Dinar
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Posts posted by Dinar
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38 minutes ago, Gregmal said:
Don’t forget dominos. His crusade against wellness company Herbalife, and his love of Valeant which was robbing people dependent on drugs.
He s probably the greatest long term fundamental investor I’ve seen first hand(aka not someone like Buffett who did his thing decades ago), but also 100% the embodiment of why Wall Street people and hedge funders are universally thought of as scumbags.
Greg, you should take a look at Chris Hohn at TCI - I think he is as good as Ackman, also Nick Sleep - his letters are floating around the web, and he did his thing 20 years ago.
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32 minutes ago, no_free_lunch said:
REITs are really starting to get their prices hammered. Apartment ones in particular seem very compelling to me given their relative safety. I think either we have inflation and rents move up to offset the rate bump or we don't have inflation and rates move back down. Either way, this seems a decent entry point for the space.
I like Avalon Bay (AVB) an apartment REIT with properties mainly on the east/west coast. They have a long history of slowly raising the dividends (not all REITs have this kind of history) and are not particularly levered. They have also traded substantially higher (up to 60%) from where they are today.
Does anyone else have a fav REIT? Are there any stand out REITs with a secret sauce that manage to get alpha over their peers?
My favorite REITs at today's prices are: AIV, CLPR & VRE. If the price ever gets to $50, I will load up the truck on ELS - Equity Lifestyle
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15 minutes ago, Spekulatius said:
Belgian beer St Bernardus :
It is fantastic, I love this one
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Given the very hard insurance market - supposedly 50% price increases, shouldn't profits be higher?
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CNQ - Canadian Natural Resources
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1 hour ago, frommi said:
BTI, recession resistant, cheap, has momentum going and pays you while waiting. Debt load from reynolds aquisition finally under control and still growing 5-8% per year.
I think that you will regret your choice. BTI is losing volumes at 3%+ per annum, and even faster in the more profitable US market. Revenues barely grew by 3-4% in 2022 in constant currency despite 10% inflation. I would not touch it and Altria with a ten foot pole. PM (which I own) is a much better choice in my opinion.
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1 hour ago, writser said:
Very well done!
I'm up ~7.5% in EUR, so around break-even in USD. Not the best year, as always I made some mistakes here and there. Nevertheless I am reasonably content to see my deep value / special situations grab bag holding up in a challenging year.
As in 2020, special situations tend not to be completely market neutral in case the shit really hits the fan. This year, ADES was an example of something that might have worked out a year earlier. Management should have simply liquidated as there was absolutely no appetite for a cash box pursuing a speculative SPAC-like deal in 2022. I liked the setup but that was ugly.
RBCN was an example of something that worked out very well - if you paid some attention you could make some very decent trades around the Janel tender offer.
As in other years there's still quite a bit of fat left on the bones in terms of CVR's, liquidations and delisted instruments for which I simply use brokerage marks. That performance will show up when these instruments pay out (or don't). Noteworthy are a large position in the PDLI liquidation, a position in UDF IV that is potentially very undervalued, a large position in Genkyotex CVR's and a position in the BMY CVR lawsuit. Last year I also added quite a bit of Akouos CVR's to my grab bag last year.
Also, a decent (and growing) chunk of my portfolio is in expert market stocks now. Some of these are ridiculously cheap and I am very happy to own them.
Who do you trade expert stocks through? Thank you.
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Make sure that you have enough money to pay the bills assuming the business does not make any money for three to five years.
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I would say that the healthcare problem in the US is much much bigger issue and harder to solve than the real estate issue. It is a cancer on American society.
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I think we should specify in which currency the portfolio performed, since USD is up 5%+ against the Euro and nearly 10% against the pound sterling in 2022.
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Down 6.4%
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17 minutes ago, whatstheofficerproblem said:
Yeah, I meant businesses and rich people, well since it was in Germany, I was confused, any chances an event like that can happen again? A lot of people seem bullish abuot the Yen.
There is always a chance, but it is difficult. A general rule of thumb is when a war starts, you borrow long at fixed rates and buy productive assets. The problem occurs when either your assets get destroyed in war, or revolution or via price controls.
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I generally agree with you, except David Tepper who is a phenomenal trader went on CNBC a couple of weeks ago and said that he thinks S&P should go to 3000-3200
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Bought Clipper (CLPR) today
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Blackstone and its ilk will be materially less profitable on a going forward basis. Here is why:
a) Less demand for their services. At zero interest rates, people have to flock to equities, real estate & private equity. At 7% on mortgage paper, they can just lend.
b) A lot lower returns, and hence lower management and incentive fees.
When you buy assets putting 20-50% down and using 50-80% debt financing at 3-4%, you make a lot of money. When you have to put 50% down and use 5-9% debt financing, returns on levered equity are much lower, so you have to charge less.
c) Recent controversy (unjustified) in my opinion over gating at BREIT is not helping.
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During the Cold War era, there were no hedge funds in the USSR and the Soviet banks generally did not lend to individuals. There were essentially no private businesses either. Also, it was illegal to own foreign currency in the USSR.
What you are describing did happen in Germany post WWI. The strategy also depends on interest rates paid. In Ukraine, many assets probably were destroyed. The ruble has actually strengthened against the USD, at least on the "official" market.
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29 minutes ago, CorpRaider said:
PE5 and Q give you roughly the same answer as of my last check. Prof. Shiller credits Graham appropriately.
Q is a idiotic measure. Q of 0.5 for a Five Seasons in the middle of Sahara is insanely overpriced, Q = 2 for an airport in the middle of Paris is insanely cheap.
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2 hours ago, ValueArb said:
A couple of points, it is actually Ben Graham's P/E, he came up with the concept first. More importantly, is this accurate? Here is why I ask
2013 S&P 500 EPS = 128.13 or 163.7 in today's dollars given the 27.77% official inflation over the past decade
2022 S&P 500 EPS = 190.
The average of the two is 176.86, so at 3854, it is 21.8 (I know I should use the average of the entire 10 year period but I am being lazy and this should be close enough.) So it it is not 28.21 (May be if you include 2020)
Also, there is no adjustment being made for cash held by the likes of MSFT & GOOG (3.5% and 10% of market cap respectively) and no adjustment is made for the level of interest rates.
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48 minutes ago, ValueArb said:
LOL, I only accumulated $17k in a little less than a week and now it's spiked 20%. There is a chance that it's actually well below 50% IV even at the higher price but I have to think more about the value of it's less certain assets more before paying up.
It was so much work buying $700 at a time I'm not sure if it was worth it. Maybe I should have just fed the ask to see how much it would have taken at the lower prices. My habit is never to pay above bid, and just walk away if it isn't hit, but that may have burned me.
Read Philip Fischer - common stocks and uncommon profits, if you have not already. If I like something, I will pay ask so not to kick myself later.
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21 minutes ago, Xerxes said:
All correct except the Italian example. Italy might be geographically located where the centre of Roman institutions were based, but I would hardly call them “heir to the Roman republic”.
Italy as a unified kingdom created in the 19th century can definitely draw legacy and heritage from the many Italian kingdoms and republics (Genoa, Venice, twin kingdom of Sicily and Naples, Turin etc) but not the empire of Rome. Just as Iraq cannot draw heritage from its Babylonian past.
To me, the heir to the Roman Empire, if any, was the Ottoman Empire. Of course you had Moscow as the “third Rome”, The Habsburgs, Napoleonic empire and that of Charles V all seeking “Imperial” legitimacy as heir to Rome.
Any of those above is far closer to Rome than the Italians or other post-476 AD Germanic kingdoms. I will definitely get the Italians angry with my post.
It is a pleasure to deal with an erudite debater. Yes, my Italian teacher in high school had a hissy fit when I called Napoleon a Frenchman. We can remove Italy and add the Germans, the French - from Louis the XI through Napoleon I. The reason that I did not mention the Ottomans is that I think Erdogan and company would love to put on the hat of Mehmed II.
The Hapsburgs were more in the mold of acquisition via marriage rather than war.
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45 minutes ago, UK said:
China’s challenge is particularly daunting, even for an authoritarian regime with plenty of levers to pull. Home prices in Beijing and Shanghai have jumped tenfold and twelvefold, respectively, this century, according to government statistics, after the economic opening prompted more people to park their life savings in real estate rather than in stocks or other investments. The ratio of median home prices to income surged to more than 25 at the end of 2021 in Beijing, compared with about 20 in Hong Kong and just seven in the US, according to research from Nordea Bank Abp. Nationally, the ratio in China improved slightly last year to 9.1 from 9.2 in 2020, accord to E-House (China) Enterprise Holdings Ltd., a real estate firm. In most Chinese cities, income is nowhere close to keeping pace with the cost of housing—a problem that’s felt in many countries but is particularly acute in the world’s second-largest economy. In Qian’s home of Shenzhen, an apartment typically costs 40 times the average annual salary. That’s quadruple the relative price in cities such as Los Angeles and San Francisco, according to separate data from E-House and Harvard University’s Joint Center for Housing Studies. In Shanghai, China’s business and finance hub, a 950-square-foot, two-bedroom condo sells for almost $725,000. For about that price, a buyer could snap up a one-bedroom unit in Manhattan, where the average disposable income is more than six times higher.
More than two years later, China’s efforts to reduce prices—or at least halt the increases—have had limited success. New-home prices fell for the 15th-straight month in November. Yet most of those dips have been too small to make much of a difference. November’s drop of 0.25% in 70 cities was typical: None of the pullbacks has been greater than 0.40%. That steady drip of declines—more than 3% over 15 months—compares with much sharper plunges in other markets as global interest rates surge. Prices in Toronto are off 18% from their peak, while Sydney is down 11%. Sweden’s market is forecast to drop by a fifth from a March peak, according to Nordea estimates. There are signs of steeper declines in some parts of China. An existing-home price index tracked by KE Holdings Inc. shows that values in the less regulated market dropped 7.5% in August from a year earlier. In Hangzhou, near tech giant Alibaba Group Holding Ltd.’s headquarters, existing-home prices are off more than 15% from a peak last year, agents say. The meager national declines, even as sales collapse, partly reflect the quirks of China’s housing market that keep a floor on prices. Some 90% of city dwellers own their homes, according to Goldman Sachs Group Inc. research, compared with about 65% in the US. Ownership is so ingrained, a single man or woman has a much better chance of finding a match if they own a condo.
In fact, Beijing may prefer a steady price decline to a sudden crash that could wreak havoc on the financial sector and spark an even deeper crisis, says Orlik, author of China: The Bubble That Never Pops. China is trying to manage down the oversupply of homes as well as prices to bring the market in balance, he says. In other words, a “controlled deflation” of the bubble rather than a dramatic burst. “If you want to improve affordability without having a systemic crisis, you don’t actually want house prices to fall. You want them to stabilize and incomes to rise,” Orlik says. “If prices fall 25% and everyone sells their houses, then you have a systemic crisis.” China is even trying to limit price declines in some areas. Since the second half of last year, at least 20 small cities have blocked developers from slashing prices by more than 15%. That prompted an industry group in the province of Guangdong to petition authorities to loosen restrictions to boost sales, people familiar with the matter say.
It’s hard to overstate the importance of real estate to China’s economy, making the crackdown so painful for so many. With estimates ranging from $2.4 trillion for the new-home market to $52 trillion for existing homes and inventory, the size of the sector was twice that of the US’s in 2019. Real estate accounts for about a quarter of domestic output and almost 80% of household assets. Some 100,000 companies operate in the sector, providing 27 million jobs as the nation’s second-biggest employer. Headcount shrank by 15% in the first half of 2022 alone among the 28 publicly listed developers that disclose staff levels, according to data compiled by Bloomberg. Those still employed face steep pay cuts, usually 30% to 50%, says Andy, a 36-year-old who works for a developer in Guangdong and asked that his full name not be used. His monthly mortgage obligations, at about 40,000 yuan, take up nearly 70% of his income. He’s now trying to unload one of his three homes. “I’m willing to sell it as long as I can break even,” he says. “But it’s been a tough sell.” Suppliers are also paying the price, with many fighting to get repaid by Evergrande and others. From construction material suppliers to lunch box providers, thousands of small companies are feeling the pinch from the record housing slump. “Putting on the brakes is one thing, but slamming the brakes on and making the car engine dead is another,” says Qin, a project contractor who’s spent 13 months trying to get paid. He also declined to give his full name. “Evergrande has a huge problem, but it should’ve been a ‘soft landing’ rather than what’s happening right now.” The modest price declines have done little to boost demand, which will be key to reviving the economy into 2023. CMB International Capital Corp. foresees a 30% slump in apartment and house sales this year, topping the 22% drop during the 2008 financial crisis. Morgan Stanley doesn’t expect a sales recovery until the second half of next year.
A 950 sq foot condo in Manhattan would cost anywhere from $1MM to $5MM depending on location, condition and views. Why is the writer comparing cost of a two bedroom to a cost of a one-bedroom? Seems like sloppy/dishonest reporting.
Also, how big are property taxes in China? In Manhattan, they can easily = 2% of the value of the condo per year. So if say property taxes in China = 0%, while in Manhattan they = 2% of the value per annum, that alone should justify 50%-60% higher prices in China vs Manhattan relative to income.
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1 minute ago, ValueArb said:
I'm trying to build a position in something I found that is trading at roughly 50% of intrinsic value, with a pending liquidity catalyst in probably 6 months. The problem is its only trading about $150k a day, so I can't really talk about it lest someone blow me out of my bids. Of course its unlikely anyone here has any interest in a tiny shitcap, but better safe than sorry.
How big are you trying to get? If this is as attractive as you think, why not pay up 2-3% and get it? Unless you are trying to buy $5MM of it.
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21 minutes ago, ValueArb said:
A peace treaty can't be signed until after Russia withdraws from Crimea and the Donbas, otherwise it would be a disaster. Russian leaders know that in negotiations everything they get is a win.
If Russia stops fighting, the war ends.
If Ukraine stops fighting, it ceases to exist.
You are being melodramatic and choose to ignore history, Russia does not have the troops to subjugate Ukraine, particularly in light of probable guerrilla movement.
There is no way in hell that any Russian leader will give up Crimea (look up the history of the place - it was never part of Crimea until it was gifted by Khruschev, himself a Ukrainian, in 1954), and if that prevents an armistice, then I am very sorry for Ukrainians, since the war will continue and Western support will dry up.
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24 minutes ago, ValueArb said:
a) Everyone knows this. The biggest increase in European security came when the USSR collapsed and instead of NATO facing a roughly 2-1 disadvantage in divisions, things have switched to a roughly 2-1 advantage. The problem is that if the Ukraine falls, that advantage diminishes significantly. As Putin moves more former republics under his control, our edge diminishes more.
b) Congress will go along. The only people in congress against supporting Ukraine are a small minority of whackos like Hawley, Paul, Boebert, Gosar, and Marjorie Taylor Greene.
c) Western Europe isn't part of the US, everyone knows that. Like Puerto Rico they are US protectorates that owe their freedoms to the US and the trillions we've spent since 1942 protecting them while they coasted along barely spending anything on defense.
d) China has committed very few acts of military aggression over the last 150 years. The last time it invaded someone, it got its butt kicked by Vietnam in the 1970s. Russia has constantly been invading its neighbors for hundreds of years.
Not everyone in Congress received bags of cash the way Biden did via Burisma. Calling people you disagree wackos is not a way to convince people that you are right. Have you polled Congress? Henry Kissinger is a wacko too?
I think that you are drastically mistaken regarding the support Ukraine has among the American public and Congress. How about this slogan? Instead of giving $45bn for Ukraine cut personal income taxes by 3%. I bet that would pass by a big margin in a nationwide referendum.
Divisions do not determine much - look at Germans in WWII, USSR vs Finland, US vs Iraq, US vs North Vietnam, US vs China/North Korea in the Korean War or every Arab-Israeli War.
Who cares what Russia did 150 years ago? Mongols conquered half the world in 1200s and is anyone afraid of them now? Alexander the Great did quite a bit who is afraid of Macedonia now? I am just quaking in my boots at the fear of Italian invasion, after all Romans waged wars of aggression for 1000 years! Are you busy learning Italian?
Russia is a paper tiger. China wants to avenge past wrongs - loss of Siberia to Russia, Taiwan, et all. Listen and read what President Xi and company say. Look at them muscling India.
In any case, in my opinion, the best outcome here for everyone involved is a peace treaty or a truce. In a continued war, nobody wins, and Russia where a number of village have neither electricity nor gas can suffer way more than we in the US or Europe will agree to. Look at all of the "accidents" that keep happening to the US electricity grid and substations. We are very vulnerable.
Where do REIT'S go from here ?
in General Discussion
Posted
There are long discussion threads on each one of these names and there are also VIC write-ups on all three.