Gregmal

I think there is quite a bit baked in right now, but don't disagree that there could be rough patches. That said I don't think today is worth getting worked up over. People bid up a challenged company because Buffett bought it and paid the price. Just because lower and middle class people stopped seeing the need to give Apple $700-$1000 a year for the same phone with a new color or extra inch of screen space, doesn't mean the economy is slowing down. In fact, it might mean people are getting smarter or spending that money elsewhere... Although, it does seem this is all pointing the data in a direction that will give the Fed pause, and may even lead to revisions in terms of their previously hawkish stances.

All combined probably somewhere mid-high teens. Don't care enough to tally everything up, never really have. To me the idea of talking about your returns on the internet is useless. It's like talking about your dick size in high school. Everyone likes to, but it only matters once you take the leap and can prove it with action. Anyhow, I typically run very concentrated and MSG, HTL had solid years. Went into year, and exited year with FRP Holdings as top 5 position, but spent 80% of the year not in the top 5, which kind of highlights the type of year it was. Trading was were one needed to be this year to really get alpha. GM and CTO continue to be perpetual disappointments.

https://www.cnbc.com/2018/12/28/el-erian-hold-the-fed-accountable-for-its-messaging-not-rate-hike.html This sums it up. I don't disagree with the hike, but the communication sucks and is tone deaf. Which IMO is Powell's way of trying to play politics and stick it to Trump....Which is more or less a "way to go asshole, stick it to Trump at the expense of the rest of the country"...

Hopefully not. Pushback and coherent critiques are the most useful posts on this board. I know there seems to be some kind of quasi-feud with some here vs other forums, but the main reason I find VIC much more productive is because people are dicks and cut your throat analysis/logic wise. Which for me at least, is the greatest gift because it challenges my thesis. Here, let's face it, a lot of people don't contribute shit, some basically just add meaningless tidbits of already out there analysis, and some indeed give pushback. I like the later. Look at the MDXG or FB threads...People take offense to pushback or differing opinions. They even get mad at disagreement. LOL ok, enjoy your thesis drift while I make money. Cheers...

Long time favorite MSG. Whether Silver Lake gets serious w/ Dolan or not, it won't matter. With split occurring and $1B cash heading to the entertainment company, this leaves the sports teams and other assets floating at about a $4B valuation. Which won't last long. $325(~7.5B total asset value) is probably my worst case y/e target.

I think Trump needs to own his mistakes. The Fed can own theirs, if it comes to that. Also, where the the conspiracy if a Fed chair elected by Trump raises the interest rates? He could have just kept Janet Yellen, if he likes the low interest rate policy? Anyways, I see this correction more like the one in 1987. back then, we had rising interest rates, a fairly strong economy, the Regan tax cuts buffing the economy and a considerable stock market rout they in the end meant very little for the real economy. Spot on. Trump hated Yellen and handpicked Powell. I really can't explain how he would make those decisions then, with the expectations that things would be any different than they are now.

Merry Christmas all! This is a great place with some great people. Enjoy the holidays folks.

This is getting insane. You'd think we are in the midst of some massive crisis. Or that every listed company in the US is cooking it's books... I know Tepper basically just declared the Fed Put dead, but all the writing on the wall, at least to me, seems to indicate that with a little more pain, a lot of folks are going to start looking to resurrect it.

As long as those tax rates stay in place, yes the increased value is "permanent." However, I'm talking about GDP growth. Cutting taxes gives a boost to GDP growth (not GDP level) that is transitory. Which I agree in macro terms is important, but when I look at specific portfolio companies, it really isn't. If I own FRP, and their income consists of lease revenue, interest income, and cash from the rock pits... let's say all of this stays the same, just to keep things simple. At 22% tax rate the company is now significantly more valuable, even with the same figures as last year, when paying 35%. You can look at different figures, but simplistically, you should be throwing a multiple onto that incremental income, and the value of the company should be higher. The markets right now in a lot of cases are saying the opposite. People have essentially fabricated the recession narrative out of nothing, and what I'm saying is that even if it were true(to the extent that is reasonable, ie not a crisis) it doesn't in many, many instances, with a lot of companies, support lower equity prices.

Agreed. Right now Mr. Market is very pessimistic. Why? Not really sure. The stock market's ability to predict the future is less than stellar. The bond market, with 10 year US yields at 2.79%, does not look overly fussed (and I think the bond market is a much better predictor than the stock market of what may be going on in the general economy). Perhaps the ending and reversing of QE is having a much, much bigger impact on financial assets (especially the stock market) than most understand or recognize. Perhaps the current sell off in stocks has little to do with trade wars or slowing economies. I actually think the biggest catalyst for the current sell off the fact that nobody really has a good explanation for it. Fear of the unknown and also don't underestimated the significance of the time of year. No not Christmas but month 3 of the quarter. I highly doubt this continues with S&P components popping earnings out every other day. It's just a weird convergence of events and news flow IMO. Nothing more.

I personally find this whole thing to be hilarious. It's gotten so out of hand, and it's turned a lot of otherwise sensible people into clueless idiots. The stories and headlines, the emotional crap, the complete reversals in sentiment. Oh goodness. It's like everyone sits around bitching about valuations and begging for a pullbacks and then they get the most no brainer one possible and they don't know what to do with themselves...and these are just the people who call themselves investors! -Nothing changes but a .25% rate hike. So what? -The economy is still strong, but indeed shows potential signs of slowing a bit, so what? -The Fed has ALREADY basically said they fucked up and will cater to the market, if you read between the lines. These guys were out giving interviews and trying to say the right things A DAY AFTER they raised rates and saw the reaction! -The market turns the screws on Trump, I guarantee you we get a China deal next year; he needs good news. -The biggest farce I see is people saying "one time boost from tax cuts". WTF do people come up with this stuff? The tax rates don't go back up next year! How in the world is it a "one time boost" when in perpetuity companies will be keeping 40% more of their profits? And oh yea, the "boost" we saw this year? Where, S&P has responded to this increase in corporate profitability by posting -10%! -I've spoken to probably a half dozen CEO's and CFO's over the past two weeks, and maybe it's just particular to the companies Im invested in, but NONE have seen any reason to be have a different outlook or expectation that you had 6 months ago. Overall I think we just had a convergence of kind of one off events that tripped people out and caused contagious panic. First real year of widespread tax loss selling, no Santa rally on WS, massive fund liquidations and wind downs, minor softness in numbers plus super duper scary headlines and fear mongering. Fear that the Fed is going to crush the economy. People are just running with the crowds right now and have convinced themselves of something that doesn't exist. A stupid but true reality is once people started seeing turbulence, many likely just dumped shit and figured they'll pick back up after the holidays-on the institutional side there is definitely a lot of this type of stuff. I will be buying next week because I believe once the big boys get back from holiday in January things should get back on track. This downturn if anything has just given well run companies the opportunity to suck up A TON of their own shares and spring load next years numbers. Which in any case shouldn't be bad, especially at these new valuations. For example. I will be adding to MSG. If you can get to $5B on the Knicks, and add back the cash, you currently have a NEGATIVE EV! And then still have billions in other assets. There's plenty of others like this now. How does any of the shit all the pundits are "concerned" about all of a sudden effect my investments? It doesn't.... As such, I'm a buyer all the way down, screw the naysayers. There were people calling another 20% downside in the S&P when it hit 675 during the crisis. We are no where near a crisis, despite all the crazy things people are now saying that seem to be 100% reactionary to the market decline, and 0% based in what's really going on in the US.

I wouldn't be surprised. Powell is a complete hack though. I rarely agree with Jim Cramer but he nailed this whole thing. It's one thing to hike as expected. It's another to come in completely tone deaf, after talking about being data dependent, and then push some aggressive rate hike agenda that is totally data independent. What an idiot. Kevin O'Leary gave a good sound bite on this too.

I think Dalal and Viking are spot on. I'd add that it's amusing watch this whole shit show play out. The really, really, really, smart money sat on the sidelines bitching about the Fed forever. Then, they eventually capitulate, and now they whine that there is no more easy money left... Poor really, really, really smart guys. The economy is fine. Not robust but not terrible. Stocks, if you know what you're looking for, are very cheap and have favorable conditions and a significantly lower tax rate. That's not to say the nerds with the computer programs and algos won't cause havoc from time to time, or the really smart guys throw taper tantrums like today, but the sensible investor should do well going forward.

I find it utterly hilarious how this whole "the market is expensive" rhetoric is basically an advertising product/built in excuse for poorly performing money managers. The same managers who tell you not to pay attention to the indexes anyway... Ironic.

Haven't people been saying this since basically 2011? Why this time? The recovery has been extremely slow and shallow, unlike traditional recoveries, and we've had a bunch of corrections and sector bear markets since (I was just noticing today that the DJ Diversified Industrials is down over 33% from peak) and international markets are already in bear declines, yet everybody seems to talk like it's been only up and to the right since 2009 so we must be getting close to some big thing... You could be right, but it seems hard to time the market like that. I'd rather own good companies that can benefit from dislocation and let them cleverly deploy capital if things go south, and otherwise keep creating value if they don't. But that's just what I'm comfortable with. Liberty, buying great companies when they are on sale and holding them for the long term is a proven winning strategy. I applaud those who are able to execute that strategy. I have, for the most part, been able to ignore ‘macro’ for the past 5 years and it has worked out very well. Having said that, i have been getting more cautious as the year has gone on. The biggest single reason is liquidity. Back when the Fed initiated QE it had a large positive impact on the stock market. Today we have the opposite going on; the Fed is trying to unwind QE. It makes sense to me that it will have a negative impact on the stock market. The Fed is also raising interest rates quite quickly and this is/will also negatively impact the stock market. If the Fed next week backs of future rate hikes and/or slows QE unwind i may become more constructive on stocks moving forward. However, if the Fed raises rates next week and sticks with 3 forecasted rate increases next year and sticks with QE unwind i think stocks will sell off more. In the last 5 years zero interest rates has resulted in pretty much everyone levering up. When the next global recession happens i think there is a good chance it will be as bad as 2008. Europe is a mess and they have no ammo to deal with a recession; their banks are also a mess so there is a very real possible trigger. Japan is also a mess. China is a wild card; they spent like drunken sailors back in 2008 and 2009 but i am not sure they can do the same thing again. Canada has a housing bubble waiting to pop. Of all the regions, i like the US the most but if Europe or Japan or China contract i think it will hit the US as well. There is much too much complacency right now. People have been conditioned by the past 8 years of slow but steady growth. But it has been juiced by an explosion in cheap debt. Now maybe the economies of the world can keep growing debt and continue the party. The only thing i am sure of is we will be getting a recession. When? No idea. All i know is when it hits i do not want to be fully invested in stocks (or bonds yielding +2%). Cash will be king. What will the trigger be (that will be ‘the cause’ of the next recession). No idea. But it will be pretty obvious after the fact. Buffett’s line about we will see who has been swimming naked once the the tide goes out. If i had to guess i would say debt will be the trigger. Here in Canada we have a housing bubble waiting to pop. In the US it sounds like corporate debt is a likely trigger. In Europe the banks are not in great shape (i.e. DB or Italian banks). These things tend to get started in one area and then they morph and get ugly. Viking I love your thought process and rationale and it resonates with me. I do have a few things hopefully you'd care to expand on. 1. Maybe the Canada housing bubble is obvious. I kind of agree. But isn't part of the bubble process widespread euphoria and enthusiasm? I've hardly seen that in the Canadian housing market, especially over the past 3 years. Almost everyone I know is negative there. 2. Why does the next recession need to be a replica if not worse of the GFC? There's plenty of reasons we could have a recession that pales in comparison to 2009. I think 2009 was a once in a lifetime series of events... I mean almost everyone was asleep at the wheel. Whereas the past decade there have been scores of people hoarding cash and waiting for the first 2% decline to scream about the next big one. Recency bias at it's best IMO

Haven't people been saying this since basically 2011? Why this time? The recovery has been extremely slow and shallow, unlike traditional recoveries, and we've had a bunch of corrections and sector bear markets since (I was just noticing today that the DJ Diversified Industrials is down over 33% from peak) and international markets are already in bear declines, yet everybody seems to talk like it's been only up and to the right since 2009 so we must be getting close to some big thing... You could be right, but it seems hard to time the market like that. I'd rather own good companies that can benefit from dislocation and let them cleverly deploy capital if things go south, and otherwise keep creating value if they don't. But that's just what I'm comfortable with. This is spot on. Not to say I didn't find Vikings thoughts to be compelling as well. But I'm in complete agreement that there's great companies everywhere and if you keep a few on the radar you're better suited just building into them. Find something in your wheelhouse and then just play it through the cycles.

Personally I've thought for a while that some things were frothy, and other, not. The froth has by and large been coming out of the market in phases, since about 2015. The big tech names are IMO the last leg of the correction back to more reasonable valuations. That said, this is just another example of why I think indexes are useless. I've heard a million times from people "how could stocks be cheap, SPY is flat for the year", which is a great summation of index mania and the laziness exhibited by most investors when it comes to individual stocks. It is my believe that we are in the beginning stages of a period where fundamental value investors will clean house.

You don't get K-1s from REITs. The experience for a US investor owning REITs is like that of owning any other "normal" business. The REIT itself generlaly just doesn't pay taxes as long as it follows IRS rules. Hmm.... Thank you for letting me know. I wish other MLPs are like this, where dividends are not taxed twice, and no K-1 headaches to worry about! Do you know if REITs tend to go up in a bear market like Utilities? I noticed a lot of REITs, Utilities, Gold miners going up lately. It depends what type, and it is not always the case, but generally speaking, yes. REIT's that own, say, triple net properties with investment grade tenants are more or less bonds, and reacts in similar fashion during times of duress.

Yea the bulk of those definitely pre-date my obsession with investing.

Over the past 10 years, I've seen two kinds of collapses. First is sky high valuation followed by disillusioned shareholders. Second is stock moving lower first, and value investors screaming bargain all the way down, while E continues to deteriorate. I think AAPL is in the second basket. The problem with valuation with P/E is that you have to be damn sure that E is going to go up, not down. AAPL is changing reporting standards. That's a tip off that the next few Es will be bad. It seems AAPL got a whole lot more popular(especially around here) once Warren capitulated and bought in big. You'd think there wasn't even a bear case anymore the past year, which is odd because there was the entire way up when Icahn owned it. Just my lazy guess, but Buffett's buying spree probably put $50 a share on this that wouldn't have been there otherwise... There were people here joyfully buying AAPL way before Buffett got into it. I foolishly wasn't one of them. But in the past even if I wasn't a believer in Apple, I came close to buying a few times just because it was so damn cheap. Of course a stamp from Buffett would move the thesis. Berkshire has never made a mistake with this much capital. I'd venture out to say and Buffett will agree that the Buffett buying spree happened because that extra $50 or more per share should have been there. Wasn't referring to anyone specific in the above. Just an observation. The growth slowdown is obviously nothing new. It just seemed that this worry became less relevant in the past year, coinciding with Buffett buying and the stock going on a tear. I'm a younger dude, but I've never seen Warren fly into a position like he did with this one. I find it interesting to observe from afar.

Over the past 10 years, I've seen two kinds of collapses. First is sky high valuation followed by disillusioned shareholders. Second is stock moving lower first, and value investors screaming bargain all the way down, while E continues to deteriorate. I think AAPL is in the second basket. The problem with valuation with P/E is that you have to be damn sure that E is going to go up, not down. AAPL is changing reporting standards. That's a tip off that the next few Es will be bad. It seems AAPL got a whole lot more popular(especially around here) once Warren capitulated and bought in big. You'd think there wasn't even a bear case anymore the past year, which is odd because there was the entire way up when Icahn owned it. Just my lazy guess, but Buffett's buying spree probably put $50 a share on this that wouldn't have been there otherwise...

Cronos is a total POS. But it's one of the big names and the cost is obviously much lower than CGC or TLRY. These desperation moves are so obvious. I don't know how you get a GROUP of high paid executives together and come to a consensus that THIS is a good use of corporate resources. At least when PEP bought SODA or KO bought GMCR they pretended to have a plan... What's funny is that when it fails, rather than curb it, they'll buy it out completely just to bury it privately...

Maybe not what you're looking for, but most(here, not generally speaking) can probably get a no interest for 12-18 month credit card with a 25-50K limit. Send 25K to a related Paypal account as payment for services. This works around the cash advance fee. You pay about 3% to paypal. Send the proceeds to a bank account. Wire to brokerage account. You can then also margin this money further if desired. After 12-18 months worst case do a balance transfer to another 0 interest promo card. I'm not advocating this either, but if you are looking to leverage your investments with borrowed money...

These are still pretty much all grossly overvalued. That's not to say there isn't a risk fledgling tobacco and alcohol companies don't incinerate a few billion dollars here or there to try to create the appearance they are innovating...

All I'd say is that you don't HAVE TO do anything. Don't let them boss you around. That's bullshit. If they are being difficult then you are wasting your time negotiating in good faith. I'll leave you an example. I've been invested in a company that has kind of had a history of shareholder neglect. Over the past several years, this company has been disingenuously egging on it's largest shareholder, largely because the shareholder feels they aren't doing their jobs. There have been multiple proxy fights, and a whole bunch of other nonsense. The entire time, management has been boasting about wanting to buy back the activist shareholder's position in the company. After several years of poor results, the shareholder finally said "ok, make me an offer". What did they do? They made a below market offer and then put out a presentation accusing the shareholder of being desperate and looking for greenmail...Typical scumbag move. So my advice to you; don't give them anything. Just ask them to make an offer, with the ability for you to turn it on them. Otherwise, just let them dig their own grave, and document everything through your lawyers.