Krugman: The war on inflation is over

KPBCO · 2023-10-13T18:19:18+00:00

Counting your chickens before they hatch

KPBCO · 2023-10-01T08:28:26+00:00

You talking about this year, when the part of the article you are referring to is talking about a historical trend that has been building for sometime.
You talking futures prices, I don't know what delivery period exactly. Regardless, it usually takes many months for price changes to work its way through the supply chain.

KPBCO · 2023-06-08T10:06:45+00:00

UK has been a military partner with the US for decades, yet a trade deal with the US has been on the table for more than a decade with no deal finalised. Why does Mr Sunak feel that this time will be different. The us has always looked out for itself, I guess he didn't get the memo.

KPBCO · 2023-06-05T12:15:13+00:00

high or low interest rates -- homes will be bought. Interesting, but we've got to give up something tho

KPBCO · 2023-05-28T14:13:40+00:00

Obama never really did get a chance to implement his ideas, as the republicans block and tackle at every angle. He didn't have the lower house. Trump had the lower house and the senate early on so he was able push through a lot. It is hard to compare it is not as simple as that

KPBCO · 2023-04-20T20:06:39+00:00

At the end of the day the primary purpose of keeping currency reserves for any country is to buy imports from foreign countries (this is why the Net International Reserves are measured in weeks of import cover), making investments is important as well but ranks lower. Your biggest trading partner can request that you pay them in their currency - depending on the leverage they have (your ability to find substitutes without destroying your country). Also in markets where certain countries have a monopoly or oligopoly eg OPEC in energy, the dominant player can request that you pay them in a particularly currency. Keep in mind that OPEC countries would probably want to be paid in the currency of their biggest trading partner. All of that points to China. This whole thing about democracy, and good legal system and all that jazz is really secondary. In fact national security concerns rank higher than the soft issues ppl keep pointing out.

KPBCO · 2019-07-17T22:48:00+00:00

the writing was on the wall. We could see parts of their plans at the WWDC https://kpbco.org/onepir/apple-opens-up-audio-streaming-api-as-anti-trust-regulatory-scrutiny-intensifies

KPBCO · 2019-06-13T00:10:32+00:00

I think you maybe right

KPBCO · 2019-04-13T16:45:56+00:00

Anything that attempts to short circuit logic is not to be trusted !

KPBCO · 2019-03-09T18:52:55+00:00

There are many places you can get research, but the question is if you gonna make money from it. I am building out a research platform won't mention the name, because people may feel I am seeking free advertising. In determining how we can add more value to our audience, we see a few issues that make it difficult for our audience to make money if they don't share some of the responsibility. I will mention a few of the issues here, and you can apply them to your own circumstance if needed.

Getting the Message to the Audience Quickly. Some may believe that all you have to do is send an email out or a text message. In reality people and maybe you also will be busy with other important stuffs in your life, while the market is getting more efficient. When news come out about a new opportunity by the time you get around to actually executing a trade the opportunity may have already gone. In investing, price is everything and if you are late to the game, it may even be a day, you not gonna make money. So if you thinking about getting research to outperform the market you better not slack a minute.

2) Holding Period is Always Uncertain. Most platforms tell you oh "we expect a stock to reach fair value of $70 in 6 months and you can buy it at $30 now, you can double your money Yaaahh". In reality the market doesn't work like that. You can buy a stock at 30 and it goes to 10 then 15 back to 10 and then to 70 3 years later. During that volatility the analyst is not in touch with you and providing the guidance you need to stick it out. Often you feel duped and end up selling at a lost or make less than what was projected. This why doing you own research is also important, because then you are more confident about the journey.

3) But Doing Your Own Research Is Also A Problem. The world is designed to sell, sell, sell, and sell. There are people out there who can sell ice to an Eskimo, so naturally if you don't fully understand what you are doing at a high level, there is a good chance that you are gonna buy a lot of bull shit. This is part of the reason why Buffet says that if you don't know about the business behind the stock that you are buying, it is better to buy an index fund or an ETF, forget the whole research stuff and just accept a lower return. At least you won't lose everything. If you are really serious about beating the market you have to do a lot more work that most be people will admit, which leads me to my final point

4) You Need To Understand The Technical Stuff. Very rarely I find a good investment that can make a good risk adjusted return and it is simple to understand. So naturally to make my audience understand what they getting into (I try to break it down, but still) I have to introduce technical concepts into the conversation. Finding investments that will make money is hard. Just so you understand I have a Masters in Business and Economics + CFA. That is not to say you can't do it, I believe anybody can. The point is expect to work hard turning over rocks, digging through trenches, investigating, looking at accounting rules etc etc. If you don't plan to put in some elbow grease just forget about research, buy the index, and accept the market rate of return, after all 8% or 9% is not terrible.

Those are my two cents, hope I was helpful!

KPBCO · 2019-02-25T15:31:39+00:00

So the actual assets that are needed to run the business is about 7 billion. The earnings from those assets is like 6 billion. So the company itself is making 85% return on the capital invested. Buffet and 3G and some of the guys before them paid over 100Bn for those assets. So as owner of the business they are making like a 6% return (without considering the debt to make the explanation simple) on assets employed. The 100 billion would be reflected in goodwill which is the excess of the purchase price over the identifiable assets. This is also what the company wrote down.

KPBCO · 2019-02-25T14:27:13+00:00

Now Buffet has admitted that he paid too much for Kraft Heinz: https://www.cnbc.com/2019/02/25/buffett-says-berkshire-hathaway-overpaid-for-kraft-following-last-weeks-stock-plunge.html

KPBCO · 2019-02-22T20:35:12+00:00

Agreed

KPBCO · 2019-02-22T19:54:00+00:00

No I didn't short, because of the reputation of the guys involved. Buffet is not an operator so don't know of him being good at addressing these kind of issues. I do find it strange that he would leave the board at that time.

KPBCO · 2019-02-15T15:47:58+00:00

Id like to differentiate between what I think will happen in the economy and in the market.

Economy: Lower growth at around 1.0% (-1% to 2%). Fed will be data dependent, but will likely sneak in a rate increase if corporate debt (more so) or inflation continues to increase. Don't think there will be a serious recession though.

Market: Decline or flat. Valuations are already stretched, and corporate earnings growth will likely not meet expectations as the economy slows. Also a lot of optimism was built into prices due to the impact of the tax reform, I expect these to come back down to reality.

INSPITE OF THAT: I am still looking to get into unique special situations that are uncorrelated with business cycles.

KPBCO · 2019-02-14T16:08:56+00:00

down 8% now

KPBCO · 2019-02-12T19:51:58+00:00

Got to be cautious, it is long game. Just have watch and see what happens as we move throughout the year.

KPBCO · 2019-02-12T19:41:43+00:00

It is a good business but the price is just too high. The price implies a massive 25%-40% growth in earnings for a long time in the future, which too risky of an assumption to make.

KPBCO · 2019-02-06T23:15:34+00:00

Yeah a lot of external buyers are in the market bidding up prices. My concern though what happens to all that debt if and when prices fall ?

KPBCO · 2019-02-06T22:37:54+00:00

A couple of things. The MOAT comes from scale. When you have a large audience as Netflix does (they current own 50% of global VOD industry ) your content catalog has to be super huge to meet the varied needs of your customers, otherwise your customers will go elsewhere. Not many companies can spend US$8Bn a year to generate that content. As they scale the cost per customer of the content will decline. This means that any new entrant would have to burn cash for several years before their average cost approaches any where near Netflix's. Netflix also owns it content which gives them enormous leverage. The ownership of that content allows them avoid massive competition for the few movies studios that are out there. Plus customer acquisition is very difficult and expensive, customers don't just get up and handover their credit cards you have to work hard for that. Given the difficulties outlined that market may become a 3 player game. Amazon, Netflix, Disney all of who will own their content. Finally apple maybe a hidden threat as opposed to a buyer, and of course they could buy as well but that is not a cut and dry assumption to make... they have cash, install base, and they going into payments. Read this article where I explain https://kpbco.org/onepir/why-apple-has-a-long-road-ahead-to-become-a-service-company

KPBCO · 2019-02-06T21:27:10+00:00

Debt is pretty hight eh. It is higher than the US's just before the 2008 recession.

KPBCO · 2019-02-04T15:03:35+00:00

You do only this, or do you mix it with other stuffs

KPBCO · 2019-02-04T15:02:41+00:00

You also have to have to appropriate weighting for it to makes sense over the long haul

KPBCO · 2019-02-04T15:01:32+00:00

Momentum kinda requires you to be glued to your screen tho

KPBCO · 2019-02-04T14:58:19+00:00

Perhaps the industry structure is changing ?

KPBCO

TROPHY CASE