ValueArb

I wonder if he is as bothered by the lack of focus and investment in non core low moat assets (ESPN, Hulu, streaming) as I am? if I owned Disney all I would want to keep is content production and the parks, and focus on quality over quantity. It’s likely I just don’t understand the business anymore since everyone wants to do the opposite of that.

nobody owes Ukraine anything. nobody owes Finland anything nobody owes Sweden anything nobody owes Poland anything nobody owes the next domino anything

Buffett was never a long term holder until his portfolio got too large to nimbly move in and out of positions. Before that he spent 20 years as almost entirely a value trader, and those were by far his highest return years.

if Putin wins in Ukraine, he becomes an existential threat to Europe. He’s been moving one country at a time for a long while. and the performance of the Russian military has been far better than their performance in 1941, and they ended up winning that war. Russia is enormous and deep with resources. They can easily replace their losses ten times over. Europe is massively wealthy, can easily afford higher energy prices AND to aid Ukraine. Especially when France and Germany have barely contributed so far.

SRG, my favorite net-net at two thirds book value. 30% of my portfolio now.

I’m still waiting for the first business to be built on the blockchain. Hard to imagine 30 years is going to be enough time to see a much wider adoption of the worlds slowest and most energy intensive public database.

if higher energy prices ends European support for Ukraine, we should just negotiate Europes complete surrender to Putin now. Can you imagine Churchill telling Parliament, “We shall fight them on the beaches, unless gas prices exceed 25 cents per gallon as I have an election to win!”

ChatGPT is terrible and its based on a type of "AI" that is a dead end that will never work for the vast majority of serious applications. To the first point, I'm a software engineer and i've seen code its generated, and its basically a templating engine. It is entirely useless for the work I do. Anyone who has used it for other tasks realizes it's "confidently wrong" in far too many use cases. To the second point, Benedict Evans said it best. :

Twitter can't go bankrupt. Elon isn't going to throw away $44B by refusing to put a couple billion more in every so often to keep it afloat. Plus burn rate has to be dramatically lower given no one even works there anymore. Elon will find a face saving way to step away and have someone else run it at roughly cash flow break-even until he can find someone to buy it (the Saudis?) for $20B or so.

I have no idea where the bottom is, but my experience is in years where the stock market has done very poorly there is a lot of people taking tax losses at year end so the market doesn't really have a chance to rebound until the new year.

There is a free $4B for the taking if they tender enough to bring GBTC up to NAV. The question isn't why they haven't done it already, the real question is why haven't they announced they are closing GBTC and everyone is getting bought out at the current $8 price? That's a free $4B for the promoters, unless their books aren't quite correct. I had a straddle on the bitcoin miner MARA last year, I read their 10k and saw so many red flags this is clearly a scam so I bought $7.50 PUTs. Then I built a model of their revenues were they to complete their buildout over the next 2 years as they proposed they'd have an easy $200M a year in highly profitable revenue, so I bought $45 calls thinking I don't know what is going to happen but it's definitely going in one direction or the other. Today MARA is at $3.80. Alas my options expired worthless in january and I stopped looking at it until today. I was shocked to see revenues in most recent quarter dropped YOY from $51M to $13M. It wasn't just the drop in BTC price, but also the mining rewards getting halved. And even worse, their hosting and electricity costs were $14M last quarter, so they lost money on mining before $12M in G&A and other costs! The one thing I hated about how they ran their business was how they never sold any of the BTC they mined and not only that they borrowed to buy more. Their business value is entirely correlated to BTC pricing and they doubled down with leverage on that. Well today they are hemorraging cash, running low on BTC and cash and drowning in debt. They look like just a few quarters away from Chapter 11. I imagine we'll see quite a few miners folding up tents soon, basically the leveraged ones, clearing out space for those who managed their balance sheets conservatively.

They definitely added some effects, but the words are hers. One small segment of the market will be twice the entire market size in 8-10 years. Assuming the capitalization of the total market grows at a 10% growth rate over that period "disruptive" companies would go from 10% to roughly 80% of the total market cap! Non-disruptive companies would lose 50% of the market cap. So Apple, Coke, Berkshire, all bankrupt! To quote the famous criminal psychologist Silberman from "The Terminator", SILBERMAN (excited) This is great stuff. I could make a career out of this guy gal. You see how clever this part is...how it doesn't require a shred of proof. Most paranoid delusions are intricate...but this is brilliant.

We are at war. We are using our extra inventory in the right place, while keeping more than enough for any reasonable risks that appears.

I think my home value went up 30% because rates went from 5% to 2.5%. I doubt home prices will continue to rise if mortgage rates keep increasing.

If rates double from 2.5% to 5%, the cost of the mortgage doubles. Because the cost is the interest paid. Your payment might not double because your principle payment doesn't increase, but that's just forced savings. A 30 year $240K loan at 2.5% has a $948 payment, $500 in interest. At 5% it's a $1,288 payment, $1,000 a month in interest. Not only does the higher loan cost nearly 40% a month more, but you are building equity far slower. And if you have a 5 year fixed, good luck on getting a rate anything like you got in the last 3 years when you refi.

I can't move until my kids go to college (and then I'll be likely forced to downsize). So my Apples to Apples comparison is that the house I sold is going to cost me over $52,000 a year in interest + taxes now instead of the $35,000 it would have cost when I sold it end of 2020. Assuming I could buy it back for same price. 6 months ago I got a new job at my highest cash comp ever, and a couple weeks ago they increased it 15% due to "market adjustments". I'm an outlier making 25% more in 2 years yet still not close to the 50% cost increase my old house would be at its sale price. And assuming that it would even sell for that (I often wonder if I missed out on another 10-20% in appreciation selling in December 2020 instead of waiting 6 months, would have made divorce even more tolarable). A couple that decides to move from NY to FL is also a year late because the cost would have been far lower last year. Moving from expensive to cheap and downsizing your home will always make sense. The problem is the 95% of the buyers just trying to buy a house where they live today now can afford a whole lot less.

Lets not forget that AMZN dropped 95% after 1999 and didn't get back to even until 2009. Even when you see the far future correctly, the volatility can make it impossible to hold on to your bets.

How much does a 10% increase in wages help when mortgage rates just doubled?

Whats the total of outstanding loans against BTC?

I really think this could be a -50% year for the S&P 500. Odds of it happening are probably only 1 in 5 but right now the Fed can't get any handle on inflation and their target interest rate levels have to be increasing with every lousy monthly report. 1972-1974 inflation grew from 3.3% to 11%. Dec 1972 to Sept 1974 the S&P dropped from around 800 to 350. The big difference is that interest rates were already 6% (Ten Year Treasuries) and only rose to 8%, so market didn't really think inflation was permanent then either (and rates came back down). They didn't blasted off until 1978 peaking at 15% in 1981. So far this time inflation has from a lower starting point (1% to 8.5% in two years) and they have increased interest rates a little faster (0.5 to 3% vs 6-8%). And the Fed knows history, so they should get a handle on this much quicker. In 1973 the Fed was also dealing with coming off the gold standard, so they had no experience with what was to come.

Yes and just separating out inflation is a problem as well. Increasing prices 7% last year might have added more than 7% to earnings. Schiller's formula does attempt to adjust for inflation, but given I just got a 15% "market adjustment" raise 6 months into a new job (that started me at my highest salary ever) makes me wonder how accurate our current inflation measures are. Edit for clarity: Schiller is also using ten year earnings so it might be less accurate when earnings are growing faster than usual. For example if the typical decade doubles earnings but the last decade tripled them its average earnings will be significantly lower than its most recent year than the typical decade. Given how much S&P profit margins have increased the last decade thats a possible issue.

Not sure why Jack Dorsey doesn't agree to a series of transactions with the owner to trade it at every higher prices to keep the NFT Ponzi going.

I've been listening to their podcasts and they've apparently added a lot of capital over the last few years. I've never heard them discuss returns though. As curious as I am I like that they aren't pumping their services by claiming outsized returns.

When I first started to believe value investing could work I encountered Whitney for the first time. After reading his crap I began to wonder if I was wrong.

First let me start anecdotally. We saw it in PCs, that market has been zero growth or shrinking over the last decade, but in 2020-21 showed huge growth for a year. This quarter they are all (except Apple) shrinking again. Car manufacturers can sell whatever they can make, as can chip makers. Now for actual facts, total EPS for S&P 500 in 2021 was the highest in history and it's not close. About 40% higher than in 2019. https://ycharts.com/indicators/sp_500_eps