Gregmal

Yea well there’s a tried and true way to solve the housing issue…which is bizarre when you think about how big of a component housing is and the supposed “commitment” to beating inflation…and yet they’re doing the EXACT OPPOSITE! The builders were planning on building us into oblivion and investment firms were gung ho to fund it, and then confused Jerry and friends started freaking out about CPI, then switched to focusing on the stock market price action, then changed tune to focusing on the jobs market, and now are concerned that restaurants are too expensive and whatever. What a circus it’s been. Tangentially, if you look at what the market has really reacted to, it’s was clearly CPI and CPI being north of 7%. Not all this minutiae about .2s and .3s.

They have a $40 target, but none of it makes sense. I continue to be a very happy camper as there remains plenty of opportunity to buy world class assets because folks manufacture a consensus idea that they should not trade for what they’re worth. Garden should trade for a fraction of its replacement cost, St Joe should trade on an earnings multiple, AIV does development so the assets aren’t worth what they’re worth, Nintendo will never be sold so you can’t put a value on its IP….on and on. Anyhow, FRPH is another one that fits the bill; I’ve been adding a bunch to lately.

Housing should be 30% of income if done responsibly. For simplicity sake if you make $100k, $30k a year is housing expense. 1/3 is taxes and insurance. So even if those go up 10%, you’re more than covered as long as your annual raise is at least 1%.

An analyst report from Goldman citing “valuation” on MSGE….can think of a few things but valuation certainly ain’t one. The book report writers never cease to amaze.

There is also a psychological element to charts which can tell you things. And also an overlap with fundamentals. For instance the $400 on Fairfax represents a function of its price to book. If folks tends to buy at .6x book then whatever the shares outstanding correlates to will show that. A lot of this stuff overlaps but simply on its own, such as the people who day trade SPY or something, it’s stupid.

Yup. That’s basically it. All those big scary stories we were told ain’t happening. The sinisterness didn’t exist. The rampant wage price spirals stayed in the textbooks. Oh and they nearly blew up the banks they’re tasked with regulating in a feeble attempt to generate “credibility”…whatever that means. So yea, their 15 minutes is up. They can fuck off. They’re not fooling anyone with this super granular focus on minute stuff fluctuating point one percent here and there. And I’ll happily stand by our politicians coming for their heads if they dare try to fuck with peoples jobs. It’s over. The market has moved on.

point ones and point twos move around randomly as they do so far, hardly a path to SPY thirty two first it was transitory now it is here forever as the Fed keeps looking backwards the forecasts never get much better Jokes aside, if these things are such a big deal and input...whats the payoff of it all? I get some people are super duper excited about 5% bonds....Im not. If inflation is 5% you have no upside. If the rationale is stocks might go down, well then the stock market isnt for everyone, IDK. The meat of the issue is wayyyy behind us. We are off from the "5-10%" inflation everyone screamed about and Id be shocked if we ever get back there again anytime soon, especially if all else just stays the same. So whats the point and whats the play? A while ago some of us talked about FFR futures....trade woulda been a bust. Obsessing over the last 25 or maybe 50 here seems so short sighted. Its also crazy to hear these delusional Fed clowns talking about "not happening fast enough" and "stubbornly high"...Uhmmm, the first small hike was barely one year ago. Its maybe been 8 months or so since rates were anywhere impactful. They've admitted theres a huge lag, generally 12-18 months....and yet we've gone 9 to 4 and theyre still mouth breathing about "not happening fast enough"...whats fast enough? Hike tomorrow by 200 bps and voila a day later we get instaCPI and it comes in at 1.99%? This is starting to challenge covid in terms of stupidity of the response from these officials.

Plus, when would the extinction of the super low 30 year fixed start showing up on a 12 month lagging figure? Oh. 12 months from when you would last expect to see them reflected via rate locks and home closing. So what? July? We are about to see those things drop off big too. And I’m not sure why folks aren’t aware of this either. Still think there’s a chance we see negative cpi figures late summer or so. But the fork is in last years wondering about inflation remaining high. It’s not. June year over year with the housing and oil mega spikes in 22 will really start to show this, more so than it already had.

And the flaw in their backward looking approach that may eventually screw the economy and your focus is again totally missing how big a component meaningless stuff like OER is in the equation. And then when all else fails it goes back to “bars, restaurants, and hotels are too expensive”…nothing is inflating anymore. We trumped up wage price spirals starting in January and nothing happened. It just never ends. There’s nothing commendable or rational about playing with peoples jobs and livelihoods but that’s exactly what they love doing. But I suppose their thesis is now “people with 3% 30 year fixed rate mortgages have an imaginary rent burden”…in other words, imaginary inflation.

Shucks. Was hoping for SPY 3000 next week.

Even the meteoritic rise in egg prices has reversed. This is all bullshit and anyone still talking about it needs to have their head examined.

Yea it’s stunning to me to hear them continuing to talk about inflation lol. Like your 15 minutes is up. Go home.

I find it helpful in sometimes assessing levels of support for a stock. Or for milking an existing position, IE Id probably wanna sell MSGS puts around $150 cuz Id be fine owning it with that basis and it tends to bounce off that pretty quickly. Sanj you cant say low $400s weren't meaningful and obvious for Fairfax while the turnaround was talking place. But in general I agree. If you are focusing on valuing a business or asset than the charts are just kind of a distraction. So perhaps if you are a full time market professional and you kinda have to be doing something...sure. But for a normal person its stupid and for a long term investor, outside of using options strategies, I just think your better off doing other things with your time. Anyone telling you their entire investment strategy is day trading based on charts is either lying or making money doing something else.

Blowout from Toll Brothers. And now margins are improving lol. Wonder if the wizards are still shorting?

Well, maybe the problem isn’t the markets but the people tasked with these jobs? Isn’t it crazy how they’re all just sitting around guessing, gossiping, and speculating about the Fed? Instead of just doing their jobs and investing? The last few years, starting around early 2020, I’ve really been amazed how many people continue to participate in the stock market despite being overridden with fear of “something bad might happen tomorrow”. So dumb

Again, there’s always some data point for bearish folks to get hung up on. It never ends. I remember having the “bottom” debate in December with folks and it was like “oh not enough time has passed, bear market rally”…6 months later…same story, different fears. Whatever.

Nothing I saw. Sometimes the market is just generous.

Bought a bunch of FRPH last 5 minutes of the day.

Is the disruption and/or apparent benefit not absolutely massive? Much of law is interpreting rules and using existing case knowledge to build a point of attack. The best lawyers probably still don’t have the on demand knowledge of both the written jargon but also all the cases out there which may have relevance. But an AI program can instantly sift these and learn arguments based on what’s been successful in the database. Is this not basically the equivalent of having robo umpires in baseball? Automates something that is technically pretty defined? There are definitely investment angles here. Could the $1200 an hour lawyer turn into a subscription service or app? Could the architects and engineering firms be on the chopping block as well?

While not a fan of this sort of stuff, if screaming rumors is all it takes to decimate a stock I think it’s probably wise to look at a short selling ban. Seemed pretty cut and dry that everything was stable and then a rumor about exploring a sale pops up and deposits flee. Definitely not a healthy situation.

What do you guys think in general of rent regulation risk and subsequently how to apply valuation metrics to an asset exposed to it? In a way its like owning a dual class structure stock. Its not something I've really been able to process because theres plenty of examples, like Vancouver, where it hasn't really impacted property values. But then of course theres plenty of data that goes with the conventional wisdom that it could significantly impact them. One of the biggest things I think gets confused with a lot of this stuff is the "theres plenty of people who want to be there" argument. Of course it is nice to have that issue, but its really something with diminishing value to a landlord after a certain point. In a way I guess it parses the income vs appreciation argument. A great unit that is well located probably provides most the return to an investment, especially with the "everyone wants to be there" element, via price appreciation. Whereas NOI is probably not all that special. So I guess in certain areas you really need to fine tune this as a buyer. And if we are talking traded stuff, kind of evaluate the degree of certainty one has that the assets can be efficiently monetized.

I recall 2011s summer drama vividly, but also dont see anything jumping off the page in terms of obviousness outside of GLD...which even there isnt super exciting but just kinda a decent short term IRR type setup.

Added a small bit to HHC at 74. Not thrilled about having to deal with crummy management now, but very keen on being a pre IPO investor in Ackman Enteprises.

Like can anyone imagine the calamity and chaos at firms like Bloomberg for instance, if it became widespread common knowledge that you don’t need all this instantaneous info and god forbid you can actually be patient and practical? That 95% of the time the correct move is to just do nothing? I’d gander the returns of many quiet individuals like @dealraker beat the shit out of pros paying a quarter mil a year for a terminal! Nah…those secrets must be kept as they are the key to active management alpha! Folks in general need to wake up to the idea that the game is rigged against them and 1) there’s a reason they don’t educate young people on financial matters and 2) it’s the bread and butter of all these leach firms that you constantly need to do something in the name of being conservative and well prepared.

The problem is that all those returns are based on hopium and money printing. Then add in 9% inflation and really you need to discount them bigly! Jokes aside, the biggest issue is largely that many have very inflexible framework. For much of the last decade or so, every time the market goes up, we have people claiming it’s undeserved. Like how many times recently have we seen every downturn met with “I knew it” and every updraft met with skepticism? An underlying belief that the market “should not be up”. And I mean if that’s always the subjective analysis, then what’s the point of even paying attention to the market? Shit should just always be down and when it goes up it’s invalid…. I don’t get it.