Gregmal

Seth Klarman, one among many underperforming value investors, with a denigrating and condescending tone around his remarks, called Bitcoin a "trading sardine". In fact here is what he had to say: "There is the old story about the market craze in sardine trading when the sardines disappeared from their traditional waters in Monterey, California. The commodity traders bid them up and the price of a can of sardines soared. One day a buyer decided to treat himself to an expensive meal and actually opened a can and started eating. He immediately became ill and told the seller the sardines were no good. The seller said, 'You don't understand. These are not eating sardines, they are trading sardines.' Like sardine traders, many financial-market participants are attracted to speculation, never bothering to taste the sardines they are trading. ... trading in and of itself can be exciting and, as long as the market is rising, lucrative. But essentially it is speculating, not investing. You may find a buyer at a higher price — a greater fool — or you may not, in which case you yourself are the greater fool." Meanwhile, yesterday, Klarman got a life raft when Abbvie decided to acquire Allergan, a position he found to be more to his liking. Nevertheless, on his "value investment", Mr. Klarman is still said to have lost over $100M as his basis was significantly higher than the acquisition price. Prior to the acquisition, Mr. Klarman was likely down 30-40% on his AGN position. What I find hilarious is the premise that "OMG DONT BUY THIS ITS SPECULATIVE, ITS FOR MORONS, ITS A MANIA, YOU MIGHT LOSE BIG!!!!", when these guys then go and end up suffering the exact fate they snidely predict others will, buying "their own" type of investments! They underperform, then they need to make excuses why they are missing things. SO they disparage the people that are making money rather than say, "I didn't see that way to make money".They play the "sound and responsible fiduciary" card, but as a money manager, your job is to make money, not be a fiduciary. Give me all your money and I'll buy 30 acres and bury it in a fortified compound and have it guarded by people with AK-47's all day.. I'm not raising capital on that despite being a great fiduciary. Make money, or shut up. A good money manager is fine waiting for things, but also needs to be able to see what is working and what is not and how to capitalize on what is working. Sure there are a lot of idiots buying Bitcoin, and Tesla, and Beyond Meat. Figure out how to make money off the idiots.... Not sit there and whine and make excuses and disparage those who are actually making money...

Finally pulled the trigger on some HHC at 92.63. We should be nearing there bottom.

This is 100% spot on. It seems many are confusing a bubble in certain areas with "the market" being in a bubble. I don't think many people here are buying the bubble names anyway, so its a non event as I have no interest in shorting these. But there's always areas of froth in the markets. Nothing new here.

Good couple points on value investing https://www.cnbc.com/2019/06/21/is-value-investing-dead-it-might-be-and-heres-what-killed-it.html At least the older fashioned version of it. Reading other threads, it just seems like people want to make excuses not to invest. If presented with a quality company that is firings on all cylinders, its "that's too expensive". If given something dirt cheap, then we get "its got too much hair/too many issues"... So it just seems like people don't want to invest.

IMO people are just using the bubble narrative to justify shitty investment returns. I remember Einhorn whining about a "bubble" and "froth" in like 2013...Marc Faber back in 2011... clearly they've just been WRONG

What I meant to communicate(poorly) is that writing something off because of the perception that it adds something negative, isn't always wise and really doesn't have much to do with whether one can make money in this situation. I am not a BTC expert and think its kind of gimmicky. The attraction I see for people is regaining anonymity. The government has gone so overboard invading peoples privacy, and strong arming foreign countries who used to have favorable banking laws, to the point where it is ridiculous. Sure, there is a criminal element that benefits from this, but as I mentioned before, there are criminal elements to everything, everywhere. So its not a deal breaker when making an investment.

Probably quite a bit less than when you fill your car with gas or pay sales tax to the state you live in, or federal taxes, or pretty much anything else you spend money on. Tip your waitress? Many do drugs. Your $20 ends up paying for dope. This is a stupid way to look at something.

I do find it amusing that the geniuses at the Fed take 2-3 quarters longer than even the average person to realize what is going on. I don't think we need a rate cut now, but I also dont think we needed nearly as many as these idiots gave us the last couple years.

MX and EBAY

CVS and MSG

I would just ignore the noise and buy quality companies while looking for the occasion speculation trade.

Jeez, I thought mine were bad at 3.7% of appraised value with a typical 3% escalation.

+1 Take a look at the sample of companies where investors have found large margin of safety: Loews Seaspan FTP Sandridge Sears Fairfax Altius St. Joe The common pattern is they get a large net asset value and market price is at a fair bit of discount to that. This gets many investors excited, they see a large margin of safety, stupid market, etc.. The thing to focus on is to look out a few years and see what the earnings are going to be. Maybe 5 years or 10 years. Focus on where the earnings are going to be. Those are the fundamental drivers of a business. Not what discount you are getting to current net asset value. OK. This is the easy one. Take the case of some companies that are currently experiencing problems. You would say, I do look out over the next few years and I am going to capitalize the earnings of the business when they normalize. Fine. Except that many of these businesses are in industries that are getting disrupted. And you do not want to invest in any company that does not sell for less than 10x earnings. So a large portion of the investment universe is out of bounds. I would suggest to look at where value is actually being created. Vinod Many here would rather own those listed companies, because the understanding of being a badge wearing "value investor", is buying shitty companies, or at best, ones with questionable fundamentals, at a big discount to IV(while forgetting that maybe, just maybe, that discount is warranted)

I think the thing is to understand the fundamentals, but also be aware of the context. If you look some of the great long term compounders, in hind site they are easy to see. Duh. But what is easy to see is also capable of being extrapolated and applied to ones search for current companies with those characteristics. Google, again, just using it as an example, is a dominant, one of a kind company, regardless of where we are in the grand scheme of things, and will be, with almost 100% certainty, in the future. So now that I've determined this to be my foundation for owning a name, next up is price. Which at the end of the day, for a high caliber, established and dominant company, IMO(and I say this with a lot of caution for myriad reasons), is not really all that important in the grand scheme of things; all things considered. Why? Look at how long people have been talking about Amazon being overvalued(I am one of those people). Plot that chart and tell me how many times you could have bought it and how many times, over the long haul, you would have regretted it? Draw downs are just part of the markets glorious opportunity. You could have bought Apple before the GFC, Priceline during the tech bubble, etc. With proper risk management(averaging in slowly, a bit of diversification, continued diligence making sure you continue to own quality) the odds of getting hurt are very, very, small, if not, dare I say, almost nonexistent. Versus just sitting on a large pile of cash and being the grumpy old man that complains about why things are so expensive... It always makes sense to own great assets. The prices paid for them changes with the times. If you stay flexible with your ability to adjust(going overweight/underweight) as the price paid changes, you will make out quite well. But I have a hard time convincing myself it EVER makes sense, not to own ANYTHING of a great company.

Its an interesting scenario. I've argued for a really long time that the market isn't really expensive all things considered, people are just looking at things the wrong way. In the spring/summer/fall, I do a lot of fishing. When I go out, I always have a cooler with me for drinks and whatnot. Doing this, I would invariably run through a lot of ice. Spending $2.25 for an 8lb bag will take a long time to add up, but in time it will. Nonetheless I started thinking, and honest to god truth, Yeti coolers are the only coolers that ACTUALLY do as advertised and keep things cold for 6+ days. All the others say they do, but you're lucky to get 24 hours out of them. If in the course of a week I go out 5x, and instead of buying ice 5x, buy it 2x, the payback period is not that long and its actually quite beneficial. So, I was able to find a value proposition in a $250 cooler that my entire life I had thought was grossly overpriced. Your last paragraph is an example of that. Managers are using the wrong tools to evaluate some of these great businesses. Much like Buffett has said about missing Google. Its not, "we buy the most expensive assets and add as they go up", it is "we buy tremendous businesses and they appreciate at a greater rate than crummy ones".

Yawn. Basketball sucks.

MSGN.

I would think Buffett, like any semi intelligent or better, successful entrepreneur, would approach this as a unique opportunity to exchange thoughts with an individual who has done admirably well using a non conventional approach; one different than his own, and as such, this is perhaps an opportunity to learn something.

Trimming CRSP.

AAL, CTO and more GOOG

GOOG, GOOG, GOOG

I need to cycle back into refineries again. I bailed from MOC (at a small profit) and like Buffets former pick of PSX better, as it is better run (imo) with better capital allocation. It’s not cheap enough me to buy though, so I got some DOW instead. CLF‘s dividend raise is supposedly trying to bolster confidence, but the yield is too small to matter and won’t support the stock, imo. Yea PSX and MPC are the ones I like. They're small, as are a lot of my positions, so I don't have to give myself grey hairs worrying about aggressively managing it. I try to find levels where things get interesting to build starters, and then just scale in on further pullbacks. Agree on CLF, but if you listen to the calls, Goncalves has talked about his preferences for capital allocation. Given dividends are way down the list, I think this bodes well for what is being done with the others. They already ripped through about 10% of the shares outstanding since October if I remember correctly.

More CLF. Mexico tariffs? F you market, says Lorenco Goncalves, lets raise the dividend 20%...

While I dont disagree with much of the sentiment, at least on an academic level, what I think is flawed is the notion that equity risk is high relative to future returns. Granted, no one knows the future, but people have been saying this for at least the last half decade and returns have been more than adequate. There is little reason this can not continue to be the case. At least not any more reason than there is to make the case that it can not continue.

Got some FRPH at the close. $46.70 Ill take all day