matthew2129

Aren't credit ratings explicitly just an assessment of the issuer's ability to pay contractual interest and principal when due? If they were rating "real" returns then shouldn't Berkshire's and Microsoft's bonds with coupons of <1% issued in 2020 be getting downgrades?

+1

The whole FTX debacle is just another prime example of why we need start bullying nerds again

I know that fridge, it is a fine fridge, but I would never pay over $45 for it personally

Aren't they explicitly not selling any and just allowing current holdings to runoff?

Hopefully for a while, though over the long term combined ratios have been strongly correlated to interest rates

Today's 4.08% intraday high on the 10yr yield felt an awful lot like the top

UMG starter position

Popping stocks, dropping yields and tight credit spreads didn't do much for inflation during the 2010's decade

Also unloaded some more ATCO to move into more compelling opps. Given how badly smoked most shipping comps have gotten since the original takeover offer was made, I'd be pretty shocked to see a raise at this point. Market price still a tiny bit above the offer price so who knows. Would probably be trading with a $9 handle today if not for the offer

JOE and MSGE adds

Ironic part is that Grantham was calling Nasdaq a "super bubble" in January 2021 while simultaneously being very bullish China and emerging markets. Since then, Nasdaq is almost exactly flat and China is down 50%. And now dude's taking a victory lap. Go figure.

0% inflation in July and real time CPI indicators suggesting we could have moderate deflation in August. Seems like a reasonable time for a bit of a pause . But Volcker fanboys still want to make us pay for the sins of our past and show inflation who's boss.

As seen on twitter:

Completely agree. 30 year fixed mortgage rates in the 5-6% range while the 30 year forward inflation expectation is at 2.2% is not cheap. Same goes for high yield in the 7-8% range while the 5 year forward inflation expectation is 2.3%. Think inflation expectations are wrong? Then go bet on breakevens. But comparing YoY trailing inflation to the current Fed Funds Rate is completely missing the point. Nobody buys groceries, gas or real estate at the Fed Funds Rate.

More NVR. Looks like the just authorized an extra $500M to their buyback program: https://www.prnewswire.com/news-releases/nvr-inc-announces-share-repurchase-authorization-301599264.html Weird that they released this in the middle of the trading day. I wonder if they meant to release at 1pm Pacific instead of ET?

The risk is that in 2 years from now interest rates are back to near zero and interest income is back in the toilet along with it. When you have long term liabilities, investing in long term assets that you can hold to maturity is not a real risk imho

Idk what the amateur central bankers are saying, but JP and the Fed have been clear in their releases and press conferences that they view the neutral rate to currently be around 2.4-2.5%....

Would have liked to see them nibble on long term bonds and extend the duration of the portfolio during the q2 spike in rates, but oh well, guess you can't teach an old dog new tricks

Yet what you describe is the exact opposite of a wage-price spiral: Which one is it? Everyone loves to cite the risk of a "wage-price spiral" b/c they heard it happened in the 70s and ignore the fact that the majority of sudden and steep rises in inflation over the last hundred years were followed by equally sudden disinflation (and sometimes even outright deflation).

I wouldn't be at all surprised to see YoY inflation drop below 2% by May 2023

NVR with a nice earnings beat today and hefty 20% rise (on dollar basis) in their backlog: https://nvri.gcs-web.com/news-releases/news-release-details/nvr-inc-announces-first-quarter-results-14

NVR and LOW....housing market pullback be damned, I'm here for the buybacks

A growing number of in-person and online shops are starting to accept USDC. It's really a no-brainer from the merchant perspective; it's certainly better than accepting credit. Once USDC is ubiquitous, fiat off-ramps won't be necessary. Don't think we're far away (couple years, not decades)

Started positions in DIS and CPRT