OIL?

[Parsad]

26 minutes ago, 73 Reds said:

LOL, I'm not even smart enough to understand the term "value investor".  Most investors (as opposed to traders) use value principles to evaluate an investment, i.e., buying a dollar for less than a dollar.  As for AMZN?  You could say I was smart and dumb.  I bought the stock in 1997.  And am perhaps one of the only multi-year shareholders who didn't make any money.  But the education was worth a lot more.  And the idea that patience is far more important than price.  

 

All "investing" is actually "value investing".  If you aren't looking for value or in particular "margin of safety", then you are not actually investing...you are speculating...assuming that someone will pay more for something without knowing its intrinsic value...gold, crypto, etc.  

 

Only by examining the cash flows of a business over its lifetime or examining a balance sheet in a liquidation, can you come to any real conclusion of what intrinsic value is...in the future or in the present.  

 

AMZN today is a very mature business with much more definable cash flows...it is easy to view it similarly to a bond now.  In the early days of AMZN, God it was running massive losses and EBITDA (not the best measurement, but is widely used) was all over the place.  You could not get a read on the company.  I remember Buffett saying back in like 2003-2004 that AMZN would eventually be profitable...even though I couldn't see it...but he never invested. 

 

People think when he said he didn't understand technology, he was referring to the entire industry.  But all he meant was that the cash flows at the time were not definable over time, because the businesses were still growing rapidly and so much was being reinvested at a rapid rate into new and existing operations.  Would they get back at least a dollar for every dollar spent?  Hard to know for many younger tech companies.  But those same young companies are all the mature, massively cash-flowing businesses we see today and make up most of the Mag7!  

 

Cheers!

[73 Reds]

2 minutes ago, Parsad said:

 

All "investing" is actually "value investing".  If you aren't looking for value or in particular "margin of safety", then you are not actually investing...you are speculating...assuming that someone will pay more for something without knowing its intrinsic value...gold, crypto, etc.  

 

Only by examining the cash flows of a business over its lifetime or examining a balance sheet in a liquidation, can you come to any real conclusion of what intrinsic value is...in the future or in the present.  

 

AMZN today is a very mature business with much more definable cash flows...it is easy to view it similarly to a bond now.  In the early days of AMZN, God it was running massive losses and EBITDA (not the best measurement, but is widely used) was all over the place.  You could not get a read on the company.  I remember Buffett saying back in like 2003-2004 that AMZN would eventually be profitable...even though I couldn't see it...but he never invested. 

 

People think when he said he didn't understand technology, he was referring to the entire industry.  But all he meant was that the cash flows at the time were not definable over time, because the businesses were still growing rapidly and so much was being reinvested at a rapid rate into new and existing operations.  Would they get back at least a dollar for every dollar spent?  Hard to know for many younger tech companies.  But those same young companies are all the mature, massively cash-flowing businesses we see today and make up most of the Mag7!  

 

Cheers!

Right; when I owned it AMZN was not really a tech company at all.  If anything, it was a future tech company that sold books.  You were buying prospects that were not yet evident other than to those on the inside and those with a lot of faith.  But I disagree that AMZN today is like a bond.  Yes, its current business is fairly predictable but there is certainly a degree of optionality, similar to MSFT and AAPL. You're buying brainpower.  Same with this Board's namesakes; if anyone believed they were done acquiring new businesses who would own them? 

[SharperDingaan]

Cash (T-Bills/Bonds, BTC, etc.) is the same as any other asset.

'Fully Invested' is a minimum portfolio weight of X% or higher; the weight driven by the why. 

 

We're higher risk. Risk management dictates a sale and return of original cash as soon as we double, the residual position becoming house money. Thereafter, swing trade around the residual position to increase it at little risk to ourselves. High cash, so that we still live if/when we screw up.

 

We're concentrated. Quantity often requiring that we have to make a market, know the company, and be willing to sit on the unpopular position for years. Ability to execute on life changing positions of dog sh1te, on a dime, requires experience, expertise, and high cash.

 

We're intentionally harder to kill than most. BTC in case we ever have to run, and the patience/expertise/experience to use it wherever we land. Interim systematic use to protect from inflation and grow the pile, requires high cash.

 

One of the best uses of cash is to protect against the loss of 'funny money' gains (Mag-7, O/G, etc.); today you're a lucky hero, but tomorrow you're a bum unless you kept it; reinvest a small % of the cash raised in long puts for more 'funny money' on the way down. Nothing to do with opportunity cost.

 

One of the other best uses of cash is market making. XYZ coy's distressed 7% bond at 33c, that literally nobody wants as it is expected to be rolled into a debt/equity swap within 18 months. Institutions need to sell, and you step up for 300K of principal in one trade ; thereafter sell the debt for equity 5 years out, and take home a 40-60% CAGR. With no need or intent to sell early ... no opportunity cost.   

 

SD

Edited March 23 by SharperDingaan

[Blake Hampton]

I for one hope this guy @Lotsofcoke sticks around. He's speaking my kind of language.

[Lotsofcoke]

I see my old friend Francois and I have similar views on AI: 

 

 

[Red Lion]

8 hours ago, SharperDingaan said:

The longer you look out, the more reasonable it seems that the USD trades at a discount to CAD at some point; 40%+ F/X gain should it occurr. 

So I understand that usd may be slowly losing its reserve currency status. But what makes you bullish about the CDN in particular? Do you think the CDN fundamentals are superior? 

[SharperDingaan]

Over time, FX rates are driven by the combination of fiscal/monetary/trade policy of country A (US) vs country B (Canada). Canada has been able to use Trumps disruption, and intelligently invest in/renew sorely needed infrastructure across the nation. Once built (3-5 yrs out), Canada will be exporting a lot more, the US will be a smaller trade partner, and Canada will be a lot less vulnerable to catching a cold/flu when the US falters. Construction work, and Canadian sourcing during the build, further mitigating US exposure. Rising anti fragility.    

 

The US has not been able to use Trumps disruption and intelligently invest. AI as the great saviour has limited scope; it doesn't help with planting and bringing in the crops, flipping burgers at minimum wage (or less), and the sale of US manufactured goods that are now too expensive for foreign buyers, relative to the competition. Tariffs, global disruption, etc also actively working against holding USD reserves ... further worsening US prospects.

 

GBP used to be the reserve currency; it's demise through the 1950's/1960's offers useful takeaways. The 'GoGo' 1960's wasn't just about the pill, freedoms, and fashions ... it was primarily because for owners of the ascending reserve currency (USD), quality companies with long established trading relationships were dirt cheap. The same thing might be said today with Yuan replacing USD.

 

Americans chose Trump to break the frame; the bet being that radical change was better than more of the same (similar to  Brexit). Power to the Americans, but the risk is on them, not everyone else; far better to hold one's wealth in some other currency than USD while the US experiments.

 

Not that long ago Canada's official opposition should have won a material majority; as the then prime minister was despised across the land, and anything else was better. Instead, they failed; the sitting prime minister was persuaded to 'take a walk in the snow', replaced with a better candidate, and the opposition exposed as to how bad they actually were. The rest is history.

 

Similar thing in the US today, Trump owes much of his control to how bad his opposition is. While the US works it out, the risk is on them and not everyone else; again, far better to hold one's wealth in some other currency than USD.

 

Net result ??? it is preferable to hold CAD over USD for most of the next decade.

 

SD

Edited March 23 by SharperDingaan

[Spooky]

On 3/20/2026 at 6:15 PM, Lotsofcoke said:

As for end of world... One must invest like the end of the world doesn't happen... If it does... what you bought or sold won't matter and your cash won't help you or get you into the after life in a better position...

Totally agree! That’s why I don’t understand those gold bugs. It pays to be an optimist. 

[Red Lion]

15 hours ago, SharperDingaan said:

Over time, FX rates are driven by the combination of fiscal/monetary/trade policy of country A (US) vs country B (Canada). Canada has been able to use Trumps disruption, and intelligently invest in/renew sorely needed infrastructure across the nation. Once built (3-5 yrs out), Canada will be exporting a lot more, the US will be a smaller trade partner, and Canada will be a lot less vulnerable to catching a cold/flu when the US falters. Construction work, and Canadian sourcing during the build, further mitigating US exposure. Rising anti fragility.    

 

The US has not been able to use Trumps disruption and intelligently invest. AI as the great saviour has limited scope; it doesn't help with planting and bringing in the crops, flipping burgers at minimum wage (or less), and the sale of US manufactured goods that are now too expensive for foreign buyers, relative to the competition. Tariffs, global disruption, etc also actively working against holding USD reserves ... further worsening US prospects.

 

GBP used to be the reserve currency; it's demise through the 1950's/1960's offers useful takeaways. The 'GoGo' 1960's wasn't just about the pill, freedoms, and fashions ... it was primarily because for owners of the ascending reserve currency (USD), quality companies with long established trading relationships were dirt cheap. The same thing might be said today with Yuan replacing USD.

 

Americans chose Trump to break the frame; the bet being that radical change was better than more of the same (similar to  Brexit). Power to the Americans, but the risk is on them, not everyone else; far better to hold one's wealth in some other currency than USD while the US experiments.

 

Not that long ago Canada's official opposition should have won a material majority; as the then prime minister was despised across the land, and anything else was better. Instead, they failed; the sitting prime minister was persuaded to 'take a walk in the snow', replaced with a better candidate, and the opposition exposed as to how bad they actually were. The rest is history.

 

Similar thing in the US today, Trump owes much of his control to how bad his opposition is. While the US works it out, the risk is on them and not everyone else; again, far better to hold one's wealth in some other currency than USD.

 

Net result ??? it is preferable to hold CAD over USD for most of the next decade.

 

SD

So is this more of a short the dollar trade or buy cdn? 
 

It seems like all currencies are a depreciating asset, so perhaps more meaningful to find investment opportunities or high roic businesses where possible unless you can get the timing just right and use leverage or options on the fx side? 

[SharperDingaan]

5 hours ago, Red Lion said:

So is this more of a short the dollar trade or buy cdn? 
 

It seems like all currencies are a depreciating asset, so perhaps more meaningful to find investment opportunities or high roic businesses where possible unless you can get the timing just right and use leverage or options on the fx side? 

 

Not a trade, investment strategy. Wherever practical, within North America, CAD denominated assets and USD denominated debt. 

 

SD

[whatstheofficerproblem]

The spread on my backwardation play is closing. Looks like more folks getting involved. Short CLU26 and long CLZ26, spread was $6+ last week, now $4.

[Red Lion]

7 hours ago, SharperDingaan said:

 

Not a trade, investment strategy. Wherever practical, within North America, CAD denominated assets and USD denominated debt. 

 

SD

My only real CAD denominated asset is FFH, but I feel like this is really just a USD investment in another wrapper. 

[SharperDingaan]

1 hour ago, Red Lion said:

My only real CAD denominated asset is FFH, but I feel like this is really just a USD investment in another wrapper. 

 

It isn't just what the asset and liability FX denominations are, it's also where the head office (controlling mind) is, the investor protections on that home exchange (TSX), and what the overall USD exposure looks like net of FX swaps for the next decade or so. A FFH would be similar to the big 5 banks, big 3 Lifeco's, etc. Canadian.

 

SD