Saluki

@Morgan yes, that's the one. It had profiles in there of people from Seaspan, Scorpio, Frontline, and some of the other major companies, so it's a good one to get a feel for some of the players and their different strategies.

I’m in a Florida airport now. They have free water fountains (with paper cups to fight covid) and the .5 liter bottled water is $2.89 (generic)- $4.29 (Evian). charging twice that amount in a poor country is outrageous.

https://finance.yahoo.com/news/mexico-stocks-sink-government-alters-141758192.html Looks like all 3 Mexican airport operators got a surprise today.

That's a great question because if you really like something then you can find some historical valuation metric to justify your decision to buy. So for example, someone on this board has been heavily talking up a certain women's underwear maker. And you can look and pick out things like price to sales where it looks cheap. But other companies like Gildan (or even Hanes) are not getting beaten down as badly, so it's not that people hate the garment business, they just hate that stock. But if you look at something where the industry seems cheap by some valuation measure (or hopefully several), then you are not just buying a cheap company, you are trying to find the best value in the flea market. I think book value is not a great valuation metric for shipping, but if you see that they are all selling for much less than book, then you can find out if any corners of the market look promising, or companies that are making the right moves for shareholders by paying dividends, buying back stock, or paying down debt. The same goes for things in the energy industry where they have a history of buying more capacity or doing more exploration instead of returning money to shareholders. For each industry, identifying the turning point is different, so it's important to stick with what you know. In shipping, you look at the replacement order book vs the existing fleet. For things like banks, I don't know what to look at, so it's an easy "no" for me. I think most of these decisions will involve some qualitative aspect. Maybe gun stocks or tobacco (or autos besides Tesla) will always trade at a low P/E because people hate the industries, and in those cases you will hopefully find some that have hidden growth potential, like the vaping or oral tobacco, to grow into a good outcome since the expanded P/E multiple will probably not show itself. Buffett made a great deal on buying a Railroad, which he jokingly said is one those industries that has a bad century now and then. But if you look at WHEN he bought it, it's fascinating. RRs had been consolidating after a few went bankrupt and the government eased the rules that made it hard for them to increase rates, so that they could make money again and not rely on government subsidies. So it looks like one of those places where "theory blinds observation." If you are a person who has known that Railroads are a bad investment because it has always been for as long as you and your father, or possibly your grandfather, have been alive then you won't see it. If too many people put it in the unloved pile and it deserves to be there, then no problem. But if they are wrong about it, then it's running towards the goal with no one on the field.

I have some stuff in firearms (SWBI and a little VSTO), and a little tobacco (BTI). Shipping has been dead money for 10 years, but I have a mid position is STNG and a smaller one in NETI and a few shares in two other ones I'm still researching (KNOP and SFL). People hate oil, but VTS and OXY are mid sized positions for me, but I'm holding not buying more. People hate Chinese stocks and BABA is cheap now, but I'm down 50% on my position, so who knows. I think commercial real estate is being killed for good reasons, but a lot of it is oversold. HHH did a capital raise at $50 during the start of Covid and it's at $75 now. The pandemic is no longer an existential threat for them and they have some great assets, albeit with mediocre management that keeps changing at the top. So it probably doesn't deserve a premium, but this discount is a bit much. My Mexican cable stock, TV, is getting killed but on a SOTP basis it looks good, and the bonds were selling close to par last time I checked, so who knows about that one too. Fairfax India looks cheap enough that they are buying back shares. The Canada/India row is a nothing burger in the longterm.

I added a little NTDOY. Still building a position slowly when I get dividends or trim a little on something else.

In terms of fishing where the fish are, the small/micro caps are full of tons of junk with the occasional gem. It's like going to flea markets and estate sales. The volatility on these microcaps takes some getting used to, though. I have a tiny position in one that I am trying to keep track of until I decide if it deserves a bigger weighting. There was some minor good news this morning, but nothing that would make me want to buy more: https://finance.yahoo.com/news/taylor-devices-announces-first-quarter-114500081.html Within an hour of the open it was up almost 10%, then after lunch it gave up all its gains and was down 3.5% from the open.

This is a very easy and worthwhile read about the Glock pistol and how it went from zero to the number one handgun in the US in a few years, dominating police contracts and outcompeting rival like Smith and Wesson, Beretta and Sig Sauer who were larger and had been around for a lot longer. Glock was an engineer in a radiator factory who had a side gig making curtain rods, hinges, and knobs in his small machine shop on an old Russian metal stamping machine. He heard about a contract for the Austrian military and thought he would have a good chance of winning it because all the companies bidding for it were foreign. So he took out books from the library to learn how guns worked and started with a clean sheet of paper. He designed a gun with much fewer parts, and therefore had fewer things that would break, that was easier to make and cheaper. After getting that contract he set his sights on the US market at the perfect time when police wanted to move away from 6 shot revolvers to pistols with higher capacity magazines. With a US headquarters in Atlanta, near one of the largest strip clubs in the US, they would fly in police chiefs and give them strippers, booze, and envelopes of cash, they soon took over the police market. Along the way you'll learn about the tax cheating, the US executive who had jailed (and who may have been framed), and the shady Luxembourg fixer named "Panama Charlie" who hired an incompetent hitman to try to carry out the dumbest planned hit in history. There's also stuff in there about his friendship with Jorg Haider, the Austrian neo-fascist politician. I listened to it on Audiobook as part of my research into S&W, but it's a fascinating story even if you have no interest in this type of stuff.

The Koch family had no problem making their fortune building refineries for Stalin. Although Oil and Gas isn't as morally objectionable to most as munitions, what they did is more morally reprehensible than selling bullets to people fighting a Russian invasion. If you were talking about selling guns to North Korea or to rebel warlords in Somalia, then I would say that you are correct. But I don't think the line is as clear as it seems. I don't have any defense companies, but I do own Smith and Wesson. Guns are used by criminals, but they are also used by law-abiding homeowners to protect their loved ones, and Police Departments are very large purchases of S&W. I'm okay with it, but I can see why others would be uncomfortable with it. But in terms of "fishing where the fish are", Bruce Greenwald said that "unpopular and unloved" industries tend to be good places to find value.

@Jaygo I have a medium sized position in STNG and I had a medium, now small, position in NETI (I sold half). I had been jumping in and out of few where I saw it was cheap, but I'm currently looking for things that have a moat like Offhsore WInd (NETI) where you can keep compounding and not face new entrants or more ship building like drybulk or tankers. I have a very small position now in KNOP (shuttle tankers) and SFL, which has long term contracts in a little bit of everything, but is increasing it's Ro-Ro fleet. The business model of SFL reminds me of what Sokol was doing with ATCO. Roll-on-Roll off is an oligopoly, but the Ro-Ro only companies are expensive, and it's one of those specialty things which I hope is not wide open to new entrants. KNOP is an oligopoly with Teekay, and Shuttle Tankers can work work as crude tankers in a pinch, but not vice versa, which I hope will make them more resilient. I'm still digging into KNOP and SFL and I like what I see so far, and may add more, but it's a small position for know while I study them.

I've been adding slowly slowly to NTDOY. I also bought a small amount of CPNG and BTI yesterday. CPNG is trading at prices below what they were before their last quarterly earnings came out (which were awesome), so it's like getting more free bites at the apple.

Since I don't have a background in Shipping, I had to read several books to get comfortable enough to put some money to work and not be one of the "tourists" that gets scalped. Besides the excellent "Shipping Man" by trilogy and The Business of Shipping, a textbook by Breskin, I read Dynasties of the Sea, which has biographies of some of the CEOs of the largest companies. However, this book was recommended to me by @Packer16 when we chatted at the Berkshire AGM. I had heard of the book, but said that I didn't want to read another 800 pages, but he insisted it was worth the read. I have to say he was correct. It's very detailed with information on shipping cycles and prices, formulas and charts that you won't be able to find anywhere. The long view is definitely necessary to understand what is going on. In the same way that you can do fine in investing with reading Security Analysis by Ben Graham, you can do fine without this book, but like Security Analysis it will separate the pros from the tourists. The hardcover was $200 and the softcover was $100, but because I'm a deep value guy at heart, I picked up a used copy of the prior edition for $10. I don't think much changes in shipping, and since it covers shipping from the time of sails and the transition to steam power, I think it's got most of what I needed. If there is ever a third edition, it will probably cover the period in 2020 where ships were used as floating oil storage and the new vessels to install offshore wind turbines, or new green fuel vessels, but 90% of what you need is what never changes (fleet size, order book, spot vs contract, financing, etc). Highly recommend if you are interested in shipping as an investment, but for most people shipping is a terrible business so stay away

I agree. This goes back to Buffett's simple Rule number 1: Don't lose money. By way of analogy, most cancer research is into the complicated stuff like killing cancer cells, but not other cells, or keeping them from replicating. Very little research goes into prevention with things like healthier lifestyle. That is much more effective in reducing deaths from cancer because you can't die from it if you never get it. Rule Number 1. But if you spent years of your life doing complex science (or math), you probably don't want to work on the simple stuff. It's like how architects are obsessed with putting cantilevers into their designs. It'to prove that they are at a skill set above the guy who designed the extension your brother in laws house. It's hard as you add more and more tools to your tool chest to remember that you don't have to use them. Sometimes it's chipping away the marble, not adding more clay. I remember an MMA guy telling me once about how to win a fight. "If you're on the bottom, get on top. If you're on top, stay on top." It's not impossible to win if you're on the bottom and someone is dropping elbows on your head, but it's an easier path to victory if you are on top.

Kurt Vonnegut's son is a doctor and also a writer like his father, but not nearly as well known. This is an essay in one of his books that gives you something to think about. https://www.nytimes.com/2010/09/26/magazine/26lives-t.html The less-toxic mushrooms make you very sick right away. With the ones that kill you, you feel fine at first, and then a few days later your liver dies, and you follow shortly thereafter. Feeling sick as a dog and having sweat pour off me so soon after my meal was a good sign. It reminds me of Munger's quote about wanting to know where he was going to die so he wouldn't go there. I would guess the analogy here would be the less toxic stocks are the ones in secular decay (like Newspapers). It can look like something good, but end up being a value trap and you will slowly lose money every quarter but will be okay once you figure it out and sell, as long as you didn't eat a huge dose of it. The ones that kill you are the ones like Lehman which look like they are doing okay for years and something inside them is killing them, and when it's obvious, it's already too late.

Sold the NETI in my retirement account. Still have the shares in my taxable account. Bought a little NTDOY with the proceeds and the rest is sitting in cash.

Added a little NTDOY. Still a small position but building to a full position when I get cash.

I posted on the book thread about reading the John Neff on Investing. He killed the indexes when he ran his fund during the 70s and 80s, which had periods of very high inflation and energy prices. I wanted to see what strategy works best there and it turns out that, luckily for people here, what worked best for him was traditional Ben Graham value investing. He learned value investing in college from someone who had studied under Graham in Columbia. With energy companies, the best time was after a long bear market in that sector (check) and he felt that you should be strict about your valuation. If you sell on the fundamentals, it may still keep going up but thereafter it's just speculation and it can correct quickly. Oil has some supply constraints and unless we have a prolonged recession, I don't see it slowing down. Yes, China wants to decarbonize, so does everyone, but that takes time. Maersk just launched it's first green biofuel container ship. It's dual fuel because the factory that makes the green fuel that it needs is still being built so there literally isn't enough green energy to run it. I don't have huge exposure to energy, but I have midsize positions in OXY, VTS and STNG, and I plan to hold until everyone is talking about oil stocks instead of AI stocks on the news, then it'll be time to move on.

I'm not sure how it will play out in the US vs the rest of the world. If NIMBYism or a lack of appetite for federal and state subsidies in offshore installation aren't around, then I don't know if anyone will be willing to build ships in the US, to comply with the Jones Act, which will be large enough to install the new generation of larger wind turbines. The larger wind turbines are more effecient, which makes them cost effective, but you need new bigger installation ships. If the ships aren't built, you are stuck with smaller installation ships, installing less efficient smaller turbines, which makes the project less attractive and less likely to be built. it's a chicken/egg problem. ENETI, just got a big 2027 contract for a ship that won't hit the water until 2025. And I don't think this is because the people overseas are doing that much more projects. It's because there are bigger offshore turbines being built and the fleet order book hasn't kept up. https://finance.yahoo.com/news/eneti-inc-signs-vessel-reservation-115400557.html With mobilization commencing in the first quarter of 2027, the contract will be performed by one of the Company’s two NG16000X Wind Turbine Installation Vessels currently under construction at Hanwa Ocean in South Korea. Inclusive of mobilization and demobilization, the engagement is expected to be between 210 and 245 days and generate approximately USD 87 million to USD 100 million of gross revenue. Project costs are expected to be USD 15 million in aggregate. Someone one here had a post pitching GLDD. It looked interesting but I couldn't get comfortable with a company that is reliant on relationships with state/local governments. I've since come to appreciate the moat in specialty ships like Ro-Ros or Shuttle Tankers, or Offshore Wind Installation, so maybe I'll take a look again.

Well, my understanding is that the tax loss / wash sale rule applies if you are planning to buy/sell the same securities and try to declare a loss on it (not a gain). Assume you have, say a $10k loss on stock A, which you sold, and a $10k gain on Stock B, which you own. Why can't you sell Stock B and buy it back it back right away? You have the stock at a new higher basis. If I sell, AMZN today (for a profit) and I buy it back after it goes up tomorrow (or down), I don't see anything weird in my brokerage account. My broker only does weird things to my basis when I sell for a loss and buy it back within 30 days. I should add that I'm not a tax guy, so if I'm wrong about this, please let me know.

@Fundmanagerthrwawy they came out with a reprint of the original. It's called Security Analysis The Classic 1934 Edition.

I read most (but not all) of my first copy of Security Analysis (5th Edition). The formulas printed on the front and back inside covers are useful, but the book itself is just okay and it was a slog to read. I had a post it with the chapter numbers in the back and I would cross off each one as I read it. It was like a chore on my to do list. The writing is mediocre. Just as a camel is a horse designed by a committee, when something gets edited too many times, it's the book equivalent of a camel. I bought the 6th Edition of Security Analysis and I like the essays at the beginning of the chapters by the different value investors, but I still wouldn't put at the top of my list of recommended books to learn about investing. I have a copy of the original 1934 edition, that was reprinted and has been sitting on my shelf for years, and I finally got around to reading it. I'm about 100 pages in, but I have to say that I like it a lot better than the modern editions. Graham is a good writer and his examples of the same stock at different points in time with wildly different values is so useful that people still use it today. One of the things he's known for is having a basket of net-nets. People often asked if he could've gotten a better return by focusing on a select few which did well, instead of buying a large basket and not doing a lot of digging. It's not laziness that led him to the approach. He used a great analogy about a roulette wheel where the odds are 18/17 in favor of the house. If the odds temporarily tilt in your favor by the same amount, then what is the best strategy? The winning strategy is to bet on every number, and every round you will pay out $34 and get back $36. Any strategy that differs from that will lower your return. If you make a large bet on one number, you can lose everything if you guessed wrong. That analogy is remarkable useful for thinking about investing vs the SP500. Like a roulette wheel, the index has a small number of winners that had a huge payout (Google, AMZN, AAPL) compared to the rest of the market. The index is betting on every number in the roulette wheel. It's a huge advantage you would have to overcome to beat it. The outcome in roulette is chance and unknowable, which is why the index is your best bet. In Graham's time, it was hard to ferret out information about individual companies, so the returns would be the same as if they were random. Now we have an incredible amount of information available, but the advantage of knowing that you are betting on those 500 companies and you already own all the future big winners is something to think about. A 90 year old book isn't on most people's reading list, but going to the original sources is a lot better than getting watered down retellings.

Uranium is hard to understand. Apparently there are ways to change the way you refine it which can affect the available supply. People don't disclose how much they have so although he thinks there is a shortage coming, it's hard to tell. And there are non-economic reasons that people move away from Nuclear, like the Fukushima accident and ESG. Although nuclear doesn't produce greenhouse gasses, the greens in Germany shut down their relatively new nuclear reactors, and when they didn't have enough electricity, they turned back on their coal generators. They now have the dirtiest air in Europe except for Poland. Putin has made a claim that Ukranians want to bomb their own nuclear plant to blame Russia (which is something that Russia usually does before they do it themselves and blame Ukraine). If, god forbid, there is a nuclear incident in Ukraine, which has more reactors than Chernobyl, you could easily see other shuttering their reactors due to public pressure.

First Jones Act compliant offshore wind service vessel being built for Ostead profiled on CBS. Video about an offshore wind farm on the East Coast US. Marine Money video with two companies in the offshore wind space. Some of these videos on Marine Money or Capital Link with the largest operators in the shipping world have only a couple of hundred views, which is why I think a lot of these shipping companies still have room to run. Everyone hates shipping and no one is looking at it, they are throwing money at AI and other nonsense. I think Bruce Greenwald had a good point about looking at overlooked and unloved areas of the stock market. I have a mid size position in STNG and NETI and a couple of very small positions in two other shipping companies that I'm studying.

Sold a little ATEX and added to NTDOY on the dip. I still think ATEX is undervalued, but when I bought it I decided to give it 3 years for the thesis to play out. So I'm selling the stuff I bought 3 years ago for the tax loss harvesting and hanging onto the rest that I bought later at lower cost. I may buy it back later if they get more business, but utilities (their customers) move very slowly.

I'm about half way through this book and it's a really interesting read. It's a look at business development through the lens of biology /evolution instead of the standard mathematical/physics model. A lot has been written in the past 20 years about "behavioral economics" and how it doesn't fit with the classical "rational man" narrative in most economic models. This book was written in 1990, but he cites a study done in the 1980s where they analyzed the articles written for The American Economic Review and found that 1/2 of them contained no data at all, just mathematical models. Another 25% contained data that someone else gathered. Only 1% analyzed data that was gathered by the writer. While no biologist would publish books and articles without ever going into the woods to see what he was writing about, I don't know of any economists who have made field trips to a factory, an oil field, or a shipping port. Economics was born in the time of Newton, not Darwin, but the current mania with math and physics may be an attempt to give the field legitimacy. Taleb says that majors like "social science" and "culinary science" are BS, because you don't need to call a real major "Physics Science". It's a marketing thing. So maybe the emphasis on physics and math instead of biology isn't just marketing, but it's also wrong. The advancement of technology and the competition in business have more in common with biology and evolution than they do with physics. Concepts in biology like genetic drift (why Australia has so much strange wildlife) and Silicon Valley and it's culture are easier to form an explanation for than anything we can come up with in math. Niches in an environment that give one species an edge feel a lot like moats. Looking forward to the rest of the book, but if you are looking for a book that is not usually talked about but has some interesting ideas, this is a good one.