ValueArb

Germany's military budget has to increase, it knows this.

In Europe it's been made perfectly clear how tenuous their future is if Russia wins in Ukraine. That would increase the size of Putin's military by a third, Russia's economy by a similar amount, allow them to dominate the Black Sea and put a ton of Russian divisions and air crews 400 miles closer to western Europe. And Ukrainian aid passed overwhelmingly in both houses by roughly 80% yes votes. Some americans don't understand how critical this conflict and our future geopolitical costs that will increase if Ukraine loses (and how much better and safer the world will become when Ukraine takes back all of its territory). But I remain confident that most americans will understand this. Even DeSantis came around.

Ukraine isn't going to ever sue for peace and it's never going to be abandoned by most of Europe, esp UK and US. This is at least a 3-5 year war, and we need accept that and start training and supplying them with more modern weapons, including Abrams, F-16 and ATACMS. Russian's cannot fully replace modern equipment losses and won't likely ever be able to during duration of war. Their tiny economy was already in sad shape before the war. They couldn't build anything more than a handful of T-14 Armatas, or SU-57s in the last decade. Now with sanctions instead of having an Italy size economy they might be half that. And with much more diminished access to modern computer chips. They'll keep pouring in sacrificial troops and using massive amounts of ammunition, artillery and dumb munitions, but over time as the costs of war hit more and more families in Russia proper the inevitable mass street protests will begin. All the Ukrainians have to do is take back Melitopol and take out the Kerch bridge, and Crimea falls as trapped and unsupplied Russian troops panic and try to flee on the few available ferries.

In investing theree is no such thing as reversion to the mean, only reversion to intrinsic value.

I’m a value investor, so I can’t comment on “buy and hold” investing, as I don’t understand what that is. Concentration is a pretty simple concept for value investors. This means you understand how to estimate intrinsic value, only buy with a large margin of safety, stay within your circle of competence, and demand a moat or at least a catalyst. If you do those things not concentrating is an expensive mistake. This is because you should have no problem ranking investments in terms of likely returns and risk. So why would you put some of your portfolio into a 20th or 30th best idea instead of your five best ideas? You would be reducing your returns. And you would be increasing risk. The fewer positions you hold the better you know them and their risks. You will never understand 20 or 30 positions as well as you can 5 or 10. Volatility is not risk, but even if it concerns you volatility of an uncorrelated ten position portfolio is not much more than a 30 position portfolio. Lastly, if you don’t understand how to value well enough to rank, you should not be buying individual stocks. Nothing wrong with index funds.

Short homebuilders? How about commercial real estate instead?

Russia has been recruiting in Syria since last summer, it's not helping. Russia is much larger than Ukraine, but it's more and more isolated every day. Russia's GDP was smaller than Italy before the war started, now with sanctions it's likely far smaller. Before the war started their only aircraft carrier has been out of service for 6 years due to a series of mind numbing accidents and lack of resources. Their new "wonder weapons" like the Armata tanks and SU-57 super fighters only existed in a handful of copies despite decades of development. They started the war lacking precision guided munitions and used almost all of their stock within the first few months. Their space program is falling apart with nearly a dozen serious accidents or failures in the last five years. They have 10,000 tanks in storage but few of them are usable, most stripped and parts sold, and all of them well out of date. They can get more light weapons from China, more ammunition from North Korea, more drones from Iran, but they lack the manufacturing and technical ability to restore the stocks of their most advanced anti tank weapons, precision guided munitions, planes, helicopters and SAM systems. They were using western processors they've been cut off from and now they scavange chips out of washing machines. Russia will continue to feed poorly trained and equipped troops into the meat grinder as long as Putin remains in power. But without the abilty to stop HIMARS and other precision long range strikes, they'll be perpetually short of ammo and rolled up quickly once they expended their maximum efforts. I've said from the beginning this war would go on for years, the only way for Russia to "win" is for the US and Europe to let down Ukraine but so far we've done the bare minimum to keep them in the fight. Once Ukraine gets heavy western tanks and Bradleys in volume, they'll have the battlefield edge, and begin retaking more territory. Note the influx of new long range precision strike weapons, esp. hititng Mariupol. If Ukraine pushes through to Mariupol and we supply them with ATACMS or they built their own local weapon with similar range, Crimea becomes untenable for Russia. The bridge will be kept permanently out of action, the fleet will have to leave or be sunk at their moorings. They'll have no ability to supply their troops in Crimea with any significant volume.

Putin doesn't have the control that Stalin had in order to push out the changes the Russian military needs, and this is only an existential battle for him and his cronies, not for the troops, officers and country. Russian "soldiers" are untrained, poorly equipped and don't want to be there. Ukrainian soldiers are battle tested and fighting for their homeland and freedom. I think the massive advantage is on the other foot.

This is no different than the pronouncement that the war would last 4 days or 2 months last year. We've been waiting for the real Russian army to show up the entire war and it looks more and more likely that it no longer exists. I find it obvious Russia will boost manpower, I find it very hard to imagine how they are going to boost conventional munitions of any sophistication. They can't rebuild their tank force, the tanks still in storage are the worst of the worst and likely stripped by the Kleptocrats. They can't build advanced weapons without access to western technology. Unless we fail to supply Ukraine with enough munitions, they'll continue to relentlessly attrite the Russian forces. Soon with Bradleys (and Leopards) they'll dominate the remaining Russian armor. They are just receiving ER GMLRS and GLSDB can reach out nearly 100 miles and hit precise targets, forcing Russians to move their ammo and headquarters (again) even farther away from the battlefield and accentuating their issues with supplying front line troops. Lastly, the Ukrainians are smart with modern military leadership that gives individual units initiative and they desperately want to win. The Russians are trapped in a Stalinesque top down command system, and their troops are just trying to balance between dying on suicidal wave assaults and being shot by their own officers.

This site really needs a way to upvote posts.

As a shareholder, isn't this what you like to see? Stay out of favor and cheap to maximize your gains from the buybacks?

Brownfield Capital.

I haven't even started looking yet, I'm still doing everything through Interactive Brokers. But when I get time I'll be sure to post what I find here.

2026 $15 puts and $45 calls on INTC. It's either going to turn it around (unlikely IMHO) or it's going to burn through most of it's cash trying to catch up in fabs.

Thanks to all of you.

I will send you a printout of my brokerage account, it's full of them;)

I fell into a habit of playing poker in the afternoons. I made a lot of money playing poker and it cost me far more money in my investments.

I think there is a lot of skimming in that 500 pages.

At over 4% average interest rate, $31T in federal debt is going to cost over $1.2T a year in interest in a few years when it rolls over. And that assumes a balanced budget, at the last decade's average of $1T in annual deficits by decades end we'll be near $40T in debt. If inflation spikes rates again, interest costs could be well over $2T annually. So is a default inevitable by 2030?

I believe the widespread adoption of workplace air conditioning is what dropped Arizona from the list;)

I love conspiracy theories but I love applicable and convincing evidence even more. I'm still awaiting the evidence.

I demoed using ChatGPT to write code to our US mobile team at my company (a late stage Unicorn), and my managers concern mirrored Amazons. We don't want our proprietary code to get scooped up in its knowledgebase so for now he told us not to use it.

every dictator has a cost/benefits model in their head. If they see a worst case scenario for Putin end with him still controlling Crimea and Donbas they are going to be more likely to commit to their own invasions think the west will tire quickly like they did with Putin. this is all theoretical anyways given there is no way Ukraine is going to agree to any peace deal with Russian troops still in the Don Bas or Crimea. And now way should we end our support no matter how long it takes.

So I had lunch with my developer friend who is using ChatGPT and it was pretty enlightening. He has a chat setup where he shares his code with the AI so it can model how he does things. Then he asks it to generate boilerplate code that would take him hours to write for dozens of classes and it spits it right out for him based on the attributes of his classes that he's shared with it. Essentially he's using the tool to help automate production of the most time consuming but least intellectually challenging work. He still has to review and fix occasional errors but its saving him a lot of time. So what I learned is that you can customize ChatGPT in your own chat by giving it your data, and as it learns you can make it more powerful and useful for your problem domains. He's also setup a separate marketing chat where he's training it on all his products marketing documents and asks it to spit out marketing copy for his new release with emphasis on specific features he tells it. He said it reads great. He also said he'd be happy paying $500 a month for it. It's main problem is performance, its slow at time and sometimes he gets cut off for rest of the day because he's made too many queries. So this makes sense to me. It's a pattern matching tool with enough intelligence that you can train it to do tasks for you. The idea it's going to write code on its own or that the code it writes is going to be perfect quality are both ludicrous. I'm betting people are creating startups right now to leverage it across very narrow domains (customer support for plumbers, traffic court advisor, etc) where they can polish it by training it on specific better curated data to make it far more trustworthy in those domains.

This is how big crypto still is. The DOJ arrests a founder of a crypto exchange they claim did $700M in money laundering, and its so small no one has ever even heard of it. https://www.reuters.com/business/finance/us-treasury-dept-says-has-identified-bitzlato-ltd-money-laundering-concern-2023-01-18/