Dinar
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Posts posted by Dinar
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2 hours ago, Spekulatius said:
@alwaysinvert Thanks for the fantastic background on the Swedish real estate crisis (if it’s even that). Seems quite similar to what is happening in Germany. It’s mostly an issue with valuation and financing due to rising interest rates. Vonovia $VNE.DE (German real estate co) has a debt to EBITDA of ~16x which seems similar to Castellum 14x. It very high but both have no issue with the asset themselves with virtually all the real estate occupied (Vonovia is at 97.5% occupation) and rising rents, some of which are rent controlled too. VNE also has most financing done via unsecured bonds because they are investment grade.
So, what is happening in Sweden plays out in many countries in Europe almost the same way, I think.
Spek, isn't the issue with Vonovia that they cannot push through the energy increases that they have experienced (as much as two months of rent) and also places like Berlin trying to confiscate the property? There were accounting issues too I believe with Vonovia - capitalizing a bunch of expenses, etc... Do you like any of the German residential plays?
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6 minutes ago, Castanza said:
Question for those who live in NYC: Has the city ever been accommodative to middle class life? I've always been under the impression that cities have always been a breakdown of the following three classes
- Poor people who embrace the shit life in the projects.
- College kids who are there to party, intern, and network
- Rich people who have the means to full
Has it ever been accommodative to middle class life? Whenever I see someone complaining about not being able to make it in the city as a middle-class or even upper middle class person I think they weren't realistic with expectations (lifestyle and budget).
Sure. First of all, there are different neighborhoods - West Village is 10x more expensive than say Staten Island or Bay Ridge. Yes, for decades you could live on a middle class salary in Bay Ridge, Bensonhurst, Flushing, Riverdale, et all. Recently, immigrants from Tajikistan, Uzbekistan, Egypt, Yemen, et all made Bay Ridge and Bensonhurst very unpleasant. In the 1970s of course, housing was very cheap all over the city. Riverdale is still quite cheap, so is Inwood.
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1 hour ago, crs223 said:
China is a strong country and it is getting stronger, both financially and militarily. This is very upsetting to the US and many Americans.
Attacking Luca as a communist because he doesn’t share your hysteria to Chinese atrocities is disgusting, IMO.
How wonderful it is for the Chinese that we are caught up calling each other communists/transphobes/etc instead of doing anything impactful.
I did not call Luca a communist, I said his behavior reminded me of communists in the West who were busy praising Soviet Union, yet would never move to the utopia and preferred to live in the West. The word that you are looking for is called a hypocrite - Luca thinks the West is awful and China is great but prefers to live in Germany rather than in China.
China will not succeed and implode inspite of its hardworking population. Here is what will seriously damage China:
a) The West and the East (Vietnam, South Korea, India, Japan, Taiwan, Philippines, et all) all recognize that China is an enemy and will treat it as such. China has no allies, (perhaps with the exception of Pakistan), only enemies. Russia hates and fears it. Nobody likes China.
b) Chinese demographics are awful, probably the worst in the world.
c) No Chinese is safe in China, anybody who is able to accomplish something can be a billionaire today and in jail tomorrow. So the best and brightest are fleeing China. How many people have left HK? How many people leave China every year? How many people would leave China if given the chance?
d) Chinese science is awful and cannot improve in a climate of fear. What have the Chinese invented in China in the past fifty years? Sure, scientists of Chinese heritage have invented outside of China, but in China? China killed a doctor that wanted to blow the whistle on Covid-19!
e) Their leadership is even more moronic than in the West. Look at Mao, look at the one child policy, look at Covid-19, look at crackdown on Jack Ma. What have the Chinese leaders of the past ten years accomplished?
Yes, the West is mired in awful infrastructure, terrible politicians, idiotic debates over mental illnesses (transgenderism) and necessary but ill-thought out environmental transition, as well as other insane proposals - MMT, universal basic income, reparations, abortion bans. Yes, we have ethnic tensions. Yes, US and Western Europe should have never invaded Iraq in 2003, and never bombed Yugoslavia.
However, we can vote the bums out - New York blossomed under Giuliani and Bloomberg. US can blossom under Lee Kuan Yew type leader. China has burned bridges and will continue to burn them as long as President Xi is in power. It is easy to destroy, hard to build. Who will ever trust China again?
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7 minutes ago, RichardGibbons said:
I think it's pretty clear what side of the line Luca is on. He sprouts poetic about China's glorious achievements, and his only concession to the other side of the coin is that genocidal camps imprisoning a million people are "absurd". Rather than, say, "horrific", "atrocious", or "horrendous".
There's no doubt whatsoever what side of the line he's on.
That said, there's lots of people who support the horrendous, and it's convenient for us that Luca is so transparent about his passion.
He reminds me of a lot Communists in the West who supported the Soviet Union and communism but preferred to live in the West. He claims to live in Germany and yet admires China so much... He pisses on NY subway (which does deserve scorn) and his praise of Shanghai metro reminds me of Soviet metro, yet everybody who can tries to leave China and immigrate to the US, the reverse I do not see...
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1 hour ago, Luca said:
Ill try to take chinas viewpoint from here:
That's not proven and speculation to be fair. They did not ,,unleashed,, it, at least there is no 100% hard evidence for it.
I posted in the china thread that the US would never be in the position it is now without intellectual property theft. It is very true that Chinese try to get access to industries and try to copy existing technology to increase their own exports and wealth. On the other hand one can have a debate about IP and how legitimate current IP legislation is. This could perhaps explain the view of china:
,,The World Trade Organization proposed new, enhanced intellectual property rights, patent rights, which means monopoly pricing rights, far beyond anything that existed in the past. In fact they are not only designed to maximize monopoly pricing, and profit, but also to prevent development. That’s rather crucial. WTO rules introduced product patents. Used to be you could patent a process, but not the product. Which means if some smart guy could figure out a better way of doing it, he could do it. They want to block that. It’s important to block development and progress, in order to ensure monopoly rights. So they now have product patents,,
It was the only way for china to get where they are now with state directed economic policies that actively interfere in industry, cut off foreign markets, support local industry etc. Otherwise they would still just be a US manufacturing Hub of above described militarized monopolies. Also: Some industries just cant be spawned by itself, TSMC was state backed, Airplane production was partly state backed.
Also not fair to say.
So you suggest to completely cut contact with 1.5b people and the second biggest economy in the world?
Dude, when you say that Covid did not originate in China and the China is not helping Russia in its war against Ukraine, you lose all credibility. And yes, better to not deal with China at all from the perspective of the civilized world (South Korea, Japan, Taiwan, Australia, New Zealand, Europe, USA)
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35 minutes ago, Spekulatius said:
Not in satisfactory quantity. How are they getting it to China? By train or truck through Siberia? Building pipelines will take a long time and likely wont suffice.
Also how would Russia or China defend supply chain that is a few thousand miles long?
What do you mean how will they defend it? Are you proposing that we bomb Russia as well?
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1 hour ago, Spekulatius said:
I agree on taking a flyer on chinese stocks as a trading sardines. The shorter the trade the better. Any fighting in Taiwan would destroy the TSMC facilities anyways - they are complex systems and even just damaging some utilities or supplies makes them unusable.
The secondary effects of an attack on Taiwan on the AUS economy will be terrible, but China will be destroyed by the subsequent blockade of all goods coming in or out of China. No crude, raw material , food will get into China unless the US allows it. China has no means to counter an US/western lead sea blockade. The Chinese Economy will basically turns to rubble and hunger breaks out.
I guess they can try the nuke threat. No good other option left. Or maybe get rid of Xi and the CCP and try something else, if it comes to that.
Actually, China can get everything it needs from Russia in terms of raw materials
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@Luca, you ask why China is pressured so much? Because it is an enemy of the West. It unleashed Covid on the world (let's not forget, you could not travel from Wuhan to the rest of China, but you could fly abroad), it steals intellectual property everywhere, it engages in mercantilism and destroys foreign industries via domestic subsidies. It is helping Russia in its invasion of Ukraine.
The best thing for the West & Korea/Japan, is not to deal with China period. No imports and no exports. No intellectual property transfer.
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24 minutes ago, Luca said:
If i would bet on a society and economy that will be world leading in a decade id bet on china, as problematic some things are. Owning a strong business that is playing both in china and globally is still a really good position.
This has to be a joke right? Everybody who can is fleeing China, it has insane demographic and water problems, capital is fleeing! What a recipe for a success?
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1 hour ago, Spooky said:
Article in the FT with Bullard saying he is open to still raising rates as insurance against inflation. He is one of the more hawkish members and the top of his range is "just above 6%". If true, it still doesn't seem too bad to justify all this doom and gloom.
It was pretty obvious back at certain points in 2022 that sentiment had diverged significantly from reality towards pessimism, reaching levels last seen during the financial crisis. Unless something else breaks here (big if) it looks like the bottom has already happened and the stock market has bounced back pretty well this year. There is still also a tonne of institutional money sitting on the sidelines.
All that being said in a recent podcast Sam Zell said if he was at the Fed he would raise rates by another 3 or 4 percent....
Yes, but why did he say it? I think Sam was sitting on a mountain of cash and if rates are up another 3-4%, then perhaps massive bargains in real estate?
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@RedLionand @CorpRaider, why wouldn't you buy ALX instead?
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1 hour ago, dealraker said:
change, in the late 1990's we had a connection such that we got little Jimmy Rogers formerly of Quantum/Soros to come right on down here to little Lexington, NC to our investment club meeting/seminar (we had others too). Jimmy was big into commodities, he'd just set up his own commodity index fund. Riding that motorcycle all over the world too...he was hot! On CNBC...again from all over the world once a week or so. The global thing was on his mind.
We, the club that is, were towards the end of a 10-year run of holding almost all tech stocks...so you can guess how much attention we paid to Jimmy or anybody else. Baby, we were crusin' high...and getting kind of well-known around these parts, you know the Beardstown Ladies type fame. By 2000 our ten year annual was 35%, yep thirty-five percent a year for a full decade!
By 2001, later on in 2001, you probably guessed correctly that we'd blown-up our portfolio, ended up barely beating Mr. Market. Jimmy had too blew a fuse I think. Jimmy today? He's out selliing that commodity thing again! He's old school now, not in the high profile CNBC guest mode/status any longer.
Hotshots all around, interesting to me as to which ones you choose to post about and follow. What's making the ones you follow and post about more attractive than others? We had a guy (we have some mega wealthy club members) associated with Dalio come to the club a couple of years ago. Of course you know that story, it was China. But we only had a couple of members with any interest in that - at least for the club.
I spoke with Jimmy a couple of times, once he came to lecture at my school, and it was a small turnout so I got to talk to him for half an hour, incredible for me in 1998 I think, the second time was he was having dinner with his wife, my friend and I were sitting a couple of tables away, and I came up to say hello. He offered us to join him, and it was a very interesting conversation (for me at least), that must have been 2003-2005 time frame. Very interesting character.
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55 minutes ago, Sweet said:
Think you should ask that of yourself.You are being rude.
John is very emotional when it comes to the Russia/Ukraine war, and like many people immediately gets angry when he hears something that he disagrees with. I know quite a few family friends with whom I avoid discussing the war since I don't want to get into a fist fights. People cannot separation passion/what they wish would happen, from reality.
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As the population ages, and it is harder to climb stairs and drive, cities look more attractive, most of my parents' friends would move to Manhattan tomorrow if they could afford it.
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14 minutes ago, james22 said:
And if you get Giuliani 2.0 from 1990, then could it all magically come back?
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@dealraker, Sir Chris Hohn at TCI is incredible.
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27 minutes ago, John Hjorth said:
To me, you appear here to be too kind here, @dealraker. With all respect for @TwoCitiesCapital as such, who has compounded consistently over longer periods of time in gold and bonds?
The argument posted above is invalid, unless you're a trader.
Which brings up the next question : Show us a long term really successful trader, or even better more than one.
I will show you two (which are the exception that prove the rule) - Soros & Druckenmiller
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45 minutes ago, Spekulatius said:
More like the magnificent seven.
I prefer the Seven Samurai
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30 minutes ago, Castanza said:
Curious what you’ve looked at in Italy? Hard to look past the terrible demographic and economic trends in that country.
France, UK, and Germany all had some interesting plays during the covid crisis. Particularly in the REIT/property markets, but haven’t looked any further since.
I own Campari in Italy.
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7 hours ago, Luca said:
I should have specified, of course we have millionaires that live paycheck to paycheck. What i am talking about is that
1. 15% of the US population lives in poverty, this number didnt change since 1960 (bottom should see rising of living standards in a working capitalistic system)
2. Capital flows have been hugely distributed upwards since 1975 (https://www.rand.org/pubs/working_papers/WRA516-1.html)
Same counts for my homecountry germany btw, end of the 1980s the average DAX-30 Manager made 14x of the average worker, today it is 50x.
These people are not as poor as someone in a Kenia Kibera Slum but the numbers do show that the average workers has been hugely disadvantaged compared to the capital the US generated over the last 50 years.
You do realized that these statistics do not reflect reality.
a) They do not take into account cash income - hundreds of thousands of people in NYC get cash income - doormen, nannies, handymen, hairdressers, waitresses, construction workers, porters, cleaning women, dog walkers, et all. Friend's nanny gets USD 65K a year in cash, yet her official income is zero. Millions and probably tens of millions of people in the US have very substantial cash incomes that never get reported, and mostly at the bottom of the official income distribution.
b) They do not take into account income redistribution policies - Medicaid, food stamps, welfare, section 8 housing, and so forth
c) Assuming 50 week a year job, and 40 hours per week, it implies that at 25th percentile, somebody makes $10 an hour. Where in the US today are unskilled people paid $10 per hour? There are certainly not 50 million jobs in the US that pay $10 per hour or less.
Are there poor people in the US? Absolutely. You want to help them? Create a good educational system and remove disincentive to work.
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9 minutes ago, Luca said:
The US economy and more than half the population there runs on austerity and deficits, barely money left, 60% paycheck to paycheck, lots of things financed on credit card debt, huge loans etc. The problem is not that they arent saving enough, they dont earn enough. The capital flows go to little into the hands of these people and too much goes into financial engineering. Indices had a huge run since 2008 but the real economy looks different. Varoufakis put it nicely:
"a majority of people in the majority of advanced countries are struggling to make ends meet,they work soul destroying jobs. They work plenty of hours and there is absolutely no connection anymore,the end of the American dream if you want to put it that way, there's no connection anymore between how hard you work and the probability that you will manage to rise up in their social mobility, however hard you work, you will never make it these days, at least for the median brit and median german. Huge inequality is the other side of the coin of high asset prices"
We discussed this in another thread i think, about keynes theory of 15 hour work week by the end of the 20th century. Didnt happen, instead we have an overblown financial sector with more funds than stocks in the US...
What needs to happen are real investments into the real economy by international capital, growing wages so that these investments can be absorbed, business has to offer good well paying jobs--> less debt for the average american, more political stability in the US, better quality of life, higher productivity etc reinforcing the cycle. Unfortunately, the capital currently is still too concentrated and then inactive/not increasing growth/multiplying.
What are you basing your argument on that these people who live paycheck to paycheck do not earn enough? I know plenty of people with USD 500K in annual income who live paycheck to paycheck, and people with USD 100K in annual income who save plenty. Don't buy $300 sneakers and $1000 apple phones and $1000 apple watch.
Most of the people I grew up with were very poor, yet all became very successful through hard work. Hard work pays very well in the US, even if you are not skilled, you can easily make $20 per hour in NYC.
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1 hour ago, thowed said:
It's the million dollar question! If I knew the answer, I wouldn't be on this board.
If you haven't already, I'd recommend reading the Fundsmith Owner's Manual, which is very good on long-term compounders & the concept of 'don't try to be too clever, stick with the ones that you know have endured. Also the think-pieces on Lindsell Train's website. They both have concentrated buy&hold portfolios of 'boring' compounders, esp. stuff like Pepsi, & McCormick's, Diageo, Brown-Forman. It feels like certain industries are less likely to be disrupted - will women stop using cosmetics? (L'Oreal & Estee Lauder). People will spend money on their health. People will want insurance.
Anyway, just some thoughts.
And I'm very jealous of your large exposure to Constellation - congrats for that, & I am presuming it's a good place to work too!
True, but look at performance of Revlon and even Estee Lauder over time.... Revlon was a wipe-out and EL has not been fun over the last couple of years.
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54 minutes ago, ourkid8 said:
What do you think of Falcon premium intermodal service?
https://ca.finance.yahoo.com/news/cn-gmxt-announce-transformational-mexico-200400401.html
Nothing. You can announce whatever you want, but making it work is not easy. If it was so easy and such a winner, why didn't they do it a year or two or three ago? Also, interesting - connection in Chicago. This is the biggest bottleneck, and every railroad tries to avoid it. I think a year or two ago, CN bragged that thanks to an acquisition done I believe during Hunter Harrison's tenure, they could avoid Chicago and save 20+ hours. So now they are going through Chicago? I think that this is a desperate attempt to try to reduce losses from CP-KSU merger. The investor day in June will be interesting.
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1 hour ago, John Hjorth said:
Bought some more SCHOU.CPH [as I have done within the three years or so, on and off]. Furthermore added a very tiny bit to BN.
What is the thesis on SCHOU CPH? Thank you
How much does it take to be ‘rich’ now?
in General Discussion
Posted
In NYC, the marginal tax rate on a self-employed individual or income of a spouse in a dual income household can easily be 60%. $60K for a nanny including benefits is cheap. By the way, never heard of anyone paying benefits for a nanny. An acquaintance is a lawyer who wants to go work for the government one day, so wanted to employ a nanny on the books - made three dozen offers, all declined, since all were on the dole and wanted cash.