TwoCitiesCapital

I don't remember the book I saw it in, but there was a study done that concluded the vast majority of individuals equities have NOT outperformed treasuries over long time horizons (like 20-30 years). Indices do as a result of survivorship bias and continuing to weight the survivor ever more higher than the losers.

The comment was that Trump "owns" things where Europe does not. Not that he was elected. My argument was to demonstrate that Trump owns very little and regularly blames his bad results on others. Whether the people are dumb enough to believe him and re-elect is another discussion entirely.

Like Trump owns his decision of appointing Jay Powell (blames Biden)? Or ownership of the explosive deficits that resulted from the tax cuts his first presidency? Think it'll be any better this time around? What about accepts ownership of the results of his campaign when he lost the election? What about the inflation that resulted from both his, and Biden's, fiscal response to COVID? What about accepting ownership that the Ukraine/Russia war didn't end on Day 1 of his presidency? Or Day 180? Or any time soon? What about ownership of failing to release the GSEs from conservatorship in his first term? What about failing to avoid the US getting involved in the Iran/Israel conflict. What exactly DOES Trump accept ownership of?

See, the ETF flows are the only reason I believe the 4-year cycle may break. Having a secular shift in trillions of assets to permanently allocate a percentage to Bitcoin seems to me the primary force large enough to offset the supply shocks that have historically led to boom/bust. If a small portion of money is consistently moving to BTC, over time, to the point where people own 1-5% of their portfolios in it on average, that seems to be what puts a floor under its drawdowns and not necessarily a contributor to them. Greater liquidity tends to lead to LESS volatility - not more.

This is probably going to be the seeds of the next bear market IMO. Just like Genesis' "we'll lend you money against your GBTC to buy more Bitcoin to convert into GBTC at a premium" unwound in spectacular fashion with multiple casualties after locking up 3-5% of circulating Bitcoin supply. My guess is that this is what causes the explosive/parabolic upside than encourages folks to double down late in the game just in time to force them to liquidate on the backside of the cycle. People keep saying the 4-year cycle will break, and I believe it eventually will, but human nature is human nature and every cycle has introduced a new population of people thinking they'll get rich quick off of this which sets up the inevitable correction in those expectations.

To be fair, they've believed this since 2016 when Trump was first elected and they first went to 0 duration. It took 5-years of earning exceptionally low rates on capital and a global pandemic to be right. It worked out, sure. But I don't think it was a special foresight as much as it was Fairfax was priced as if interest rates would never rise and we know that was unlikely. Muddy Waters helped us here

I haven't seen the calcs or the cost inflation but I know that asbestos, lead, and environmental concerns added to. Pair that with the fact the buildings haven't been renovated since the 1930s and you probably have a lot of modernization going on with things like power/plumbing/outlets/HVAC/etc all with the additional expenses of maintaining the historic building. Would definitely be cheaper to tear down and rebuild, but that isn't what they're going to do with buildings they want preserved. Not that it's even of the same scale, but my condo building was renovated into condos in 2008. There was a rooftop fire in 11/2023 that destroyed the roof and my a portion of my unit underneath. It was multi-millions to repair/replace the rooftop and fix the damages in my unit and took them over 18 months to finish. And that was just the roof and a single unit with no lead/asbestos/environmental concerns, no re-plumbing/electrical work, little need for machinery like cranes, in a relatively newly renovated structure from 2008 in a state with significantly lower CoL/wages than D.C. I can certainly see how these things can add up when doing an entire commercial building needing significantly more work, with significantly more red-tape surrounding its historical nature, significantly more expense related to asbestos/lead remediation, and encountering significantly more delays due to the scope. Not sure $2B is the right number, but also can't say I'm really surprised either.

Scroll up a few comments. People still believe crypto is for criminals. Understanding is limited and those who don't understand the financial plumbing arguably don't understand the value prop of either Bitcoin or stablecoins. To add to that, we're not at the hype cycle part of the bubble yet IMO. So I don't think most people are taking it seriously.

Stablecoins are here to disrupt V and MA. Any strides forward they make are to defend their existing market share. Stablecoins are another competitor in the field, and a low cost one at that (at least for now). Competition means lost market share and lower profit margins - is not likely bullish for incumbents

Any idea how long it takes to dig channels? Seems like an over reaction to something I'm guessing is a few weeks?

He's publicly called for their release while privately leaning on Republican leadership to defer the vote to 3 months from now when he hopes everyone will forget that he was involved with a child trafficker. I tend to disagree. No way Epstein amassed the connections and wealth he did without implicating some of the biggest names. My guess is that it isn't going to make either party look good and that major party donors, affiliates, and perhaps politicians from each side are named. Is why Epstein didn't survive and why no trial was ever going to be held and why no list will be released by EITHER party. But Donny wanted political points for calling Democrats pedophiles and pretending he cared about child safety. So here we are...the unofficial leader of the evangelical church refusing to condemn child molesters because he likes to rub shoulders with them... +1 Definitely a major miscalculation on this point. I guess he didn't realize that his followers' cognitive dissonance on electing a sexual predator and serial adulterer didn't mean that they didn't care about protecting children and family values.

The party of law and order is less hard on enforcing it within their own members than Trump was when discussing his teenage daughter.

Yes! Exactly! I knew several Democrats who were critical of Biden after his first term and how he handled things. As a matter of fact, it was a feeling that was so widespread that the Democratic party eventually felt forced to pivot candidates late in the game. If only both parties were able to exhibit such self reflection...

Literally happens all of the time LOL

Even if they were 'deals' - there is nothing stopping Trump from throwing them out in 12-24 months and blaming Biden for how badly they were negotiated. Anyone agreeing to these terms thinking they're fixed is a fool - Trump has already proven he doesn't have the integrity to stick with the terms of his prior 'deals'. These will be no different. Just agree to whatever, drag out the negotiations putting as little effort into them as possible, and then drop them when the next administration comes in.

The ONLY 'nothing good' that would come from exposing members of a child-sex ring is that exposing them would be embarrassing for those who did the exposing. Which is why they haven't been released by either party - and won't be. There is no other valid reason for protecting child molesters

That's exactly what this is. Give your billionaire buddies tax breaks and partially fill the hole by kicking people of Medicare, gutting social safety nets, cutting funding to emergency response organizations, gut the IRS, and then make the lower- and middle-classes pay more via tarriffs. This describes everything this man does - including calling for the release of the Epstein files

The ONLY reason to not release these is because it likely implicates the politically connected and wealthy on BOTH sides of the aisle. Is why the Democrats did nothing about it as well. But the Democrats didn't campaign on protecting the country from pedophiles or promise the release of the data or scream at the top of their lungs for the accountability of it all during the last election. And neither Biden nor Kamala were on flight logs for Epstein nor are they pictured with him nor had friendships spanning a decade with him nor did they write him bawdy letters for his 50th birthday. So my guess is it's probably a bit more damaging to MAGA and their second-coming of Christ at this point. So they'll rake Trump over the coals for this, as he raked them, but both know the docs won't be released - especially not by Trump who is likely implicated in them.

I don't think that's the case. I just think they're thinking of all of the components of gain that may not flow through to the income statement based on accounting conventions. With relatively easily forecasting and taking known-knowns, it's pretty easy to get to a base case of $75-100 of economic value added this quarter from interest, insurance, associates, and mark-to-market movements, but not all of those flow through the income statement which was my point above. Some pass through, some get added to the balance sheet, some don't get marked up at all but will be reflected in "fair value over carrying value" commentary, and some will be consolidated with the lookthru earnings being less than the gain in market value (which will be the case for Eurobank). I think economic growth/earnings will be in the ballpark of $100/sh. I think what actually gets reported on the income statement will be closer to $60-70 which is where my vote landed.

Short-term treasuries were modestly lower, but wouldn't impact much on a price basis. So lets call it roughly the same $500 million in interest/dividends as Q1. Will take the same share in profits/associates of $70 million from Q1 as well. There will be another ~$630 million gain on the TRS held on their own shares. Just those 3 items get you to $50+. We didn't count insurance, any realized gains/losses from equity investments, any additional lookthrough income in associates, any improvements to interests earned from larger float, and no credit given to excess of carrying value adjustments for things like Eurobank. All total, on a look through basis, it's not hard to get to a scenario where Fairfax gets $100+/sh in economic earnings per share, but that won't be what is reported.

Only took a week.

Typically, wholly owned subsidiaries are consolidated. So it would be on the balance sheet as the value of their real estate, stores, and inventory, and any other assets. Am guessing the sale price reflects a multiple of book, so should still be positive to Fairfax BV.

No mark-up for using the card - at least not where I made my purchase at. There is a balance transfer fee - would have to double check but I belive it's 4-5%. A great rate for 18 month financing and significantly less than what the car is financed at.

Inflows to ETFs were $1.12B yesterday - or roughly 10k BTC - yesterday. There are only 450ish produced each day. Some thoughts: 1) this was the second highest inflow ever (first was Trump's election) and was a random Thursday with little-to-no catalyst. This is what you'd expect from secular adoption. Eventually, $1.12B of inflows will be the norm (Thursday) and not the exception (Trump's inauguration). 2) 10k BTC demanded on a random Thursday vs 450 produced is a stupid supply/demand mismatch that will REQUIRE significantly higher prices to compel sales of BTC and to reduce demand denominated in BTC. Particularly if there IS a bullish catalyst. 3) anyone that was compelled to sell between 100-110k had opportunities in January, June, and July to do so. Those sellers have probably exhausted their supply at this point and most of those coins would've moved to wallets holding out for significantly higher prices than 100-110k. The sellers are gone and HODLers still holding. This is bullish for price dynamics. 4) I'm guessing the FOMO will start at some point in the next 3-months. The typical calendar year would suggest waiting until Uptober. But this bull market has been relatively muted this far, and demand still dramatically outstripping supply, that I think the typical Q3/summer lull might be skipped this year.

This. I try to find the middle ground - deals are too lucrative to totally ignore, but I also don't want to spend hours planning flights (let alone hotels) to get the best redemptions available. I typically sign up for 1-2 stupidly lucrative cards a year. This year it was Capital One (spend $500 and get $200 back) which I did in a single purchase. Now will be used as an balance transfer card to roll a portion of my new car loan at 0% interest for 18 months. The other was the American Express Business Platinum. Already had the personal, but got a 150k sign-up bonus AND the 35% points return immediately increases the value of the sign up bonus and the 180k of accrued points I already had. So far, have used points to book for round trip tickets to Denver, Toronto, Florida, and Hawaii for my girlfriend and I and will still be ending the year with a higher point balance than I started with as a result. 8-free round trip tickets isn't anything to sneeze at.