in what investable process are we still in the early innings

[Guest cherzeca]

@gregmal. agree with the social trend, especially as women in the workplace defer pregnancy in order to first establish their careers, but are there investable names?  sounds to me more like a good career path rec for a medical student

[Cigarbutt]

With regard to genetic deficiencies in the IVF process, I have been told that more recently, given the advances in accessibility, couples are being sold the option to perform genetic testing on embryos prior to selection. While it is old news that one can choose the gender of their child, now having the ability to select the healthiest of the harvest further makes this something that potentially appeals to a wider audience.

 

The mainstream acceptability is also still incredibly low. No one ever wonders why so many celebrities have twins at what seems like a significantly greater rate than normal folks? Or how wealthier folks tend to conceive later on? IVF...so as this starts becoming more acceptable to talk about, and accessible from the healthcare standpoint(Starbucks for instance covers this for part time workers now!) I think it is an inevitable growth arena. From there, it will merely become a decision, rather than an embarassing subject and a financial hardship, and when people are given the choice between "trying" blindfolded and leaving the health of their baby to chance, VS, having the entire process planned; no different than a vacation and the health more or less assured- I think I can see where it leads.

-The social acceptance and access.

You may be interested to know that IVFs are only partially covered by our Canadian medicare-for-all system and provincial coverage varies. There doesn't seem to be a terrible amount of social stigma for infertile couples looking for alternatives (in fact, it could be the opposite with generalized sympathy) but access remains a key issue. In my jurisdiction, in 2010, there was a decision to publicly fund open access to IVF for both medical and social infertility (the story behind this is interesting but not relevant for you although it involved a local celebrity). Interestingly, this was followed by a huge demand in services, a significant improvement in results including a drop in rates of multiples births and... an explosion in costs, so much so that the program was severely curtailed in 2014 (due to 'fairness' reasons). This post is not to compare both systems, it is to underline that when coverage will be more widespread (private, public, hybrid or whatever), there will be a realization that there is a huge unmet demand that will stretch from medical to social reasons.

 

I think it was said earlier so let me just throw my vote behind commodity lite-AI. That stuff seems to really be gaining steam. It will get easier and easier to apply and the workforce with relevant skills will grow.  It has and will continue to have a wide variety of applications.

 

How to invest?  Who knows for sure but one thought is that it will drive down costs. Perhaps monopolies with high labor costs will benefit.  Rail companies come to mind as being possible ai winners, oddly enough.

I'm note sure what you mean by commodity lite-AI (the first basic applications?) but I agree that this could benefit railroads. The industry has achieved a huge reduction in employment and corresponding improvement in 'productivity', and the employment levels have stabilized but there appears to be some incremental room for further downsizing related to more efficient management of inputs. Just in case you don't get access to the Post article, they discuss lower employment in 2019 due to cyclical factors but the renewed productivity phenomenon is also described.

https://www.railserve.com/employment.html

https://www.washingtonpost.com/business/economy/railroads-are-slashing-workers-cheered-on-by-wall-street-to-stay-profitable-amid-trumps-trade-war/2020/01/02/dc757ed4-1603-11ea-a659-7d69641c6ff7_story.html

[Gregmal]

@gregmal. agree with the social trend, especially as women in the workplace defer pregnancy in order to first establish their careers, but are there investable names?  sounds to me more like a good career path rec for a medical student

 

Theres a few. VITR is a monster and the undisputed king but you're paying a high price for that. You've got a few others like Virtus and Jinxin but my favorite is HTL which is much more off the radar and has what appears to be enough hair to keep most folks away. But Ive found management to be good stewards of capital, disciplined with acquisitions, and not terrible in choosing how and when to raise capital. PGNY I like too but not at 10x sales for what is ultimately middleman work. I'd at least be waiting until lockup to consider touching that, even if its part of a basket approach.

[Gregmal]

@Cigarbutt- definitely interesting. This was around 2010 and in Quebec, yea? I dont doubt that happens...we all know if free healthcare in the US takes over costs will be completely ignored!

 

All kidding and politics aside, I would more so think moderately scaling out available is what occurs. Most employers dont offer coverage, but that is changing. And I don't know if "stigma" is the right word, although maybe, but its definitely not an open subject of discussion for people here. Taboo, perhaps. Or maybe just uncomfortable. Then theres also the whacky religious folks who hate it as well. The markets in Europe and Asia seem to be way ahead of the US; hard to discern what this actually implies, but I would think we do have some catching up to do with the world given our societal trends.

[jobyts]

Online dating

 

My teenager told that among their circles finding a date through tinder implies that you are not smart enough to find one in person.

That felt me as a warning flag for the future of the online dating industry, and I sold my MTCH stock while doing the year end re-balancing.

[no_free_lunch]

Cigarbutt, I meant the readily available machine learning libraries.  I just hesitate to call what I am talking about AI so a lite seems appropriate.  This technology seems to be getting way more accessible and that's what is required for wide spread applications.

 

I am thinking of augmenting workers tasks to boost productivity.  With rails there is a lot of potential for self driving trains IN THE YARD for stitching trains together, as one example.  It is actually one of the most dangerous places for rail crews.  You would still need people out there but maybe less people and maybe if can be done faster and safer.

 

We don't need to wait for these technologies to be invented it's more a matter of engineering and initiative at this point.

[wachtwoord]

Online dating

 

My teenager told that among their circles finding a date through tinder implies that you are not smart enough to find one in person.

That felt me as a warning flag for the future of the online dating industry, and I sold my MTCH stock while doing the year end re-balancing.

 

Tinder is not for online dating but for online fling finding matchup (online casual sex?). Other solutions exist for finding relationships.

 

The latter is a huge grow market in my opinion. Especially knowing how socially unconnected and busy people are these days (if this doesn't materialize birth numbers will go the way of Japan).

 

Similarly, I expect solutions for finding friendships to appear and become popular (and no, before anyone says, Facebook is not for finding friends ...).

[RuleNumberOne]

Yeah, i bought my current house from someone who wanted to escape CA's short-term capital gains tax and moved to Austin, Texas.

 

It seems Austin is one of the hottest housing markets in the country. I think it is the first choice for people looking to run away from the Bay Area.

 

Texas is completely flat and has a lot of land, so it may not go up too much over the long term.

 

Tequila (CUERVO.MX)

Artificial body parts and organs

Space Technology

Housing in Texas

[Spekulatius]

Yeah, i bought my current house from someone who wanted to escape CA's short-term capital gains tax and moved to Austin, Texas.

 

It seems Austin is one of the hottest housing markets in the country. I think it is the first choice for people looking to run away from the Bay Area.

 

Texas is completely flat and has a lot of land, so it may not go up too much over the long term.

 

Tequila (CUERVO.MX)

Artificial body parts and organs

Space Technology

Housing in Texas

 

It’s true that building in Texas is comparably easy, which holds housing prices down, but I think that may change for two reasons that are probably somewhat related:

1) demographics are changing and Texas become “bluer” and at some point attitudes towards zoning etc will become more like in California.

 

2j The expansion is space has its limit with the millennial generation that can exist any more if there isn’t a Chipotle and Starbucks within two blocks from the home. That will cause some housing to become much more desirable and limit the spread.

 

I would think any of the above would show in a city like Austin first, DFW area second and Houston probably last. Anyways, I think it would be a multi decade trend and then there is some back wind from the Texas economy doing better than average too. I think any bet on the Texas economy in the long run may be a good one.

[NewbieD]

Vitrolife could be worth a look for those looking at IVF. Any other suugestions?

[DTEJD1997]

Hey all:

 

I think we are still in the early innings of revitalization of the industrial Midwest and the return of manufacturing and commerce.

 

If you are patient and careful, you can buy real estate in the midwest for well less than what it costs to RENT on the coasts.  Obviously NYC & SF are always going to be important and expensive cities.  They will probably always have lots of business and activity.  HOWEVER, those skilled people with capital who can figure out what to relocate in the Midwest are going to have a competitive advantage (real estate & operating costs & wages are lower).  Those who figure it out and can do it are going to make a lot of money.

 

I knew real estate in & around Detroit was "silly" cheap.  In the past month, I've discovered another place that is perhaps even cheaper than Detroit, and arguably a better geographic/political location.  So it is not just Detroit, but probably the whole of the Midwest.

 

The Midwest should also start to become attractive to employees.  You can OWN your house, have a NICE house.  Heck, $300K can buy you a mini-mansion in a good school district.  What will $300k buy you on the coasts?  An ambitious & capable employee can accumulate capital & have a good standard of living in the Midwest.  What good is it to make double in NYC if you can't hold onto any of it?

 

Conversely, I think we are at or near "peak coasts".  That is, the prices/influence in NYC and SF are at or near their peaks.

 

If I am right, this is already starting...but will still take a number of years to play out.

 

 

[SharperDingaan]

Vehicle manufacturing, and workforce re-training.

 

What we are starting to see in vehicle making, resembles what occurred when cars displaced the horse and buggy; today's auto-manufacturer being yesterday's buggy maker. Bet against NA auto, and its ability to adapt rapidly enough.

 

An electric vs an ICE vehicle requires materially fewer parts, and they are easily replaceable modules; you don't fix, you swap out the module.  What do you think happens when 40-50% of the NA vehicle-making workforce becomes obsolete? And do you really think that today's GM or Ford will look anything like it might look like, under an 'all electric' line-up? - even if a GM or Ford still exist? Workforce retraining becomes a growth opportunity.

 

SD

 

[Lakesider]

Upgrades to DDR5 at data centers? Micron just releasing specs now.

[DTEJD1997]

Vehicle manufacturing, and workforce re-training.

 

What we are starting to see in vehicle making, resembles what occurred when cars displaced the horse and buggy; today's auto-manufacturer being yesterday's buggy maker. Bet against NA auto, and its ability to adapt rapidly enough.

 

An electric vs an ICE vehicle requires materially fewer parts, and they are easily replaceable modules; you don't fix, you swap out the module.  What do you think happens when 40-50% of the NA vehicle-making workforce becomes obsolete? And do you really think that today's GM or Ford will look anything like it might look like, under an 'all electric' line-up? - even if a GM or Ford still exist? Workforce retraining becomes a growth opportunity.

 

SD

 

Do you really think we are going to all electric OR even majority electric vehicles in NA market in the next 5 years?

 

I don't see it.  Not even close.

 

I don't know of any line of electric vehicle line or company that is profitable.  Tesla sometimes makes money, but rarely.  Tesla is going to replace Ford & GM?  seriously?

 

Chrysler is building a HUGE new plant adjacent to their Jefferson Ave. assembly in Detroit.  They will be producing GASOLINE vehicles there.  At least in the beginning.  They are hiring 3,000+ new workers.  Supporting businesses are moving in there.  The neighborhood is starting to improve already.

 

Conversely, GM is shutting down their Poletown assembly plant.  This is where the electric Cadillac and Volt were produced.  BOTH of those electric cars have been shut down.  How much money/time/talent has GM wasted on their electric vehicles?

 

Ford has bought up the abandoned Michigan Central train station (and some adjacent buildings/lots) for their self driving and electric vehicle engineers.  They are spending AT LEAST $700mm to do this.  I guess Ford does not have office/lab space in Dearborn or their other facilities?  If I were a Ford shareholder, I would be PISSED at the squandering of capital on that project.

 

In my circle of friends/family, I only know of ONE PERSON who wants/has an electric car.  For everybody else, it is not even a topic of conversation.  Besides analysts on the coasts and hipsters, who is demanding electric vehicles?

 

FCAU seems to have the best plan for electrification, at least so far. 

 

I don't see electrification/self driving coming, and I think it is largely a bubble and waste of capital at this point.  If consumers wanted electric vehicles, why has nobody been able to make any money satisfying demand?  That is even WITH government subsidies.

 

We will see.

 

 

[james22]

At the Robin Hood conference last week, I enjoyed the presentation by author and entrepreneur Tony Seba, which he posted here (31 minutes – an earlier, longer version is here). He discussed “S” curves and how we tend to underestimate the rate of adoption of new technology.

 

Here are two examples:

 

One, Google estimated that its Lidar system, which cost $150,000 to build, would cost $70,000 by 2012. Analysts mocked and scoffed at the estimate – but Google was right: that’s exactly what it cost in 2012. But what’s more impressive is that by 2013, that same equipment cost $10,000… only a year later, a mere $1,000… and then three years later, $250!

 

And two, in 2000, a top computer used for nuclear warfare simulations had a capacity of 1 teraflop (1 trillion floating point operations per second), cost $46 million, used 850 kilowatts of energy, and took up 1,600 square feet. By 2017, Nvidia had developed a 2.3 teraflop computer that cost $59, used 15 watts, and was small enough to fit in your hand.

 

The lesson here is that humans think in a linear fashion – yet certain systems, including tech disruptions, are non-linear.

 

Seba’s conclusion regarding electric vehicles is that they will account for the majority of new cars sold within six years.

 

https://empirefinancialresearch.com/articles/observations-from-the-consumer-electronics-show-electric-and-autonomous-vehicles-whos-buying-tesla-japan-vs-china-business-cultures-thoughts-on-the-12-questions-to-ask-before-you-marry-someone

[BG2008]

Hey all:

 

I think we are still in the early innings of revitalization of the industrial Midwest and the return of manufacturing and commerce.

 

If you are patient and careful, you can buy real estate in the midwest for well less than what it costs to RENT on the coasts.  Obviously NYC & SF are always going to be important and expensive cities.  They will probably always have lots of business and activity.  HOWEVER, those skilled people with capital who can figure out what to relocate in the Midwest are going to have a competitive advantage (real estate & operating costs & wages are lower).  Those who figure it out and can do it are going to make a lot of money.

 

I knew real estate in & around Detroit was "silly" cheap.  In the past month, I've discovered another place that is perhaps even cheaper than Detroit, and arguably a better geographic/political location.  So it is not just Detroit, but probably the whole of the Midwest.

 

The Midwest should also start to become attractive to employees.  You can OWN your house, have a NICE house.  Heck, $300K can buy you a mini-mansion in a good school district.  What will $300k buy you on the coasts?  An ambitious & capable employee can accumulate capital & have a good standard of living in the Midwest.  What good is it to make double in NYC if you can't hold onto any of it?

 

Conversely, I think we are at or near "peak coasts".  That is, the prices/influence in NYC and SF are at or near their peaks.

 

If I am right, this is already starting...but will still take a number of years to play out.

 

Come on DTEJD1997, you just doing the "private real estate" equivalent of talking your own book.  You're pulling a Bill Ackman!  I see right through you!  Just joking.  I really have to come visit you in Detroit. 

[SharperDingaan]

Your train station example evidences that even Detroit recognizes that the future is electric, not ICE.

And the Jefferson plant evidences what you do over transition. Build huge & new; then transfer work from all the less efficient, higher cost and smaller plants, to pay for it. OK for maintaining profit, not so hot for the laid off workforce.

 

SD

 

 

 

[james22]

With the rise of SRI/ESG funds, we might begin to see a greater sin stock premium?

[Guest cherzeca]

WSJ article on investable themes. https://www.wsj.com/articles/four-fund-themes-that-investors-are-likely-to-bet-on-11578279840?mod=hp_jr_pos3

 

mentions thematic etfs:  QTUM, TAN, PBW