Gregmal

Folks are still doing deals for office at 6 caps and triple net at 4 flat in the private market. So while these aren’t prices I’d be paying, saying otherwise, like Chanos, is basically just putting together a valuation short. On MF, I’ve been saying now since after the initial COVID wave that it should be viewed as the new treasury if inflation is a concern. They’re liquid, hard asset protected income generators that bump payout every month typically. However I’m not sure I see much more room for spread compression against treasuries.

My view since like 12 years old is that gold is bullshit and only worth what someone else will pay. And it’s within the same framework where you can see how bitcoin works or doesn’t work. Something just has to be widely accepted as holding value, and it does. Doesn’t have to make sense I mean for all the complaining about bitcoin, what’s gold useful for on a widespread basis? How do I pay for my coffee in gold? Bring a chisel and a drug scale to the store?

The Fed is dragging its feet because they can not solve the problem with the tools at their disposal. Check out some of the more detailed analysis. Mr Inflation himself, Einhorn, “shoveling snow with an ice cream scooper”…Harris Kupperman absolutely nailed this but folks were too busy whining about what he thought of vaccines or that a stock he picked a while ago went down…. Literally every single person linked or quoted or YouTubed in most of these threads says the same thing. That is by definition “consensus”. What do they say? -recession -more pain ahead -rates going higher -persistent inflation -everyone is asleep at the wheel(while every sentiment reader or fear index is off the charts mind you!) On to the issues you asked about…I can confidently say I probably have a better handle on residential real estate than 95% of people, the returns are there to prove it. The way rents work is they rise and then they roll. So they spiked late 2020 and last year, but then bc of renewal structure you have a nice 12-18 month figure goosing where you get all your rents up to market rate. Rental rates for the most part will start moderating big time in a couple months. Same with housing prices. Probably Q4. Energy is gonna be a problem but the Fed largely ignores it and rightfully so. People get what they voted for. November will bring sentiment change. Food? That too is tapering off although much lumpier. You can see it in a lot of the consumer product segments. The inflation happened last year. Some raised. Some held off and are now raising prices because last year they said transitory and now realize they’ve got to pass it along. CPB is a good example. If we want to harp on grains and wheat, sure. But again, food prices across the board jumped last year and are also leveling off they’re just influenced by big jumps in specific places. But bottom line, something isn’t consensus if nobody thinks it, or if the majority of folks are saying the opposite. I mean 2 months ago the media starting having a field day with the “inflation crisis”. Every hedge fund guy doing an interview starting saying they were shorting the market. The Fed admitted they were wrong last year on transitory. The market sold off hard. Rates have gone up a bunch….but everyone is asleep at the wheel at the market is not pricing anything in….LOL OK

Weird. I was told days ago consensus was that inflation is now transitory but everyone and their mother keeps parroting that it’s here to stay…

For instance Netflix is down more than bitcoin. Is Netflix worthless too or people just have less bias against it?

I say this because one thing I’m seeing right now, and I see it all the time in these instances, is the certain beliefs that have been wrong for a long time, get spirits and then all that came with those beliefs gets it’s 15 minutes of fame. The Fed punch bowl group spent 10 years saying bubble and today they still think we re going back to 2012 equity valuations because “finally” they think they are right. Same with the gold bugs re:inflation. It’s all plausible. But I also think some sort of hybrid and varied outcome is much more likely. We still should structurally have higher equity valuation than before. Governments will still be accommodative by and large. So to me, 2020-2022 was wild but not a case study for models. Isn’t the trend and pattern simply getting back to precovid? Give or take? I thought the market was pricey pre COVID. So maybe 10-15% lower than that if you ascribe to no value creation for 2 years? I agree there’s a lot of uncertainty. Which is why I think we re seeing so many ridiculous and outlandish predictions. It’s like bitcoin. Every time it goes down, the I told you so crowd who’s been wrong since $1000 says “see, I knew it!”. But it’s probably here to stay and gonna have a place and a lot of volatility like everything else? It doesn’t have to be a 0 or $1,000,000.

Is there a point where there is just a reset on the economic fronts? We had zilch of this precovid. So has Japan with 0 rates. The COVID responses across the world, fucked all this up. The supply chain, one by one, will correct. So while I’m open to what you’re saying, isn’t it much more likely that eventually Ford produces enough cars that the days of bidding wars and capital gains on vehicles is over permanently? Same with lumber, steel, and whatever other widgets are currently or recently an issue? Supply chains get congested, as COVID continued to be on again off again it got worse. So if we re past COVID crap, don’t they eventually normalize to precovid?

Those products are toxic and they have malfunctioned horrifically on several occasions. Plus they just own the futures. Might as well save yourself the headache and just buy the futures or futures options.

They typically trade a bit lower. Historically at least. However a lot of the times I’ve played stuff like this where it works, you can lock in some by selling ATM. So you may own 60s with a .40c basis and at 80 you’re getting a bid of 14…but you can probably(just pulling a number out of my ass) sell the 80s for $5.

Plus, it seems energy, not rates is really the remedy. Higher energy prices lowers air travel, car prices, and probably consumption in general. My heating oil bill, if I was poor, let alone middle class or better, would be far more impactful than 1-2% I’d pay to borrow money. Everything is so backwards right now.

Idk but it just seems bizarre how obsessed everyone is with this. Inflation is not currently 8%. It wasn’t last year either. As they measure it, they significantly missed measuring price increases that occurred last year. Now this year, the are giving us numbers based off wrongly advertised numbers. It doesn’t matter what Mays print was, it matters what it is going forward. So we can say “inflation” is 8% all we want and then compare it to forward rate expectation, but going forward, inflation is not going to be anywhere near 8%. So sans the sensationalism, if rates are 3-4% going forward, and inflation is 5%, that’s a wee bit different than what some are advertising.

Banks and energy companies are evil. Tech helps with the agenda. Plain and simple. Quid pro quo

Ya im not complaining but its a complex product and last thing I want, although I doubt it will occur, is some of the TVIX type malfunctions LOL. Like 2014 TVIX problems.

The basis is a pattern repeating in which we've seen things that rarely occur or have never occurred, occur. So, twice we've seen what? VIX 80 or something? So you can buy your self a month of coverage, at say the July 60 strike for 40c. So just look around at the dates and strikes and see whats interesting. VIX goes to 80 or 100 and you've got yourself a few new homes. I also think if you wanna be a little creative, you can short some of the 25-30 VIX puts to fund it.

Anyone still follow PFIX? I bought a little last year when there was some discussion about it. Made sense to me and the product seemed cool. However it’s only gone from 40 ish when the 10 year was like 1.3-1.5 to now 63. It was marketed as basically the Bill Ackman type swap trade with huge payout. Am missing something. Wouldn’t be the first time some product underwhelms.

Yup. Ive been watching that VIX chart and for the past month or so playing for a super spike. Nothing yet but feel like its coming and the prices on the options dont really reflect it. Those are the 20-40x trades.

I’m personally waiting for single digits on the S&P to blow my load. Just kidding.

Genuine question Ive kicked around, the answers to the housing shortage(crisis some call it, but to me its awesome) was to build. Except now you see homebuilders getting scared off, reducing their enthusiasm for building. Folks with existing 30 year mortgage arent selling...so what exactly solves the issue? Are all investors gonna puke their properties? Housing supply is still nowhere near sufficient, even after solid increases its like half of where we were pre covid. Even if we get back to precovid, in other words current homes listed doubles, the problems that were supposed to get solved, dont get solved.

Might be early but I doubt we here one more contrarian than that.

Pools are fun. So is buying stonks. My mother is law handed off the kids today midday and was like "oh today must be tough"...and I know the casual lingo and all but thought, I golfed in the morning, took my daughter to Dad/daughter day at gymnastics, bought a bunch of stocks I really like at prices I honestly didnt expect to see for a while, then picked my son up and went to the pool, bought more stock, and now am having dinner before some night fishing. Rough day indeed LOL.

Come on, let’s hear em. Most ridiculous things people are doing and thinking about doing. Always a fun exercise. A year ago I joked about $200 oil. Seems now more than an outside shot. Today, I’m not buying bonds but am getting tempted to hit up some dirty dirty junk. Maybe not some carvana but how about some of the energy companies? Transocean has some real wild ones currently hoisting bong yields. Berkshire Energy as well has duration. Where’s the biggest consensus opportunities? Meaning, where are there 10 kids all on the same side of the seesaw?

What did the Fed do today? Was at the pool for a big chunk of it and couldn’t find anything. Any idea what they’ll do tomorrow?

No problem. These Solas folks seem intent on selling so its providing a good entry point. Imagine having that size position and decided open market sales into a bad market are the way to go? Idiots. Anyway, just sold some more APTS which I was gonna wait to next Monday on, but CLPR and VRE just said hello so I couldn't resist picking up some more.

Doubled BRK today and added 25% to JOE now double digit position. How easy is the JOE story to understand here? A 5 year old could do it. Go to page 29 of the recent presentation. Press print. Take a black magic marker. Color in all “Joe land”. Then with the same marker color in “public land”….now look at what’s left? Looks like all that coloring spells “Irvine” too….

AOS starter