Markets still falling like whoa

[phdhorn 6,224]

[Cheeseweasel 26,438]

3 hours ago, Wally Fairway said:

good times the 70's

You forgot the most important one.

[52-80 19,158]

On 6/30/2022 at 4:50 PM, phdhorn said:

 

this chart is so deceptive because of the timeframe. 

you need the right level of zoom to appreciate the full context:

[Wally Fairway 5,549]

54 minutes ago, 52-80 said:

this chart is so deceptive because of the timeframe. 

you need the right level of zoom to appreciate the full context:

The Wally Effect

[Guest]

Payrolls +372,000.

At what point does the narrative change to "you know what, the economy isn't that bad."? Adding nearly 400K jobs and unemployment at 3.6%

Inflation sucks. Covid has caused all sorts of disruption. Being in a rising rate environment is new for everyone. But things are humming along despite those headwinds. Could a recession come? Absolutely... there's always one around the corner. But I think the general consensus is that the economy is in the tank. I don't think that's true.

[Hefeweizen 5,321]

I don’t think that’s the consensus at all (that the economy is bad).  I think there is a well justified fear that inflation may cause an overreaction in interest rates and tightening, but I’ve not seen anyone serious claim we’re in anything but a technical recession (output shrinking due to gdp).  I do think home buying will be the first indicator of a real slowdown.  If we see big drops in home prices then I’ll be worried.

[Cheeseweasel 26,438]

25 minutes ago, FirstTimeCaller said:

Payrolls +372,000.

At what point does the narrative change to "you know what, the economy isn't that bad."? Adding nearly 400K jobs and unemployment at 3.6%

Inflation sucks. Covid has caused all sorts of disruption. Being in a rising rate environment is new for everyone. But things are humming along despite those headwinds. Could a recession come? Absolutely... there's always one around the corner. But I think the general consensus is that the economy is in the tank. I don't think that's true.

I agree. However, if everything is really ok, how will Cramer grift? 

[Wally Fairway 5,549]

34 minutes ago, Hefeweizen said:

I don’t think that’s the consensus at all (that the economy is bad).  I think there is a well justified fear that inflation may cause an overreaction in interest rates and tightening, but I’ve not seen anyone serious claim we’re in anything but a technical recession (output shrinking due to gdp).  I do think home buying will be the first indicator of a real slowdown.  If we see big drops in home prices then I’ll be worried.

 

28 minutes ago, Cheeseweasel said:

I agree. However, if everything is really ok, how will Cramer grift? 

Cramer and JPow will push the fear factor until Fed rates are 4.5% and it really does kill the economy; because the Fed drives full speed ahead all the while looking out the rear window

[Storm the Field 5,294]

59 minutes ago, Hefeweizen said:

I don’t think that’s the consensus at all (that the economy is bad).

Uhh, consumer sentiment and state of the economy type questions are polling at or below GFC levels. This, despite 3.6% unemployment and the vast majority of  respondents rating their personal financial situation as positive. Basically, a large segment of the public has decided that "recession" means "high gas prices" and "depression" means "high gas prices and a seller's housing market."

[StruggleBus 3,922]

1 hour ago, Hefeweizen said:

If we see big drops in home prices then I’ll be worried.

Not happening as long as there is no inventory

[Captainant 27,667]

1 hour ago, FirstTimeCaller said:

Payrolls +372,000.

At what point does the narrative change to "you know what, the economy isn't that bad."? Adding nearly 400K jobs and unemployment at 3.6%

Inflation sucks. Covid has caused all sorts of disruption. Being in a rising rate environment is new for everyone. But things are humming along despite those headwinds. Could a recession come? Absolutely... there's always one around the corner. But I think the general consensus is that the economy is in the tank. I don't think that's true.

I think what's missing here is the quality of those jobs being added to payroll. If those jobs are at $15/hr, they're paying maybe $2500/mo ($30k/yr) before taxes. That's not exactly going to increase that person's overall economic contributions, especially when you consider that the average rent rate in the US is around $1300/mo (and median around $2000). 

The economic pie ain't pretty if you're below the middle of the curve. 

4 minutes ago, Storm the Field said:

the vast majority of  respondents rating their personal financial situation as positive

I'd similarly be curious to see the economic makeup of their respondents, but this makes sense. If 30% of the country is generationally stuck trying to keep their heads above water, then the vast majority of respondents would still be in a positive financial situation

[Incredulity 11,671]

Recession or not is going to be argued ad-Infinium even after the we post 2 quarters of GDP contraction in a couple weeks. 

It's all relative.  We are leaving a time when demand for everything was completely unhinged and supply was fucked.  Not only did every consumer have "free" money to spend, every company from A to Z was provided PILES of money.  PPP, ERC, CARES support......(I am probably missing stuff too)

 

My guess.  We overshoot on tightening and post relatively shitty numbers into Q2 of 23, Fed freaks the fuck out and lowers rates and resumes QE.

 

[Incredulity 11,671]

46 minutes ago, StruggleBus said:

Not happening as long as there is no inventory

it's already happening.  scroll around on zillow.  price cuts are very common, especially at the high end. 

 

[StruggleBus 3,922]

2 minutes ago, Incredulity said:

it's already happening.  scroll around on zillow.  price cuts are very common, especially at the high end. 

 

Yes, the market has cooled. But a significant downturn isn't happening without more inventory. Trust me, I sell software and also finished in the top 20 percent of my high school class. 

[Incredulity 11,671]

Just now, StruggleBus said:

Trust me, I sell software and also finished in the top 20 percent of my high school class. 

[Cheeseweasel 26,438]

38 minutes ago, Incredulity said:

My guess.  We overshoot on tightening and post relatively shitty numbers into Q2 of 23, Fed freaks the fuck out and lowers rates and resumes QE.

The FED is a woman packing for a trip she just found out about. They are throwing a bunch of shit in there and hoping they'll need it but in reality are just adding additional weight to the luggage we're going to have to carry around 3 airports and hotel lobbies. 

[babysdaddy 2,724]

46 minutes ago, StruggleBus said:

Yes, the market has cooled. But a significant downturn isn't happening without more inventory. Trust me, I sell software and also finished in the top 20 percent of my high school class. 

I don't get that reference and it makes me sad.

 

 

Guys is always talking his book but he's no dummy. Thread is relevant.  Real GDP may decline a bit given inflation numbers but nominally we are going through the roof.  Debt to GDP going to be close to 100% by 9/30, mainly given deficit spending is below last year (no stimmy) and nominal growth.  We measure everything in Real (https://www.bea.gov/news/2022/gross-domestic-product-third-estimate-gdp-industry-and-corporate-profits-revised-first)  however nominal is continuing to increase which is part of Ackman's point (https://fred.stlouisfed.org/series/GDP)

[StruggleBus 3,922]

There's no reference, I'm just really smart

[Incredulity 11,671]

1 hour ago, babysdaddy said:

Guys is always talking his book but he's no dummy.

fuck Ackman for his COVID performative bullshit.  piece of shit would sell his mother to make a buck.(credit to Sir Larry Wildman)

[Sbbruin 21,853]

These quarterly "buy/sell" notes from our investment advisor are always interesting:

Spoiler

In the second quarter of 2022, the largest buy for the GJCM Growth Strategy was as follows:
Meta Platforms, Inc. (FB)
• With over 3 billion monthly active users, Meta is one of the world’s largest social networks. The
company’s products (Facebook, Instagram, Messenger, WhatsApp, and Reality Labs) enable
people to connect and share with friends and family through mobile devices, personal
computers, and other surfaces. Substantially all of Meta’s revenue is generated from selling
advertising placements to marketers. The company was founded in 2004 by its current CEO,
Mark Zuckerberg.
• In our opinion, Meta’s biggest competitive advantage is the network effect provided by its
platform. As more users use the company’s products, new users are attracted to the platform
to stay connected with friends and family. Users’ time is limited, and thus they are more likely
to stick with one or two social networks, which allows them to connect with friends and family
in an efficient manner. Evidence of this can be seen with other social network platforms having
limited or no success (e.g., Google shuttered its Facebook competitor, Google+, in 2018 after 7
years of operation).
• We believe Meta will continue to be a major beneficiary of ad revenue shifting from traditional
mediums (e.g., print, TV, real estate, etc.) to digital. Advertisers are attracted to the growing
number of users as a place to market their products and services. Meta’s extensive use of AI
technology to collect and process a massive amount of data from its users (e.g., age, gender,
location, interests, and behaviors) allows marketers to better pinpoint ads. Efficiently targeted
ads allow marketers to generate a higher return on investment from their advertising spend,
which leads marketers to spend more with Meta. Finally, Meta provides marketers an
ecosystem where they can advertise across many platforms in one place.
• Outside of core Facebook and Instagram, the company appears to be in the early innings of
monetizing its properties and developing new ecosystems. For example, the company has been
testing ways for businesses to interact with potential customers on its WhatsApp and Messager
properties. Additionally, the company is in the very early stages of developing products and
developer platforms for the metaverse.
• While questions exist on the growth path of the overall economy and new competition, we
believe Meta can earn over $13 per share in 2023 and currently trades at ~12x earnings
(~11x excluding cash). We believe this is a very reasonable valuation given the company’s high
incremental margins and its long runway to grow revenue at a reasonable rate for the
foreseeable future.
In the second quarter of 2022, the largest sells for the GJCM Growth Strategy were as follows:
Madison Square Garden Sports (MSGS)
• Madison Square Garden Sports owns a collection of leading sports teams. These sports teams
include the New York Knicks, New York Rangers, two development league teams, and esports
teams through Counter Logic Gaming. In addition, the company owns two professional sports
team performance centers: the MSG Training Center in Greenburgh, NY and the CLG
Performance Center in Los Angeles, CA.
• Lacking a catalyst to realize the value of the company’s assets, we have decided to liquidate our
position in MSGS. We plan to reinvest the proceeds in other opportunities when they arise.
*Market data and estimates as of transaction date.
Coinbase Global, Inc. (COIN)
• Founded in 2012 by its current CEO, Brian Armstrong, Coinbase is a leading provider of end-to-
end financial infrastructure and technology for the crypto economy. The company offers retail
users the primary financial account for the crypto economy, institutions a state-of-the-art
marketplace with a deep pool of liquidity for transacting in crypto assets, and ecosystem
partners technology and services that enable them to build crypto-based applications and
securely accept crypto assets as payment. As of Q1 2022, Coinbase had 98 million verified users
and $257 billion in assets on its platform.
• We have decided to exit our position in COIN as a slowdown in the crypto market will likely be a
headwind to the company’s growth for the near-term. We still believe there is potential for
crypto infrastructure and technology and will continue to monitor the crypto economy and
Coinbase. Yet, a turnaround may take some time.

 

In the second quarter of 2022, the largest buys for the GJCM Equity Income Strategy were as follows:
Amazon.com, Inc. (AMZN)
• Founded in 1994, Amazon is a household name known by most as one of the world’s largest
online retailers. The company’s websites allow it and third parties to sell hundreds of millions of
unique products across dozens of product categories. Beyond its retail operations, the
company’s Amazon Web Services segment (“AWS”) offers developers and enterprises a broad
set of cloud storage and database services. Headquartered in Seattle, Washington, the
company generated about two-thirds of its revenue in the United States in 2021.
• While people have been purchasing goods online since the 1990s, we believe online penetration
of retail still has plenty of runway, and Amazon is very well positioned to capture a growing
share. The company’s focus on the customer experience has built a platform that has incredible
scale and networking effects that we feel shield it from competition. For example, Amazon’s
third-party seller services exhibit strong network effects with customer growth. As more SKUs
are added to Amazon’s platform from third-party sellers, more customers are attracted to the
platform.
• Amazon’s AWS segment is the market leader in public cloud. We believe this very cash
generative business segment has plenty of room to grow as more companies look to outsource
their IT infrastructure to the public cloud. Additionally, as customers outsource a larger portion
of their IT infrastructure to AWS, they become stickier clients as the cost to switch to another
provider increases.
• Applying conservative growth rates and normalized operating margins to Amazon’s multiple
revenue sources, we believe the company could earn about $9.25 per share by 2023.
Furthermore, we feel the company’s long runway for growth driven by opportunities in multi-
trillion dollar industries will allow it to grow its earnings for many years.
Alphabet Inc. (GOOGL)
• Alphabet Inc., through its subsidiaries, provides online advertising services, hardware, cloud
computing, and other products and services in the U.S. and internationally. It operates through
its Google Services, Google Cloud, and Other Bets segments.
• We believe Alphabet will continue to benefit from the digital revolution, as the use and
proliferation of mobile devices expand, and consumers look for new ways to consume content
and interact with technology. In addition to its strong core business (search), we feel Alphabet
has multiple assets that it can monetize to a greater extent going forward, including YouTube,
Android, Google Cloud, and properties such as Waymo and Verily in its Other Bets segment.
• Alphabet currently trades at 16x estimated 2023 earnings per share. This does not factor in the
$100B+ of net cash that it carries on its balance sheet. We view this as an attractive price for a
company with a strong economic moat that is growing significantly faster than GDP.
*Market data and estimates as of transaction date.
In the second quarter of 2022, the largest sell for the GJCM Equity Income Strategy was as follows:
Nestlé S.A. (NSRGY)
• Nestlé S.A. is a leading food and drinks company that manufactures and markets its wide range
of products all over the world. The company’s diverse product line include coffee, pet foods,
infant foods, prepared meals, milk products, confectionery, and bottled water. The Americas is
the company’s largest market. Nestlé is headquartered in Switzerland and can trace its
beginnings back to 1866.
• Nestlé remains a core position in the strategy; however, we are trimming the position for
portfolio management purposes.

 

[Trey3216 15,346]

2 hours ago, babysdaddy said:

I don't get that reference and it makes me sad.

 

 

Guys is always talking his book but he's no dummy. Thread is relevant.  Real GDP may decline a bit given inflation numbers but nominally we are going through the roof.  Debt to GDP going to be close to 100% by 9/30, mainly given deficit spending is below last year (no stimmy) and nominal growth.  We measure everything in Real (https://www.bea.gov/news/2022/gross-domestic-product-third-estimate-gdp-industry-and-corporate-profits-revised-first)  however nominal is continuing to increase which is part of Ackman's point (https://fred.stlouisfed.org/series/GDP)

Nominal doesn't mean shit. Nominally, UT is the best FB program in all the land.  But really....

 

For Fuck's sake, If a low income earner who drives 30 minutes to work everyday had his/her wages increased 50% over the last year, nearly all their wage increases have been eaten up by the increase in fuel costs to get to and from work.  Then factor in food/rent/utilities/etc costs and the're making less money than they did before.  Nominal measurements are for fucktards like Ackman.  Hell, Ackman was probably technically correct about Herbalife.  How do you think he feels about that trade.   Dumbass rode Valeant Pharma from $200 to 8 and finally sold ( I bought 10k shares at 8 and sold that bitch at 20, just cuz Ackman was out).   Fuck that stupid fucker. 

[MoJames 8,244]

1 hour ago, Trey3216 said:

Fuck that stupid fucker.

[Trey3216 15,346]

Just now, MoJames said:

No, Ackman is just a piece of shit stupid fucker.  I love to laugh at him. 
 

Still one of the top 5 moments I’ve ever seen on CNBC.  
 

https://youtu.be/hCZRk1lL90Q

[52-80 19,158]

5 hours ago, babysdaddy said:

I don't get that reference and it makes me sad.

 

 

Guys is always talking his book but he's no dummy. Thread is relevant.  Real GDP may decline a bit given inflation numbers but nominally we are going through the roof.  Debt to GDP going to be close to 100% by 9/30, mainly given deficit spending is below last year (no stimmy) and nominal growth.  We measure everything in Real (https://www.bea.gov/news/2022/gross-domestic-product-third-estimate-gdp-industry-and-corporate-profits-revised-first)  however nominal is continuing to increase which is part of Ackman's point (https://fred.stlouisfed.org/series/GDP)

rates did have a nice 3 days since that post

[TonyTexas 10,512]

 

[tbone_ 14,123]

No shit

[Hefeweizen 5,321]

I’ve made a terrible mistake.gif

 

 haha hopefully Twitter takes his billion and then goes bankrupt.

[Wally Fairway 5,549]

There is no chance Elon takes the easy way out; pays the $1B break up fee and says Adios MF'rs.

Hell in 6 months he could come back and offer $24.20 or maybe even $14.20. it would be the best billion he ever spent

[Captainant 27,667]

On 7/8/2022 at 8:28 PM, Hefeweizen said:

I’ve made a terrible mistake.gif

 

 haha hopefully Twitter takes his billion and then goes bankrupt.

 

22 hours ago, Wally Fairway said:

There is no chance Elon takes the easy way out; pays the $1B break up fee and says Adios MF'rs.

Hell in 6 months he could come back and offer $24.20 or maybe even $14.20. it would be the best billion he ever spent

I dont think musk has legal outs available. He waived due diligence to sign a binding agreement to buy TWTR for $54.20/share. Musk used the gambit to cash out ~$8 billion out of his still inflated TSLA valuation to execute the deal, and has financing lined up. Trying to strangle the deal to a lower amount than you are contractually obliged to pay is some fraudulent fuckery and market manipulation if allowed to go through as y'all suggest

[TonyTexas 10,512]

On 4/26/2022 at 9:20 AM, BehoId, The Underminer! said:

Does the difference between TWTR price and $54.20 just represent the odds that the deal doesn’t actually close?   Seems like a bargain to me.  Free 8%

Valuable life lesson: Nothing in life is free

Edited July 10, 2022 by TonyTexas

[MonkeyDoughnut 10,235]

On 7/9/2022 at 9:08 AM, Wally Fairway said:

There is no chance Elon takes the easy way out; pays the $1B break up fee and says Adios MF'rs.

Hell in 6 months he could come back and offer $24.20 or maybe even $14.20. it would be the best billion he ever spent

That's not an option. The $1B fee is conditional and not a "because I feel like it" choice.  My guess he's hoping Twitter comes to him and says give us $5B or less and we'll let you walk away.  My other guess is Twitter tells him ... Lol...pay up as you are about to have way overpayed for us... Thanks for the extra $25B.

[ChiTownDoc 21,154]

On 7/8/2022 at 10:17 AM, StruggleBus said:

Yes, the market has cooled. But a significant downturn isn't happening without more inventory. Trust me, I sell software and also finished in the top 20 percent of my high school class. 

Username definitely not checking out.  

[ChiTownDoc 21,154]

On 7/8/2022 at 1:02 PM, Sbbruin said:

These quarterly "buy/sell" notes from our investment advisor are always interesting:

  Hide contents

In the second quarter of 2022, the largest buy for the GJCM Growth Strategy was as follows:
Meta Platforms, Inc. (FB)
• With over 3 billion monthly active users, Meta is one of the world’s largest social networks. The
company’s products (Facebook, Instagram, Messenger, WhatsApp, and Reality Labs) enable
people to connect and share with friends and family through mobile devices, personal
computers, and other surfaces. Substantially all of Meta’s revenue is generated from selling
advertising placements to marketers. The company was founded in 2004 by its current CEO,
Mark Zuckerberg.
• In our opinion, Meta’s biggest competitive advantage is the network effect provided by its
platform. As more users use the company’s products, new users are attracted to the platform
to stay connected with friends and family. Users’ time is limited, and thus they are more likely
to stick with one or two social networks, which allows them to connect with friends and family
in an efficient manner. Evidence of this can be seen with other social network platforms having
limited or no success (e.g., Google shuttered its Facebook competitor, Google+, in 2018 after 7
years of operation).
• We believe Meta will continue to be a major beneficiary of ad revenue shifting from traditional
mediums (e.g., print, TV, real estate, etc.) to digital. Advertisers are attracted to the growing
number of users as a place to market their products and services. Meta’s extensive use of AI
technology to collect and process a massive amount of data from its users (e.g., age, gender,
location, interests, and behaviors) allows marketers to better pinpoint ads. Efficiently targeted
ads allow marketers to generate a higher return on investment from their advertising spend,
which leads marketers to spend more with Meta. Finally, Meta provides marketers an
ecosystem where they can advertise across many platforms in one place.
• Outside of core Facebook and Instagram, the company appears to be in the early innings of
monetizing its properties and developing new ecosystems. For example, the company has been
testing ways for businesses to interact with potential customers on its WhatsApp and Messager
properties. Additionally, the company is in the very early stages of developing products and
developer platforms for the metaverse.
• While questions exist on the growth path of the overall economy and new competition, we
believe Meta can earn over $13 per share in 2023 and currently trades at ~12x earnings
(~11x excluding cash). We believe this is a very reasonable valuation given the company’s high
incremental margins and its long runway to grow revenue at a reasonable rate for the
foreseeable future.
In the second quarter of 2022, the largest sells for the GJCM Growth Strategy were as follows:
Madison Square Garden Sports (MSGS)
• Madison Square Garden Sports owns a collection of leading sports teams. These sports teams
include the New York Knicks, New York Rangers, two development league teams, and esports
teams through Counter Logic Gaming. In addition, the company owns two professional sports
team performance centers: the MSG Training Center in Greenburgh, NY and the CLG
Performance Center in Los Angeles, CA.
• Lacking a catalyst to realize the value of the company’s assets, we have decided to liquidate our
position in MSGS. We plan to reinvest the proceeds in other opportunities when they arise.
*Market data and estimates as of transaction date.
Coinbase Global, Inc. (COIN)
• Founded in 2012 by its current CEO, Brian Armstrong, Coinbase is a leading provider of end-to-
end financial infrastructure and technology for the crypto economy. The company offers retail
users the primary financial account for the crypto economy, institutions a state-of-the-art
marketplace with a deep pool of liquidity for transacting in crypto assets, and ecosystem
partners technology and services that enable them to build crypto-based applications and
securely accept crypto assets as payment. As of Q1 2022, Coinbase had 98 million verified users
and $257 billion in assets on its platform.
• We have decided to exit our position in COIN as a slowdown in the crypto market will likely be a
headwind to the company’s growth for the near-term. We still believe there is potential for
crypto infrastructure and technology and will continue to monitor the crypto economy and
Coinbase. Yet, a turnaround may take some time.

 

In the second quarter of 2022, the largest buys for the GJCM Equity Income Strategy were as follows:
Amazon.com, Inc. (AMZN)
• Founded in 1994, Amazon is a household name known by most as one of the world’s largest
online retailers. The company’s websites allow it and third parties to sell hundreds of millions of
unique products across dozens of product categories. Beyond its retail operations, the
company’s Amazon Web Services segment (“AWS”) offers developers and enterprises a broad
set of cloud storage and database services. Headquartered in Seattle, Washington, the
company generated about two-thirds of its revenue in the United States in 2021.
• While people have been purchasing goods online since the 1990s, we believe online penetration
of retail still has plenty of runway, and Amazon is very well positioned to capture a growing
share. The company’s focus on the customer experience has built a platform that has incredible
scale and networking effects that we feel shield it from competition. For example, Amazon’s
third-party seller services exhibit strong network effects with customer growth. As more SKUs
are added to Amazon’s platform from third-party sellers, more customers are attracted to the
platform.
• Amazon’s AWS segment is the market leader in public cloud. We believe this very cash
generative business segment has plenty of room to grow as more companies look to outsource
their IT infrastructure to the public cloud. Additionally, as customers outsource a larger portion
of their IT infrastructure to AWS, they become stickier clients as the cost to switch to another
provider increases.
• Applying conservative growth rates and normalized operating margins to Amazon’s multiple
revenue sources, we believe the company could earn about $9.25 per share by 2023.
Furthermore, we feel the company’s long runway for growth driven by opportunities in multi-
trillion dollar industries will allow it to grow its earnings for many years.
Alphabet Inc. (GOOGL)
• Alphabet Inc., through its subsidiaries, provides online advertising services, hardware, cloud
computing, and other products and services in the U.S. and internationally. It operates through
its Google Services, Google Cloud, and Other Bets segments.
• We believe Alphabet will continue to benefit from the digital revolution, as the use and
proliferation of mobile devices expand, and consumers look for new ways to consume content
and interact with technology. In addition to its strong core business (search), we feel Alphabet
has multiple assets that it can monetize to a greater extent going forward, including YouTube,
Android, Google Cloud, and properties such as Waymo and Verily in its Other Bets segment.
• Alphabet currently trades at 16x estimated 2023 earnings per share. This does not factor in the
$100B+ of net cash that it carries on its balance sheet. We view this as an attractive price for a
company with a strong economic moat that is growing significantly faster than GDP.
*Market data and estimates as of transaction date.
In the second quarter of 2022, the largest sell for the GJCM Equity Income Strategy was as follows:
Nestlé S.A. (NSRGY)
• Nestlé S.A. is a leading food and drinks company that manufactures and markets its wide range
of products all over the world. The company’s diverse product line include coffee, pet foods,
infant foods, prepared meals, milk products, confectionery, and bottled water. The Americas is
the company’s largest market. Nestlé is headquartered in Switzerland and can trace its
beginnings back to 1866.
• Nestlé remains a core position in the strategy; however, we are trimming the position for
portfolio management purposes.

 

I’m on the raft too, bro.  

[Fudge Nuggets 19,190]

On 7/8/2022 at 1:02 PM, Sbbruin said:

These quarterly "buy/sell" notes from our investment advisor are always interesting:

  Hide contents

In the second quarter of 2022, the largest buy for the GJCM Growth Strategy was as follows:
Meta Platforms, Inc. (FB)
• With over 3 billion monthly active users, Meta is one of the world’s largest social networks. The
company’s products (Facebook, Instagram, Messenger, WhatsApp, and Reality Labs) enable
people to connect and share with friends and family through mobile devices, personal
computers, and other surfaces. Substantially all of Meta’s revenue is generated from selling
advertising placements to marketers. The company was founded in 2004 by its current CEO,
Mark Zuckerberg.
• In our opinion, Meta’s biggest competitive advantage is the network effect provided by its
platform. As more users use the company’s products, new users are attracted to the platform
to stay connected with friends and family. Users’ time is limited, and thus they are more likely
to stick with one or two social networks, which allows them to connect with friends and family
in an efficient manner. Evidence of this can be seen with other social network platforms having
limited or no success (e.g., Google shuttered its Facebook competitor, Google+, in 2018 after 7
years of operation).
• We believe Meta will continue to be a major beneficiary of ad revenue shifting from traditional
mediums (e.g., print, TV, real estate, etc.) to digital. Advertisers are attracted to the growing
number of users as a place to market their products and services. Meta’s extensive use of AI
technology to collect and process a massive amount of data from its users (e.g., age, gender,
location, interests, and behaviors) allows marketers to better pinpoint ads. Efficiently targeted
ads allow marketers to generate a higher return on investment from their advertising spend,
which leads marketers to spend more with Meta. Finally, Meta provides marketers an
ecosystem where they can advertise across many platforms in one place.
• Outside of core Facebook and Instagram, the company appears to be in the early innings of
monetizing its properties and developing new ecosystems. For example, the company has been
testing ways for businesses to interact with potential customers on its WhatsApp and Messager
properties. Additionally, the company is in the very early stages of developing products and
developer platforms for the metaverse.
• While questions exist on the growth path of the overall economy and new competition, we
believe Meta can earn over $13 per share in 2023 and currently trades at ~12x earnings
(~11x excluding cash). We believe this is a very reasonable valuation given the company’s high
incremental margins and its long runway to grow revenue at a reasonable rate for the
foreseeable future.
In the second quarter of 2022, the largest sells for the GJCM Growth Strategy were as follows:
Madison Square Garden Sports (MSGS)
• Madison Square Garden Sports owns a collection of leading sports teams. These sports teams
include the New York Knicks, New York Rangers, two development league teams, and esports
teams through Counter Logic Gaming. In addition, the company owns two professional sports
team performance centers: the MSG Training Center in Greenburgh, NY and the CLG
Performance Center in Los Angeles, CA.
• Lacking a catalyst to realize the value of the company’s assets, we have decided to liquidate our
position in MSGS. We plan to reinvest the proceeds in other opportunities when they arise.
*Market data and estimates as of transaction date.
Coinbase Global, Inc. (COIN)
• Founded in 2012 by its current CEO, Brian Armstrong, Coinbase is a leading provider of end-to-
end financial infrastructure and technology for the crypto economy. The company offers retail
users the primary financial account for the crypto economy, institutions a state-of-the-art
marketplace with a deep pool of liquidity for transacting in crypto assets, and ecosystem
partners technology and services that enable them to build crypto-based applications and
securely accept crypto assets as payment. As of Q1 2022, Coinbase had 98 million verified users
and $257 billion in assets on its platform.
• We have decided to exit our position in COIN as a slowdown in the crypto market will likely be a
headwind to the company’s growth for the near-term. We still believe there is potential for
crypto infrastructure and technology and will continue to monitor the crypto economy and
Coinbase. Yet, a turnaround may take some time.

 

In the second quarter of 2022, the largest buys for the GJCM Equity Income Strategy were as follows:
Amazon.com, Inc. (AMZN)
• Founded in 1994, Amazon is a household name known by most as one of the world’s largest
online retailers. The company’s websites allow it and third parties to sell hundreds of millions of
unique products across dozens of product categories. Beyond its retail operations, the
company’s Amazon Web Services segment (“AWS”) offers developers and enterprises a broad
set of cloud storage and database services. Headquartered in Seattle, Washington, the
company generated about two-thirds of its revenue in the United States in 2021.
• While people have been purchasing goods online since the 1990s, we believe online penetration
of retail still has plenty of runway, and Amazon is very well positioned to capture a growing
share. The company’s focus on the customer experience has built a platform that has incredible
scale and networking effects that we feel shield it from competition. For example, Amazon’s
third-party seller services exhibit strong network effects with customer growth. As more SKUs
are added to Amazon’s platform from third-party sellers, more customers are attracted to the
platform.
• Amazon’s AWS segment is the market leader in public cloud. We believe this very cash
generative business segment has plenty of room to grow as more companies look to outsource
their IT infrastructure to the public cloud. Additionally, as customers outsource a larger portion
of their IT infrastructure to AWS, they become stickier clients as the cost to switch to another
provider increases.
• Applying conservative growth rates and normalized operating margins to Amazon’s multiple
revenue sources, we believe the company could earn about $9.25 per share by 2023.
Furthermore, we feel the company’s long runway for growth driven by opportunities in multi-
trillion dollar industries will allow it to grow its earnings for many years.
Alphabet Inc. (GOOGL)
• Alphabet Inc., through its subsidiaries, provides online advertising services, hardware, cloud
computing, and other products and services in the U.S. and internationally. It operates through
its Google Services, Google Cloud, and Other Bets segments.
• We believe Alphabet will continue to benefit from the digital revolution, as the use and
proliferation of mobile devices expand, and consumers look for new ways to consume content
and interact with technology. In addition to its strong core business (search), we feel Alphabet
has multiple assets that it can monetize to a greater extent going forward, including YouTube,
Android, Google Cloud, and properties such as Waymo and Verily in its Other Bets segment.
• Alphabet currently trades at 16x estimated 2023 earnings per share. This does not factor in the
$100B+ of net cash that it carries on its balance sheet. We view this as an attractive price for a
company with a strong economic moat that is growing significantly faster than GDP.
*Market data and estimates as of transaction date.
In the second quarter of 2022, the largest sell for the GJCM Equity Income Strategy was as follows:
Nestlé S.A. (NSRGY)
• Nestlé S.A. is a leading food and drinks company that manufactures and markets its wide range
of products all over the world. The company’s diverse product line include coffee, pet foods,
infant foods, prepared meals, milk products, confectionery, and bottled water. The Americas is
the company’s largest market. Nestlé is headquartered in Switzerland and can trace its
beginnings back to 1866.
• Nestlé remains a core position in the strategy; however, we are trimming the position for
portfolio management purposes.

 

How much are you paying a guy to buy Facebook, Amazon and Google (and sell Coinbase) for you?

[Sbbruin 21,853]

36 minutes ago, Fudge Nuggets said:

How much are you paying a guy to buy Facebook, Amazon and Google (and sell Coinbase) for you?

That’s sound strategy.  Pretty savvy eh?

[Fudge Nuggets 19,190]

19 hours ago, Sbbruin said:

That’s sound strategy.  Pretty savvy eh?

Sounds like they're really earning that 2 and 20 (or whatever).

[Sbbruin 21,853]

No it’s scaled.  I think it’s 1.5% now.

[Incredulity 11,671]

Big time 

[ChiTownDoc 21,154]

6 hours ago, Fudge Nuggets said:

Sounds like they're really earning that 2 and 20 (or whatever).

Lol.  2 and 20 is hedge fund shit.  These basic FA types are 60-80 basis points and if you push them can get you into some shit Joe Q Public can’t.  My moron paid for himself with recovery funds early on in covid.  The thinking was there’s gonna be so much money printed that nobody will really suffer much and the ‘recovery’ funds won’t even be for recovery but once those companies take your money you’ll get a king’s ransom in return.  Anyways, said moron paid for himself - this time.  

[Trey3216 15,346]

13 hours ago, ChiTownDoc said:

Lol.  2 and 20 is hedge fund shit.  These basic FA types are 60-80 basis points and if you push them can get you into some shit Joe Q Public can’t.  My moron paid for himself with recovery funds early on in covid.  The thinking was there’s gonna be so much money printed that nobody will really suffer much and the ‘recovery’ funds won’t even be for recovery but once those companies take your money you’ll get a king’s ransom in return.  Anyways, said moron paid for himself - this time.  

Hey man, we're not all morons.  Just because some dumbasses that majored in education and took a test so they can sell front loaded mutual funds exist in this industry doesn't make us all idiots.  

[ChiTownDoc 21,154]

1 hour ago, Trey3216 said:

Hey man, we're not all morons.  Just because some dumbasses that majored in education and took a test so they can sell front loaded mutual funds exist in this industry doesn't make us all idiots.  

Haha, I used moron just because that’s the typical vernacular.  I was showing he’s actually really worth having.  If I thought he was a moron he’d be gone.  Keep up the good work.  Just taking our medicine now.  18 months from now we will be flying again.  18 months is a blip.  

[Trey3216 15,346]

3 minutes ago, ChiTownDoc said:

Haha, I used moron just because that’s the typical vernacular.  I was showing he’s actually really worth having.  If I thought he was a moron he’d be gone.  Keep up the good work.  Just taking our medicine now.  18 months from now we will be flying again.  18 months is a blip.  

Yep.  Got most of our new $$ coming in going to Short Duration and LC Growth/Value blend.  Using the coupon payments from bonds to purchase equities and will use the $$ from bonds as they come due to scale even further into equities over time.  Allows us to DCA in a manner that also offers some short term hedging against market volatility.   

[ChiTownDoc 21,154]

8 minutes ago, Trey3216 said:

Yep.  Got most of our new $$ coming in going to Short Duration and LC Growth/Value blend.  Using the coupon payments from bonds to purchase equities and will use the $$ from bonds as they come due to scale even further into equities over time.  Allows us to DCA in a manner that also offers some short term hedging against market volatility.   

See I’m too busy w my day job for any of that shit, not that I would know wtf to do even with all the time in the world.  

[Incredulity 11,671]

 

[52-80 19,158]

Fuck me running. I said I mostly liked Bernie. But please, this is some terribly embarassing populist rhetoric 

 

 

[Trey3216 15,346]

5 hours ago, 52-80 said:

Fuck me running. I said I mostly liked Bernie. But please, this is some terribly embarassing populist rhetoric 

 

 

Lol.  When was the last time we didn’t have a populist?   

[Trey3216 15,346]

Lol.   Holy shit.   9.1% CPI 

[Parliament 14,260]

 

11 minutes ago, Trey3216 said:

Lol.   Holy shit.   9.1% CPI 

Lol?

[Guest]

11 minutes ago, Parliament said:

 

Lol?

Lol.

[Hefeweizen 5,321]

11 minutes ago, Parliament said:

 

Lol?

Some men like to watch the world burn.

 

Holy shit I think we just raised rates to clients in May by 15 percent and that may not be enough…