Mephistopheles

Don't forget the free rent with the eviction moratorium. If you're a middle class person working hard, it may be better to get fired and live rent free with supplemental income from the government. Edit: just make sure to sign a very expensive lease before doing that

Thanks for the replies. I passed on the deal. 1) The terms were bad, I learned that the seller owns the real estate and he was refusing to part with it and wanted to charge onerous rent. There is nothing special about the bar except for the location, which is absolute prime for the area. However, it seemed the seller wanted to get out of the business yet retain all the economics via absurdly high rent. 2) the owner is known to be an asshole, and his broker wasn't pleasant to deal with either I requested financials and was sent the tax filings for 3 years. The broker (when I requested the financials) tried to convince me that the sales are artificially low since the bar only operated between 9pm-2am, whereas it has the potential to open at 11am - 2am. Have you ever seen a college dive bar that doesn't sell food that can profitably operate opening at 11am? lol

@GregmalSo I did some digging. Liability insurance is like 50k/year. (I'm a doctor so am well aware of liability). I guess if premium cost is priced in then it's fine. @JRM Good points regarding stealing. I agree that manager is important. I work less than part time so I can for sure make it work.

One of the main 4-5 college dive bars at the place I went to undergrad is for sale, liquor license included. From 10+ years of experience as a consumer frequenting the area, I know the bar is a big hit. Assuming campus life returns to normal, it will thrive without a doubt. Has anyone here invested in bars? Any suggestions on how to learn about them?

I don't think Buffett was a hypocrite at all. His fidicuary duty is to BRK shareholders, not OXY shareholders. He complained about the Kraft deal because he felt it was value destructive to Kraft of which he was a shareholder.

I hold the reverse view. I think the chances with political action are much worse than the optionality of a court ruling. Politicians will be politicians - kick the can down the road and do nothing. If John Paulson's friend Steve Mnuchin couldn't get it done, nobody will, at least that's my cynical view. The Courts on the other hand are less politically motivated, IMO. I think the APA issue is quite different than the 5th Amendment one which is different than the breach of implied covenant. I'm not betting on legislative/court action as much as I am on the higher option value for the action happening. Without an expiration date, there is plenty of room for change in valuation. But a still cheaper price would be nicer. If you buy at 2 cents of par, than 20 cents is a 10 bagger. Just a fun little bet, nothing big.

Is it really binary though? There's a different between a crapshoot that pays even vs. one that pays 10:1, assuming the risk is the same. I agree with your overall point that most of the legal "analysis" is just brain damage with no return. I used to be that way, and frankly I love constitutional law, so I did enjoy it, but it failed to pay off. Now I just see the big picture. I think they are definitely worth >0% of par given the possibilities in the remaining litigation and the remote possibility of reform. More so the implied volatility attached to those possibilities is what makes it exciting. I've only nibbled thus far and would love to see it go down further to like 1% of par.

https://www.npr.org/2021/06/24/1009858617/britney-spears-transcript-court-hearing-conservatorship First Fannie and Freddie, now Britney Spears. Slippery slope

As has been demonstrated for the past 10 years on this one, there's no predicting what the government will do. All we have is a highly profitable duopoly and bunch of possibilities to realize those profits. Right now there's perhaps $12-13 (par value) in the pot of possibilities for every $1 you bet. How much is that pot valued? I'd say it's >$0. Maybe we should wait to get 30:1 (another 50% draw down), idk. But at some point the option becomes a good bet. When sentiment changes the option becomes fairly or overvalued, then you sell. I was fortunate to have completely sold out not so long ago at about 20% par and I've developed an appreciation for this being a trading vehicle, not a buy and hold forever investment. I started nibbling again yesterday and today. Hoping to get 99:1 odds (which is where it went to right after the 3rd amendment).

It may appear that way because the loudest ones opining are the ones with a vested interest in a shareholder friendly outcome. Those not invested don't care as much. So you only hear one side of it. I don't even know if Carney was right or just lucky. His vested interest was to create a stir as the lone voice on the other side. And while things have been bad, it's not a total banana republic either. The DC case that got appealed went back to Lamberth as opposed to being tossed out, that is something right?

So I am looking at long term chart. It appears that after the third amendment profit sweep, the prefs bottomed at about 1% of par within that month. That's when there was no litigation momentum or anything. I'd say that's the apparent floor for the option value. Now if all cases get tossed out then the floor can break, but it seems like a good measure for now.

Well, having a legal background may help assess the odds but it seems like the lawyers got Collins wrong too. I guess people see it based on what they want the result to be. That WSJ journalist John Carney turned out to be right so far, few years ago I remember everyone making fun of him. So, I have no idea what the odds are, and I don't think most people do. So you just have to buy when the sentiment is awful and hope for a reversal. What is that buying point? 11:1? 20:1? 30:1? The profitability, litigation, and lack of expiration date ensures that the option value remains, whatever it may be.

I know everyone is shocked and upset, but I think the prefs may be a good bet now if you treat them like call options. Right now you can get about 11:1 return (selling for about 8.4% of par). There are still a couple of cases in appeals from my understanding - Lamberth and the Court of Claims. My non-lawyer understanding is that neither of these are related to the SCOTUS ruling today. Meanwhile the companies remain profitable. What's the chance of the call option, with no expiration date, going to zero with outstanding litigation and underlying profitability? Very unlikely IMO. I'm not saying buy today necessarily, but if they drop further, then at some point you're buying a really undervalued call option that may re-rate to a fairer price. Furthermore, you can do it in a taxable account and if it drops, swap out from Fannie to Freddie or vice versa, and take the tax loss while avoiding wash sale.

I got out of this completely not so long ago. After many years of disappointment by the Courts, I wasn't expecting anything great from SCOTUS, even at apparent 4:1 odds. What a shame. I lost a small amount of money net, but the biggest loss was the opportunity cost over the years. Whatever happened with the 5th amendment takings case in the Federal Court of Claims?

I haven't asked them about rates, but if they only negotiate down to 2-3x IBKR then I'd rather not do margin with them. My bigger problem with them was not allowing stuff like bull call spreads in IRA accounts, for which they were unwilling to budge at least for me.

That's an interesting point about negotiating margin rates. Another reason I use IBKR is because it allows me to do bull call spreads in my Roth IRA. Merrill Edge doesn't, which is so stupid because it's the same thing as a covered call. I'll ask Schwab about margin and spreads. Are there any other brokers that are willing to negotiate? Merrill is not. TD has some of the worst margin rates but I hear they have a great platform, has anyone been able to negotiate with them? Also the other supposed benefit about IBKR is the quality of their execution. Is it truly better than the others? I haven't noticed any difference between it and Merrill Edge, but I'm by no means a day trader or fast trader. Does execution quality between these brokers even matter for infrequent traders?

I use ibkr for the margin rates. Otherwise it’s god awful

What if Melinda was physically and verbally abusive to Bill, and then one day Bill walked in on her with another man, and then he proceed to cheat? Then would it be more forgivable? What if Melinda had a cuckhold fetish and promoted Bill sleeping around until she got jealous and then called it cheating? Point being that none of us can judge anyone else's personal relationships from the outside so we should not even attempt it, let alone try to relate that to their professional lives. If you take a microscope to your life or mine, and review every aspect of it and use it as a means of judging our professional character, I bet neither of us would turn up clean.

Not from a professional standpoint, no

Re: Snowball - my understanding is that Buffett gave free reigns in order to not bias the story nor have the audience perceive any bias. Meaning, he wanted Alice to publish the book without even reviewing it. Then when he saw the final copy he or family was upset at the level of detail regarding their personal lives. Like everything else in his career, he believed that giving people more reign and off hand approach will motivate them to do a better job. It didn't work in this case. Re: Buffett and Gates extramarital affairs- who cares? Who are we to judge? Who's to say Melinda didn't have an affair? None of this matters when judging their character because for us it's just an outsider perspective. I hated Trump but I feel the same way about his stormy Daniels thing. Who cares? And regarding Gates and Epstein relationship, definitely odd but I doubt that every friend of Jeffrey Epstein committed statutory rape. It's guilt by association.

I know Gates is a nerd, but he's the richest man on earth. Why is it so hard for him to get women who are not subordinates at MSFT? Why did Bezos have an affair with that woman who's now his girlfriend? She's got all that plastic surgery on her lips. Seriously if you're the richest man in the world, have some better taste and class. If Bezos/Gates had affairs with supermodels, that would be a bit more understandable and forgivable.

lol! where is this from?

I think selling puts can be beneficial in a situation where the IV is crazy high. Here you may not really care to own the stock but you can still make good money. For instance on Viacom last week I sold a few short term puts ATM $45 strike that expired last week and on. The one that expired last week I kept almost all of the premium as profit. The other one, expires on 4/23, I sold on 3/29 when the stock was $46, and today it closed below $43 yet I am still in the black. Most of the profit is from the IV collapse and some of it in the time value factor. (Though tomorrow I will probably be in the red). But, here's a stock which I think is ok to own at $45 but I am not thrilled about it. I am betting not on valuation, rather against volatility. Hoping to sell some $40s tomorrow depending on IV as CS and Nomura unwind.

winjitsu, ANP, Pelagic, thank you all for your generous responses. I have decided to pass as this is definitely in the way too hard pile for me. But I appreciate the thought processes laid out here and it'll help me look at another opportunity if I ever get it. I had to look up what an MVP was. Do they have one? No clue. And I don't know any angel investor either. The founders do have experience in starting businesses but not specifically in this industry. And ultimately, I do agree it's bizarre they are asking for a relatively small minimum amount from people in the U.S. (less than $50k commitment). As ANP pointed out, given the mania and the amount of money floating around, why would they need to ask for small sums from low net worth individuals? Let's see what happens. Watch this become the next Tesla :P.

Family friend from India who is a financial advisor sent me a presentation for a EV company. I know nothing of the culture, climate, environment there. Further, I've never put money in a startups before. The company plans on launching a product latter half of this year and thus is gathering funding for manufacturing. Plan is to launch an EV Motorcycle. Its the biggest two wheeler market in the world, but EV motorbike sales in the country are close to zero now, therefore it is somewhat intriguing. That said, a company that doesn't sell products yet is nearly impossible to assess. How would you approach? Study the founder? Look for share alignment? Try to make sure it's not a fraud? Obviously the industry is in a bit of a mania right now which I am taking into account. Likely will not invest, nonetheless I want to take this as a chance to learn about investing in the country.