samwise

Thanks! I’ll try to lookup the economist article.

Anyone making the decision about sending kids to school? Currently I understand that kids (ages 5-10) have low risk of getting and passing the disease, low effects if they do get it. Plus the virus is pretty controlled in my area (Toronto), so their risk of interaction with another infected kid or teacher is about as low as it will ever be until after a vaccine. On the flipside, I don’t think staying home for another year (when kids might get vaccines) is good for them either, academically, mentally, socially. Appreciate any thoughts.

Thanks both. I also looked at ambev. The price in USD seems to have peaked in 2013-ish, about the time you said people were paying peak multiples. That’s a long time to wait. Seems investors will always be battling currency headwinds. So for a foreign investor there may be no growth.

Why is that? Currency devaluations , inflation , or something else?

Thanks for sharing. It is ultimately a bet on the underlying passenger growth, translating into profits in a good regulatory environment. There are other bets exposing you to the same underlying passenger growth: TDG and HEI (and PCP within BRK, although that is more sensitive to new plane deliveries I think). Another option is to buy the loyalty programs, although those have turned out to have their own risks. So given these choices, why would one favor the Mexican airports today? 1. They are cheaper on EV/EBITDA apparently 2. They are exposed to regulatory risk 3. They have a limited life on the concession (~28 years), vs say TDG which has a 70 year life once a part is accepted as part of an aircraft design. 4. They are not diversified over global passenger miles, so there is country specific and even city/airport specific risks. 5. As hard assets in emerging countries, they face expropriation risks.

Cutting corners on the science is dangerous both because it can lead to people getting exposed and dying when they think they're protected and aren't, and because if there are safety or efficacy issues, it can cause long-lasting backlash against vaccines in general, leading to more deaths and suffering over decades. You already have crackpots making stuff up about vaccines, if you give them something real because you don't do things right, it'll be bad. From what I've seen, Russia is talking about a phase 1 vaccine that has been tested on hundreds of people... That's pretty bad science. Is the concern with the Russian vaccine: 1. Safety? 2. effectiveness? Safety: If the virus kills 0.6% people and the vaccine has dangerous side effects 0.6% of the time, you haven't really gained much at the population level. Effectiveness: OTOH, if its not truly effective, you will start being spikes in cases as people get infected. Its a loss of resources and credibility, but for a poor country it might be worth the shot that it does actually work well. Agreed it's not unto the usual standards, but in the current scenario everything is now a risk-reward decision in real time with limited information. Safety would probably worry me the most here. So Putin's injected his daughter to allay those fears. Not the right way to look at it. You don't gamble with whole populations by injecting them with unproven medicines. This kind of callous thinking is what got the US and Russia in their messes in the first place. Not supporting Putin's decision here, which s probably more driven by the propaganda value and his domestic political needs. I do hope the planning for the next pandemic considers questions like the following. I certainly haven't seen them discussed anywhere. If this virus had an IFR of 50% (Ebola like) with huge infectiousness, and you offered me a vaccine which had a 1% side-effect of death. I would be sorely tempted to take that "side-effect" risk as the lesser of two evils. The current IFR is much lower, making that vaccine much less tempting. I would want way more safety and effectiveness, but not sure how much more. Surely not at the usual standards where things take 10 years. So how much less can one settle for as an individual or as a country?

Cutting corners on the science is dangerous both because it can lead to people getting exposed and dying when they think they're protected and aren't, and because if there are safety or efficacy issues, it can cause long-lasting backlash against vaccines in general, leading to more deaths and suffering over decades. You already have crackpots making stuff up about vaccines, if you give them something real because you don't do things right, it'll be bad. From what I've seen, Russia is talking about a phase 1 vaccine that has been tested on hundreds of people... That's pretty bad science. Is the concern with the Russian vaccine: 1. Safety? 2. effectiveness? Safety: If the virus kills 0.6% people and the vaccine has dangerous side effects 0.6% of the time, you haven't really gained much at the population level. Effectiveness: OTOH, if its not truly effective, you will start being spikes in cases as people get infected. Its a loss of resources and credibility, but for a poor country it might be worth the shot that it does actually work well. Agreed it's not unto the usual standards, but in the current scenario everything is now a risk-reward decision in real time with limited information. Safety would probably worry me the most here. So Putin's injected his daughter to allay those fears.

Where is the data to support your argument that there were way above normal deaths in NY during that period? I can't find any data so I would be curious to see it. Since you seem to be making some strong claims, if you or someone else could bring me an updated chart of the one below, I'd really appreciate it. Of course I never said I'll be right and you are wrong. We are all here to figure this puzzle out. See Dalal’s chart above. Official sources are here https://www.cdc.gov/nchs/nvss/vsrr/covid19/excess_deaths.htm

I have been told this by 2 doctors directly. One of them actually mentioned a figure, like $35,000 per patient. So some death certificates are being mismarked in NY while reality is “normal”? Total deaths are also above normal. Is the state shooting those people and marking them as COVID deaths? If they are not shooting them, and everything is normal, then there are death certificates for people who are not actually dead? So these “undead” people are roaming the streets of New York, in apartments, houses, nursing homes etc? If the undead are everywhere now, is this the zombie apocalypse? Truly an alternative world. No one says COVID is normal. But you are intentionally twisting other people's words. No one ever said alive people were issued death certificates. What I am saying is that people died from obvious other causes and the state classified all these death as COVID death, inflation the total COVID death and trying to get more federal funding. But on the other hand, the media is accusing Trump for covering up the actual death count, which implies that the actual COVID death number is higher. Anyway, I am tired of posting here, as people are intentionally putting their words into my month, for whatever reason. I'll just keep quiet until the end of this month and see if the COVID daily new cases is sharply lower. Muscle, no you never said things were normal. And COVID deaths would be over stated if death certificates are fabricated. But there were way above normal deaths in NY during that period. In this train of thought (from your friends in ER) did those people actually die? I.e. was the rate of people dying normal or were there a lot of excess deaths?

I have been told this by 2 doctors directly. One of them actually mentioned a figure, like $35,000 per patient. So some death certificates are being mismarked in NY while reality is “normal”? Total deaths are also above normal. Is the state shooting those people and marking them as COVID deaths? If they are not shooting them, and everything is normal, then there are death certificates for people who are not actually dead? So these “undead” people are roaming the streets of New York, in apartments, houses, nursing homes etc? If the undead are everywhere now, is this the zombie apocalypse? Truly an alternative world.

So strip clubs are open and schools are closed? Interesting priorities, if true.

Thanks for linking this study. A 17 million sample with full medical history! Pretty good. I do hope that some of the results are statistical flukes though. So for example, smokers have lower risk than people who never smoked! But the worst off are people who smoked and quit. They have about the same risk as people who had cancer diagnosed 1-5 years ago! You know they always mention the reliability of confidence intervals (19 times out of 20). I hope this is the 1 times out of 20 you will get a fluke. It’s not unexpected in a study that covers >20 risk variables.

That is interesting. If one insurer tries to raise premiums to get better underwriting profits, it will only work if all the others do it at the same time. So this has to be either some regulatory rate increases or oligopoly where they all raise rates together. Do you know whats going on in the nordics? Reminds me of the Canadian banks. Can you give me some names of these insurers?

Yes. You succinctly captured the American spirit of individuality. As an outsider I had never realized it quite as starkly before this virus revealed it. Not all Americans are assholes. Although CoBF has a share of them. Apologies. Didn’t mean to stereotype and tar individuals or a country. No name calling intended. Even as an outsider the US is where a lot of my investments are, so the recent surge is worrying( though I haven’t sold anything). The consumer rebound could slow if they think its better for them to stay home. Doesn’t require a shutdown, just a change in risk perception. That will increase the cost to companies and the economy. Definitely my perception of the US as a country has changed, even if I cannot really explain it. It isn’t just me. See for example this unkind FT article: https://www.ft.com/content/95b9ee10-11be-4530-beb3-42b3ea7b5db0 It links this episode to the 1918 anti-mask league and back to the pioneer spirit, making all of this part of American tradition. Of course their words are hurtful : “the freedom to be stupid”. Greg seemed to say the same thing in his usual direct style. The anti mask league of ~100 years ago: https://en.m.wikipedia.org/wiki/Anti-Mask_League_of_San_Francisco https://www.influenzaarchive.org/cities/city-sanfrancisco.html# Trump wasn’t even born then. Nor was CNN FOX. But people were claiming that the law was unconstitutional even then. Makes one think there is a deeper link. I am not using this for any investment decisions though. Just seemed interesting.

Yes. You succinctly captured the American spirit of individuality. As an outsider I had never realized it quite as starkly before this virus revealed it.

1990 HongKong: Xinghua Port. No topic on this, so just posting in this thread. In case anyone else owns and thinks there is more upside here. Does anyone have an opinion on what price this will be sold at, if at all. Thanks.

Agreed about the multi-factor nature of this. From a science or engineering point of view yes those are low r-squares. You don’t manufacture a product based on those. But not rubbish in any field. Depends on signal to noise in that field. Low r-squares are accepted in finance, since any predictability “should” be competed away. And low systematic predictably can be exploited in portfolios which diversify the noise. See here, a r-square of 10% is deemed acceptable by the finance PhD from imperial college, for the standard and most famous model in this field , made by the guys who won a Nobel prize. https://www.researchgate.net/post/Fama_and_French_R-squared And using these low squares they run large asset management firms like DFA, and their former student runs AQR. Off topic, but then I guess this thread has rarely stayed on topic.

Very interesting analysis. Thanks for sharing. I had two thoughts when I saw the graph of deaths vs mobility. 1. A common sense explanation which makes me think there is causation here: you can tell people all you want that they should stay home and apart, but they only listen when the bodies pile up. 2. The r-square is ~50%. This is wonderful billionaire territory for financial market predictions and rubbish noise in laws of physics. Not sure where in the spectrum between rubbish and wonderful such an r-square is in “epidiomology”.

Uk talked about a study showing 1/3 reduction in deaths of ventilated patients a couple of days ago. Seemed like a big deal to me. Then I saw comments from people saying steroids are used regularly for inflammation, and this isn’t a breakthrough, but it is statistical confirmation that they work in this situation. I am confused. Any of the various doctors here care to opine? Does this advance the standard of care and save lives, reduce mortality, or not. PS: sorry if this was already posted and discussed up thread. I did make an effort to check but couldn’t even find the last post actually about the virus.

Thanks for sharing. He is very optimistic that the dance can be maintained at low cost indefinitely, until vaccines are available. If true, doesn’t this support the general market level now? The economy may function almost ok, barring some mass entertainment events which need >50/100 people together. Do you share such an optimistic view? Let’s say California and North east manage the dance, and the mid west, Texas, Arizona fail and need another hammer lockdown. How big an impact is that to the US economy?

The spread is now in Brazil and Russia. Even in India, despite an early lockdown, cases are spreading and they are considering opening up. Bill Gates was despondent about the chances of emerging markets to contain the virus. Seems he was right again.

Brazil is actually looking quite similar to the US now. Anti-lockdown protests, supported by the president. Health ministers have resigned. None of that in the US so far. https://www.japantimes.co.jp/news/2020/05/18/world/brazil-jair-bolsonaro-supporters-coronavirus/#.XsSXX8pE2hA Other similar places, people are defying the Venezuela lockdown because of economic hardship. In that country this means actually going hungry, instead of missing the rent check. https://www.bnnbloomberg.ca/venezuelans-defy-lockdown-and-growing-epidemic-to-return-to-work-1.1438393

Do you think they are over-earning overall? I took another look today after rb’s response. The net margin has risen from ~5-6% to 8% in the last 5 years, directly correlating to a lower combined ratio. And they have captured market share. The share capture is likely permanent, and will continue, as will the structurally lower expenses. But won’t the CR rise, lowering margins by about 2/8=25%? They would need their sales to rise 25% to overcome that, which could be couple of years if the current momentum continues, or longer if the momentum fades. In that case, the multiple probably contracts too. So you can have flattish revenue, lower margins, lower multiple. Pretty bad for the stock price.

Best of luck with the job. If compliance requirements are hard, before you join, sell anything you wouldn’t hold for the long term.

Thanks rb.