Gregmal

Everyones gotta find their own process. And then the work begins refining it and evolving as an investors. In a world of "this is what youre taught"...everyone runs to the income statements. Personally, the first place I go when looking at an investment is the balance sheet. Why? Because Im not interested in crappy balance sheets. It only means...bad things. Poorly managed, declining profits, interest rate/refi risk...and many more derivative negatives. Whereas Ive made an absolute fortune, finding companies with pristine balance sheets, and "nothing really going on"....playing inflections or event driven stuff. CKX a good recent example. Nintendo falls into this bucket as well. When the balance sheet is a fortress, you have time to sit around and wait to see the cards turned. You can also employ your own leverage to put on the investment. Whereas some crapco with a huge debt burden, you sweat more and more with every tick of the clock.

Well why not base it on your own work?

Both are a waste of time. If Im concerned with the earnings power of something, I typically try to figure out what the next three years of earnings will look like. One year is such a small sample size; anything can happen in a year.

Bet the teachers are still getting paid though.

Sure there is. Look at all the spending packages being promoted as immediate and urgent. And all the other stuff they’re jamming in. War is always a great excuse to move money around

The amount of money and power available to the incestuous complex during times of “war” is too attractive to them. The complex includes military industrial but they’re just a piece of it. The powers that be love war. Look at how much freedom some were willing to give away to the government because of a bad flu strain a few years ago! Telling people they are in danger and in need of protection is the easiest snake oil to sell.

We need “wars” to excuse 2013s oil prices and inflation being a little higher than normal going into elections. Always have to have something to point a finger at…remember, Joe Biden told us the buck stops with him. Guess the dementia has taken its toll.

Think its very clearly in the interests of a lot of the establishment to keep this and Ukraine going.

Show of hands…who voted for this?

This really isn’t an issue for most companies. It’s only really related to investment managers and such, and those certainly don’t trade at a market multiple.

Conversely, Ill give you another...I earlier also wanted to hedge and the IWM has been money there the past few years. I wanted duration and there is plenty on the chain. But OTM and duration are tough. So I bought $220 Dec 2025 puts. Figured if we rip its ITM enough where I can take another stab while its still got some time to work out...IE 20% move from $205 Would still mean I can save the trade or size it up with a decent probability of it coming back in. So I could double down. Versus if I went for say $150 puts...its a hero trade kinda and a move to $250 more or less crushes the realistic odds I can ever salvage that strike. So in this case I like things where I can have the market be flat and not lose much, go down and make money, or go against me and trade it again.

Why go a week out? It’s funny you mentioned this because I got bored and saw a trade setup a couple weeks ago and just closed out pretty much this trade. TSLA at 175 looked good for a hedge. I didn’t want near dated stuff because I’d have to time it perfectly. I didn’t want to go too deep in the money because it’s a volatile stock and can quickly go against you…so less capital exposed was my goal. I settled on Sept $150 puts for $10.50 figuring the time value would buy me a few months to be right. But a quick move to about $150 would bet me 50-70%. Closed em out this morning for $16.5-17. So…what is your wager? Tesla gonna tank, fast. A timing call? Hedge you don’t care about not working out? Fundamental short…IE you need time for it to play out and just roll options? Most crucial thing with this stuff is how you structure it. Also keep in mind, VIX 20 vs VIX 14 matters too.

It really just depends on what you’re trying to do.

I just can’t stomach investing with management teams that exhibit zero shame or accountability for such putrid performance. At least not anymore

Nah. Remember how long Fauci kept lingering around and doing his stupid pressers even though everybody but NY and CA moved on from COVID? Jerry’s doing the same thing. Im actually semi hoping for a Trump victory just to see this guy get fired. He’s a clown.

Add to Fairfax

This is what’s so bizarre about this whole inflation saga. The culprits have been super obvious. First go around it was clear as day that stimulus checks and shut down related supply chain disruption was the majority of the “9%” inflation. Now it’s obvious housing and secondarily energy is most of the inflation. Yet people wanna talk about services lmfao….it’s like talking about the attractiveness of a 500 lb chick and being like “yea she’s got a really nice bracelet!”…Who TF cares?

Duh lol.

The problem with small cap stuff is that even with good ones, G&A can be a huge chunk of the overall earnings. So right out of the gate, you are at odds with their management because its almost a survival thing for them to ensure they can pay themselves. In the mid-larger cap space, its really just the product of most management personnel being career whores. Ladder climbers. So even when you get good ones, they have little loyalty and will bounce for a bigger check or better job title elsewhere. While theyre employed they are motivated by maximizing their compensation. So me, I just kind of hunker down in stuff that is the exception to a lot of this, and Ive only really found that exception to occasionally exist with either founder led, or owner operator type C-suites. Folks underestimate how disruptive it is when the C-suite is constantly turning over. Culture at a company is built over many years, and cant evolve in a positive way when every 5 years a new guy comes in asking for stock options.

ASP being $430k isn’t inaccessible because of plumbers. It’s because Fed went mental on a rate crusade and with 20% down you’re now looking at like $4000 a month for a shit box. Even if prices went back to pre COVID levels, because of mortgage rates being where they are, it’s still massively exclusive for the average person. Also embedded in this is that most Americans haven’t actually had any sort of material wage growth since GFC. And now they start to demand it, and have some leverage to get it, and these academic assholes do what? Ooh wage growth bad lol. Like you can’t even make this shit up. It’s so incompetent at the highest levels that one might think it’s not incompetence and that the game is just rigged.

It’s like these Fed guys are so arrogant that they refuse to acknowledge that they can not control inflation if it is caused by certain elements in the economy that they have no control over. So they just ignore it and say “inflation up, raise rates”. It’s hilarious watching this because it just shows an academic deer in the headlights

Yea but the super core stuff is bullshit as is the outdated and academically inspired “dual mandate”. Once we start carving up niche ways to create an “inflation problem”, gives people way too many avenues to run with data, as we ve seen. If the true concern is widespread/broad reaching “inflation”…by far and away the two biggest problems are housing and energy. If the objective is to hit the area most significantly impacting the lives of Americans, especially the average ones, it’s housing. And housing has been made widely inaccessible and unacceptably unaffordable for most, because of the Fed and their rate hike crusade. These imbeciles are so dumb that it seems they blindly look at some “inflation gauge” and then just go “too high” and simultaneously shout “raise rates”, almost completely oblivious to the cause and effects of such. This is why we narrow down and strip out this or that…it’s nonsense. Fix housing and energy and the “real” inflation is pretty much zero, if not negative. Just because we go “oh services” and act like this is more impactful in a negative way than people’s shelter situation doesn’t make that the truth.

And then we re back to people calling for rate hikes over things like oil prices(zero to do with rates) and housing(the reason housing is bloated is because of rate hikes)…

It’s kinda funny but I actually agree with much of this. The question is, did it matter? Wasn’t it inevitable? Trump pissed off the media and liberals because he mastered THEIR game. It enraged them that they couldn’t slander him in the news or leak a video and put an end to his campaign. That had been the liberal way until then, in fact, it still kinda is. There was no question Mitt Romney was the most qualified candidate we ve had for president in decades. And the media turned it into a runaway for Obama using race bait, culture war propaganda, and lies/innuendo. Trump found a way to negate that, and that’s why they all went mental. I’ll still never forget the Presidential Debate where when asked our greatest foreign threat, Romney competently explains that it’s Russia…and Obama, offering nothing but a made for tv quip about “the 1980s called and wants their foreign policy back” and instantly became the winner of that debate…yes, on an arrogant, ignorant, and flat out wrong wisecrack! Now the same outlets that celebrate that “own”…want to cry to us about big bad Russia. Fuck them

Dont think it works in Canada but the 30 year mortgage really starts doing its thing once you get past the first say 5-8 years....especially with a decent down payment. The equity gets larger, the interest payments smaller, you dont even really need appreciation of the home, although that happens quite often as well. Basically you start approaching the mortgage "tipping point" they call it where your principal payments exceed the interest payments..is where you really see your "worth" accelerate and this unlocks a lot of variables for you in terms of accessing the equity. Also around this time, is where you really start to see the benefits of inflation on that fixed rate. There was a point in time, not even really that long ago, where a $3,000 a month housing payment was considered large. Today? Not so much. So its really just where the good aspects start accelerating up and the negative ones accelerate downward...a tailwind for the owner.