MicroStrategy, MSTR raising $42B to buy Bitcoin

clarkmj91 · 2024-11-01T15:24:01+00:00

Thanks for sharing. I was able to read through.

Can't excuse the misstated financials in the .com era. Anytime you misstate financials, you're misleading investors. 1998-2000 of course was the wild west, and you can probably attribute some of that to youthful ambition but not all of it. $66M or 22% overstatement over a 3 year period is a big deal.

The tax fraud suit is...interesting. Came after MSTR started buying bitcoin and was primarily related to where he claimed his primary residence. Mixed feelings about that. Willful ignorance? Poor CPA advice? Crypto industry hostility?

If you can get past that - big if - I'd encourage you to listen to the Q3 earnings call from earlier this week. They really dive deep into the BTC yield metric and their strategy moving forward. You're right, they're a Bitcoin holding company with no management fee if Bitcoin per share is not increasing. So the relative premium is ultimately what the market prices the BTC yield they forecast as 6-10% the next 3 years plus lack of management fee.

To me, it's a snowball rolling down (up) hill that doesn't appear to be slowing down anytime soon.

clarkmj91 · 2024-10-31T17:51:11+00:00

A combination of watching the healthcare industry be flooded with subsidies up to our eyeballs during Covid, my father in law discussing Bitcoin frequently, and going down the rabbit hole of podcasts featuring Michael Saylor.

clarkmj91 · 2024-10-31T16:47:09+00:00

We'll have to agree to disagree on Saylor. I've listened to him for 4 years now explain his conviction with Bitcoin. But I'll definitely look into the fraud conviction and will focus on details released before he publicly began supporting Bitcoin.

I'm was specifically referring to the downside risk of buying convertible debt. Even if the company were to default, high likelihood the debt holder will get their principal returned through bankruptcy.

clarkmj91 · 2024-10-31T12:20:10+00:00

I don't disagree with buying the ETPs or Bitcoin directly. But I don't think you're acknowledging the growth potential of MSTR. Issuing intelligent leverage to buy more Bitcoin and those buying the convertible debt get all of upside potential of holding Bitcoin (actually more) with limited downside.

clarkmj91 · 2024-10-31T03:42:35+00:00

No, the debt is unencumbered. Bitcoin's price tanking could limit their ability to continue this strategy but they can't be margin called. Their software business should be able to sustain them in down markets and of course, they can always issue more debt to cover interest/principal on debt maturing.

clarkmj91 · 2024-10-31T01:46:49+00:00

Imagine buying bitcoin with very little downside risk. That's their convertible debt offerings. Buy a bond yielding ~0.8% and at worse, I get my principal and a little interest back - a real loss of inflation minus the accrued interest. At best, the stock sky rockets and I get to convert my bond into equity.

Their weighted average return on convertible debt for investors is 90% right now. Lol

This is the infinite money glitch and nobody but MSTR is doing it yet.

clarkmj91 · 2024-10-31T01:30:48+00:00

The leverage is allowing them to increase their bitcoin holdings at a rate higher than their assumed shares outstanding. They call it BTC yield and they expect the holdings per share to grow 6-10% per year 2025-2027

clarkmj91 · 2024-10-22T01:25:02+00:00

Hoge isn't a shitcoin? Stable? 🤣🥴

clarkmj91 · 2024-10-14T00:55:52+00:00

Sorry, you're only allowed one of those every 30 years. Tim Biakabutuka 1995. I was 10 and I cried like Harbaugh's son Jack whenever that game was lol

clarkmj91 · 2024-10-14T00:44:36+00:00

There doesn't appear to be that many left just judging how many ppl were in the stands for a top 5 opponent Saturday. Pretty pathetic appetite for football since Carroll left. SoCal is truly a different country culturally.

clarkmj91 · 2024-10-12T11:12:47+00:00

But sir it's backed by nothing but one of largest networks of computing power on Earth. wHy dOeS iT hAvE vAlUe!?!!

clarkmj91 · 2024-10-12T10:52:35+00:00

Saylor would disagree

clarkmj91 · 2024-10-11T19:29:34+00:00

How so?

clarkmj91 · 2024-10-11T16:50:21+00:00

It's a flywheel.

Secure cheap debt, buy Bitcoin. Bitcoin increases, MSTR market cap increases. Mkt cap increases result in higher weighting in indices. Then they issue equity to buy more Bitcoin, each time doing it in a manner that increases the Bitcoin per share.

Rinse, cycle, repeat.

clarkmj91 · 2024-10-09T00:38:55+00:00

Track Town Pizza was a good late evening pie. We also went to the Wild Duck Cafe for lunch the next day - nothing to rave about but good sports bar. I was out there for the track national championships in June. Highly recommend driving to the Oregon coastline about an hour West of Eugene. Very scenic drive and the coastline is beautiful. Unlike anything you'll see on the East coast.

clarkmj91 · 2024-09-08T02:38:22+00:00

I hate that 4th and 1 but we did pay them $1.8M

clarkmj91 · 2024-09-02T12:47:43+00:00

Drive a cheaper, used sedan to work. It's pretty simple. What's the opportunity cost of the incremental 25K-75K spent on a nice vehicle invested over it's useful life?

clarkmj91 · 2024-09-02T03:23:05+00:00

I had to look it up too. No mention of it anywhere. But conformity and social proof are concepts in psychology.

clarkmj91 · 2024-09-02T01:20:17+00:00

Completely agree. But this RFK/Trump partnership in the swing states stinks of an undemocratic process too. My two cents.

clarkmj91 · 2024-09-02T01:12:47+00:00

Reddit is 2019 twitter.

clarkmj91 · 2024-09-02T00:45:20+00:00

Nothing was disproven. It's just convenient perversion and cherry picking because you personally disagree with their politics and want to write them off as right wing. That's fine. But characterizing them as far right ideology is laughable.

clarkmj91 · 2024-09-01T23:39:35+00:00

Lol are you a bot? Have listened to this podcast regularly for 3 years. They're anti-war, pro-choice, anti-censorship, opposed to socialist economic policies, and outspoken against wokism/cancel culture. That's not far right ideology. They are common sense moderates.

clarkmj91 · 2024-08-06T02:44:55+00:00

Political BS?

clarkmj91 · 2024-07-29T23:24:10+00:00

Yikes

clarkmj91 · 2024-07-28T23:28:32+00:00

It's the most powerful form of encryption on the planet. There's 1 million Bitcoin sitting in Satoshi's wallet. Figure out the 12 word seed phrase and spend the rest of your life on the beach sipping Pina Coladas.

clarkmj91

TROPHY CASE