Parsad

There's been inflation since the beginning of the United States and the printing of the U.S. dollar. Whether you look at 10 years, 20 years, or 100 years...stocks are a better hedge for inflation than anything else. No, they aren't going to counter a market panic spike in inflation like gold or other commodities, but in terms of protecting against inflation, nothing has been better. When it comes to contraction of valuations, you have to remember that you could see a spike in earnings growth for several years, that justifies current valuations and reduces the market's overall valuation 5 years out. Based on what Trump is doing, the market is justifying the higher valuations because it believes earnings will grow faster than normal for the foreseeable future (his term and maybe a couple of years after). I look for distressed investments, but I cannot discount this possibility. Why, look at the earnings of the Mag7! They have high historical valuations, but their earnings are real, their growth is real, their balance sheets are solid, their margins are unreal, they have cash up the ying-yang. These companies are not the internet stocks of 1999...they are GE, IBM, KO, etc in the 1950's! As long as they keep growing and sustain their margins, there is room to run, regardless of how crazy $2T, $3T or $4T in market cap sounds. At some point, things will slow and those valuations will contract, but I just don't see it happening any time soon. The economy is strong...well before Trump showed up this term...job opportunities are there (even more with all the illegals kicked out)...growth is there...train cargo is doing well...consumers in the top 40% are showing unusual resiliency. I think the best historic period to "rhyme with" might be 1982-1991...sudden inflation, it eases, we have room to run, but there may be a shock type of correction and then a resumption of the bull. Maybe the shock hit during the tariff announcement was exactly that...Nasdaq down 20% in very short order and the S&P down 11% in short order. I just don't see markets collapsing to half their valuations unless some outlier event happens...big war, another pandemic, some large country failing, etc. It will happen, but no way of predicting when. Cheers!

Some think I'm crazy, but I'm really heavy in retailers that have gotten killed...M, TGT, LULU...I own a lot of all three! M and TGT have gained some ground and I'm up on them quite a bit, but I still think my M and TGT Leaps are a double from here. I own a lot of LULU stock. As it keeps going down, it's getting bigger and bigger, but I'm totally comfortable with the size. I think all three are potential takeouts...especially M and LULU. M has a history of scaring away takeouts, but that real estate is worth 1.5 times the current market cap and the retail business makes $1-1.2B a year in profit. LULU is getting so low, forget a rebound in retail, I think someone could easily take them out for a 50% kicker on the current stock price. It's down 50% YTD and about 60% all time! 14 times earnings for one of the top retailers in the world that is still expanding and growing! Cheers!

Oh, I agree with that. I just thought there was another way to do this without all of the dumb panic and still undefined pain to come...just like DOGE. Needed to be done, but the chainsaw effort, schtick around it and then the depressing end result of like $9B in savings...well! I still think Buffett's import/export certificates was the ideal way to deal with the problem of the trade imbalances. But no politician actually truly listens to Buffett. Cheers!

That's understandable. I'm not sure I would add here. I would build cash until I see any good quality stock drop unnecessarily to a valuation that will give me better than 15% annualized. I think we are close to where the long-term return for Fairfax is going to be about 15% annualized based on valuation. So there is still some room, but that gap has shrunk considerably over the last 2-3 years. It will all depend on what opportunities come their way. If you are in that building wealth phase of accumulation, you want your ideas to be home runs...the fat pitch with a margin of safety...ideally 20%+ annualized returners. Cheers!

No, what I was saying was that there was nothing wrong with U.S. GDP for the last 3-4 years. The fantastic 3% GDP announced today is where it's essentially been for 3-4 years. Layoffs, etc were just in response to you saying there was no pain. There is real pain in the U.S. economy for middle-lower income people. The primary relief has been lower gas prices and now some reduction in food prices, but almost everything else is going to go up in price in the next 6-12 months. Cheers!

You mean like adding nearly $4T to the national debt and staying in a deficit for another 3 years? That type of unsustainable model? And no pain...check the layoffs or closings globally. Cheers!

I'm guessing you are being facetious, but just in case! I've held various amounts of Fairfax shares since 2001...selling an oversized position after it runs up...and then loading up after it hit a hurdle and fell below book value. After all these years, my situation after this latest run is now different than it was when I was younger and building the portfolio. It now makes up about 25% of all my portfolios, including my niece/nephew's RESP's. I'm very comfortable with that position sizing now for the rest of my remaining life. You should decide what lets you sleep at night. Historically, I could find stuff that might get me a couple of extra points in return over Fairfax's return, but I don't need that anymore. As long as Prem keeps chugging along, and I look after the rest of my portfolio including ETF's now, I don't need to do much. So to each their own...sleep well...build wealth! Cheers!

There was nothing wrong with GDP...even from the Biden economy...until the tariffs made the world shit the bed when Trumpie implemented them! It's like congratulating someone who shoots himself in the foot, for not shooting himself in the head! Cheers!

Hi Guys, Is that better? Let me know. Thanks! Sanjeev

https://finance.yahoo.com/news/warren-buffett-longtime-social-security-172041590.html Cheers!

Greg, keep this stuff to the Political Posts thread. Cheers!

+1! Cheers!

U.S. consumers had access to cheaper goods. It's not the world taking advantage...it was the world selling to the U.S. Now if you want to reduce U.S. consumption of foreign goods, tariffs will work fairly well, but they increase the cost to U.S. consumers, who will naturally spend less. The better alternative would have been what Buffett suggested two decades ago...importers and exporters are given trade certificates that can be used or sold on the open market to balance imports and exports. There would be no price increase for consumers since an importer would sell its equivalent export certificate in the open market...and vice versa. You would have balanced trade with no net increase in cost at the retail level. Cheers!

Yeah, that's not entirely accurate. There are core materials/goods in manufacturing that come from certain countries that domestic consumers and small businesses cannot replace. Some of those materials/goods will now cost more at the domestic retail level because the domestic manufacturer/producer has to pay the tariff. So yes, some items domestic consumers will be able to replace with non-tariffed products. At the same time, there will be many products that cannot be replaced and the domestic consumer will pay. Trump wasn't going to implement tariffs unless there were significant tariff revenues to offset his other spending. American consumers, like global consumers, will be more for things they want...plain and simple! Cheers!

I agree with that, but can they control it. We're talking about massive tariffs when you look at it globally. You already have seen price increases and product shrinkage over the last 4 years, but that may have just been the beginning. Cheers!

While the tariffs will fix the trade imbalance over time and provide Trump with revenues to offset tax cuts in the BBB, you have to remember that they will be paid 100% ultimately by U.S. consumers...not foreign producers or citizens. This will certainly have an inflationary impact to Americans and probably much of the globe. Hopefully, the tax cuts and savings in the BBB will offset reduced spending and saving by the tariffs, but we'll have to wait and see if it is net-net a positive. It certainly will drive more investment and manufacturing back into the U.S., but when unemployment is already near historical lows and consumers are strapped for cash, the investments and jobs impact on the economy with reduced workers and disposable income...hard to figure how the economy will react. Long-term it should be beneficial, but short-term it could be very inflationary and drive consumers to stop spending...think 1970's/early 1980's before the boom of the 80's and 90's. But instead of an oil embargo, it would be global recession from tariffs driving up inflation and reducing spending. Lower rates would only spur more inflation. Cheers!

Hey Greg, the one thing I think you have to admit and be a bit worried about is that all of these deals now have minimum 10% tariff and most are in the 15-20% range. China and Canada will be the big ones outside of the EU. Manufacturers and retailers have said already that the first price increases will be felt in the 3rd quarter and probably another bump in the 4th quarter or 1st quarter 2026. With all of the tariffs hitting retail prices, and all of the stimulus in the BBB, it's almost certain that inflation is actually going to increase through the next year. I said before that I thought inflation will hit once the tariffs are set...and it certainly looks like that. What do you think Trump can do to mitigate significant inflation...presently, Powell's resistance to lowering rates is the only thing preventing that, but that is short-lived as Powell will be gone next year? Cheers!

You gloat as much as Trump! Cocksucker! I would have hated to play sports against you as a kid. It's like Jake Paul knocking down all these old ex-athletes. But he somehow keeps winning. Cheers!

Yes, I'm sure many of you would like more stuff like: "Michelle Obama is a man" "Obama was born in Kenya" "Biden used to run with Capone" "Hillary more evil than Putin" "Powell driving U.S. into a ditch and Trump cannot control him" "Guns don't kill people, people kill people" And a whole host of other favorites! Cheers!

No, not to get him. There just won't be any information coming out probably about anyone. If anything scandalous comes out about some Democratic senator or congressman, then as Epstein's best friend for 10 years, there would have to be something about Trump. So better just to let it all go away without anyone getting in trouble. Cheers!

It's like cops investigating cops without any sort of outside oversight. This was to be expected. Nothing will come of it! Cheers!

Excellent as per usual! Cheers!

So far, pretty much every Premier of every Province has said positive things about him or given their trust for now. As well as First Nations representatives are waiting to see what he does. Rarely has there been such a consensus in Canada's history! He's pushed for inter-provincial trade barriers to be removed...pretty much on target. Pushed for faster development and less regulation...pretty much on target so far. Asked for 15% cuts in the 1st year, 7% cuts in the 2nd year and another 7% cuts in the 4th year from every Federal department minister. Speeding up defense spending to 5% of GDP. Already actively working on creating significant new partnerships outside of the U.S. especially with his relationships in Europe and Asia. Maintains the core cultural, historical aspects of Canada without overly cow-towing to the left or right. He's accessible, respectful, not afraid of dictators like Trump, a consensus builder! Time will tell, but so far so good. Cheers!

Oh, I hope not! AOC would be the worst thing to happen other than Trump! I hope the U.S. gets someone like Carney...up the middle, understands decorum, globally-versed, business-minded with actual success and self-made, a unifier rather than divisive figure! Cheers!

Pay $16M, end Late Night & Colbert, promise to eliminate DEI, seek out any bias at CBS...approve the merger after getting all these concessions...not unlike Columbia paying $220M yesterday! A fucking tyrant, but he keeps winning his battles and lawsuits! Cheers! https://finance.yahoo.com/news/fcc-license-approval-clears-way-220925528.html