The only downside of buying local markets on IB was that you had to convert enough currency to make the trade and it was hard to get the right amount without uneconomic residuals sitting in the foreign currency. That being said, I believe they just announced auto-conversion of currency balances which SHOULD mean that this is taken care of and you can buy foreign stocks with USD balances and IB auto-converts the appropriate amount for settlement/commission on your behalf. I only own local holdings @ IB. I use ADRs in my accounts at Schwab.
The other piece is liquidity - there may be a handful of notable instances where foreign companies listed on major exchanges via ADR might actually have more liquidity in the US than their home country, but I don't know how often this might actually matter for us smaller individual investors.
I generally buy the foreign stock on the local exchange on margin, then convert exactly the amount of currency that I need, that way I don't end up with any extra.
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2 hours ago, coffeecaninvestor said:
I’ll check teck out.
For the most part small cap outperformance Usually lasts 2 years of less in GFC & 2020, but it rips off the bottom. Small cap value didn’t do well at all.
Homebuilders look attractive especially NVR it performed better off the bottom and did well long term.
Homebuilders did so well out of 2020 because everyone was replaying 2008 in their minds and thought RE would get killed. When it didn't, they soared.
I think it's unlikely the market will make the same mistake twice in a row. You need to be prepared to look for the next mistake, not get tee'd up to take advantage of the last mistake.
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IMO, in a big crash you don't want quality businesses now trading at reasonable prices, you want junky businesses trading like they're going bankrupt in 5 minutes that will survive.
Eg. In March 2020 I bought ROST, IBKR, and GOOG. All are great businesses and were trading cheaply.
But I did way better buying TZOO (low quality travel business trading like it was going broke) and CVE 30 year debt trading at $0.50, taking a quick double, and then rolling the profits into COST to get quality.
Anyway, next time that happens I'm more likely to try to find super-cheap stuff than buy quality on sale. I think screens like "P/S down more than 50% from 5 year average" would be the way to go.
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1 hour ago, Malmqky said:
I know people in tech that do this. If you're good, you can find $200-300k TC jobs that are remote and only have 20 or so hours of "real" work weekly. Jobs with TC closer to $100k and low stress/workload are even more plentiful.
Of course, tech layoffs are a real risk here.
Tech layoffs seem like a huge reason why people would do this. Having 2 jobs means if you lost one you'd get a package and still have a job.
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5 hours ago, vinod1 said:
2. No matter what, an annuity is a no brainer in this case. Only question is how much and who to get it from.
I think it's quite possible that the economics of an annuity in this situation end up very closely approximating the following:
She gets the principal back, while the seller of the annuity gets 100% of the returns.
The OP should definitely price it out, but I'd be surprised if it's a no-brainer given the low life expectancy here.
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I'd leave it in cash equivalents
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4 hours ago, DooDiligence said:
More like an opportunity for them to reduce headcount(s) for clients.
https://aecmag.com/features/autodesk-laying-the-foundations-for-ai/
On an unrelated note, a buddy of mine said his firm just added Revit because more and more clients want 3D now. BIM will likely be next.
Clients reducing headcounts isn't good for you when your product is priced as $-per-seat
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5 minutes ago, changegonnacome said:
I'm sorry this is dumb from JPM.
The Fed is fully aware that itself is 'inflating' car payments and 'inflating' mortgage payments..eh its called tighnting monetary policy guys!!......so no JPM......the Fed is not measuring the "inflation" itself is creating it strips all that out as it can turn around tomorrow and makes everybodys car payment 20% less....what it cant do tomorrow is turn around and drop the price of haricuts 20%!....you dont get a PHD and do something as dumb as this (you do other dumb stuff but not this dumb)...so rightly the Fed is concerned over the inflation figures for which it itself has only tangential influence over via financial conditions.....put another way the Fed is concerned with the inflation occurring in sectors of the economy (mainly services) which are persisting at 3.x%+ levels and that have nothing to do with covid supply chains , have nothing to do with the fed funds itself and have nothing to do with energy and have nothing do with OER....namely SuperCore.
SuperCore (ex-energy! ex-housing! ex-interest rates increases the Fed is doing itself!) just keeps trucking on MoM basis, on a 3m basis, on a 6m basis and YoY at levels completely inconsistent with 2% inflation........now if you think 3.5% inflation is whatever thats a completley different conversation......but if you take the narrow aim of price stability.....the FACTS say we arent headed for 2% sustainbly.
Haircuts are getting more expensive because wages are going up.
Wages are going up because otherwise employees can't afford their rent, so they're pushing harder for increases.
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4 hours ago, pricingpower said:
One aspect I'm not clear on is if shares need to be moved out of street name to be sure to get the cash out treatment... seems like will need to register them pre the record date for the reverse split / subsequent split. Anyone looked into whether the transfer agent has any unexpected fees? Googling a bit seems most brokers are 0-$100 for using the direct registration system but transfer agents also sometimes have additional fees.
I feel for the middle office guy somewhere who's about to get a tsunami of 9,999 share registration requests.
I think it's unlikely that they will need to be directly registered. They estimated they'll buy back 31% of outstanding, and there's no way that % of stock is held directly.
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3 hours ago, Dinar said:
So, with the caveat that I should have bought at half the price, the thesis is: demand for power is going up, price for power is going up, this company will see growing profits, will buy back shares, and is at a huge discount to CEG and sells at a double digit free cash flow yield a year or two out.
You might have bought my shares! I bought this in the fall, mostly of the VIC thesis which I liked. But I think lower natural gas prices put a bit of a cap on the upside here so I took the profits. The federal minimum price of nuclear really limits the downside, so I think it's probably fine here, but if nat gas stays low I think that will limit upside.
Uplisting and index add catalysts still to come though, so I certainly could have sold too early.
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On 3/22/2024 at 12:11 PM, ValueArb said:
How much will it damage the sports gambling business if Shohei Ohtani gets banned from baseball for gambling on it? Will MLB baseball force all teams to cut ties with sports books if they cost the MLB their biggest star?
Lots of crazy rumours circling that his interpreter was just covering for him and that his losses far outstrip the reported $5M.
I think MLB needs gambling money more than they need Shohei Ohtani. MLB is probably the sport that has the most to lose from the bundle/RSN model breaking.
I think ultimately MLB needs gambling and wants Ohtani. I think even if it was him it gets swept under the rug. May be he takes a year off as a soft suspension - this year is good as he can't pitch anyway.
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3 hours ago, John Hjorth said:
I'm not an American and have no political affiliation in that country. I avoid their politics whenever anyone talks about them.
But as a shareholder, my strong preference is that Berkshire not consider politics when writing insurance contracts, only premium and risk. I think that's reasonable and relevant to the conversation here. If you've been appointed moderator of the board without me being aware of it then I apologize. -
Republicans buy insurance to.
Charging high fees for bespoke insurance that no one else can write is what I want Berkshire to do. If they didn't feel his collateral was good then fine, but I hope they aren't giving up lucrative opportunities for political/optics reasons.
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6 hours ago, dwy000 said:
I've used buyers agents when changing cities or if we didn't have time to do a proper search. But there is absolutely zero chance they are earning anywhere near the 2-3% that they end up getting. I get it for sellers who can actually put in a lot of work. But even then, in a hot market the agent can earn a massive commission for a listing that might last a week or two.
What I'd really love is a commission schedule that goes up as the price goes up. For a $1m property, a trained chimp could sell it for $750k whereas a really good agent is the one who gets you $1.1m. I'd give 1-1.5% on the easy part and then increasing to pay them like 5% above a certain threshold.
I think this is likely to end up happening at some point, especially if buyers commission is removed.
On a $1MM house $500 + 15% over 900k provides more incentive to get a good price than 1.5% of total, even though the expected commission is the same.
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Yeah. Buyers will be way more price sensitive than sellers, imo, on offering their agents commissions. Sellers feel they need to offer the full amount to attract buyers, while buyers paying their own way will want a deal.
Sellers also have a big influx of funds at closing so never really see the commission, while buyers will have to either add to their mortgage or pay cash.
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30 minutes ago, Saluki said:
Float is a big part of the growth story for Berkshire and Fairfax, but I'm wondering as a thought exercise how you would value it in other companies that have characteristics that resemble insurance float. For instance, if I buy an airline ticket for my vacation on July 4, I pay now but the flight doesn't happen for a few months, then after the flight happens, they pay for the fuel and salaries etc. Some companies like Walmart sell product quickly and pay suppliers slowly, so they have free use of that money to build new stores. Apple and Amazon, last time I checked have similar qualities.
Just thinking out loud here, If it's a fast grower like early Amazon, I guess you can value that float based on the rate of return on their invested capital. With insurance companies, it's based on what financial instruments they can invest it in. But with both those options, you have to give the money back.
There's a company that I've posted about before, and I won't mention the name because I'm the only person keeping the post active and I'm not trying to pump the stock, just get some input on valuing something. If they get a 20 year contract for $20 million, that income is recognized at $1 million a year. But if you get all of the money at the beginning of the contract (assume it's a patent or license or trademark) and you don't have any opportunities to reinvest in growing your business, then what is it worth? It's not really float because you don't have to pay it back. And discounting that last $1 million from 20 years to today doesn't make sense either because you don't wait twenty years to get it. You get it now, and you get to use it and never have to give it back, so from an accounting standpoint it's not income today, but from a practical standpoint it is.
If they don't have any possibility of reinvesting it in the business and you assume that it gets invested in fixed income, then would you value it like a bond? I assume you would ignore the fact that you recognize $1mm a year as income as the contract progresses, because it would be double counting? If this is the correct way to value it, then let's a wrench into it. What happens if you buyback shares? Do you value the effect of the buyback based on the value of the license/patent if you sold it off completely to a third party? Do you value the buyback based on what you paid for the patent/license, i.e. book value? Do you value it based on the stream of income vs the stock price and whether it's accretive to shareholders? Or is there some other method that would be better?
Airlines are often not great for float, because their credit card processors often either keep the money, or require large amounts of restricted cash. AirBNB has tons of float along those lines.
For your example, if they have $20 MM of cash from some sort of licensing deal (no ongoing costs) I'd value it at $20 MM. That's exactly like having $20 MM in cash from some other source, except the GAAP shows over many years which doesn't matter, imo.
What they do with it is a capital allocation question, but it isn't different than what would they do with $20MM of cash balances.
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45 minutes ago, Intelligent_Investor said:
I wasn't alive long enough to take advantage of Berkshire's huge run before the 2000s
This. I didn't start investing until late 2008. My results have been better than if I bought and held BRK at that time. That would have probably been lower risk though (and a lot less work).
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12 hours ago, Jaygo said:
Moreso I think he is making a statement on the juxtaposition of men and women working their asses off in freezing weather, scraping bodies off the tracks only to be manipulated by the Washington ( politicians, ESG dicks, WS ) elite with a stroke of a pen from the comfort of a taxpayer funded office.
Since he complained about railroad wages in the letter, I think he wanted to make it clear that while he respects the front line workers he has issues with the politicians.
Otherwise "billionaire rail baron complains about front line worker wages in letter to millionaire investors" is a bad look.
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I think SIRI will get added to a variety of smaller indices once the Liberty shares are spun off into the float.
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3 minutes ago, Dinar said:
Why? Thank you.
I only owned it as a trade. I bought the dip on the short report last week and am taking my profits now.
I will never own it as a long term hold, because I don't trust management. I get that's not the consensus opinion on this board (and the last couple of years have been good). But after they had Fairfax India effectively borrow money from Omers at a high rate along with giving them a free upside option on their best asset (the airport) in exchange for getting a mark to charge fees with I'll never trust them.
All that said, the short report was obviously opportunistic so it was some easy short term money to pick up. Was able to get a nice round-trip on nearly a 10% position.
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Sold out of FFH today.
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3 hours ago, ValueArb said:
What’s a good way to estimate future natural gas prices?
I’ve found a potential investment that would lose half its value if natural gas prices goes lower (even to zero), might lose 25% if they stay at current levels, and is a 5x-10x if they go up significantly. It’s an intriguing range of outcomes but what the heck do I know about natural gas prices?
I think in a situation like that predicting thr future is less important than controlling the spread of your own outcomes.
You can size it like an option and sleep well knowing it's probably a good risk-reward but is a bit binary.
If you want to size it larger you need a good hedge. So something that will benefit from gas prices staying the same or dropping, and ideally you want that to have a bunch of leverage.
Something like a fertilizer company, or maybe puts on a nat gas producer or nuclear power generator (both of which benefit from high gas prices).
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I think reducing the size of the investment portfolio would be a good choice for a post-WEB world. I'm not sure about the "paying capital gains" taxes part of it, that doesn't seem like a great plan to me.
If their insurance subs are overcapitalized, couldn't they move a chunk of Apple to the holdco, and then do a swap with shareholders for their BRK shares on a tax free basis? That seems like it would function as a buyback, reduce concentration in Apple (which is no longer cheap, imo), and reduce the size of the securities portfolio which helps the successor be successful.
Berkshire Hathaway Annual Meeting 2024
in Berkshire Hathaway
Posted
He wouldn't bother wasting time with something that had zero chance of approval. No way they could own two Class 1 railroads.