Compare GDP, Exports and Population
- - -
P.S.:
The following images (from old files) are included here from 09Apr2023 for reference purpose > These
images are just for information purposes only, this is not investment
advice. Readers should consult their own advisers for advice before
making any investment decisions:
These images / screenshots / weblinks are sourced from various web sources >
aaa
27Sep2023 Soliloquy Swagatham
Why are you punching below your weight?
20Aug2023 Soliloquy Swagatham
As a bachelor, you get a discount of 50 percent from society. And as a renter, you get a discount of 40 perecent from the same society.
Combined together, a bachelor-cum-renter gets a discount of 90 percent!
Feb2024: Super Investors
Nalanda India Equity Fund - Sridharan Anand or Buggy Human - tends to hold for long term
Anil Kumar Goel (shows past nine quarters data) - tends to hold for long term
Hollywood Quotes > IMDb > Hollywood > Quotes >
"My daddy, he'd walk for 40 miles for liquor and not 40 inches for kindness." ~ Ruby in "Cold Mountain" (2003)
Hollywood Quotes > IMDb > Hollywood > Quotes >
at around 17:30 into the movie "Elizabeth: The Golden Age" >
Sir Francis Walsingham: "William, you look dreadful, they are not feeding you in Paris.
"You can't learn the secrets of the universe on an empty stomach."
"Don't get emotional about real estate."
~ real estate broker Rick Carver (Michael Shannon)
- 99 Homes (2014)
"Don't be soft. Do you think America give a flying rats ass about you or me? America doesn't bail out the losers. America was built by bailing out winners. By rigging a nation of the winners, for the winners, by the winners." ~ real estate broker Rick Carver (Michael Shannon)
- 99 Homes (2014)
"When you work for me, you're mine.' ~ real estate broker Rick Carver (Michael Shannon)
- 99 Homes (2014)
FT 02Jun2024 by Amy Kazmin - If elected in June, Eike Schmidt wants to run city ‘according to corporate criteria, without ideology’
Florence, Italy
Eike Schmidt made a name for himself as director of Florence’s famed Uffizi Gallery by taking on the ticket-scalping mafia which was selling museum passes at inflated prices.
Now the German art historian — who recently acquired Italian citizenship — is fighting another improbable battle: to be elected as mayor of the northern Italian city.
“What is important... is to run the municipality according to corporate criteria, without ideology,” Schmidt recently told affluent Florentines.
Schmidt — an expert in Florence’s powerful Renaissance-era patrons, the Medici family, and their miniature ivory sculpture collection.
Florence suffers from excessive tourism.
Florence is the birthplace of modern banking and cradle of the Renaissance.
The city — which spent a year under Nazi occupation after Italy switched sides during second world war — is among the last leftist bastions in the country.
20Apr2024 Real Vision video - Ash Benington talks to Jacob Shapiro of Cognitive Investments
- crude oil markets have shrugged off Israel-Iran shooting at each other last week
- the fight between Israel and Iran seems to be a cat fight; neither country is serious about waging a war
- Iran well telegraphed its attack on Israel; meaning Iran alerted the US and other countries well before their attack on Israel
- But Israel's attack on Iran was different; Israel gave advance info to the US only at the last minute, before attacking Iranian embassy in Damascus, Syria
- there is shadow boxing going on between Israel and Iran
- no country in the Middle East wants an escalation of war in the region; but Israel's Netanyahu gov't has a vested interest in war escalation
- the longer the war goes on, the longer Netanyahu doesn't have to face questions on security failures (of 07Oct2023 when Palestinians attacked Israel) and doesn't need to face corruption charges
- the most important thing in Middle East happened last year when China brokered a diplomatic deal between Saudi Arabia (Sunni regime) and Iran (Shia regime)
- Saudi Arabia seems to be focusing on development rather than doing proxy war with Iran
- Saudi Arabia and Iran now are not at each other's throat; this is a different dynamic in the Middle East
- energy prices haven't responded to the Israel-Gaza conflict the way one would have expected -- markets seem to be more sophisticated now compared to six months ago; maybe, markets don't see the conflict spreading to other areas; maybe, the global economy is much weaker than expected dampening crude oil demand; maybe, market is thinking inflation will come down
- my longer term expectation is inflation in the US will not go down and it will not come down; inflation probably will be moving in a range; we are going to have periods of elevated inflation and periods of deceleration; we will have a lot of volatility
- the results of US presidential election on 06Nov2024 will have big impact on markets
- Trump and Biden have similar views -- both implement trade protectionism; they are both America First and they are both for fiscal profligacy
- Biden did not get rid of any of the restrictions imposed by Trump earlier
- but how Trump and Biden want to achieve their common goals is different; Trump wants to use a blunt instrument (tariffs on Chinese goods) while Biden's approach is more surgical; Biden doesn't want go aftern China in a blanket way
- Trump doesn't care about European allies and other allies; whereas Biden is amenable to allies
- Biden is not going after European allies the way Trump did; Biden doesn't see Canada and Mexico as threats for trade or others
- Biden and Trump have similar goals; but their tactics for achieving those goals are different
- to paraphrase Churchill, China has no permananent friends nor enemies; they have permanent interests
- what China wants more in the Middle East is stability; China is interested in the ME because China sources its oil from there; ME is an investment destination for them; maybe, they are interested in Belt & Road Initiative building alternative trade routes in case something happens to the maritime realm
- China played a stabilising role in ME and it will continue to play that role
- the US-China relations have improved in the past two years compared to what happened during the Trump presidency
- if the US is stuck with the Middle East problems, it has less time for South China Sea; it has less time for improving Taiwan relations
- I'm looking at market opportunities in emerging markets away from the Middle East problems
- there are opportunities for investors in Brazil and Indonesia (good demographics)
16Apr2024 Real Vision video - Jacob Shapiro and Marko Papic talk about geopolitical risks
Middle East is a dumpster fire
it's a multi-polar world -- but Americans don't like this phrase
Iran alerted the US before attacking Israel with missiles and drones -- which were mostly repulsed by Israel
the US couldn't prevent Israel from attacking Iranian embassy in Damascus
the Middle East, including Israel, is not strategically important to the US -- because as you know the US no longer needs Gulf oil after the Shale revolution in the US
the South China Sea and Russia-Ukraine war are strategically key to the US
the Middle East is most imporant for Asia Pacific countries, like, China, Japan, South Korea and India -- that are actually importing crude oil from the Middle East
these Asian countries, China and India have more at stake in maintaining the political stability of Middle East region; not the United States
if you go back and see, during 1948 and 1967, the US was not supporting Israel
Israel got its nuclear weapons because French gave them the technology; not the US
in a way, Turkey is an existential threat, not Iran, for Israel -- Turkey's border is close to Israel; Iran's borders are very far from Israel
another interesting country is Saudi Arabia -- after the Palestinian attack on 07Oct2023, Iran and its proxies are not targeting any oil facilities in the Gulf
the Isreal-Iran open conflict has not really affected global crude oil supplies and Sunni monarchies which have made deals with Israel
Gulf monarchies are stuck in the past; most of them are autocracies; yes, they have lots of natural gas and oil; but they don't have good institutions and rule of law -- so we can't depend on Middle East for market opportunities
scope for market opportunities is more in Western and Eastern Europe around the Russia-Ukraine war; Europe has goods institutions and rule of law as opposed to the Middle East regimes
opportunities exist in Brazil
the median Amerian voter doesn't bother about Israel-Palestina war; American voters are extremely wary of entanglements in foreign wars
Donald Trump changes his views all the time -- but not on trade protectionism and leveraging on debt (lower interest rates); if Trump were to be elected in Nov2024 election, imagine Trump imposing 60% tariffs on Chinese goods -- that would definitely shoot up US inflation
Tariffs are attacks on American consumer
if you look at global supply chains, a lot of intermediate goods still come from China; there is not a lot of decoupling in China trade
Mexico recently has surpassed China as US' number one trade partner; because Chinese goods are coming via Mexico, not because of any meaningful change in trade
If Trump wins and were to impose 60% import tariffs on Chinese goods, it will be a shock to the US' physical economy
Japan's economy looks good despite problems with Yen; we're bullish on Japan's stock market
Japan's markets are poorly understood in the West
China is a national security threat for Japan, but still Japan does a lot of trade with China; and Japan is fine with that diplomatic ambiguity
05Apr2024 Real Vision video - Dee Smith and Jacob Shapiro talk to each other on The hidden agenda of world turmoil -
highlights from the conversation:
Jacob Shapiro -- newspaper headline supply junk food to our brain
multi-polar geopolitical world
It's good Russia-Ukraine war didn't spread to NATO; it's just Russia-Ukraine war
Israel's war on Gaza has remained within the two regions; fortunately, it has not spread to the entire Midddle East -- except for some Houthis throwing missiles on Red Sea
I see a lot of opportunities
you need to see beyond the junk food of media headlines
In the past, the West led by the US naively believed globalisation would lead to more pockets of liberal democracy; but it was a delusion. Look at Vladimir Putin's Russia and Xi Jinping's China.
Even though China joined WTO (in Dec2001) and became part of the global economy, the politics of China under Xi have worsened; Putin has not liberalised Russia in the last 25 years or so.
The US was delusional in thinking that globalisation would create more liberal democracies
Unfortunately, globalisation has contributed significantly to rising inequality -- though in the US inequality has somewhat come down after the COVID-19 Pandemic due to money transfers / stimulus payments by the US government
Though we're in a multi-polar world, the US is still the most powerful country, it's still the top dog
Countries, like, Iran, Turkey, Brazil and India may become more powerful in future
The US has passed its prime -- nations, like people, have a life cycle
There is this crushing load of debt -- this is of the government, the corporates and households
Debt is a bet on borrowing from the future to pay for the present and it's a bet that the future is going to be richer than the present
Is it accurate to think that future gains from technology and innovation will offset the rising debt levels in the US?
82% of the decline in the US manufacturing jobs (blue collar jobs) in the past 20 years is due to automation -- it's not that globalisation and outsourcing have taken away majority of US jobs overseas in the manufacturing jobs
And now artificial intelligence (AI) is coming for white collar jobs -- we aren't prepared for that
The US adversaries are testing its military power to the hilt -- take for example, the Houthis with low-cost drones are creating major disruptions to the global trade / container shipping in the Red Sea -- and the mighty US isn't able to do anything meaningful to control the Houthis
It's amazing the US Navy with its nine aircraft carriers could not control a rag-tag Houthi military supported by Iran
The US needs reform in immigration laws urgently
In 2023, majority of immigrants at the US-Mexico broder are from Venezuela, not from Mexico
Humans have a tendency to rationalise the things that they have done irrationally
My grandmother used to say only a fool learns from his own experience; a wise man learns from other people's experience
The US voters resent the fact that they only have two choices for the next President, that is, Biden and Trump and the other fact that both are old
-- computer chips - integrated circuits (ICs) -
-- Intel on semiconductors: The term semiconductor refers to a material that can be altered to
conduct electrical current or block its passage. However, it more
commonly refers to an integrated circuit (IC), or computer chip. The
most common semiconductor material is silicon. Not surprisingly, silicon
is also the main ingredient in computer chips.
-- Semiconductor (semiconductor) refers to a material whose conductivity is
between a conductor and an insulator at room temperature.
Semiconductors are widely used in radios, televisions and temperature
measurement. For example, a diode is a device made of semiconductors.
-- Chip is an abbreviation of integrated circuit.
-- Amazon on computer chips: A computer chip is a tiny wafer of semiconducting material with an
embedded electronic circuit. It contains millions of microscopic
electronic components called transistors that transmit data signals.
-- 14Feb2020 Samsung Tech Blog: Foundry? Fabless? Learn about the Semiconductor Ecosystem All at Once!
-- 07Feb2023 What is the Difference Between Semiconductor Fabs or Fabrication plants, Fabless Companies, and Foundries? - Fabs (short for “fabrication”) are facilities in which semiconductor products are manufactured.
- Fabless companies focus on designing chips. They partner with other companies (foundries) for the manufacturing phase.
- Foundries are companies that manufacture semiconductor products as a service. They do not design chips.
- Integrated device manufacturers (IDMs) design and manufacture their own chips in their own fabs.
-- Quartr Tweet dt 07Oct2023 - infographic mapping out 120+ Key Companies in the Semiconductor Industry - semiconductor value chain
- Quartr Tweet dt 28Feb2024 - updated infographics on semiconductor industry
27Feb2024 The Economist - Why do Nvidia's chips dominate the AI market?
Since January 2023 the chipmaker’s share price has surged by almost 450 percent
With the total value of its shares approaching USD 2 trillion, Nvidia is now
America’s third-most valuable firm, behind Microsoft and Apple (as on 01Mar2024, its market cap is USD 2.06 trillion)
Its revenues for the most recent quarter were USD 22 billion, up from USD 6 billion in the same period last year.
Nvidia controls more than 95% of the market for specialist AI chips
Nvidia’s AI chips, also known as graphics processor units (GPUs)
or “accelerators”, were initially designed for video games. They use
parallel processing, breaking each computation into smaller chunks, then
distributing them among multiple “cores”—the brains of the processor—in
the chip. This means that a GPU can run calculations far
faster than it would if it completed tasks sequentially. This approach
is ideal for gaming: lifelike graphics require countless pixels to be
rendered simultaneously on the screen. Nvidia’s high-performance chips
now account for four-fifths of gaming GPUs.
Happily for Nvidia, its chips have found much wider uses: cryptocurrency
mining, self-driving cars and, most important, training of AI models. Machine-learning algorithms, which underpin AI,
use a branch of deep learning called artificial neural networks. In
these networks computers extract rules and patterns from massive
datasets. Training a network involves large-scale computations—but
because the tasks can be broken into smaller chunks, parallel processing
is an ideal way to speed things up. A high-performance GPU can have more than a thousand cores, so it can handle thousands of calculations at the same time.
But Nvidia’s soaring valuation is not just because of faster chips. Its
competitive edge extends to two other areas. One is networking. As AI models continue to grow, the data centres running them need thousands of GPUs lashed together to boost processing power (most computers use just a handful). Nvidia connects its GPUs
through a high-performance network based on products from Mellanox, a
supplier of networking technology that it acquired in 2019 for USD 7 billion.
This allows it to optimise the performance of its network of chips in a
way that competitors can’t match.
Nvidia’s other strength is CUDA, a software platform that
allows customers to fine tune the performance of its processors. Nvidia
has been investing in this software since the mid-2000s, and has long
encouraged developers to use it to build and test AI applications. This
has made CUDA the de facto industry standard.
Nvidia dominates AI chipmaking because it offers the best chips, the best networking kit and the best software.
03Feb2024 Bloomberg Meta Platforms (Facebook) declared a dividend for investors for the first time in its history - first time dividend -
Meta announced a quarterly cash dividend of 50 cents a share for Class A and B common stock beginning in March. With Mark Zuckerberg holding about 350 million shares, he would take home about USD 175 million in each quarterly payment before taxes, according to data compiled by Bloomberg.
Meta's co-founder stands to receive a payout of about $700 million a year from the social media giant’s first-ever dividend for investors.
31Jan2024 ET - Retail and consumer sector in India: Growth predictions for FY 2024-25 - by Ravi Kapoor of PwC India -
The overall FMCG sales declined by 4.5% in Q3, affecting both urban and rural markets
The complete nine-month picture for FY24 seems to be marginally better, with overall FMCG value growth at about 2%, with rural growth at just 0.4%, versus that of last year
Causes of decline in FMCG sales in India:
A. Demand-side drivers:
1. Post-COVID recovery has been slow in rural India
2. Agricultur GDP growth is just 1/3rd of its long term growth
3. PM Modi govt cut MNREGA (rural job guarantee scheme) outlay by 17% to Rs 60,000 crore in FY 2023-24
4. erratic monsoon impacting rural economy negatively
5. The real per capita incomes have been stagnant over the last few years (FY 2019–24)
6. Higher household spends on services such as education, health, data – communication and transportation – have taken relatively stagnant budgets away from product consumption
7. India's high inflation suppresses consumers' buying power
8. HNIs are buying more premium products; while middle/lowers are unable to spend on mass-priced ones (top 16% of households in India generate 50% of India GDP)
B. supply side factors:
1. high unit prices of essentials and discretionary categories
2. Market share gains: Smaller regional players across consumer categories such as tea, edible oils, biscuits and laundry have better value offerings compared to national or branded players
Question by ET: RBI has now raised its GDP growth projection to 7% for FY24.
Last year you had said India would be lucky if it achieves 5% growth
next year. What went right or are we just lucky?
Answer by Raghuram Rajan: We are
happy India is outperforming expectations. There are three big reasons.
> First, the industrial world did not slow down as was anticipated. For
instance, the US grew at 5% in the third quarter despite significant
interest rate rises, about 3 percentage points above potential.
> Second,
Chinese demand for commodities stayed muted, keeping commodity prices,
especially energy prices low. Indian GDP always benefits from this
because we are an energy importer, including through the boost a low
deflator gives to our GDP calculation. Both these are not India’s doing,
so they could be attributed to our luck.
> The third is enormous
infrastructure investment by the government in the first two quarters of
this year. That is what went right.
08Jan2024 History - Only thirteen people attended Karl Marx's funeral - Karl Marx was buried in Highgate Cemetery in London, in a section allotted for atheists and agnostics - Marx died on 14Mar1883 in London -
29Dec2023 BSE holidays 2024 - NSE holidays 2024 - BSE trading holidays 2024
17Dec2023 WSJ It’s the Magnificent Seven’s Market. The Other Stocks Are Just Living in It.
magnificent seven - Apple, Microsoft, Google, Amazon, NVIDIA, Meta and Tesla
charts below
cumulative return of magnificent seven and S&P 493
combined share of largest 7 firms in S&P 500
magnificent 7 weighting in MSCI ACWI
change in annual earnings
average PE ratio
28Sep2023: India – US bond yield spread falls to
lowest level in 17 years
- India 10 year yield vs US 10 year yield - India 10 year G-Sec yield vs US 10 year Treasury yeild - yield spread chart -
--
as of 28Sep2023, the 10-year India G-Sec (7.18% GS 2033) yield is 7.18 percent,
whereas that of the US 10-y Treasury is 4.55 percent – giving a narrower yield
spread of 263 basis points, which is a 17-year low
--
as of 31Dec2022, the spread was 345 bp and as on 31Dec2021, it was much higher
at 494 bp
--
the 20-year average yield spread is north of 450 basis points or 4.5 percentage
points
--
lower yield spread means Indian G-Secs are less attractive to US investors, as
compared to US Treasurys
--
aggressive rate hikes by the US Fed to anchor inflationary expectations
compared to India’s RBI may have contributed to the narrower yield spread
--
the market thinks the Fed may raise rates further up; but the same is not the
case with RBI
--
the commentary from the recent FOMC meeting (19-20 September) has been
perceived by the markets as ‘hawkish hold’ – and this has further pushed up US
Treasury yields this week
--
the inflation differential and interest rate differential also play a part in
the narrower yield spread
--
on the fiscal side, the US seems to be in a much deeper trouble, with the US
debt ballooning to USD 33 trillion
--
there are problems for the US Treasury in selling US bonds to investors – the
bulk of which are foreign central banks
--
China is not buying US bonds in recent years; in fact, they whittled down their
holdings of US Treasurys in recent years
--
due to high US fiscal deficit, the US Treasury has lined up a lot of bond
selling -- with little interest from investors, the US bond yields have shot up
in the past one to two months
--
there are expectations that the US Government may shut down due to problems in
raising US debt ceiling in the US Congress
--
it is expected the yield spread between the 10-year government bonds of India
and the US my go higher in the coming months
12Dec2023 TS - GO 1634 dt 12Dec2023 from General Administration Department - 2024 Holidays under NI Act in Telangana state - bank holidays
04Dec2023 S&P Global Ratings –
Global Credit Outlook 2024 – New Risks, New Playbook:
PDF document - web archive - Highlights >
>
we’re back in a high interest rate regime; cheap money era, that started after
GFC 2007, ended
>
corporate credit defaults would rise in 2024 as interest rates and bond yields
are high; even some governments too would see higher defaults
>
geopolitical risks are in centre stage: Israel-Hamas war, Russia-Ukraine
conflict and ongoing US-China tensions
>
the increased geopolitical fragmentation affects corporates and governments in
supply chain and energy security – impacting food prices, global trade and
inflation
>
acceleration toward energy transition poses its own set of challenges
>
tighter financial conditions (elevated interest rates) and softer economic
growth in 2024 would affect corporates
>
the US Fed may not cut interest rates before Jun2024
>
the resilience of the US consumers (as we witnessed in 2023) may not last longer;
household savings fattened by COVID-19 stimulus are shrinking and US consumers
are increasingly wary of spending especially on discretionary spending
>
outlook for global banks remains steady
>
why is the Israel-Hamas war in the Middle East is worrisome from an energy-supply
perspective?
1.
roughly one-third of world’s LNG travels via Strait of Hormuz
2.
roughly one-fourth of world’s oil passes through Strait of Hormuz
3.
Strait of Hormuz is the only shipping route from Persian Gulf to open sea
Strait
of Hormuz is a strait between Persian Gulf and Gulf of Oman, bordering Oman,
Iran and UAE
>
there are elections in more than 50 nations in 2024
>
commercial real estate is in trouble in the US and Europe
>
residential real estate market in China is in deep problems
>
higher-for-longer interest rates will continue to pressure asset values and
erode credit metrics in 2024 – increasing the refinancing risk for borrowers in
real estate sector
>
many emerging markets (EMs) will navigate the challenges better than other
nations
>
nearshoring will benefit Mexico, India and Vietnam among EMs
--
because of supply-chain relocation away from China, nearshoring will benefit
these countries
--
FDI flows are increasing for Mexico
--
Vietnam’s exports to the US jumped fourfold between 2013 and 2022; and
accelerated following Trump administration’s imposition of tariffs on China in
2018; but, Vietnam has several challenges, like, infrastructure and labour
constraints
--
India is set to become world’s third largest economy by 2030
--
India will be the fastest growing major economy in the next three years
--
it remains to be seen whether India can become the next big global
manufacturing hub; and the opportunity can materialise if: 1) India developing
a strong logistics framework for the manufacturing sector; 2) India unlocking
the labour market, upskilling workers and increasing female participation in
labour market – success in these two areas will enable India to realise its
demographic demand
--
India’s booming digital market could fire up startup ecosystem, especially in
fintech and consumer tech
--
in the automotive sector, India is poised for growth
>
of the EMs, Indonesia, Chile and the Philippines will be benefited by energy
transition
--
the need for energy transition and achieving sustainable development goals will
boost demand for key metals, like, copper, cobalt, nickel and lithium – which are
critical in electric vehicles (EV) and battery production
--
most of the miners of these metals are in China, Chile and Indonesia
--
there is a major opportunity for key EMs such as Chile, Peru, Mexico,
Indonesia, Argentina, The Democratic Republic of Congo, and the Philippines, which
hold some of the world's largest reserves of these metals
>
climate change risk is real for coporates
>
Higher-for-longer interest rates and input-cost inflation could slow the energy
transition
>
Tighter budget constraints (for corporates, governments and households) put
pressure on environmental policies
>
With slower economic growth and higher financing costs, priorities might shift
away from tackling climate change
>
China Slows, India Grows
>
Asia-Pacific growth engine to shift from China to South and Southeast Asia
>
While China growth will slow down next year, that of India, Vietnam,
Philippines and Indonesia will grow higher
>
higher interest rates and Israel-Hamas war escalation are key risks for the
Asia Pacific region and other risks are global energy shock and risk of US’
hard landing
09Nov2023 TOI - A toy vendor carries his shop on a moped - risk - life risk -
25Nov2023 Tweet (X post) - What went wrong? - Dr Simon Goddek - obesity - overweight - 1973 vs 2023 -
Moosaram Bagh (in Hyderabad, India) is named after a French general Michel Joachim Marie Raymond, popularly known as Monsieur Raymond.
This French adventurer came to India in the last quarter of the 18th century as a merchant.
Raymond established a gun foundry in 1786, for the manufacture of guns and cannons, in Hyderabad. He became close to Nizam of Hyderabad and supplied arms and ammunition to Nizam.
Due to his popularity, local Muslims fondly called Monsieur Raymond ‘Musa Rahim’ and Hindus ‘Musa Ram’. (Musa is Persian for Moses). Hence, the name Moosaram Bagh for the Hyderabd locality (Bagh means garden).
Raymond died on 25th of March, 1798. The area surrounding Raymond's tomb is known as Moosaram Bagh or Moosarambagh.
27Dec2017 QZ - In Dec2017, Chess Grandmaster Anna Muzychuk (Ukraine) refused to play in Saudi Arabia because of the country's discriminatory policies against women, even though the prize money from the tournament was very high - misogyny - skin in the game -
16Jan2022 Novak Djokovic refuses to vaccinate himself with COVID-19 vaccine ahead of Australia Open Championship tournament in Jan2022 - Tennis - skin in the game -
26Oct2023 interview - Timothy Ferriss (Tom Ferriss) talks to Nassim Taleb and Scott Patterson (WSJ journalist) - full transcript - randomness - antifragile - skin in the game - black swan - Bob Rubin trade -
Bruce Lee quote: “Fear not the man who has practiced 10,000 kicks, but the man who’s practiced one kick 10,000 times.”
The Ottomans and the Austrians had – the world was separate, but they had a lot of traffic and it went through what they call quarantine spots. So you would go into a sort of hospital (lazaretto - a hospital or a quarantine spot that treats contagious diseases) that has quarantine and there’s seven days one way, nine days the other way, and they would implement that the minute they smelled anything.
Venice was a maritime power, they had lazarettos, they did very well. But Marseilles, France was decimated because they didn’t have lazarettos. (a little preparedness would save a lot of lives) - anecdote -
The KGB was not very good at spying, we discovered, but was very good at disinformation.
So I truly think that we’re suffering a lot from this disinformation up to today when people worry about some risks, not others.
Germany panicked after the nuclear disaster at Fukushima, Japan in 2011. Germany freaked out over something that actually didn’t kill people. They shut down their entire nuclear program and in its place opened up a bunch of coal-fired power plants, which is obviously much more direct risk to humanity than nuclear power plants that don’t kill people.
Some people are good at running their businesses. They are skeptical in one area (their business), but they can't transfer their skills and skepticism to stock market. These people put money in stock market blindly and become suckers one day.
12Oct2023 BQ Prime - AIF Structures Being Used To Circumvent Regulations, Says SEBI's Ananth Narayan
"We have found various cases of AIF structures are being used to
circumvent other regulations. They are being used to avoid recognition
of non-performing assets by getting fresh funding coming for stressed
borrowings," said Ananth Narayan Gopalakrishnan, the whole-time director of
SEBI.
In AIFs or alternative investment funds, the actual commitments raised currently are around Rs 8.5 lakh crore, with investments of around Rs 3.5 lakh crore.
96.5% of S&P 500 return contribution this yr is from the 10 largest constituents...
No other positive performance yr is really even close.
Contribution of top 10 stocks in S&P 500 index >
They never show you this map on the news.
Israel - Palestine conflict
the shrinking land of Palestine and Israel expansion since 1946 >
- money laundering - hawala - emigration - send money abroad -
Chinese people in mainland are using Hong Kong as a conduit for illegal transfer of money to safe havens, like, the US, the UK, Canada, etc.
While Hong Kong has been stripped of many of the political freedoms it used to enjoy, it still occupies a unique place in China’s financial ecosystem as the only area with unfettered access to global capital markets. Once cash is there, it can go anywhere.
The transaction moved through an informal, unregulated system known around the world as hawala.
People caught using illegal currency-exchange services in mainland China usually are fined 30% or more of the amount of money they attempted to transfer. If the sum is significant, those providing the service face significant jail time.
But there is a dark side to remittance operations. To ultimately settle exchanges via hawala, Chinese underground banks regularly use cash generated by criminal groups through activities such as drug trafficking, cigarette smuggling, organized illegal immigration and human trafficking, according to the NCA.
The British law enforcers found that Chinese student accounts were sometimes used as a back door to get money into the legitimate banking system.
UBS Group AG, for example, estimated in its annual wealth report that there were 6.2 million Chinese with assets of more than $1 million at the end of 2022.
Real estate consultant Juwai IQI said in August that it expects more than 700,000 Chinese to exit the country in the next two years. Top destinations for buying property—based on searches on its site—include Australia, Canada and the UK. Singapore introduced a 60% property tax for foreign purchasers in April, which has crimped midmarket demand.
And the crackdown on crypto has made it much harder to use digital currency as a workaround.
Yet there are still ways. One popular technique is known as “smurfing.” It involves recruiting people on the mainland who haven’t used their legitimate remittance quotas of USD 50,000. By using many people, the agencies can then use their bank accounts and small individual allowances to funnel large amounts of money outside the country.
One common ruse is to doctor import contracts where bills have to be settled offshore. This can be done by inflating the value of the goods imported, with the seller then agreeing to siphon the difference into a separate offshore account.
Based on unexplained discrepancies in tourist data—which suggest Chinese tourists are leaving cash abroad when they travel—as much as USD 150 billion is expected to exit this year, according to an estimate from Gary Ng.
“After the COVID-19 era, Chinese have an increased demand for sending money overseas both for work or personal reasons,” says Liu Xinyu. “More people could resort to illegal channels, and we could see a rise in cases investigated by authorities.”
For individuals, even as COVID-19 lockdowns are lifted, the memories of the extreme curbs remain. “The pandemic definitely sped things up,” says Dominic Volek. People with wealth in China are “looking for a Plan B.”
06Oct2023 MIT - Street-fighting Mathematics: The Art of Educated Guessing and Opportunistic Problem Solving
By Sanjoy Mahajan - copyright 2010
Make sure to mind your dimensions and units.
You need to compare comparables -- for example, you can't compare a country's GDP with an MNC's net worth; because GDP is a 'flow' number while net worth is a 'stock' number -- here, flow and stock have different dimensions though they have the same units (say, dollars or Yen).
People often confuse between dimensions and units, while comparing.
- lost satellite - metric vs English units -
Page 3 of the PDF:
That compared quantities must have identical dimensions is a necessary condition for making valid comparisons, but it is not sufficient. A costly illustration is the 1999 Mars Climate Orbiter (MCO), which crashed into the surface of Mars rather than slipping into orbit around it. The cause, according to the Mishap Investigation Board (MIB), was a mismatch between English and metric units.
"The MCO MIB has determined that the root cause for the loss of the MCO spacecraft was the failure to use metric units in the coding of a ground software file, Small Forces, used in trajectory models."
Instead of using metric units, they used English units -- losing satellite in the process.
12Jan2024 Trading View - Microsoft's market cap surpassed that of Apple Inc on 12Jan2024 and Microsoft has become the number one company by market cap in the US and S&P 500 index -- its market cap is USD 2.887 trillion versus Apple's USD 2.875 trillion.
Last time, Microsoft's market cap surpassed that of Apple was on 29Oct2021.
30Mar2024 CoinMarketCap
- total market cap of all crypto currencies as at 9.00 AM on 30Mar2024
is USD 2.64 trillion - crypto assets - Bitcoin - Ethereum -
12Mar2024 CoinMarketCap - total market cap of all crypto currencies as at 8.00 AM on 12Mar2024 is USD 2.73 trillion - crypto assets - Bitcoin - Ethereum -
31Dec2023 CoinMarketCap - total market cap of all crypto currencies as at 9.30 AM on 30Dec2023 is USD 1.65 trillion - crypto assets - - Bitcoin - Ethereum -
- Microsoft dethroned Apple Inc to claim number one spot
- Tesla is at 12th spot now
31Mar2024 TE
-Trading Economics - data - macro indicators, like GDP, interest rate,
inflation rate, budget, debt to GDP, current account, population, etc.
31Mar2024 Trading Economics - data - commodities - crude oil, coal, uranium, gold, silver, copper, etc.
31Dec2023 TE -Trading Economics - data - macro indicators, like GDP, interest rate, inflation rate, budget, debt to GDP, current account, population, etc.
31Dec2023 Trading Economics - data - commodities - crude oil, coal, uranium, gold, silver, copper, etc.
30Jun2024 BSE - BSE market cap of all listed firms is Rs 439.25 lakh crore (or USD 5.26 trillion) as on 28Jun2024 (last trading day of Jun2024)
- number of companies with listed equity capital and available for trade are 4,170 as on 30Jun2024
30Mar2024 BSE - BSE market cap of all listed firms is Rs 386.97 lakh crore as on 28Mar2024 (last trading day of March 2024)
- number of companies with listed equity capital and available for trade are 4,154 as on 31Mar2024
29Dec2023 BSE - BSE market cap of all listed firms is Rs 364.29 lakh crore as on 29Dec2023 (last trading day of calendar year 2023)
30Sep2023 BSE - BSE market cap of all listed firms is Rs 319.07 lakh crore
31Sep2023 data - Trading View - CoinMarketCap - bitocin - ethereum - crypto assets - top S&P 500 by market cap
Production costs are low in Saudi Arabia and Russia, averaging $9.30 and
$12.80 a barrel respectively last year, according to Rystad Energy
estimates. Those low costs mean most of the revenue from oil exports can
be converted into profit.
The International Monetary Fund estimated earlier this year that Saudi Arabia’s break-even oil price to balance its budget is about $81 a
barrel.
25Sep2023 video: Ian Bremmer talks to Harvard psychologist
Steven Pinker - poverty - human development indicators or HDIs -
--
extreme poverty globally has declined
--
number of wars and people killed in wars have fallen
--
globalisation (the world is more knitted together in commerce now) has improved
the lives of people globally and probably has reduced number of wars
--
wealth now comes not from land (land grab was major reasons for wars
previously) but from knowledge – this has contributed to more global peace
--
rise of democracy (though it’s not a perfect guarantor of peace) too may have contributed
to a better world now – but not democracy now is not moving in the right
direction
--
why does the US punch below its wealth in terms of so many measures of
well-being?
The
US is an outlier (worse than several Western countries) here. The US is an anomaly:
it’s rich, more or less democratic, it’s lower life expectancy, it scores
poorly on math tests, its people are more obese, it suffers more from drug
addition, more gun violence, its people are less happy, etc.
Some
of the factors are:
--
there is government support for social services, like, old age , healthcare and
poor people, but the US isn’t doing enough in these areas
--
in the US, there is less gov’t attention on poverty, segregation, etc.
--
in the Southwest and South US, traditionally, there is hostility towards
centralised government – Americans in these parts think they’ve to defend their
homes themselves and should not depend on government
--
Americans fight over parking spots, but this doesn’t happen in Europe or Canada
--
The US is less happy than it should be given its wealth
--
a UN reports finds COVID-19 is reversing decades of progress on poverty,
healthcare and education globally
--
populous movements and nationalism are pushing back against the globalisation
--
it has been known by AI (artificial intelligence) researchers for decades that people
are too easily fooled
--
one of the dangers of large language models (LLMs) is people will vest undue
confidence in them
24Sep2023 VR - Nirma to acquire majority stake in Glenmark Life Sciences - acquisition - takeover - special situation - corporates - open offer -
Kurt Vonnegut was writing in The New Yorker about Joseph Heller (of Catch 22 fame). And Vonnegut said, “Joseph Heller and I were at a hedge fund mogul’s house.” I’m not sure if it was hedge fund mogul, but somebody very, very rich in New York.
And Vonnegut said to Heller, ‘You’ve made a lot of money out of Catch-22. This guy makes as much money in a day as you’re ever going to make. He’s got penthouses and yachts and jets and villas and models falling off his arm and so on.'
And Joseph Heller looked back and said, “I have something he’ll never have.” Kurt Vonnegut was puzzled and he said, “What’s that?” Heller said, “I have enough.” - anecdote -
- Blackjack - Kelly Criterion - Claude Shannon at MIT - Roulette - first wearable computer - Warren Buffett - long term thinking - mental models - tragedy of commons - fundamental attribution error - independence - health and fitness - marathon - Charlie Munger's mental models - Ray Dalio -
- Before the publication of Black-Scholes-Merton option pricing model, Ed Thorp was using the model to make moeny. When the pricing model was published, Ed Thorp thought his fund could no longer make money. But he was wrong, because people did not catch on the model right away. So when the Chicago Board Options Exchange opened for business in April 1973, the only people on the floor were Thorp's traders. It was like having machine guns against bows and arrows.
Ed Thorp: If you really are interested in investing, it’s worth educating yourself and trying to do it because you will learn a lot about investing. You might actually find a way to win and you’ll learn about how the world works and a lot about life too.
Ed Thorp discovered Bernie Madoff's investment fraud back in 1991; though Madoff was caught only in late 2008. Thorp discovered Madoff's fraud when he was reviewing the portfolio of McKinsey & Company, New York back in 1991.
Sometimes, it's better for people to take their talent and go somewhere else. But getting somebody to actually make that uncomfortable transition is very difficult, even though for an outsider, it’s totally obvious. So a lot of people, when it’s involving them, they can’t see clearly. When it’s involving one of their friends or acquaintances, they can generally see a lot better, or think they can.
Numeracy: Averages don't tell you about distribution.
- Schaum's Outlines is a simple book on basic statistics
Numeracy: Elementary mental calculations are important.
Numeracy: Rule of 72
Numeracy: conversation about Hollywood movie "Rain Man"
Life is a lot like running a marathon.
If you plan ahead, you can avoid a lot of problems that sink other people: knee replacements, heart clogging up, catching diseases because you don’t do proper vaccination and so on. So, thinking long term is one thing that a marathon teaches us.
Wealth is associated positively with longevity, and it’s obvious why. I mean, it’s not fair, but it's what it is.
Ed Thorp is 89 now (May2022), but he looks like 60, because of good health and fitness.
There is no reason to believe that you have any kind of edge [in markets]. You’re basically rolling dice or buying lottery tickets. And just as in the gambling casinos, where most people do not have an edge, you hear stories about lucky winners, and that draws in more people who want to play. But if you look at all of them as a group, including the good players, who actually have an edge, if you look at all of them as a group, they lose.
Charles Mackay's book
I think an important thing for everyone is to think about the world and society as 'us' instead of 'me', and to try to act that way, and to think longer term.
17Oct2023 CNBC - video - On
28Sep2023, Scott Wapner of CNBC talks to Bill Ackman, who manages hedge fund
Pershing Square - investing - stock investing -
full transcript of the above interview at CNBC
(related article on Bill Ackman's view on Robert F Kennedy Jr's scepticism on COVID-19 vaccines)
>
great businesses will do well in any economic, political or macro environment
>
two risks we’re concerned about in the last 18 months are: energy prices and
long end of the US Treasury yield curve
>
we’re likely to have a government shutdown and a data shutdown (in a gov’t
shutdown, gov’t agencies can’t release economic data – which will be a dark
period for markets)
>
in the US bond market, we’ve supply of more paper while China, Russia and Saudi
Arabia are selling US Treasuries
>
we’ve an economy that is still strong; inflation at more than 3%
>
our view is the 30-year US Treasury yield at 4.7% is not attractive enough to
buy; because structural inflation is north of 3% and it’s going to be
persistently higher, we were in low interest rate regime for a long time,
massive fiscal spending during COVID-19, infrastructure spending, huge fiscal
deficit, high government debt, government selling a lot of government bonds and
bills, US govt’s imprudent balance sheet and others
>
we’re in a different world
>
the world changes gradually
>
the 10-year US Treasury yield is going to reach 5% very soon
>
investors should not use 30-year US Treasury bond to speculate 0n the short
term economy – it’s not a good idea to buy 30-year US T bond in anticipation of
a recession – the structural forces of the US bond market have changed
>
the key is to own businesses that have pricing power; businesses that do well
in a 3-percent inflation regime
>
it’s hard to manage a business in a world where inflation is volatile (US CPI
was at 9.1% in Jun2022 and in Sep2023 it’s at 3.7%)
>
the companies we own are like royalties – we own Universal Music Group which
has royalties on music streaming; Google and YouTube have revenues from ads –
others are Burger King (owned by Restaurant Brands) and Hilton Hotels – for these
businesses inflation is a friend as long as their costs don’t inflate as
quickly as their revenues – I remain comfortable owning such businesses even if
inflation remains high
>
Alphabet (Google) is our latest entrant; we bought in late 2022 and early 2023
>
around the launch of ChatGPT in Nov2022, Google fumbled a bit and the stock got
sold out to 15 times earnings (PE ratio of 15) – and in the market, the Google stock
got mispriced – so, the launch of AI (artificial intelligence) gave us an
opportunity to buy into Google in Jan2023 – Google is our second largest
investment
>
Google’s Bard is neck and neck with ChatGPT; Google will be a dominant player
for a very long time
>
I’m a continuous learning machine (I learnt from my 10-year-old bad experience of
shorting Herbal Life leading to a battle with Carl Icahn)
>
I’m still psychologically short Herbal Life (fun comment by Ackman)
>
being psychologically short entails lower risk
>
Warren Buffett is my unofficial mentor for many years
>
we’re better at risk management now than we were 10 years ago
>
I don’t do short selling any more now
(in short selling, asymmetry is against short sellers)
>
understanding asymmetry in life and in investing is very important
>
now, what we do is we own great businesses
>
if you want to be a successful investor, you need to own great businesses and
do nothing with them – this is an amazing investment strategy
>
there is a ‘circle of life’ quality to what Carl Icahn facing with regard to
Hindenburg report on Icahn’s empire
>
I’ve written him (Robert F Kennedy Jr, a Democratic presidential candidate in
the US) a cheque
06Oct2023 ET - Colgate to brush up on science than focus on ayurveda, says Colgate-Palmolive global CEO Noel Wallace
Investing
– stock investing – Colgate Palmolive India Ltd -
Colgate to brush up on science rather than focus on ayurveda.
As per a TOI report, based on information from industry sources, Colgate is the clear market leader in toothpastes with a lion’s share of around 48%, while Patanjali (Dant Kanti toothpaste brand) has a share of around 11%. Patanjali has grown from less than 1% market share nearly a decade ago, while Colgate has lost nearly 800 basis points during roughly the same period.
India accounts for less than 4% of global sales despite Colgate controlling half the oral care market here. Volume growth in India is a priority for us.
I would not call the Patanjali brand (of toothpaste) a natural brand. I would first call it an ayurvedic positioning and with natural ingredients. The difference for us is that we are a science-driven brand. We spend more money than any other toothpaste manufacturer in the world by multiple of three on clinical validation and science.
So, our benefit is to stay focused on how we bring scientific credentials to the market. Patanjali was a distraction for us. It didn't play to our strength. And rather than playing to our strengths, which is what we are doing now, we got diverted to that. Now we play naturals because we know how to play naturals.
The ayurvedic credentials that Patanjali has, we are not going to compete with that. That's the core of what that brand stands for. We stand for science and technical superiority. That's where we need to compete. We can tactically compete in some of these segments. And we should. But it shouldn't be a strategic thrust for the company.
Fifty percent of rural India don't brush up their teeth.
20Sep2023 Forbes India video - Aswath
Damodaran
Investing
– stock investing –
--
big decisions in your life are often made on accident
--
for me, teaching is front and centre of what I do
--
human beings instinctively want to learn
--
I’ve 50,000 case studies of publicly traded companies
--
it’s fascinating for me to value companies in real time
--
venture capital firms are incapable of valuing companies, they price them – it’s
a pricing game for them – VC firms are traders
--
Artificial intelligence (AI) is the mood of the moment
--
during my lifetime, the four big changes that have changed the way we live and
work are:
1)
personal computers in the 1980s
2)
the online / internet boom in the 1990s and later
3)
the social media
4)
artificial intelligence
--
in the last two years, among emerging markets, India has been one of the
winners because of a combination of healthy economic growth (though lower than previous
years) and inflation that is not out of control – the danger for India is it
should not overreach – India should not be caught in the China Plus craze and
should settle for a lower growth rather than over-enthusiastic about next China
or something like that – you see the consequences of overreach from China -
--
India is a big market and it’s growing – the fundamental story of India is a
really positive story – India has its weaknesses, like, lack of infrastructure
07Sep2023 FT - No other investor has a life
story quite as unbelievable as Li Lu – by Eleanor Olcott
- investing - stock investing -
- Li Lu was born
in 1966 in China
- in 1989, he
participated in the Tiananmen Square student protest in Beijing (Peking)
- he defected to
the US in 1989 and was granted asylum in the same year
-- Li started his
hedge fund Himalaya Capital in 1997
- his hedge fund
currently manages assets worth USD 14 billion
- Li pivoted from “freedom fighter to Manhattan yuppie” as one newspaper put
it
- due to the deteriorating relationship
between the US and China, many US foundations and endowments downsizing or
divesting entirely from China
31Aug2023 New York Fed - effective federal funds rate (EFFR) - fed funds rate - fed rate -
- the effective federal funds rate (EFFR) is calculated as a
volume-weighted median of overnight federal funds transactions - it is published by the New York Fed every day
- as on 30Aug2023, EFFR is 5.33 percent against the target fed funds rate of 5.25-5.50 percent
30Aug2023 Carried interest:
Carried interest is a share of profits earned by general partners of private equity, venture capital, and hedge funds. Carried interest is due to general partners based on their role rather than an initial investment in the fund. As a performance fee, carried interest aligns the general partner's compensation with the fund's returns.
The origin of carried interest can be traced to the 16th century when European ships were crossing to Asia (for spices) and the Americas. The captain of the ship would take a 20% share of the profit from the carried goods to pay for the transport and the risk of sailing over oceans. The name is not connected with interest rates or interest payments on a loan or bank account. - anecdote -
29Aug2023 UBS global wealth report 2023 - PDF download from the weblink -
23 great investors >
Part I: Mainstream investments
Fixed Income
- Larry Fink (BlackRock)
Public Equities
- Ronald Stephen Baron or Ron Baron (Baron Capital Mgmt)
- John W. Rogers Jr. (Ariel Capital Mgmt)
Real Estate
- Jonathan ("Jon") Gray (Blackstone)
- Sam Zell (equity international)
Private Wealth / Family Offices
- Mary Callaghan Erdoes (JP Morgan Asset & Wealth Mgmt)
- Dawn Fitzpatrick (Soros Fund Mgmt)
Endowments
- Paula Volent (Rockefeller University)
- Kim Lew (Columbia Investment Mgmt Company)
Part II: Alternative Investments
Hedge Funds
- Seth Klarman (Baupost Group)
- Ray Dalio (Bridgewater Associates)
- Stanley Druckenmiller (Duquesne Capital)
- Jim Simons (Renaissance Technologies)
- John Paulson (Paulson & Co)
Private Equity and Buyouts
- Sandra Horbach (The Carlyle Group)
- Orlando Bravo (Thoma Bravo)
Distressed Debt
- Bruce Karsh (Oaktree Capital)
Venture Capital
- Marc Andreessen (Andreessen Horowitz)
- Michael Moritz (Sequoia Capital)
Part III: Cutting-edge investments
Cryptocurrencies
- Mike Novogratz (Galaxy Digital)
SPACs
- Betsy Cohen (Cohen Circle)
Infrastructure
- Adebayo Ogunlesi (Global Infrastructure Partners)
ESG
- David Blood (Generation Investment Management)
22May2024 David Rubenstein of Bloomberg Wealth talks to Sallie Krawcheck, Ellevest CEO & Co-Founder
- The best advice I've ever received:
invest early -- it'll take care of compounding your money
- Ellevest, a financial firm / Fintech, targeting women has assets under management of USD 2 billion
- Ellevest started in 2016
- we are about 85% women
- 100% of our financial advisros are women
- Women's longevity is six to eight years longer than men
- About 75 to 80% of women die single, because half of the marriages end in divorce (US specific)
- Women's investing needs are different
- the boomer generation in the US accumulated most wealth in history; as they are reaching theri 70s and 80s the gentlemen tend to pass away leaving enormous in the hands of their wives (great generational wealth transfer in the next couple of decades in the US)
- in the next couple of decades, US women are going to have most of the country's wealth
- in Jun2002, Fortune magazine ran a cover story on Sallie Krawcheck 'In Search of the Last Honest Analyst'
Asks Rubenstein: "To succeed in Wall Street, what skiils do you need?"
Karwacheck answers: "You have to work hard; you need to stick out and be a contrarian; don't be a me-too analyst; you need to take big calls on big stocks
The biggest investment mistake men make is 'overtrading' and for women it's 'not investing.'
07Mar2024 David Rubenstein talks to Vasant Narasimhan (Vas Narasimhan), CEO of Novartis - video - pharma - drug discovery -
-- drug patents in the US last for 17 years
-- Novartis has Leqvio, a cholesterol lowering drug whose dose is two times in a year (infrequent dose)
-- we've USD 45 billion in sales every year
-- Our research headquarters are in Cambridge, Massachusetts, and Basel, Switzerland
-- it has taken more than 25 years to realise the potential of anti obesity / weight loss drugs (meaning, the research for the drgus had taken place over 25 years before they are approved by FDA)
-- Narasimhan joined Novartis in 2005
-- He became CEO of Novartis in 2018 at the age of 41 years
-- Novartis has 76,000 employees
-- we've slimmed down after selling several consumer / other businesses
15Feb2024 David Rubenstein talks to Ruth Porat, President, CIO and CFO, Alphabet Inc: - video - technology - AI - artifician intelligence -
I've had breast cancer twice
Alphabet has USD 100 billion cash
In the US -- Finace is East Coast and Technology is West Coast
Quark test -- if are unable to describe a quark in under 30 seconds, you are just rambling
Google has been using AI (aritificial intelligence) for over a decade
Google AI tools -- Google Brain and Google DeepMind (Bard chatbot is now known as Google Gemini since Dec2023)
30Nov2022 video: David Rubenstein, Carlyle co-founder, in conversation
with Richard Vague on the former’s book ‘How to Invest: Masters on the Craft’
-- investing - stock investing -
-- this book is about
investment strategy of 23 great investors
Some of the Rubenstein’s
quotes from the above interview >
“Libraries are indispensable
to a good free society”
“If you go along and invest
with what everybody does, by definition, you will be basically the average. And
so if you’re going to be great at something you have to take a risk and you
have to do things that other people don’t do.”
“One of the qualities
great investors have in common is they are willing to defy conventional wisdom
or not to take the path of least resistance. They were able to do something
nobody else saw at that time.”
“I haven’t bought any cryptocurrencies,
but I’ve invested in a few companies that service the crypto industry.”
“My Family Office did look at
FTX (founded by Sam Bankman-Fried) as an investment, but my people couldn’t
figure out the relationship between FTX and Alameda – so, the people at my
Family Office turned down the investment.”
“The average person should
not try to be anybody who’s an expert in this book. You can’t become like these
great investors. You have to devote your entire life to do like them. If you’re
a doctor, lawyer, public official or dentist, you’re doing great things for society
and that’s fine – don’t try to be Warren Buffet, that’s not realistic. The
average person is better with equity index funds or money market funds or fixed
income.”
“When people become wealthy,
they tend to spend more on healthcare. When nations like China become wealthier,
their spending on healthcare increases substantially.”
Important characteristics all
these great investors have are:
-- they’re reasonably intelligent
-- they’re generally well
educated
-- they are not school
drop-outs
-- good felicity for numbers
(need not be mathematicians)
-- they admit their mistakes
and go on to the next thing
-- they are good at sharing
the credit
-- they take the blame for
mistakes (humility)
-- they are not arrogant
-- they are incredible
readers
-- they don’t just read about
their area of expertise, they read about everything
-- they take final decisions
and they don’t want to delegate investment decisions
-- Jim Simons of Renaissance
Technologies is a world-class mathematician; he more or less invented quantitative
investing; he exploits market inefficiencies; he is eccentric and a genius; he
smokes two cigarette packs a day – this is for almost the past 50 or 60 years;
he brings his own ash tray to meetings; he doesn’t believe in socks – Jim Simons
thinks socks are an unnecessary adornment -
-- Albert Einstein never wore
socks and he argued the big toe will eventually put a hole in the sock and so
why wear it
-- Sam Zell is known as the
grave dancer; he likes to dance on the graves of other people’s bad investments
19Oct2022 video:
David Rubenstein, Carlyle co-founder, in conversation
with Neil Irwin of Axios.com on the former’s book ‘How to Invest: Masters on
the Craft’
“I’m
interested in ideas as much as I’m interested in money. Money is not more
important than ideas.”
“A
lot of wealthy people are tortured souls.”
“The
hardest thing in life is raising happy and healthy children.”
“The
most elusive thing in personal life is happiness.”
John
W Rogers Jr (Ariel Capital Mgmt): “I don’t email.”
“John
W Rogers Jr is obsessed with investing, he is a value investor. He’s on the
board of McDonald’s and to be a loyal person, he goes to McDonald’s for one
meal a day, every single day – he’s been doing it for 20 years and he seems to be
reasonably healthy.” – anecdote -
“A
recurring theme in this book: Nobody is great at everything all the time.
Everybody has their failures.”
“Ray
Dalio has built Bridgewater Associates from scratch. He has been in hedge fund
business for 50 years. His firm now manages USD 150 billion. Of all the hedge
fund firms, his firm has been the most profitable and created most profits for
investors.”
“I’d
rather invest with people that are smart and hardworking than people who are
lazy and not that smart.”
“I’m
73. I’m not old enough to be president of the United States.” – fun -
"A bird in the hand is worth two in the bush."
"At Berkshire, we make no attempt to pick the few winners that will emerge from an ocean of unprovenenterprises. We’re not smart enough to do that, and we know it. Instead, we try to apply Aesop’s 2,600-year-old equation to opportunities in which we have reasonable confidence as to how many birds are in the bush and when they will emerge (a formulation that my grandsons would probably update to 'A girl in a convertible is worth five in the phonebook.')."
All from India or Indian-origin >
CEO of Alphabet Google
CEO of Microsoft
CEO of YouTube
CEO of Adobe
CEO of World Bank Group
CEO of IBM 🇮🇳
CEO of Albertsons
CEO of NetApp
CEO of Palo Alto Networks
CEO of Arista Networks
CEO of Novartis
CEO of Starbucks
CEO of Micron Technology
CEO of Honeywell
CEO of Flex
CEO of Wayfair
CEO of Chanel
CEO of OnlyFans
CEO of Motorola Mobility
CEO of Cognizant
CEO of Vimeo
27Aug2023 Bar-headed geese (Anser Indicus) - one of the world's highest-flying birds - flies above Mount Everest - easily identified by two black bars on their heads -
- why birds can fly over Mount Everest? - bar-headed geese, like all birds - hummingbirds, ostriches and pigeons have super efficient lungs -
- how did birds get great lungs? - they inherited from dinosaurs -
- birds are dinosaurs
27Aug2023 Maria Popova on Canadian singer-songwriter, poet and novelist Leonard Cohen and creativity - music - songwriter - songwriting - singer - poetry - literature - quote -
Leonard Cohen's quotes: I’m writing all the time. And as the songs begin to coalesce, I’m not
doing anything else but writing. I wish I were one of those people who
wrote songs quickly. But I’m not. So it takes me a great deal of time to
find out what the song is. So I’m working most of the time."
"Almost everybody’s work is hard. One is distracted by this notion that
there is such a thing as inspiration, that it comes fast and easy. And
some people are graced by that style. I’m not. So I have to work as hard
as any stiff, to come up with my payload."
"I think unemployment is the great affliction of man. Even people with
jobs are unemployed. In fact, most people with jobs are unemployed. I
can say, happily and gratefully, that I am fully employed. Maybe all
hard work means is fully employed."
"Before I can discard the verse, I have to write it… I can’t discard a
verse before it is written because it is the writing of the verse that
produces whatever delights or interests or facets that are going to
catch the light. The cutting of the gem has to be finished before you
can see whether it shines."
"Before I can discard the verse, I have to write it… I can’t discard a
verse before it is written because it is the writing of the verse that
produces whatever delights or interests or facets that are going to
catch the light. The cutting of the gem has to be finished before you
can see whether it shines."
"So I always had the sense of being in this for keeps, if your
health lasts you. And you’re fortunate enough to have the days at your
disposal so you can keep on doing this. I never had the sense that there
was an end. That there was a retirement or that there was a jackpot."
25Aug2023: How climate change impacts corporates?
-- higher carbon taxes
-- higher property insurance costs
-- higher borrowing costs for fossil fuel industry
-- higher energy costs
-- higher compliance costs, etc.
24Aug2023 Tweet - how to a make a billion dollars without lifting a finger - interest income (cash holdings) for Apple, Amazon and Google -
24Aug2023 US Real interest rates - real rates - real yields - US real rate - US real yield
Different market participants use different measures to calculate real interest rates in the US:
method 1 >
Real 10-year Treasury yield = nominal 10-year yield - CPI inflation rate (year-on-year) for the latest month (Jul2023 print available)
For example: it equals 1.02 percent (= 4.22 - 3.20) as on 24Aug2023
method 2 >
"Real 10-year Treasury yields are calculated as the daily nominal Treasury yield
less year-over-year core CPI inflation (all items less food and energy) for that month. For the current
month, we use the prior month’s core CPI figures until the latest data
is available."
Real 10-year Treasury yield = nominal 10-year yield - core CPI inflation rate for the latest month (Jul2023) = 4.22 - 4.70 = minus 0.48 percent as on 24Aug2023
method 3 >
St Louis Fed (FRED Economic Data) uses a different method to calculate Real Interest Rate in the US >
"A real interest rate is an inflation-adjusted interest rate.
You might think of a real interest rate as the price of borrowing in
goods, not money. Because people and firms make decisions based on real
quantities, not nominal quantities, real interest rates are more useful
than nominal interest rates."
This blog also explains the importance of breakeven inflation rate. "The breakeven inflation rate represents a measure of expected inflation derived from 10-Year Treasury Constant Maturity Securities (BC_10YEAR) and 10-Year Treasury Inflation-Indexed Constant Maturity Securities (TC_10YEAR). The latest value implies what market participants expect inflation to be in the next 10 years, on average."
Cleveland Fed explains inflation expectations and calculation of 10-year expected inflation in the US here. The 10-year expected inflation estimate that Cleveland Fed reports is the rate that inflation is expected to average over the next 10 years. The 10-year expected inflation is 2.13 percent (retrieved 24Aug2023).
FRED: 10-year ex-ante real interest rate is nearly 1.60 percent as on 11Aug2023 (as calculated using expected inflation estimates by Cleveland Fed)
Fred: market yield on 10-year US Treasury (constant maturity) is 4.34 percent as on 23Aug2023
FRED: markt yield on 10-year US Treasury (constant matuity) inflaton-indexed is 1.99 percent as on 23Aug2023
WSJ article dated 24Aug2023: 'Real rates aren't your real friends'
the so-called space stocks - moon stocks - Chandrayaan stocks -- ISRO - moon landing - soft landing - chandrayaan rockets -
Centrum Electronics
MTAR Technologies
Paras Defence & Space Technologies
Avantel Ltd
Mishra Dhatu Nigam (Midhani)
Walchandnagar Industries
Astra Microwave Products
HAL, L&T, BHEL, BEL, etc.
21Aug2023 A snapshot of Murugappa group of companies >
the biggest listed companies, by market cap, are Cholamandalam Investment & Finance co, CG Power and Tube Investments >
The current market cap of Murugappa group's listed companies is around Rs 2.90 lakh crore.
09Jul023 video life coach Gaur Gopal Das - spiritual quotient - fun - humour -
The seven words which are the greatest enemy of growth and progress in any field are:
'We have always done it this way'
-- Nokia Phone, Blockbuster Video went out of business because they refused to adopt and change with the times
21Jun2023 video Rajiv
Bajaj of Bajaj Auto talking to Sonia Shenoy - CNBC TV18 Classics – Yoga – Homeopathy
–
--
Yoga is alignment and awareness
--
my observation from college and after reading Jack Trout (author of ‘Differentiation
or Die’) > “Markets exist at the extremes,” for example, when I was in
college, we had Hero Honda bike (based on mileage – low fuel consumption) and
Yamaha RX100 (based on power) – you can’t be a jack of all trades, you’ve to
differentiate to survive in markets – you’ve to find your own niches – as someone
said the true enemy of man is generalisation – if you don’t stand out, you don’t
create brands you create commodities –
19Aug2023 video Shiv Nadar and Ajai Chowdhry of HCL talk to Shereen Bhan – CNBC TV18Classics – HCL Technologies – HCL Infosystems – HCL group – HCL Tech – HCL Corporation
-
--
Shiv Nadar: I was 22 when I first saw a big city in my life
--
HCL created the first personal computer (PC) in India in 1978 at the same time
as other global giants, like, Steve Jobs’ Apple – it’s at the same time we were
shipping computers from Noida (26th of March, 1978) that Apple computers were shipping
out of Cupertino, California
--
HCL (originally Hindustan Computers Ltd) was founded in 1976 by six people,
namely, Shiv Nadar, Ajai Chowdhry, Arjun Malhotra, Yogesh Vaidya, Subhash Arora
and DS ‘Pammi’ Puri – all resigned from DCM (formerly Delhi Cloth & General
Mills) before starting HCL
--
Shiv Nadar: before starting HCL, I prepared business plans for two – one was
computers and another medical electronics – between the two, we decided on
computers – the tipping point for this decision was that in medical
electronics, 90% of the demand was controlled by the government and we did not
want to depend on the government and in computers there was a lot of scope for
the private sector – hence, we decided on starting computers business
--
HCl began operations in 1976 as a joint venture between the state government of
Uttar Pradesh (26% stake) and HCL (74%) – there was no chance a private company
would get a license for computers manufacturing at that time (in 1976) and so
we had to rope in Uttar Pradesh gov’t so that our company would get a
government license
--
we decided on the name ‘Hindustan’ so that our company was taken seriously by
customers – the name ‘Hindustan’ was associated mainly with government
companies and not many private companies were using Hindustan
--
at HCL, we were not in favour of giving dividends to shareholders, but UP
government forced us to give a small a dividend – for the UP gov’t the measure
of success of a joint venture company was dividends – your focus should be on
developing your company first by reinvesting the profits in your business, you’ve
your whole ahead of you and you can wait for dividends later in your life once
your company is fully developed
--
we created the EMI (equated monthly instalments) concept in India by selling
computers via IDBI (a development finance institution or DFI at that time) and
IDBI had a scheme for SMEs (small and medium enterprises) and the monthly instalment
was Rs 3,500 for buying a computer – and this was a marketing success
--
Shiv Nadar: I will always do new things, hand it over to others and then move on to newer things
--
at one time, HCL lost 50 clients worth USD 80 million – but eventually 46 of
those clients came back to HCL
--
(on joint venture partnerships) this is one life; all of us have one life, this
is no dress rehearsal and this is done in real time – it’s better to pack more in to
this if you can – joint ventures forever are rare (HCL had set up a joint
venture with Hewlett Packard of the US in 1991 and it ended in 1996)
--
Ajai Chowdhry: joint ventures are defined as 'same bed with two different dreams'
– anecdote – joint ventures need not last forever, once you achieved your goals
of the partnerships, it’s time to move on
--
Ajai Chowdhry: we learnt a lot from the HCL-Hewlett Packard parternship; we
learnt quality, we learnt scale and we learnt process; till that time we had
passion, and of course, we need both passion and quality and process – anecdote
-
--
Shiv Nadar: Companies don’t do business with companies, people do business with
people
--
Shiv Nadar: I’m a product of education, nothing really more; I grew up in Tamil
education and I was never in English education and I studied in a place like
Coimbatore where they teach you English in Tamil – coming from such a background,
I wanted to give something back to society in the form of education and establish
schools
--
Shiv Nadar quotes a dialogue from a 1970-movie ‘Patton’ about WWII > “General
George S. Patton says, ‘No bastard ever won a war by dying for his country. He
won it by making some other poor dumb bastard die for his country.’” – quote -
14Aug2023 Hero Electric Vehicles Pvt Ltd was downgraded to Crisil D rating
-- Crisil ratings - rating downgrade - corporate - debt default - EV - EVs - FAME subsidy -
-- Directors of Hero Electric Vehicles Private Limited are Gaurav Munjal,
Vijay Munjal, Vishal Ramesh Ootam, Sridhar Venkiteswaran, Naveen Munjal,
Pankaj Gupta, Vandana Munjal
14Aug2023 FT India - iPhone maker Foxconn’s cautious pivot to India shows limits of ‘China plus one’
Multinationals’ desire for a “China plus one” strategy, following supply chain disruptions and geopolitical tensions between Washington and Beijing, is driving Foxconn into a renewed push into India, where it first invested 15 years ago but where it still only employs some 50,000 of its 1 million global workforce.
India now accounts for $10 billion of Foxconn’s annual revenue, according to the presentation. That is 4.6 per cent of the company’s $216 billion 2022 revenue, more than double the 2 per cent registered in 2021.
Foxconn chair Young Liu has said China accounts for 75 per cent of Foxconn’s global operations, up from 70 per cent before the pandemic. He has not given a target for a more distributed footprint, reflecting a decidedly cautious attitude towards India.
13Aug2023: How have mutual funds holding shares of Reliance Industries Ltd as on 31Jul2023 valued shares (yet to be listed) of Jio Financial Services Ltd?
As per mutual funds portfolio statements as on 31Jul2023, Jio Financial Services' per share fair value was estimated at Rs 261.85. On 11Aug2023, Reliance Industries allotted 635,32,84,188 shares of Jio Financial Services to shareholders of Reliance Industries Ltd (record date for spin off was 20Jul2023).
So, the estimated market cap of Jio Financial Services as on 31Jul2023 (the share is likely to be listed on stock exchanges in Aug2023) would be Rs 166,400 crore (635.33 crore x Rs 261.85).
Details are >
09Aug2023 Tweet - Meru Gokhale - 'no offence, but...' 'with due respect...' - English - alternatives to not offend people - fun - humour -
09Aug2023 Tweet - Brahma Chellaney - Today, on the 78th anniversary of the Nagasaki atomic bombing, it is worth remembering that picturesque Nagasaki became the second victim of nuclear holocaust by an accident of weather: Kokura, the city chosen for the attack, was under a heavy cloud blanket, so the U.S. bomber was diverted from Kokura to a larger city, Nagasaki, Japan’s gateway to the world. - anecdote -
Nagasaki, Japan’s oldest and densest stronghold of Roman Catholicism, was paradoxically destroyed by a predominantly Christian America.
10Aug2023 Tweet - Gautam Bhatia, India's Supereme Court lawyer on independence of Election Commission of India (ECI) and the government's attempt to weaken that independence - CEC appointment -
-- structural and operational independence of ECI should be maintained as per the Constitution
-- the executive (i.e., the Government of India) should never have control over the ECI
-- as per the Constitution, the ECI must be insulated from the executive dominance
09Aug2023 BBG China Sprints Ahead in Race to Modernize Global Money Flows - crypto - digital yuan - US dollar - dedollarisation - forex flows - mBridge project (the name mBridge refers to a multiple CBDC bridge) - BIS - CBDC - bypassing SWIFT - cross border transfers - seamless money transfer -
31Jul2023 CoinDesk Galaxy Digital CEO Mike Novogratz says BlackRock CEO Larry Fink has been 'orange-pilled,' or converted from being Bitcoin (BTC) nonbeliever into a believer - Mike called Larry the most important thing that happened this year in bitcoin - in June this year, BlackRock applied to SEC to list a spot bitcoin ETF in the US -
- English - new phrase - 'orange-pilled'
09Aug2023 video - Raw Talks talks to JA Chowdary, entrepreneur and IT specialist - Anantpur - N Vittal - Hitec City - Maitrivanam - Aditya Enclave - United States of Ameerpet or USA - education - ChatGPT - AI - NVIDIA - IIIT, Hyderabad - Infotech Enterprises started at Maitrivanam -
-- Bill Gates - Microsoft - Bill Clinton - Y2K - one million dollar software exports celebrated - STPI - License Raj - innovation - technology - Telugu video - CBN - Chandra Babu Naidu -
05Aug2023 Sassi di Matera are two districts (Sasso Caveoso and Sasso Barisano) of the Italian city of Matera, Basilicata, well-known for their ancient cave dwellings inhabited since the Paleolithic period. - UNESCO - World Heritage Site - town on mountain cliffs -
-- the opening sequence with a hotel in James Bond's film 'No Time to Die' was shot in Sassi di Matera
02Aug2023 TE - Fitch Ratings downgraded
the United States’ long-term foreign currency issuer default rating from
AAA to AA+ on Tuesday (01Aug2023), citing factors such as “the expected fiscal
deterioration over the next three years, a high and growing general
government debt burden, and the erosion of governance" relative to
peers.
The current US ratings of major rating agencies are:
Fitch AA+ Stable (since 01Aug2013)
S&P AA + Stable (since 10Jan2013)
Moody's Aaa Stable (since 18Jul2013)
The ratings agency pointed to “the repeated debt-limit political
standoffs and last-minute resolutions” that have eroded market
confidence in the country’s fiscal management. Fitch placed the US’ AAA
rating on negative watch in May at the height of the debt ceiling
impasse.
The agency also highlighted the rising general government
deficit, which it anticipates will rise to 6.3% of GDP in 2023, as well
as a combination of tightening credit conditions, weakening business
investment and a slowdown in consumption that could lead to a mild
recession.
US authorities disagreed with Fitch’s decision, with US
Treasury Secretary Janet Yellen calling it “arbitrary and based on
outdated data.”. In general, a credit rating is used by sovereign wealth
funds, pension funds and other investors to gauge the credit worthiness
of the United States thus having a big impact on the country's
borrowing costs.
This page includes the government debt credit rating
for the United States as reported by major credit rating agencies.
30Jul2023 IMDB > Unknown: Cosmic Time Machine - Netflix documentary - science - space - James Webb Space Telescope
14Aug2023 video Aswath
Damodaran, dean of valuation talking to Scott Galloway, professor of marketing: - investing - stock investing -
--
Damodaran is from San Diego
--
markets are manic-depressive about Tesla stock
--
nobody knows what the new technological shift will be and what architecture we
need
--
NVIDIA has created opportunities for itself by being the early entrant into
crypto currencies and AI
--
AI will be negative sum for companies; if everybody cuts costs, they will have
to cut prices and then all companies will have reduced profit margins – making it
negative for companies in the end
--
(in the context of market for AI or artificial intelligence) if everybody has
it, nobody has it
--
a small number of companies, like, NVIDIA, can benefit from AI, but for most
companies AI may not deliver the promised profits
--
AI may not have competitive advantage for many companies
--
market is a contest between safety capital and risk capital and in the last
decade or so, we’ve tilted the scales in favour of risk capital and reaped higher
returns from risk capital – finally, safety capital (e.g., with T bills
fetching around 5 percent in the US) has a place to go now and perhaps in 2023,
we’ll find a balance between safety and risk capital – here, Prof Damodaran is
suggesting risk capital in the next decade will have moderate returns (unlike
the spectacular returns the US equities had between 2009 and 2021)
--
as an economy and a society, we’re going to pay the price for the excesses of
risk capital being cheaply available and readily accessible (between 2009 and
2021, interest rates were almost zero in the US and other developed economies)
--
because of lower interests and almost-free risk capital, people started
unsustainable new businesses
--
in any economy, you need a balance between safety and risk capital
--
(in response to BlackRock’s Larry Fink’s comment that Bitcoin is ‘digital gold’)
Larry Fink is a fixed income guy, outside of that he’s no knowledge of other
investments – with USD 11 trillion under the belt gives Fink the megaphone – I’m
constantly surprised how little he knows about investing and markets
--
inflation in the US is likely to stay higher for longer
--
at the start of 2023, all experts were gearing for a recession and predicting
markets would go down, but so far recession hasn’t materialised and stocks have
gone up contrary to predictions – ultimately, we’ve to trust markets more than what the experts tell us.
--
I’ve always been sceptical of yield curve inversion leading to a recession – actual
data do not support the thumb rule of yield curve inversion and recession
07Aug2023 video: Samir Arora talking to Business Today 07Aug2023: - stock investing -
– there is no bull run yet in India, we’re just in early stages of a bull market and as of now there is nothing to be excited about
– Indian stock market has delivered superior returns over 25 years, 15 years and 10 years – in general, we’ve done well in the long run giving 14 or 15 percent CAGR
– my prediction is Indian stocks will continue to do well in future also, though one can expect lower returns from India compared to historically
– China has disappointed stock investors in the long run – Chinese stocks provided only 2 percent CAGR returns in the past 25 years
– China + 1 strategy will work in favour of India
– (referring to market buzz in Railway stocks) we don’t buy stocks where the customer is the government – because the government demands lowest cost from companies, government doesn’t pay in time and we don’t know which company will get government orders)
– private sector banks have done well over the years – in future also, some public sector banks in the lower rung will continue to lose market share to PVBs – the lower-rung PSBs can’t handle new-age, online and app-based customers
– in the consumer sector, we don’t look at companies with 8 or 9 percent growth; we look for companies with 18 or 20 percent growth rates (like, Vedant Fashions, Varun Beverages, Westlife Foodworld, etc.) – and for such companies, we’re willing to pay higher valuation – in a big picture sense, we want companies with growth higher than India’s GDP growth
– if the stock has a momentum doing well in one quarter, one year and so on; and in addition the stock’s fundamentals are good in the past one or two years, such stocks, in a broad sense, will continue to do well in future also – it’s not that all such stocks will do well, but in majority of cases they will do well
– Fitch downgrade of the US sovereign rating will have no impact, beyond a point – because their debt is in dollars and the US can print dollars – S&P already downgraded the US back in 2011
– risks come from the unknown and the unexpected (for example, COVID-19, 2016 demonetisation, 1998 Asian Contagion, 2008 GFC, Russian debt default in 1998, Kargil war, scams, Vajpayee gov’t fell after 13 days in office, etc.) – don’t run away from such risks, take a deep breadth, look around and if you’ve confidence in future, add to your portfolio
– in general, equities will do well over the long run and in the long run you’ll lose money in debt (for example, the US equities vs US debt in the 20th century and Japanese equities did well compared to Japanese bonds)
04Aug2023 WSJ - William Bernstein on Investors' Biggest Risk: Not Preparing for the worst - Bill Bernstein - stock investing -
-- quotes Sylvia Bloom who amassed USD 8.2 million and donates most of it - benefits of compounding -
-- three biggest mistakes investors make >
1. investors overestimate their risk tolerance / overconfidence
2. when trading, investors frequently underestimate the intelligence of persons on the other side of the trade, who may be more knowledgeable than the investors
3. investors hanker after maximum returns (get rich
quickly) -- actually, they should minimise the chances of
dying poor
-- 11Jul2023 Morningstar - talking to Christine Benz, Bill Bernstein on 'Four Pillars of Investing' - investing books - #anecdote
"One half of investing is mathematics, and the other half is Shakespeare. And
what I mean by the Shakespeare of investing is the fact that history,
particularly economic and financial history, but geopolitics as well, is
a very cruel mistress. And the other part of Shakespeare is the biggest
enemy you have in investing, which is the face that’s staring back at
you in the mirror. And if you’re the kind of person who can solve
differential equations or do continuous time calculus as easily as most
people brush their teeth, and you ignore the Shakespeare half of
investing, you’re going to get portfolio insurance, you’re going to get
long-term capital management. You’re going to have your head handed to
you. So, that’s the first thing that I wanted to get across in the book."
-- benefits of passive investing
-- market psychology more important
-- be wary of people who hog the headlines / limelight
-- the extra 1 or 2% you get from investing in corporate bond isn't worth the risk
-- most things in finance aren't predictable
-- blatant fraud and gangsterism of Germany's Wirecard
-- the biggest deep risk for stock investing is inflation
-- focus more on deep risks rather than shallow risks
-- to protect yourself from inflation, you keep the duration of your bonds short; and stocks don't do well during initial stages of inflation but in the long term stocks do well
-- stocks of commodity producers are likely to do well during high inflation
-- on asset allocation: the best thing you can do is to pick an allocation that’s reasonable and
then stick with it. That’s better than using a black box
-- when stocks fall 40 or 50 percent in short term, young investors and investment virgins don't have the nerve / capacity to hold them -- once they lose 40 or 50 percent of their money, they take a pledge never to return to stock market
-- so, it's far better for young investors to start with a conservative allocation, so that they can avoid the risk of psychological shocks
-- don't prefer annuities - because they lose a lot with inflationary pressures and they can't protect you against inflation and another risk is credit risk emanating from the annuity seller
-- retirees need to be aware of the sequencing risk
-- on sequencing risk: if you’re 80 years old, the odds are you only have to pay for 10 years
of expenses. So, you only need 10 years of safe assets. The older you
get, as you spend down your safe assets, your stocks are going to grow
in value. So, just organically, your stock allocation is going to rise,
and that’s perfectly fine, because the older you are, the less bonds you
need
-- how the rich get richer? - This is a topic that I’m kind of fond of talking about, which is, this
is really how the rich get richer, which is that if you have enough
Treasury bills that you can pay your groceries and your rent for a
decade or more, then you are going to sail through a stock market
decline a lot better than the person who has no safe assets and is going
to have to sell depreciated stocks in order to pay for their basic
needs. That’s the kind of person who sells at the bottom. The kind of
person who buys at the bottom is the person who has that great elixir of
equanimity, which is Treasury bills. There is a real reason why Warren
Buffett has 20% of Berkshire in T-bills and cash equivalents. That’s how
he gets richer.
Excerpts from the above >
Seth Klarman on the current markets:
1. “This is one of the weirdest environments in the 40 years I’ve been in the investment business."
2. "People have short memories. It would be wise to think back to 1974-1975 when everything didn’t get rescued, and to imagine a bear market that didn’t immediately lead to a buying opportunity."
3. "An investor must think about cyclical change like Graham and Dodd did, but now secular change as well. The combination of that has made finding mispricing harder and requires digging deeper."
4. "The nature of most Wall Street innovations is they’re never stress-tested for a rainy day. That wouldn't be any fun."
5. "When the market is more expensive than historic averages, you can lose a lot to simple mean reversion."
6. "Warren Buffett wrote that no one should own common stocks who's not comfortable with a 50% drop in the market. Almost nobody is comfortable the 50% drop of the market, yet Americans own more stocks than ever before. I think people have forgotten that admonition."
7. "A great misunderstanding in recent years is that if you accept illiquidity, you automatically get a higher return. In reality, buying at a discounted price provides the higher return."
Seth Klarman on timeless value investment strategy:
1. "Many funds have a view that the goal in investing is to limit how much you can lose on any idea. But if you can establish that an idea is good versus bad, then why can't you understand that there might be one that's great rather than just good?"
2. "Just because an asset is in illiquid form doesn't mean it's purely illiquid. Buildings get sold all the time. Companies get sold all the time. Whereas 9.9% of the shares of a 400 million company might be a very illiquid block. Liquidity may not be what everybody seems to think."
3. "Bill Ackman once said to me that value investing is like watching paint dry, but I bring a hair blower. That's a good definition of activism." #Anecdote
4. "We go miles wide to look for opportunity. When we think we found it, then we drill miles deep."
5. "Sometimes there’s chaos in the markets and moving quickly is necessary, so a large enough discount may offset a lack of the deepest possible knowledge."
6. "Yogi Berra said, 'In theory, every theory works. In practice, a lot of them don't.'" #Anecdote
Seth Klarman on timeless value investing principles:
1. "'Margin of safety' captures what a value investor tries to do. You must leave room because you might be wrong. But having one means you're likely not to be in tears when a lot of other investors are."
2. "Value investing is something not everybody is comfortable with. It's like an inoculation. When you get introduced to the approach, it either makes sense, or it doesn’t."
3. "The hardest thing about value investing without a catalyst is that you can own something that's out of favor for an incredibly long time. Over a 5- or 10-year period, being early and being wrong look exactly the same."
4. "Science progresses secularly, but finance progresses cyclically. Most ideas have been around before, and we repeat the same mistakes. There's a lot to learn from studying past periods."
5. "There are two constraints on every investor: capital and time. Both are important."
10Dec2020 MOI Global - Bruce Greenwald on value investing - investing - stock investing
excerpts from the above interview >
If you look at a company like Deere, the part of the business that makes tractors and sells them in a big, globally competitive product market, has shrunk. What Deere really does is provide local service support. It provides local software that runs those machines off GPS systems and places every seed in the ground individually at optimal times. You have local secondhand markets because the machines last for a long time. Because it can charge a lot for these extremely valuable machines, Deere finances the sale, which is based on local information about lending risks. When Deere dominates the United States or regions within the United States and has 90% of the agricultural equipment in that sector, there’s just no chance anybody will buy a Kubota or an Agco tractor. This principle applies equally to manufactured goods as local services become a bigger part of the package.
At the end of the 1980s, profits were about 8% to 8.5% of national income. Today (in 2020), that number is about 13.5% because globalization is essentially being reversed and technology has reinforced this trend.
If you think about the old technology companies like IBM, they did everything. They did the chips. They did the software. They did the hardware. They did the peripherals. If you look at the technology companies today, they’re highly specialized. Oracle does only databases. Microsoft does operating systems and adjacent software. Intel does only CPU chips. Oracle does only fonts and graphic material. Google does only search. Once you get disaggregated markets like that and technology has enabled people to put systems together from many different suppliers, those tend to be small niche markets. In a sense, they’re local markets and product geography, and you get dominant competitors in those markets who can keep other people out because they have the scale economies, and they have the customer captivity to deny those customers and deny the necessary scale to entrants.
You’re talking about commodity businesses. The history of commodity businesses – and this includes energy – is that in the race between improvements in technology and the exhaustion of readily accessible resources (including the atmosphere), improvements in technology have won hands down for 200 years. Even though oil did well for a period starting in roughly 2003, historically it’s done badly. There’s a brief period in the 1970s and early 1980s when it did well, then it did badly for 20 years. If you’re going to buy natural resources intelligently, you must be a strict value investor and not look for growth at all. You want to make sure the asset value is there, make sure the earnings power value is there, and you want to make sure there is a margin of safety.
The ability to make good judgments about how long these franchises will last is industry-specific. Again, you better be a real industry expert.
One of the things I cannot beat out of my students is they say, “Oh, this is a powerful franchise, so I’ll pay a higher multiple for it.” Powerful franchises are all in the earnings, presumably. If you give it a higher multiple, you’re double counting. What you care about is the durability of the franchise, which is the point you raised early in the context of disruption. Also, you care about the rate of growth of that franchise, which depends on management’s ability to make those earnings from the franchise grow. You must start with detailed industry knowledge. Then yes, of course, you must be able to judge management.
22Jul2023 Tweet thread on SFB history - Utkarsh SFB was listed on 21Jul2023 - small finance banks - SFBs
List of small finance banks and their market cap (only five are listed) >
23May2012 Chakrapani: A Legend Whom Legends Respect - Aluri Venkata Subba Rao - Tollywood - Telugu film industry - producer - made movies like, "Paatala Bhairavi, Maya Bazaar, Gundamma Katha, Missamma, Jagadeka
Veeruni Katha, Pelli Chesi Choodu, Appu Chesi Pappu Koodu, Rechukka
Pagatichukka" - Vijaya Vauhini Studios - Vijaya Pictures - Chandamama publication - Telugu monthly - web archive -
20Jul2023 ICICI Direct research report - Gabriel India - stock - stock investing - auto sector -
17Dec2019 The Art of (Not) Selling by Chris Cerrone - Akre Capital Management - investing - stock investing - web archive - "100 to 1 in the Stock Market" by Thomas Phelps
-- Akre Capital blogs on Web Archives - blogs by Chuck Akre, Chris Cerrone and John Neff
12Jul2023 TE - The Swiss franc appreciated to 0.87 against the
USD, reaching its strongest level since January 2015, after
lower-than-expected US inflation data indicated that the US Federal
Reserve may be approaching the end of its tightening cycle.
13Jul2023 ICRA - Syngene International Ltd - calculation of net cash and gross debt or total debt
As on March 31, 2023, the company had net cash of Rs. 538.4 crore.
Net Cash = Calculated as unencumbered cash and liquid investments minus gross debt (including lease liabilities). As on March 31, 2023, the company had Total Debt (including lease liabilities) of Rs. 815.2 crore and unencumbered cash and liquid investment of Rs. 1,353.6 crore.
29Dec2023 TE - The
average contract interest rate for 30-year fixed-rate mortgages with
conforming loan balances ($726,200 or less) in the US fell by 24 bps to 6.83% in the week ended 15Dec2023, reaching the lowest level since 23Jun2023 - the US mortgage rate - MBA -
- the MBA 30-year mortgage rate in the US reached 23-year high of 7.9% (which was the highest since September 2000) for the week ended 20Oct2023
13Aug2023 TE - The
average contract interest rate for 30-year fixed-rate mortgages with
conforming loan balances ($726,200 or less) in the US jumped 7 bps to
7.16% in the week ending 11Aug2023, reaching the highest level since the
first week of Oct2022. - mortgage rate - MBA -
12Jul2023 TE - The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($726,200 or less) in the US jumped 22 bps to 7.07% in the 1st week of Jul2023, reaching the highest level since the first week of Nov2022. - mortgage rate - MBA -
23Jun2023 Tweet - Puru Saxena - stages of growth stocks - graph - stock market - Stan Weinstein -
31Mar2023 eGazette PDF
- web archive - Gazette of India - Government Savings Promotion Act - Gazette Id is CG-DL-E-31032023-244822 - G.S.R.238(E) -
page 18 of the PDF - Aadhaar and PAN are compulsory for opening new
accounts as well existing accounts already opened - Moneylife Advisory - PPF, SSY, SCSS and post office small savings accounts - is it applicable for post office NSC?
- state wise available RVSF - authorised car scrap dealers
25Apr2023 tweet - asset location is key to keeping taxes low on retirement income -
- US retirement accounts - retirement plans - Roth IRA - IRA - tax deferred account - retirement savings
- electric vehicles - electric vehicle numbers - electric car
- kleptocracy - golden visa -
- India’s leader, Narendra Modi, has favourites among the country’s
corporate captains. Over the past decade, wealth from crony-capitalist
sectors has risen from 5% to nearly 8% of its gdp.
- Russia, Czech Republic, Malaysia, Singapore and Mexico top the list of crony capitalism index in the world -- India is at the 10th position out of 43 countries
- rupee reserve currency? - rupee convertibility? -
- “Russia is not comfortable holding rupees & wants to be paid in Chinese yuan or other currencies, a second Indian govt official involved in the discussions said.”
Seems like they buried the lede, esp as CNY is gold convertible in Shanghai, HK, & Dubai.
- companies with largest number of employees - staff - biggest workforce -
03Jun2023 Tweet - "India has two Railways Ministers.
It is Prime Minister Narendra Modi ji when new Vande Bharat trains need to be launched.
It is Ashwini Vaishnaw when large numbers of people die in trains accidents.
Division of fame and blame." - Balasore Train accident
- Tweet 01Dec2016: Self-attribution bias is very much evident now: "Success, you're mine. Failure, don't touch me."
- cash - digital payments - CIC - currency in circulation -
- "To conclude, the rise of digital payments is equated with the end of cash. This is an equivocation fallacy, where those who benefit from the end of cash, have muddled our minds by equating the rise of digital payments to the end of cash."
- "It is understandable why governments, financial institutions and many VC-backed firms want this, given that the quality of data they will have access to will improve dramatically. However, as citizens, this should have us worried."
- "As Brett Scott puts it: 'Lifts have their use, but no responsible property developer would ever only install a lift without having emergency stairs.' The same is true about digital payments and cash." #anecdote
To conclude, the rise
of digital payments is equated with the end of cash. This is an
equivocation fallacy, where those who benefit from the end of cash, have
muddled our minds by equating the rise of digital payments to the end
of cash. It is unders...
Read more at: https://www.deccanherald.com/opinion/the-silence-of-the-celebrities-1224618.html
To conclude, the rise
of digital payments is equated with the end of cash. This is an
equivocation fallacy, where those who benefit from the end of cash, have
muddled our minds by equating the rise of digital payments to the end
of cash. It is unders...
Read more at: https://www.deccanherald.com/opinion/the-silence-of-the-celebrities-1224618.html
To conclude, the rise
of digital payments is equated with the end of cash. This is an
equivocation fallacy, where those who benefit from the end of cash, have
muddled our minds by equating the rise of digital payments to the end
of cash. It is unders...
Read more at: https://www.deccanherald.com/opinion/the-silence-of-the-celebrities-1224618.html
05Jun2023 Tweet - Jim Bianco - my Twitter was hacked - hacking - VPN - phone SIM card hacking - Twitter account -
- Tweet reply: "Never ever use 2FA over SMS." - Yubikey
- US retirement savings - IRA - Roth IRA - retirement accounts - retirement plans - taxable account - tax deferred account
- US retirement savings - IRA - Roth IRA - retirement accounts - retirement plans - taxable account - tax deferred account
- US retirement savings - IRA - Roth IRA - retirement accounts - retirement plans - HSA -
23May2021 X Post - Your 'no nonsense coffee guide' - fun - meme -
04Sep2023 X Post - Sanatana Dharma na enna da?
Kushubu ku koil kattradu
Der Brief (The Letter) -
01Aug2023 video - why my clock stops at 16.23 hours - fun - meme - this sneaky TV setting will ruin your picture quality -
11Nov2023 Tom Gauld - fun - meme - cartoon - a chair for readers -
your daily reminder >
Our Blessed Homeland vs Their Barbarous Wastes
Our glorious leader vs their wicked despot
Our great religion vs Their primitive superstition
Our noble populace vs Their backward savages
Our heroic adventures vs Their brutish invaders
25Jul2023 Reading Poses - Illustration by Benji Davies; source: "A Velocity of Being: Letters to a Young Reader" by Maria Popova (@brainpicker) - meme - fun - cartoon -
Reading poses > à°ªుà°¸్తక à°ంà°—ిమలు >
08Jun2023 Tweet - Meb Faber - trading options - stock investing - meme - fun - humour -
- Jason Zweig's quote: "I put two children through Harvard by trading options. Unfortunately, they were my broker's children."
- gadgets - Apple - VR - AR - AR / VR headset - augmented reality - virtual reality - visionOS -
- Vision Pro is a standalone headset (you need not own other Apple products, like, an iPhone or Mac)
- uses powerful M2 chip
- it uses eye tracking and hand tracking
- EyeSight: An outward display reveals your eyes while wearing Vision Pro, letting others know when you are using apps or fully immersed.
- spatial computing
- 3D interface
- Optic ID
- blends digital content with your physical space
- navigate simply by using your eyes, hands and voice
- What does it do? 1) computing 2) connections 3) content
- it's not for the masses (priced at USD 3,499; to be released next year)
- external battery: only two hours battery
- Apple operating systems
iOS (for iPhone)
macOS
iPadOS
watchOS
visionOS
- carbon tax - carbon border tax or CBT - ESG -
- Starting January 2026, the Indian steel, cement, aluminium, and
fertiliser industries will pay steep Carbon Border Tax (CBT) imposed by
the European Union (EU). The US, Canada, and other nations are also
exploring similar mechanisms.
- the highest tax is on developing countries like India. Steel and
aluminium sectors have high emission intensity and hence would attract
high taxes. The estimated tax for steel made from the blast furnace
route is 39.6 per cent, and using an electric arc furnace is 19.8 per
cent. The tax is zero if steel is made using green hydrogen as fuel and a
reducing agent.
- Indian firms risk losing market share to EU-based producers or those in
other more carbon-efficient nations. CBT will affect substantial exports
as the EU is an important trade partner for India.
- Most Chinese and Russian firms use the blast furnace routes to make
steel, while many Indian and South Korean firms use electric arc
furnaces, a more carbon-efficient process.
Jun2023 NBER working paper - full PDF - Top
Talent: Elite Colleges, and Migration: Evidence from the IITs
by
Prithwiraj Choudhury, Ina Ganguli and Patrick Gaulé
Copyright
material
--
We study migration using a novel dataset of Indian high school students taking
the Joint Entrance Exam (JEE), a college entrance exam used for admission to
the prestigious Indian Institutes of Technology (IIT). We find a high incidence
of migration, up to eight years, after students complete college: among the top
1,000 scorers on the exam, 36% have migrated abroad, rising to 62% for the top
100 scorers.
--
Highly skilled immigrants make important
contributions to innovation and technology in the United States. Often, they study in elite
universities in their home countries before getting advanced degrees abroad
--
For example, many successful Indian immigrants in the
technology industry—including Sundar Pichai,
the CEO of Alphabet Inc./Google, and Arvind Krishna, the CEO of IBM—are undergraduate alumni of the selective Indian Institutes of
Technology (IITs)
-- others include Sun Microsystems co-founder Vinod Khosla, and former IMF Chief
Economist Raghuram Rajan
--
We focus on the Indian Institutes of Technology
(IITs). The IITs are prestigious and highly
selective technical universities with lower acceptance rates than Ivy League
colleges, particularly for the original five IIT
Campuses
--
the original and Top 5 IITs are: IIT Kharagpur, IIT
Bombay, IIT Madras, IIT Kanpur and IIT Delhi
-- The first of these higher technical
institutions—called the Indian Institute of Technology— was founded in 1951 in Kharagpur. Over the following
decade, another four IIT campuses opened: in
Bombay (1958), Kanpur (1959), Madras (1959), and Delhi (1961). The five
original IITs were spread across the country,
each located in a different region
-- IIT Roorkee, IIT Guwahati, or BHU Varanasi,
which are organized along similar lines of TOP 5 IITs, are relatively less prestigious
--
Admission to the IITs is solely through the Joint Entrance Exam (JEE), where nearly one million
exam takers compete for less than ten thousand
spots
--
IIT students have even been described as “America’s most valuable import from India”
--
IIT degrees
have signaling value
-- students attending elite universities may
become part
of a network of successful alumni and faculty, many of whom have
migrated, and this network can facilitate
migration -- prior literature has shown the role of such diaspora networks in
lowering migration costs and increasing
migration flows
Tweet 04Jun2023 - PSU (public sector undertaking) Rail Stocks and their one-year stock performance >
most of these PSU Rail stocks owned by Gov't of India have given decent to spectacular returns in the past one year. #Railways
03Jun2023 BS - Foods division gives ITC an appetite for diversification
- Sunrise - Sproutlife Foods - Savlong - B Natural - Nimyle - Yoga Bar - Mother Sparsh - Mylo - Dal Bukhara - Aashirvaad - Sunfeast - Bingo! - Yippee! - Classmate
01Jun2023 The Economist - It’s not just a fiscal fiasco: greying economies also innovate less - video 16Feb2023 "ADAMO 2050 - A true story from the future - a film by Plasmon"
- innovation - patents - brain freeze - baby bust - fertility rate - Plasmon - demographic decline - demographics - savings rate - investment rate -
- The short film made for Plasmon, an Italian brand of baby food owned by Kraft-Heinz, a giant American firm, is set in 2050
- the rapid ageing of many countries around the world will be bad not just
for certain industries, or for governments whose costs rise as their
revenues decline--the falling number of educated young workers entering
the labour market will also reduce innovation, sapping economic growth
across the board
- fertility rates (the number of children a typical woman will have over her lifetime) of Japan and Italy fell below 2.1 in the 1970s -- that level is known as the replacement rate, since it keeps a population
stable over time -- anything lower will eventually lead to a declining
population
- The median Italian is now 47; the median Japanese 49
- By 2021, 124 countries and territories recorded fertility rates below 2.1 (UN data)
- There’s a global convergence in women’s aspirations for careers and family life, reducing fertility rates
- The 15 biggest economies in the world, including Brazil, China, India and Mexico, all have fertility rates below 2.1
- The obvious way to compensate for dwindling birth rates is immigration
- greyer population will mean higher spending on public pensions and
health care, but there will be fewer people of working age to pay the
taxes required
- Labour is one of the three main determinants of growth, along with
capital and the efficiency with which both are used (productivity) -- shrinking workforces lead to lower economic growth
- an ageing population will reduce both savings and investment
- Younger people have more of “fluid
intelligence”, meaning the ability to solve new problems and engage with
new ideas -- Older people have more “crystallised intelligence”—a stock
of knowledge about how things work built up over time
- the percentages of patents (for innovation) filed in Japan has been declining, as Japan started ageing since 1970s (entreprenue vacuum)
- Hungary and Poland give income-tax credits and flat payments to encourage women to have more children -- Singapore offers large grants to the parents of new children, which now
run to S$11,000 ($8,300) for the first two children, and S$13,000 for
any more, on top of tax rebates and child-care subsidies
- fertility rates are still high in Sub-Saharan Africa
02Jun2023 FT - US Senate passes bill to end debt ceiling stand-off and avoid default - US debt default - US debt ceiling limit -
- The US Senate has approved (on 01Jun2023) a fiscal deal between the White House and
congressional Republicans, ending a weeks-long political stand-off that
risked triggering an unprecedented debt default in the world’s largest
economy
- Lawmakers in the upper chamber passed the bill with overwhelming
bipartisan support on Thursday evening, with 63 backing the legislation
and 36 opposed
- The bill now heads to President Joe Biden’s desk for his signature, just
four days before the US Treasury projected it would run out of cash to
pay all its bills
- The agreement raises the US borrowing limit until 2025 and sets new caps
on government spending for the next two years, putting more
restrictions on US fiscal policy until at least after the next
presidential election
- earlier on 31May2023, The House of Representatives (lower chamber) has passed a bill to raise the US debt
ceiling, a victory for Republican Speaker (of the US House of Representatives) Kevin McCarthy that brings
Washington closer to averting a historic default
- The House voted 314 - 117 on 31May2023 in favour of the bill, after 165 Democrats sided with 149 Republicans and allowed McCarthy to see off a rebellion from some members of his own party
- In addition to burnishing McCarthy’s credentials, a law stemming from
bipartisan dealmaking would signal Washington is still able function at a
time of heightened political polarisation
- in the current (118th) United States Congress, Republicans have control over the House of Representatives by a razor-thin margin -- Republican Kevin McCarthy is the current speaker (preceded by Nancy Pelosi, a Democrat) of the House of Representatives
- in the current (118th) United States Congress, Democrats have control over the Senate -- the current president of the Senate is vice president Kamala Harris (as per the US Constitution, it's the vice president's job to preside over the Senate)
01Jun2023 SEBI - SEBI Master Circular for Electronic Gold Receipts - EGR - EGRs - valult managers - securities under SCRA, 1956 -
03Jun2023 Tweet - height of SBI Yono advertisement - ad - meme - fun - humour
27Feb2020 Tweet - Focus on what you can control - Carl Richards - meme - cartoon -
23May2023 Tweet: "A large number of WFH office jobs in the US will move to India over the next 5 years" - prediction - trend -
- AMCs - mutual funds - expense ratios - churning - NFO - TER - brokerage expenses - performance linked fee -
26May2023 Tweet - fun - meme - humour - cartoon
- note ban - Rs 2000 note -
- Gupshup - Byju's - Meesho - Eruditus - Swiggy
08May2023 BQ Prime - Cross Border Activities in India Need More Freedom, Not Less by Ajay Shah and Pratik Datta - XKDR Forum - capital account convertibility - current account convertibility -
- India's big story is Information Technology or IT Services exports, with global players like, TCS and Infosys leading -- the following Indian gov't policies have helped in the IT sector growth - 1) setting up IIMs and IITs led to kindling of scientific and management knowledge, 2) reforms in Telecom industry giving primary to the private sector, 3) the equity market reforms of 1990s with creation of National Stock Exchange of India (NSE) and capital market regulator SEBI or Securities and Exchange Board of India, and 4) reduction of barriers to cross-border (current and capital account) transactions
- IIM is Indian Institute of Management
- IIT is Indian Insititute of Technology
- "Finance follows trade"
- Political freedom and rule of law are hard to reconcile with capital controls
- Under Indian socialism, the FERA, 1973
imposed severe restrictions on cross-border financial activities
- Under FERA, a person travelling abroad had to seek foreign exchange permission from RBI; individuals were given a quota of USD 8 per day when travelling abroad
- in August 1994, India formally adopted current account convertibility, by
accepting the obligations under Article VIII of the International
Monetary Fund's Articles of Agreement
- From 1997 to 2003, various current account restrictions on residents were gradually liberalised
- RBI's LRS or Liberalised Remittance Scheme greatly enhanced the financial freedoms of Indians
- Many Indians now lead a substantially cross-border life, with a spectrum of connections ranging from travel to work visas
- these reforms also paved the way for foreign investment (FDI and FPI), which made the market value of Indian software and services companies possible
- a limit of USD 250,000 for LRS per year is meaningless if you want to give full rupee convertibility on the current account
- in the backdrop, PM Modi gov't introduced three new curbs on current acount activities:
1) Section 206C (1G) of the Income Tax Act, 1961, was introduced in 2020.
It required, for the first time, 5% of certain remittance transactions
under the LRS route to be collected from the buyer (or person
remitting), as income-tax collected at source (5% TCS), and
2) This 5% TCS is now increased to 20% TCS as per The Finance Act 2023 effective 01Jul2023, widening the ambit of current account transactions subject to 20% TCS
3) a resident individual was earlier not required to repatriate funds, or
income generated out of investments made under the LRS route. This rule
was suddenly changed in August 2022. Any foreign exchange acquired
through the LRS route, unless ‘reinvested’, must now be compulsorily
repatriated or surrendered by a resident individual, within a period of
180 days from the date of acquisition. This legal change imposes a
significant transaction cost on Indians who may wish to hold foreign
exchange abroad in a deposit account, to engage in legitimate
international transactions such as foreign travel, business, etc
- India and China are less open to capital account; meaning they impose more restrictions on capital account activities
- In 2006, Menzie D. Chinn and Hiro Ito introduced an index to measure de jure financial openness of countries across the world
- The Chinn Ito index >
13Jun2023 BL - IEX: Too many movings parts makes it a wait-and-watch
- Indian Energy Exchange - MBED - market coupling - NLDC
09Jun2023 BS - IEX plunges 15%, hits 52-week low amid market coupling worries - Indian Energy Exchange
- corporate - stock investing - know your company -
- Shares of Indian Energy Exchange (IEX) hit a 52-week low of Rs 116,
freezing at the 15 per cent lower circuit on the National Stock Exchange
(NSE) in intra-day trade on 09Jun2023 on reports that the Power Ministry
has directed the Central Electricity Regulatory Commission (CERC) to
implement the process of market coupling in a timely manner.
- Market coupling refers to forming of a single power trading entity owned
by the government where price discovery will happen with power getting
dispatched to short-term power trading platforms.
- IEX is a market leader and has the highest volumes in terms of power
trading. This will dry up volumes in a significant manner for IEX among
other power trading platforms and snatch away the moat of creating
liquidity and price discovery by IEX, ICICI Securities said in a note.
- IEX is India’s premier energy exchange providing a nationwide, automated
trading platform for physical delivery of electricity, renewable energy
and certificates including renewable energy certificates as well as the
energy saving certificates. The exchange platform enables efficient
price discovery and increases the accessibility and transparency of the
energy market in India while also enhancing the speed and efficiency of
trade execution.
- While an increase in power demand is expected in the coming months, the
supply-side liquidity is likely to further improve due to enhanced coal
supply, reduction in e-auction coal prices and consistently declining
imported coal and gas prices
- another article BL 09Jun2023 on the same IEX stock plunge
- Under ‘market coupling’, there will be one single market-cleared price
common to all the three exchanges. This means that the three exchanges
will merely collect bids and submit the bids to whosoever is appointed
as the agency to determine the common price. This is like some agency
determining a common price for Uber, Ola, Blusmart, etc. Essentially,
this means that the dominant exchange (IEX) will lose its mojo, because
unlike now, under market coupling there would be no particular reason
for a bidder to choose IEX over the other two exchanges.
- MBED or market-based economic dispatch
- Grid Controller of India Ltd (formerly Power System Operation Corporation Ltd or POSOCO) - National Load Despatch Centre or NLDC
- PIB press release dated 04Jan2022
08Jun2023 Tweet CNBC TV18 video - during last half-hour trading on 08Jun2023, the stock of IEX (Indian Energy Exchange) fell by 8.2 percent to close for the day at Rs 136.50, on rumours of Ministry of Power asking CERC to implement 'market coupling'
- corporate - stock investing - know your company -
18May2023 - Blue Dart Express - corporate - stock investing - logistics sector - express courier -
valuation and other screenshots >
13May2023 Tweet - Tren Griffin - "In 2011, Groupon was valued at $25 billion, and the company went public that fall, raising $700 million in the largest tech initial public offering since Google. The market capitalization as of 12May2023 is about $100 million."
- corporate - red flag - stock investing -
31May2023 The Hindu - Elizabeth Holmes of Theranos enters Texas prison to begin her 11-year jail sentence
- corporate fraud - red flag - stock investing - behaviour bias - blood testing - Tweet 31May2023 on authority bias
- don't be enamoured of big shots in a company's Board of Directors -- famous people like, George Shultz and Henry Kissinger were part of Theranos' Board of Directors -- as investors, we should not fall for this authority bias and invest in companies which are familiar with famous people --
"Together, Elizabeth Holmes and Ramesh Balwani promised Theranos would revolutionise
health care with a technology that could quickly scan for diseases and
other problems with a few drops of blood taken with a finger prick. "The
hype surrounding that purported breakthrough helped Theranos raise
nearly $1 billion from enthralled investors, assemble an influential
board of directors that include former Presidential cabinet members
George Shultz, Henry Kissinger and James Mattis and turned Holmes into a
Silicon Valley sensation with a fortune valued at $4.5 billion on paper
in 2014."
29May2023 Margin collection by trading members - 80% margin release facility available on T + 0 day till 28May2023 for investors will no longer be available from 02May2023 as per new rules > Tweet 15May2023 from Kotak Securities >
26May2023 BCG - Most Innovative Companies May2023 PDF - Apple Inc, Tesla, Amazon, Alphabet, Microsoft, Moderna, Samsung, etc. - innovation - technology - research - R&D -
- The
Knight Frank Wealth Sizing Model reveals how deep your pockets need to
be to join the wealthiest 1% in selected countries and territories. The
wealth needed to join the 1% ranks varies sharply from country to
country
- for example, in India you need USD 175,000 or Rs 1.44 crore of wealth to be top 1 percent of the wealthiest
--
HNWI: High-net-worth individual – someone with a net worth of
USD 1 million or more, including their primary residence.
-- UHNWI: Ultra-high-net-worth individual – someone with a
net worth of USD 30 million or more, including their primary
residence
--
prime property: most desirable and most expensive property
--
‘permacrisis’ – year 2022 delivered energy, economic and geopolitical shocks
and is described as a year of ‘permacrisis’
--
Total wealth held by UHNWIs globally shrank by 10% during 2022, a drop of some
USD 10.1 trillion
--
Global mobility has long been a must-have for wealthy investors,
fuelling demand for
second passports, visas and citizenships.
--
While the UK, as well as the EU and US, still attract considerable numbers of
globally footloose wealthy residents, it is undeniable that Singapore and Dubai
are emerging as critical wealth hubs.
--
primary goals for HNWI wealth in 2023:
1)
capital appreciation 31%
2)
capital preservation 26%
3)
income generation 23%
4)
diversification 14%
5)
impact investing / philanthropy 6%
World's most connected cities are London, Dubai, Frankfurt, etc. > screenshot below >
Total wealth allocated to: 1) primary and secondary homes, 2) equities 3) commercial property and so on... > screenshot below >
23May2023 Berkshire Hathaway Inc Class A share price reached USD 500,000 for the first time in second week of March of 2022. After reaching USD 540,000 in the last week of Mar2022, its price dropped below USD 500,000.
- again on 17Mar2023, Berkshire Class A share price reached USD 500,000 and as on 22Mar2023, it's still above USD 500,000 a share
18May2023 PBS video - Nova PBS Official - web archive - Your Brain: Perception Deception - documentary - brain connections - brain memory - consciousness - science - neuroscientist Heather Berlin
- check from 37:36 in the video for toddler vs adult brain >
17May2023 Elon Musk of Tesla says, "The only real currency is time. Time is the only true currency."
Tweet 18May2023 - This is copied from a four-year-old tweet by Mr Karthik Nagesan - copy paste -
"My parents had a tv like this... I remember because, I was the remote..." - Television - Humour - Fun
14Jan2012 Indian Express - The Irony Mask by Jaithirth Rao (aka Jerry Rao) - Jerry Rao old columns - Citi Bank - Mphasis Ltd -
- Cho Ramaswamy (Srinivasa Iyer Ramaswamy) - Tughlak - film / movie script - screenplay - fun - humour - wit - cartoon -
- one of Cho's early plays — 'Saraswatiyin Shapatam'
- great Indian writers all the way from Kalidasa to Kanna-dasan (a well-known Tamil lyricist)
- Kalidasa (slave of goddess Kali); Kanna-dasan (slave of Kanna or Krishna in Tamil)
- our own friendly script writer decides to call himself 'Dasanu-dasan' (slave of slaves)
18May2023 Home First Finance Company India Ltd - housing finance - stocks - investing - know your company -
- Jerry Rao is one of founders of this company (he may not be holding any shares now -- he may have sold his shares after the company's IPO - listed on 03Feb2021
- house loans - small ticket loans
- stock is under pressure recently (down 30% from 52-week high) due to possible exit of private equity firms, which are now official promoters of company
- CMP is Rs 698, market cap Rs 6,150 crore
- 3-year CAGR growth rates: sales 24%, net profit 42%
- current ROE 13%
- ICRA Rating AA- (double A minus)
- 6-year AUM CAGR 43%
- CRAR (Tier 1) 48.9% and return on assets (ROA) 3.9%
- concentrated in Gujarat, Maharashtra, Tamil Nadu and Telangana (70% of gross loans from these 4 states)
- gross NPA 1.6% and net NPA 1.1%
- small ticket loans means higher distress for company's loans in case of economic distress in lower middle class population
17May2023 MoneyLife - Govt of India (GOI) launches to track, recover lost mobile phones - cell phone - cellphone -
- block your lost / stolen mobile phone - CEIR - Central Equipment Identity Register - CEIR FAQs (scroll down)
- KYM - know your mobile - dial *#06# to know whether IMEI number is genuine or black-listed or already in use - IMEI is international mobile equipment identity
- know your mobile connections - know the number of mobile connections in your name - TAFCOP - TAFCOP FAQs (scroll down)
- after declaration of state assembly polls on 03Dec2023 (also compare with 2018 map)
- changes since Dec2014 till now - state assembly polls
13May2023 Tweet - Changing political footprint India - political map of India - BJP has no footing in South India - Indian federalism - India political map - population and land area of BJP vs non-BJP state governments -
13May2023 Tweet - Dhruv Rathee - political map of India - BJP has no footing in South India - Indian federalism - India political map -
13May2023 Scroll - BJP loses assembly polls to Congress party - political map of India - BJP has no footing in South India - Indian federalism - India political map -
- The Indian Union has 30 Assemblies (28 states and two Union territories
with legislature) - after the Karnataka defeat, the BJP is now in power
only in 15 of these - two major states in this, Madhya Pradesh and Maharashtra, have BJP
government not because the party won elections but due to defections it
engineered to pull down non-BJP governments
- based on 2011 Census numbers, BJP is in power in states with 45% of total India's population -
13May2023 University of Michigan Surveys of Consumers - Mar2023 - University of Michigan Index: Buying Conditions for Houses - Index's 50-year graph in PDF - US economy - Housing prices - housing conditions -
- The lower the Index, the worse the conditions for buying houses in the US
- now in May2023, the conditions for buying houses seem to be at worst in 40 years
13May2023 Tweet - Marques Brownlee - MKBHD - Tech - Google / Alphabet and Apple Inc collaboration? - Android OS and AirTag - unknown AirTag detection -
10May2023 ProSyn - Winners and Losers in the AI Arms Race - AI - artificial intelligence - chatGPT - OpenAI - generative AI - LLM - large language model -
- The first rule of forecasting, as per, the financial journalist Jane Bryant Quinn is: give them a forecast or give them a date; just never give them both - anecdote -
- with the steam engine commercialized by Matthew Boulton and James Watt, Great Britain emerged as the first industrial country and its navy
ruled the seas-- after this, handicraft industries in countries like China and
India were rendered uncompetitive, causing per capita incomes to
stagnate and even fall - anecdote -
- the first mover advantage for the US in generative AI is not guaranteed
- Netscape Navigator
was a first mover for web browsers, but it was unable to hold its early
lead over Microsoft’s Internet Explorer and other rivals - anecdote - Marc Andreessen
- cellphone adoption advanced more quickly in Europe than the
US - Nokia became a market leader partly because Europe developed a common G2 standard for cellular networks, whereas the US adopted a confusing mishmash of incompatible standards - anecdote -
12May2023 Tweet thread - Rez Karim - "Google just released ChatGPT's strongest competitor yet - Bard
It's free to use and comes with 10X more features.
Here are some of the craziest things only Bard can do ( ChatGPT cannot)" - ChatGPT - chatbot - Alphabet - AI - OpenAI - artificial intelligence -
12May2023 Ambuja Cements Ltd places order for cement capacity expansion of 14 MMT (million metric tonnes)
- this brownfield expansion of 14 MMT is part of company's strategy to double its current production of 67.5 MMT (combined Ambuja Cements and ACC Ltd) in the next five years
- to expand cement capacity at Bhatapara (Chattisgarh) and Maratha (Maharashtra) units
- these projects to be completed in 24 months and entire capex will be funded from internal accruals
(there is no such announcement today from its subsidiary ACC Limited)
- in a related announcement on 12May2023, Ambuja Cements announced that it was chosen as preferred bidder for Devalmari Katepally Limestone Block in Gadchiroli District, Maharashtra - the block is in an area of 538 hectares with estimated limestone resource of 150 million tonnes with CaO (calcium oxide) content of 42%
11May2023 CNBC TV18 - video - Mangalam Maloo speaks to Ashwin Dani, key promoter of Asian Paints -
Mangalam Maloo asks, "What keeps you going, Mr Dani?"
Ashwin Dani responds, "I eat paints, I dream paints and I drink paints." - anecdote -
- I make a living doing macro forecasts
- Fed independence will be preserved I suppose
- huge liquidity from 2009 to 2021 via QE
- trouble follows asset bubbles -
- when you've free money for 11 years (2009 to 2021), people do stupid things
- I like concentrated bets
- I like fat pitches and swing big; when I don't see a fat pitch and I stand there and let the pitches go by
- I'm very negative on US stock market
- be open-minded and if there is a hard landing (probably in Q4 of 2023 or Q1 of 2024 though timing recessions is hard), there will be unbelievable opportunities
- When British prime minister Liz Truss wanted to provide fiscal stimulus, the market immediately shut them down (Truss had to resign due to market chaos in Oct2022) and they immediately went to a more responsible form of government
- conditions for recession: asset bubbles, problems in commercial real estate (CRE), CRE losses could spread to banks, credit card losses, rapid increase in interest rates in the US in the past 15 months, etc. - as a risk manager I've to consider all these things
- we own Microsoft Corp and NVIDIA Corp and thereby we're participating in the growth of AI (artificial intelligence); I think companies would benefit from AI
- I won gold and silver; but I could be wrong and could change my mind on gold and silver in a week or two
- debt ceiling row in the US Congress is depressing to me - not passing the debt ceiling limit in time would be a catastrophe for American Capitalism
-- it's a lie if politicians say they are not cutting our entitlements -- our entitlements (like, social security and others) will have to be cut in future without doubt -- interest burden and fiscal deficit in the US are very high and they can't be sustained forever
- Israel is a best example of opposite of 'resource curse' - Israel doesn't have any natural resources but still they do well - they have outperformed rest of the Middle East which has all the resources - anecdote -
(are 'resource curse' and 'dutch disease' the same thing?)
- the US dollar 'reserve currency' status is a privilege; but we should not misuse the privilege by running large unsustainable deficits
- Joe Biden Administration made a terrible mistake in isolating Saudi Arabia's MbS (Mohammed bil Salman) - MbS is 37 years old and wildly popular not only in Saudi Arabia but in the entire Middle East - he's a dynamic leader - he appears to be trying to make a hegemony in the ME - he brought Xi Jinping of China - he mended fences with Iran - MbS is trying to create an autocratic block -
- I've three daughters and give full credit to my wife for raising them well and giving them good values
- intellectual stimulation: I just happen to be good at compounding money, I love the business, I love the intellectual stimulation of knowing every event in the world, how security prices change and try to figure out the puzzle
25Nov2022 Tweet thread - long thread - by Barry Ritholtz - Elon Musk's failure of Twitter takeover - merger - acquisition - corporate - corporate failure - Tesla -
-- other failures - Bill Hwang of Archegos Capital Management - Adam Neumann of WeWorks -
04May2023 Real Vision video - Big Picture: The casualties of the Fed Policy - ZIRP -
- EPF - EPFO - EPS - salary - employee -
Why I'm bullish on iPhone sales in India!
- Apple Inc - iPhone - GST - business -
07May2023 BS India - Behind the K-Shaped Growth by Debashis Basu - @MoneyLifers - India growth - inequality - lopsided - corruption -
09May2023 Nexus Select Trust - REIT - REITs - BSE IPO weblink - IPO starts 09May and closes 11May - price band Rs 95 - Rs 100 - ICICI Direct research report on IPO - 17 retail malls across the country -
-- sponsor is Wynford Investments Ltd (Blackstone)
-- Investment manager is Nexus Select Mall Management Pvt Ltd
04May2023 Kenvue - Kenvue Inc is a pure-play consumer health company -- it was separated from Johnson & Johnson Inc (J&J) recently - stock - stock investing - IPO -
-- Kenvue stock started trading in the New York Stock Exchange (NYSE) on 04May2023
-- Kenvue's brands include BAND-AID, Tylenol, Benadryl, Aveeno, Nutrogena, Johnson's and Listerine
06Sep2023video David Rubenstein talks to Jeremy Grantham of GMO – Bloomberg Wealth –
investing – stock investing –
-
the US Federal Reserve’s most aggressive tightening in four decades could tip
the economy into recession and take the stock market with it
-
In the end, life is simple. Low rates push up asset prices. Higher rates push
asset prices down
-
deflation in the US has been delayed by the frenzy surrounding artificial
intelligence or AI
-
personally, I think AI is very important. But I think it’s perhaps too little
too late to save us from a recession
-
we will have a recession running perhaps deep into next year (2024) and an
accompanying decline in stock prices
-
rising interest rates, deflationary forces and depressing real estate market
could lead to recession in the US
-
The Fed’s record on these things is wonderful. It’s almost guaranteed to be
wrong. They have never called a recession, and particularly not the ones
following the great bubbles. They prided themselves in stimulating the bubbles.
They took credit for the beneficial effect of higher asset prices on the
economy. They have never claimed credit for the deflationary effect of asset
prices breaking.
-
inflation is largely out of the hands of the US Fed
-
I suspect inflation will never be as low as it averaged for the last 10 years,
that we have reentered a period of moderately higher inflation, and therefore
moderately higher interest rates
-
My job description these days at GMO, I haven’t done traditional stock work for
15 years, is working on long-term, underrated problems. We have shortages of
resources. We have shortages of manpower. A population bust the like of which
we have never seen, particularly in a few countries like China. We have an
incredible growth in inequality, which I think is the poison in the political
system. And we have a great surge of toxicity. I think we’ve made our planet
unfavorable to life in every form, including homo sapiens. And these are real
issues. They’re moving incredibly fast. They threaten perhaps the existence of
a stable global society.
-
I’m pleased to say 95% of my money is in a foundation. I co-manage the
foundation. I’m advised by Cambridge Associates. And we are invested 75% in
early-stage venture capital, which most people would consider a bizarre
concentration. We consider it the best part of capitalism and very much the
best part of American capitalism. American venture capital industry is the pride
and joy of the venture capital world — bigger and better — attracts people from
all over the world.
-
even a smart man like Sir Isaac Newton could not resist bubbles - he mortgaged
his house and put money into stock market in South Sea bubble and lost all his
money. Humans can’t resist being in bubbles because there is nothing more
supremely irritating than watching your neighbours get rich - anecdote -
-
the most common mistake investors make is they become too enthusiastic about
markets
-
investors are better off investing in a global index fund (fully outside of the
US) – only invest outside the US for the time being – only the US stock prices
are overpriced, non-US markets are not that overpriced
28Jun2023 video: David
Rubenstein talks to RockCreek Founder & CEO Afsaneh Beschloss – Bloomberg Wealth
–
- social impact investment
strategy – she was born in pre-revolutionary Iran –
- her global investment firm
RockCreek manages assets worth USD 17 billion
“My
mother taught me how not to cook so that I could do other things.” --> this is probably the best advice one can give for young girls
09Aug2023 video - David Rubenstein talks to Mike Novogratz, founder and CEO of Galaxy Digital Holdings Ltd (listed in Toronto, Canada) - Bitcoin - Ethereum - crypto -
– recorded on 26Jul2023 in New York
– in 2013, I invested about USD 3 million when Bitcoin was quoting at USD 100 a piece
– in reaction to COVID-19 Pandemic when central banks were printing huge money, Bitcoin as a macro asset gained from USD 8,000 to USD 17,000
– (referring to FTX’s Sam Bankman-Fried) I never assumed I was dealing with a sociopath
– Crypto exchanges and players that went down during crypto winter of 2022 were FTX, Celsius, Terra, Three Arrows Capital, BlockFi, etc.
– Mike Novogratz has a tattoo with ‘Terra’ (TerraUSD stable coin collapsed in May2022); I also have a bitcoin tattoo
-- the now-infamous tattoo on his arm — a wolf howling at the moon with the
word “Luna” — serves as a “good reminder of hubris,” Novogratz said
– what gives something value is not the technology, it is the social construct – you say it’s valuable and I say it’s valuable, therefore it’s valuable - anecdote -
– BlackRock CEO Larry Fink has been 'orange-pilled,' or converted from being Bitcoin (BTC) nonbeliever into a believer - Mike called Larry the most important thing that happened this year in bitcoin (in June this year, BlackRock applied to SEC to list a spot bitcoin ETF in the US)
-- BlackRock's proposed ETF is part of an 'adoption cycle' for Bitcoin and other crypto currencies
– (before founding Galaxy Digital Holdings in 2018) I wasn’t going to get back to work unless:
I could find something that I could work with young people,
I learned something new, and
I could make a difference
– Bitcoin is freedom, keep the government out of my business
– (because of unclear US crypto regulations and backlash from SEC’s Gary Gensler and White House against crypto industry) we’re moving some of our offices to London and Hong Kong
– a16z is setting up an office in London (diversifying away from the US)
– Open AI’s Sam Altman recently co-founded a cryptocurrency called ‘Worldcoin’ -- and I don't want to bet against Sam Altman
-- Worldcoin uses a small device called an “orb” to scan people’s eyeballs
in order to generate a a unique digital identity for online use
– (what is best investment advice you ever received) it’s from Paul Jones who talks about the ‘pain of the game’ – most great fortunes are made in trend and you need to stay with the trend (don’t settle for gains of 100 percent or 200 percent)
-- his advice today, for someone who has $100,000 to invest: “If they were
young and had a high risk tolerance, I’d be buying Alibaba stock. I’d be
buying silver, gold, Bitcoin and Ethereum. That’d be my portfolio.”
Those with lower risk tolerance should put 30% in a portfolio like that
and 70% in bonds and perhaps an index fund, he said
– Biotech still fascinates me
– from a societal perspective what worries me is that these technological advances are happening so fast in health, healthcare, biotech and gene editing and yet we’ve cities like Kinshasa where 13 million don’t have electricity – it looks like we’re hurtling to a world that looks like Blade Runner where this elite group of people live this life we could have never imagined and they had the masses that are in this teeming soup
01Jun2023 video - David Rubenstein talks to Cliff Asness of AQR (the interview was recorded on 24Apr2023 in Greenich, Connecticut)
- stock investing - quant - quants - hedge fund - value vs growth - Clifford Asness -
“If inflation stays sticky or it comes down because we enter a nontrivial recession — it’s equities that I think are a scary place,” Cliff Asness, 56, said. “They’re not priced very consistently with bonds.” Still, he said, the US could see “immaculate” disinflation that doesn’t come at the cost of growth.
We started in Aug1998 -- it was the month in which Russia defaulted on its debt. The next 18 months were horrible for our hedge fund.
Asness founded AQR in 1998 with USD 1 billion -- this hedge fund lost 50% of money in the first one year and a half. The fund now manages USD 100 billion. We've 500 to 600 employees.
I live in Greenwich, Connecticut. I meet a lot of private equity investors. They know more about how actual companies work and how to value them than I will ever dream of. What I do worry about for the investors and, again, personally resent, is the reporting of risk and volatility.
My biggest concern and probably our firm's biggest concern is stocks and bonds seem to be taking a very, very different view.
Bonds, whether it’s a risk premium or a forecast of future interest rates — if it’s a forecast of future interest rates, what’s priced into the short term curve is multiple, severe cuts over the next year to two years. That is a recession, and not a mild one, in the forecast.
Equities are, I’m not saying it’s a graveyard, but they’re whistling past that. So that doesn’t mean bonds are right. Equities could be right. You could get what some people have called the immaculate deflation, where inflation comes down and growth doesn’t suffer. But if inflation stays sticky or it comes down because we enter a nontrivial recession — it’s equities that I think are a scary place. They're not priced very consistently with bonds. And we're gonna find out who's right in the next year.
What's the best investment advice you’ve ever received?
Asness: Pretty much every week, my wife tells me, “Stop looking at the screen. You’ll be a happier man,” and she’ll be a happier person married to a happier man.
We have a process that involves value investing, trend following, quality investing, looking for positive carry, looking for good momentum. That had suffered a lot from 2018 through 2020, all from the value component.
I think the main thing we did, which was not so easy, was to stick with our process. And then, it kicked in big-time in the last two years (between 2021 and 2023).
When I say "quants” — I mean practitioners like me, and academics — it’s basically price to fundamentals, if something looks cheap, scaled by some fundamental. We might argue what the best one is. The fundamentals can be price to earnings, free cash flow, some proprietary measure of fundamental strenght. And the cheap tend to outperform the expensive long term. That is the famous academic value effect.
Stadard 60/40 (60% stocks and 40% bonds) portfolio will do well going forward provided you stick with for the long term of 10 years or more, you don't panic, you don't get greedy, you don't time it. I think under such circumstances, 60/40 portfolio will give decent returns in future. But I'd like to add the 60/40 portfolio will give less returns than they provided in the 20th century.
However, people can do better thatn 60/40 portfolio with uncorrelated or low-correlated diversifiers.
There is no certainty, but we're going to be in a period of macro volatility for a while.
I look at our returns every day, I'm very much involved in day to day operations.
Don't obsess about individual securities in your portfolio; have a wholistic view of your portfolio -- think about how your overall portfolio is doing. Different parts of your portfolio work in different parts of time.
- what is the biggest mistake that people make generally in investing? "herd behaviour"
- be diversified, keep some money in fixed income; a certain amount in a very low-risk product and a small amount in higher-risk areas - that advice is age-old and it still applies
- Blythe Masters, founding partner of fintech-focused private equity firm Motive Partners, which has roughly $4.8 billion in assets under management
- she is still bullish on blockchain technology, and said she believes it has financial-services applications that remain “underexploited.”
- if AI (artificial intelligence) grows too quickly and is unregulated, it will be a big risk because of all of the inherent biases and abuses of the unchecked technology
- a native of Oxford, England, Masters attended Cambridge University where she studied economics - best known for her role helping create credit-default swaps (CDS)
- blockchain technology has applications in the financial services world that as yet are still underexploited.
- some of the loudest voices calling for AI regulation are not coming from the government - they're coming from within the industry itself, from academia who are sufficiently familiar with the power of the technology and its potential for adverse outcomes.
- on whether cash will be gone in 10 or 20 years - "the cash-based economy in the US exists because there isn’t an equivalent social safety net to the one you find in Scandinavian countries; as long as you have people that are unbanked, underbanked or don’t have access to the financial system, you can’t eradicate cash."
- best investment advice I received: "Do your homework."
- focus on the technology because it’s going to change the landscape in financial services over the next few years - focus on trends that are about personalization of services, democratization of access, opening up of new products and capabilities to a wider audience - but also pay attention to the risk of people being left behind (reduce digital divide)
- USD 42 billion worth of deposits were taken out, in just four or five hours in a single day, from Silicon Valley Bank (SVB) in the US in Mar2023 -- due to the power of FinTech (online withdrawal of money from cellphones / mobile phones) and social media messages - bankruptchy - bank run - bankrun - bank failure
- my 30-year-old daughter has achieved success by mostly ignoring everything I ever said to her - she's doing venture capital investing in the area of clean-energy transition and loving it - anecdote -
- the personal touch is really critical - one of the key pieces of advice is to cherish and seek out those relationships that can be truly helpful to you in your career - we still need to maintain relationships and trust, notwithstanding the fact the way we interact is changing (like, Zoom calls and online interaction)
03May2023 video - David Rubenstein talks to Alex Rodriguez - sports - baseball - Bloomberg Wealth -
Alex Rodriguez, nicknamed "A-Rod", is a former professional Baseball player. He is now a businessman owning A-Rod Corp and a philanthropist.
Alex missed a spot in the Hall of Fame if not for a 2014 suspension for taking performance-enhancing drugs.
Alex was suspended in 2014 for one year for using performance-enhancing drugs. He did not appeal and underwent the suspension.
As a baseball superstar and 25 years old, Alex signed a 10-year USD 252 million contract (the biggest in the history of sport at that time) with Texas Rangers in 2000. His contract was insured by Warren Buffett's Berkshire Hathaway.
After three years, Alex joined New York Yankees. In New York, he broke his own record when he signed a 10-year USD 275 million contract.
I'm always process-driven, I've always enjoyed practice more than the game.
I'm always surrounded with the best people, I always think long term, in terms of decades, not just the short circuit.
I'm a very very careful investor, says Alex. At A-Rod Corp, we shoot for singles and doubles and never strike out.
Warren Buffett always talked about going out and buying the greatest business you can with the best management team, and pay a fair price. Don’t buy an average business and pay a great price.
"One thing I always remember Warren Buffett telling me is there are two rules of investing:
1) Never lose money, and
2) Don’t forget rule number one."
What is the biggest investment mistake people make? Rodriguez answered: "A lot of people overestimate their ability. Just because I’m good at baseball doesn’t mean I’m gonna to be good at investing. You’ve got to work really hard and surround yourself with the best people in the world."
“I would keep it in Treasury bills right now,” said Alex Rodriguez when asked what to do with $100,000. “I would not do anything. Everything to me is still kind of very expensive.”
My father left us when I was 10 years old. My single mom raised us very well.
05May2023 Livemint - The ownership by domestic investors, individual as well as
institutional, in companies listed on the National Stock Exchange (NSE)
has breached the 25 percent mark for the first time
Quoting data from Prime Database, the report mentioned that their share
stood at 25.72 percent at the end of the March 2023 quarter, up from
24.44 percent in the previous quarter. Meanwhile, the share of foreign
portfolio investors (FPIs), also rose slightly to 20.56 percent in the
March quarter from 20.24 percent as on December 31, 2022, it added.
- DII share - FPI share
05May2023 Crisil MF Ranking - Crisil Mutual Fund Ranking Booklet as on Mar2023 PDF - Mutual fund categories > Equity, hybrid and debt mutual funds > Index funds and ETFs are clubbed together >
03May2023 India Gazette - Gazette Notification by Govt of India, Department of Revenue, Ministry of Finance -
- PMLA norms - KYC - Income tax - immovable property - client money - client stocks - client securities - client bank accounts - CA, ACS and CMA will be held responsible for any illegal / fradulent activities under PMLA - chartered accountant - company secretary - cost and management accountant - Business Standard 04May2023
Govt Gazette notification screenshot >
03May2023 Japan Talk - Japaneses art and culture - 138 types of Japanese culture
Ikebana - classical Japanese art of arranging flowers
Bonsai - Japanese art of growing dwarf trees in containers
Origami - Japanese art of folding paper
Kirigami - (similar to Origami) Japanese art of three-dimensional paper folding
01May2023 WSJ - First Republic Bank (FRB) in 2012 gave Mark Zuckerberg (founder and CEO of Facebook, now Meta Platforms) a mortgage loan worth USD 5.95 million with a starting rate of 1.05 percent
- anecdote - bank run - bank failure -
The Panic of 1907: JP Morgan and the Money Trust - PDF of this - bank failures - bank run - banking sector - banking history - John Pierpont Morgan - central bank - liquidity - monopoly - Sherman Antitrust Act - JP Morgan and others acted as a lender of last resort before the Fed was founded - Federal Reserve was founded later -
01May2023 FDIC - JPMorgan Chase Bank, National Association, Columbus, Ohio Assumes
All the Deposits of First Republic Bank, San Francisco, California
-- First Republic Bank or FRB was closed on 01May2023; FRB is taken over by JP Morgan Chase Bank which will assume all of the deposits and substantially all of the assets of FRB
-- FDIC estimates that the cost (cost of bailing out FRB) to the Deposit Insurance Fund will be
about $13 billion-- this is an estimate and the final cost will be
determined when the FDIC terminates the receivership
- failed bank - bank bailout - FDIC - bank rescue - bankruptcy - bank collapse - bank failure - US bank run - bankrun - bank takeover -
- died in mental asylum
-- medicine was very primitive till the middle of 19th Century
Dr Ignaz Semmelweis of Hungary - worked in a Vienna hospital - 19th century - importance of hand wash - antiseptic rules -
29Apr2023 Katalyst Wealth - how to read sales figures of real estate companies? - realty sector - investing - stock investing - accounting -
-- as per AS 115, realty firms since FY 2018-19 need to report their sales figures as per completed contract method (CCM) basis instead of earlier percentage of completion method (POCM) -- CCM is more conservative
"According to the National Bureau of Economic Research (NBER), there have been
30 recessions since 1871, the longest period for which performance data
is available for the S&P 500 Index and its predecessor compilation
of US stocks. I looked at how the S&P 500 performed six months
before each of those recessions and found that it produced a positive
total return 21 times. So even if you knew a recession was coming, you
would still most likely be better off in stocks in the months leading up
to it."
"The good news for mere mortals is that none of that maneuvering around
the market is necessary. The best result is likely to be achieved by
hanging on to stocks and ignoring the economy. During the periods
beginning six months before and ending six months after each of the
previous 30 recessions, the market produced a positive total return 22
times. Investors were also amply rewarded for their patience with a
median total return of 16%, by far the highest median return of the four
scenarios I looked at. And things improved from there as recessions
gave way to new booms."
28Apr2023 The Punjabi Clock - fun - cartoon
22Apr2023 Wealthtrack - video - Consuelo Mack talks to William Wilby, former portfolio manager, Oppenheimer Global Fund
- investing - stock market -
-- the irony is Silicon Valley Bank (SVB) collapse was due to the bank owning US Treasury securities (specifically, long-dated ones) on the assets side and owning excess of uninsured deposits on the liabilities side
-- we usually don't blame a bank if it owns too-much of Treasury securities; but SVB collapsed precisely due to unrealised losses in long-dated US Treasury securities after the Fed hiked interest rates sharply in 2022 and 2023
-- SVB did not have a problem in its loan portfolio
-- the US banks have a mountain of Treasuries in recent years, because the US government has issued a mountain of Treasuries
-- depositors withdrew money in very short time (just two days) using mobile phone banking apps and spreading news / rumours about SVB troubles (in Mar2023)
-- will blue-collar economy do well in future?
-- solving problems with monetary and fiscal stimulus is not good for the US economy in the long term
-- recession risk in the US is high; it takes longer to play out (for example, in 2008 / 2009 GFC, things took more than one year to play out -- sub-prime crisis, Bear Stearns trouble and Lehman Brothers collapse)
-- because of low interest rates, people have been pushed into a higher risk spectrum
-- infrastructure and energy stocks may do well in future; though these are difficult areas to invest in -- fixed-price contracts, uncertainty of gov't contracts, companies can't control costs and unpredictable profit margins
-- I own Jacob Solutions Inc, Flour Corp, Microsoft, Alphabet Inc, Boeing, ExxonMobil and Cheniere Energy
-- one of my favourite companies in semi-conductor area is ASML Holdings NV, a dutch company -- a monopoly; extreme ultraviolet technology
-- my equity portfolio is balanced between growth and value stocks
-- green energy transition is impossible on currently available technology; oil will continue with us for longer time than people expect
-- carbon is still the most efficient energy source
-- I now own 70% in stocks and 30% in cash (the asset mix was 50:50 during the 2008 crisis) -- I'm always biased towards equities
-- you need to be a lazy investor -- low portfolio churning; don't do too much with your portfolio; remember the Hippocratic oath: "Do no harm"
-- if you hold a balanced, diversified portoflio, it's going to do okay unless you start screwing it up
-- during times of big selling, the risk of screwing up your portfolio is higher
27Apr2023 The Print - “Indian Constitution and
laws expire at the border of Uttar Pradesh, as soon as the Delhi border
ends,” a designated judge in an MP/MLA court in Uttar Pradesh said about grant of protection to witnesses in cases involving past and present lawmakers.
“It’s like when people wear the helmet in Delhi, but remove it as
soon as they reach Ghaziabad in UP or Haryana,” the judge told
ThePrint.
- court - judge - rule of law -
- cash ban - less cash - digital utopia -
25Apr2023 George Mack on Josh Waitzkin - most interesting person alive - focus - fun - relaxation - recovery - creativity -
18Jun2020 Tweet - Wirecard AG shares plunge 66% - missing cash - Germany - fintech - DAX 30 -
- fraud - governance - corporate failure -
05Apr2023 Nirvana Laha - "Piramal Pharma is going to pay a royalty of 0.75% of revenue to Piramal Enterprises for "facilitating loans and advising in investment decisions". Promoters hold 43% of PEL and only 35% of PPL. Neat."
- stock investing - promoter fraud - #Corporate #Fraud #Governance - corporate failure -
04Apr2023 SG - Does 2FA for SIPs ruin the entire point of SIPs? - mutual fund SIP - two factor authentication -
9 x 1 = 9
9 x 2 = 18
9 x 3 = 27
.
.
.
9 x 10 = 91
The chaos started suddenly in the hall bc Einstein made a mistake. Correct answer 9 × 10 =. And all his students ridiculed him.
Einstein waited for everyone to be silent and said:
"Despite the fact that I analyzed nine problems correctly, no one congratulated me. But when I made one mistake, everyone started laughing. This means that even if a person is successful, society will notice his slightest...mistake. And they'll like that.
So don't let criticism destroy your dreams. The only person who never makes a mistake is someone who does nothing."
-- science - physics - maths - mathematics - anecdote
01Mar2023 MT Capital - A lot changes in 123 years - relative sizes of world markets end - 1899 and start - 2023 >
- stock markets - global stock markets - at the end of 1899, the UK was leading in stock markets
- in 2023, the US is leading with 58.4% share in world global markets - market cap - market capitalisation -
27Mar2023 Jim Bianco - "We see the mistake of underestimating new technology over and over. New technology is disruptive. It changed business models, it alters behaviour. It makes the status quo obsolete. But we often think new technology is just a minor improvement. So, we view it as a marginal productivity increase."
27Mar2023 Jim Bianco - "We all think of banks as places to warehouse our money, and in exchange, we want a market interest rate. Regulators see banks as the primary way to fund the economy via loans. They regulate them with this in mind." - bank bailout - SVB - silicon valley bank -
27Mar2023 Frances Coppola - "People do not understand the business model of banks. A bank that replaces spread-based income with fee-based income is no longer a bank." - bank bailout - SVB - silicon valley bank -
- US bank collapse - SVB - silicon valley bank - bank failure - bank run
- oddly, hedge fund managers are supporting bank nationalisation
24Mar2023 The Better Letter - Bob Seawright - the index mindset - passive funds - active funds - active vs passive - passive investing - life -
-- "Very broadly speaking, the index mindset favors average results over
extreme ones, a bird-in-hand over two in the bush, relative over
particular truth, function over form, quantity over quality, mandate
over merit, efficiency over exploration, passivity over action,
predictability over tails, determinism over freedom of choice, mistake
avoidance over smart decisions, evolution over revolution, adaptation
over reformation, safety over risk, diversification over concentration,
preservation over creation, velocity over due diligence, optionality
over decisiveness, the general over the specific, and growth over
profit."
15Sep2021 luttig's learnings - John Luttig - the index mindset - passive funds - active funds - active vs passive - passive investing - life -
13Mar2023: HSBC of the UK acquires Silicon Valley Bank's UK arm for one pound in Mar2023 -- it may be noted JP Morgan acquired Bear Stearns for two dollars in Mar2008 - US bank bailout -
20Apr2023 video - compare Apple stores in India - Apple BKC vs Apple Saket -
-- Apple BKC store is inspired by 'kaali-peeli' taxis and Apple Saket is inspired by Delhi's gates
-- 100+ staff at BKC store can speak 20 languages collectively, whereas Saket store staff can speak 15 languages collectively
19Apr2023 Tweet thread by Brad Setser - The US dollar is not losing its market share as a reserve currency -
-- US dollar dominance - dedollarisation -
-- two reasons for the drop in reported dollar reserves in 2022:
1) bond market valuations declined due to rising US interest
rates
2) the US dollar was sold off in 2022 due to its extreme
strength (as reflected in USDX's rise)
-- FT article dt 19Apr2023 on US dollar losing reserves
19Apr2023 Value Research - most actively-traded ETFs in India > Nippon India ETF Nifty bees, Bank bees, Motilal Oswal Nasdaq 100 ETF and others >
19Apr2023 WSJ - Jason Zweig - Fidelity and State Street Push to Make 401(k)s More Like Pensions
-- retirement - annuity -
-- State Street, the world’s fourth-largest asset manager, is launching a 401(k)
investment product that lets savers convert their retirement nest eggs
into a steady income for life via an annuity in their target-date fund
-- Fidelity Investments, the nation’s largest retirement plan provider,
plans to integrate a greater array of investment products from itself
and others that make regular payments to retirees into its platform
starting in 2024. The move would give the 23,000 employers with 41
million workers and retirees that use Fidelity as their 401(k) provider
the option to put products with annuities in their retirement plans
-- In 2019, the US Congress passed a law to make it easier for 401(k) plans to offer annuities, but few employers have embraced the option so far.
01Apr2023 WealthTrack - two videos - 01Apr2023 and 08Apr2023 - Christine Benz of Morningstar - Retirement - annuity -
-- Ms Benz recommends a good set of ETFs for US investors to invest in for their retirement saving -
-- best international ETFs - TIPS - REITs - index funds - put money in different buckets
-- decumulation based on income needs and social security benefits
-- several risks for prospective retirees are, like, retirement date risk, sequence risk, inflation risk, healthcare risk and longevity risk
-- safe withdrawal rate from retirement corpus
-- retirement blind spots
Tweet thread 19Apr2023 - The 11-day continuous streak of positive market breadth for BSE 500 index is broken today.
The advances - declines ratio (ADR) of BSE 500 has been positive for 11 consecutive trading days between 29Mar2023 and 18Apr2023.
19Apr2023 UNFPA - as per UN Population Dashboard, published on 19Apr2023, India surpassed China as the most populous country in the world
-- India population is 1,428.60 million (2023)
-- China population is 1,425.70 million (2023)
27Apr2023 Ipca Labs past acquisitions as per Motilal Oswal report > Lyka Labs, Ramdev Chemical, Pisgah Labs, Bayshore Pharma > in April 2023, Ipca Labs announced acquisition of majority stake in Unichem Labs - pharma sector -
26Apr2023 Indiabulls Housing Finance Ltd (IBHFL) -
- investing - stock investing - know your company - corporate -
What has changed between Aug2022 (previous notes) and now (Apr2023)?
Indiabulls Housing Finance Ltd (IBHFL): Promoter holding is now zero; Sameer Gehlaut, erstwhile co-promoter, is no longer a promoter of the company. Another co-promoter Gagan Banga is still with the company, though his stake too is zero.
Valuation metrics of IBHFL appear to be cheap -- for a good reason; because the street is not sure about the management vision for the company and how they will grow the asset size and profitability of the company. (please check the following three images for metrics) >
Revenue growth has been nearly stagnant for the past four quarters and net profit shows slight decline -- while net NPA ratio worsened from 1.80 percent to 2.18 percent.
Some ratios of the company, IBHFL, as at the end of 31Dec2022:
debt-equity ratio 2.96
net worth Rs 15,984 crore
net profit margin 10.96 percent
gross NPA ratio 4.49 percent
net NPA ratio 2.97 percent
liquidity coverage ratio (LCR) 84 percent
capital adequacy ratio (CRAR) 25.20 percent
It may be clarified the the higher the CRAR (over and above the statutory requirement), the greater the scope for future loan growth and superior the capital buffer -- the flip side being the higher the CRAR the lower the profitability ratios because higher capital is locked up without being used for generating revenue and profits.
For some time, the company's website has not been working; so, some details cannot be extracted. I've tried web archive -- only some details are available. Mr Gagan Banga is in control of the company, supervised by other directors, like, SS Mundra and BC Patnaik (MD of LIC of India).
Recently, a reputed global investor, Oaktree Capital, bought loans worth Rs 5,000 crore from IBHFL. This could be regarded as a positive.
Other than the above current developments, not much has changed in the company from my previous notes of Aug2022.
The current market price (26Apr2023) of IBHFL is Rs 105.60, with a market cap of Rs 4,980 crore. At the end of Dec2022, the price reached a peak of Rs 156 before falling by 32 percent.
It's hard for long-time investors to make money from such stocks with such legacy management issues. If your stake is small, you can live with the stock for some time. Otherwise, you need to take a harder look at the stock.
12May2023 The Shipping Corporation of India (SCI) Limited - Apportionment of Cost of Acquisition of equity shares after demerger of Shipping Corporation of India Land Assets Ltd from SCI Ltd - SCI demerger - corporate action
-
cost of acquisistion is dividend into as follows: SCI Ltd 59.68% and SCI Land Assets Ltd 40.32% (this is for income tax purposes)
- ex-date and record date for the demerger was 31Mar2023
- the shares of SCI Land Assets are yet to be listed on stock exchanges
19Apr2023 BSE - BEML Land Assets Ltd (BLAL) is getting listed today - BLAL is a spin off from BEML Ltd -
-- corporate - investing - spin off - demerger - corporate action
-- the ex-date for spin off from BEML Ltd was 08Sep2022 (record date was 09Sep2022) -- it meant if you were holding, for example, one equity share of BEML Ltd with a face value of Rs 10 each on 07Sep2022, you would have received one equity share of BEML Land Assets Ltd (BLAL) with a face value of Rs 10 each -- it took six months and two weeks, after ex-date, to get shares of BLAL listed on stock exchanges -- it meant you were out of funds / liquidity (liquidity risk) for seven months and two weeks on this portion of BLAL shares -- this lack of liquidity is a factor to be considered while participating in corporate actions, like, spin off or demerger -
-- Tweet thread 19Apr2023 for share price adjustment done by @screener_in for corporate actions, like, spin off, demerger and rights issue
Tweet thread 19Apr2023 - If you had stayed invested in BEML Ltd between ex-date of spin off of BEML Land Assets Ltd and now (BEML Land Assets listed today), you'd have lost 17.70 percent (not including Rs 10 dividend from BEML) in just 32 weeks, in an otherwise sideways market (calculation sheet attached below).
-- in the recent spin off of NMDC Steel Ltd, investors made decent money; but BEML Land Assets was not such a case
-- corporate - investing - spin off - demerger - corporate action
31Dec2023 Nifty 50 index monthly returns from Jan1994 to Dec2023 - Capital Mind
17Apr2023 Apple Inc - Apple Card's new Savings account is now available with 4.15 percent APY (annual percentage yield)
-- Starting today, Apple Card users can choose to grow their Daily Cash
rewards with a Savings account from Goldman Sachs, which offers a
high-yield APY of 4.15 percent — a rate that’s more than 10 times the national average.
-- With no fees, no minimum deposits, and no minimum balance requirements,
users can easily set up and manage their Savings account directly from
Apple Card in Wallet.
-- Apple Inc's production capacity (2021): China 230 million (98%); India 3 million (1%) and Brazil 1.2 million (1%) >
27Jul2023 S&P 500 index forward P/E ratio, S&P 500 earnings, S&P 500 valuation, US stock market >
17Apr2023 S&P 500 index forward P/E ratio, S&P 500 earnings, S&P 500 valuation, US stock market >
15Aug2023 TE - India CPI inflation jumped to 7.44 percent in Jul2023
21Apr2023 CPI Inflation of Japan is down to 3.2 percent in Mar2023 >
16Apr2023 CPI Inflation of major nations in the world > Trading Economics data - consumer prices inflation > Argentina, Australia, Brazil, Canada, Euro area, France, Germany, Indonesia, India, Italy, Mexico, South Africa, Turkey, the UK and the USA >
16Apr2023 The Money Illusion - Alternative Approaches to Monetary Policy by Scott Sumner - 219 pages book - what is monetary policy - interest rates - exchange rates - Fed policy tools -
03Apr2023 RWM WisdomTree Crypto Index exposures as at end-02Apr2023 factsheet- Bitcoin, Ethereum, Solana, Polygon, Chainlink, Polkadot, Aave, Uniswap, etc. - DeFi - Metaverse - smart contract platform - NFT - Polygon - Ether - crypto asset profiles -
-- 12Apr2021 share buybacks: friend or foe by Terry Smith - capital allocation - capex - maintenance capex -
- in 1977, 95% distributions made by quoted US companies were through dividend; but now a majority of distributions are through share buybacks or share repurchases
- What has led to this change is in part a change in regulation. In 1982 Congress enacted Rule 10b-18 which provided “safe harbour” to protect companies undertaking buybacks from being sued for manipulation under the terms of the Securities Exchange Act
- investors should view share buybacks with scepticism
09Mar2023 Fundsmith - Annual Shareholders' Meeting 2023 - stock investing - video - Terry Smith -
Highlights from the video:
–
Terry Smith - Terence Smith (Terry Smith) talks on his fund’s performance and
stocks the fund (Fundsmith Equity Fund) owns:
--
fund’s assets are GBP 22.5 billion as on 31Dec2022
--
the fund underperformed in 2022; its return in 2022 is minus 13.8%
--
but the fund outperformed MSCI World Index since its inception in Nov2010
--
its CAGR from Nov2010 to Dec2022 is 15.5% versus MSCI World Index’s 11.0%
--
some of the stocks the fund owns are:
Novo
Nordisk
Philip
Morris
PepsiCo
ADP
or Automatic Data Processing
Mettler-Toledo
Meta
Platforms (Facebook)
Microsoft
IDEXX
(diagnostic equipment firm)
Amazon
--
the companies we bought in 2022:
Adobe
Mettler-Toledo
Otis
Apple
--
the companies we sold in 2022:
Johnson
& Johnson
Starbucks
Kone
Intuit
PayPal
--
our investment strategy has three legs:
1)
only buy good companies,
2)
do not overpay, and
3)
do nothing
--
look-through ratios (key indicators for choosing good companies)
1)
ROCE
2)
gross margin
3)
operating profit margin
4)
cash conversion
5)
interest coverage ratio
Cash
conversion ratio is cash flows divided by net profits. You could use either
operating cash flows or free cash flow as the cash flow number here.
Higher
gross margin indicates the strong pricing power (a defense against inflation)
of a company.
Higher
interest cover indicates that the company is conservatively financed (not
resorting to financial engineering).
--
our metric for valuation (not overpaying for companies) is free cash
flow yield.
--
free cash flow yield is free cash flow (FCF) divided by market cap or FCF per
share dividend by market price per share
--
Fundsmith’s FCF yield is 3.2% versus 3.4% for S&P 500 (ex-financials); the
lower the yield means the higher the valuation; here, Fundsmith is slightly
overvalued versus S&P 500
--
Fundsmith’s portfolio turnover (metric for doing nothing)
Its
portfolio turnover rate is 7.4% in 2022 (it’s higher than its own average
turnover rate over the years; but much lower than the industry average of 60%
portfolio turnover).
The
definition of portfolio turnover is as per FCA (or Financial Conduct Authority
of the UK). It is equal to total share purchases plus sales less total
creations and liquidations divided by the average net asset value of the fund.
The
fund’s total cost of investment (TCI) is just 1.05% in 2022. TCI includes
brokerage commissions and transaction taxes incurred.
--
(in response to a question) one company which we would like to own but actually
don’t is Adyen – we don’t own it because it is too expensive (its P/E ratio is
60)
--
Adyen is a Dutch company – fintech – payment processor
--
Adyen is laser-focused
--
(in response to a question) the cheapest company in our PF is Meta Platforms
(aka Facebook) – its TTM P/E is just 15 and its forward P/E is 12.7 – if Meta
stops spending billions of dollars on metaverse, the stock would go through the
roof
--
in the past, technology firms were non-cyclical; but now they seem to be
cyclical in nature – but overall, they will do well in future
images from the above video >
look-through ratios
do nothing
meta platforms
liquidity constraints
07Feb2023 Livemint - New tax on distribution income, a budget damper for Reits, InvITs - by Satya Sontanam
-- A key factor fueling higher ER&D spending is digital engineering, the discipline of developing new, connected, and digitally enabled products and services using technologies such as artificial intelligence (AI), machine learning, and cloud computing. Examples of digitally engineered products include autonomous vehicles and production plants wired for Industry 4.0.
-- The use of ER&D service providers varies by industry. Our research shows the sectors most inclined to increase outsourcing over the next three years are advanced manufacturing and services, automotive and mobility, medical devices, energy and natural resources, and aerospace and defense.
-- BMW, for instance, outsourced its next-generation charging electronics program to KPIT, a service provider specializing in vehicle electrification engineering and software.
--
as on 10Feb2024, there are only seven REITs and InvITs in the index
(small market of REITs and InvITs in India) - namely, Embassy REIT,
Nexus Select Trust, Powergrid InvIT, Mindspace REIT, India Grid Trust, Brookfield REIT and
IRB InvIT
13Apr2023 NSE - NSE Indices Ltd, a subsidiary of National Stock Exchange (NSE), has
launched India’s first ever index on REITs and InvITs, named, Nifty REITs & InvITs Index - PDF of the index - The index has a base date of 01Jul2019, with a base value of 1,000 -
-- as on 31Mar2023, there are only six REITs and InvITs in the index (small market of REITs and InvITs in India) - namely, Embassy REIT, Powergrid InvIT, Mindspace REIT, India Grid Trust, Brookfield REIT and IRB InvIT
14Apr2023: On 13Mar2023, Tube Investments of India (Murugappa group) announced its foray into CDMO space with Rs 285 crore investment -- on 22Mar2023, another Murugappa group company Coromandel International Ltd announced its foray into CDMO space with Rs 1,000 crore investment --
-- on 04Apr2023, Nirma group bought a Bangalore-based CDMO player, Stericon Pharma Pvt Ltd
02Apr2023 - BSE 500 Index as at end-31Mar2023 > sector-wise market cap >
02Apr2023 - BSE Allcap Index as at end-31Mar2023 > sector-wise market cap and market cap >
31Oct2024 Nifty Indices
- screenshots /
images of NSE indices - data as at the end of 31Oct2024 - sector and top 10 stock weights, returns, risk, P/E and P/B -
NSE indexogram - monthly factsheets -Nifty 50, Nifty Next 50, Nifty
500, Nifty Midcap 150, Nifty Smallcap 250, Nifty Total Market, Nifty
Bank, Nifty IT and Nifty FMCG, Nifty Auto, Nifty Metal, Nifty Pharma and Nifty Healthcare indices
30Sep2024 Nifty Indices
- screenshots /
images of NSE indices - data as at the end of 30Sep2024 (30th is the last trading day of Sep2024) - sector and top 10 stock weights, returns, risk, P/E and P/B -
NSE indexogram - monthly factsheets -Nifty 50, Nifty Next 50, Nifty
500, Nifty Midcap 150, Nifty Smallcap 250, Nifty Total Market, Nifty
Bank, Nifty IT and Nifty FMCG, Nifty Auto, Nifty Metal, Nifty Pharma and Nifty Healthcare indices
30Jun2024 Nifty Indices
- screenshots /
images of NSE indices - data as at the end of 30Jun2024 (28th is the last trading day of Jun2024) - sector and top 10 stock weights, returns, risk, P/E and P/B -
NSE indexogram - monthly factsheets -Nifty 50, Nifty Next 50, Nifty
500, Nifty Midcap 150, Nifty Smallcap 250, Nifty Total Market, Nifty
Bank, Nifty IT and Nifty FMCG, Nifty Auto, Nifty Metal, Nifty Pharma and Nifty Healthcare indices
30Apr2024 Nifty Indices
- screenshots /
images of NSE indices - data as at the end of 30Apr2024 - sector and top 10 stock weights, returns, risk, P/E and P/B -
NSE indexogram - monthly factsheets -Nifty 50, Nifty Next 50, Nifty
500, Nifty Midcap 150, Nifty Smallcap 250, Nifty Total Market, Nifty
Bank, Nifty IT and Nifty FMCG, Nifty Auto, Nifty Metal, Nifty Pharma and Nifty Healthcare indices
31Mar2024 Nifty Indices
- (28th March is last trading day of Mar2024) screenshots /
images of NSE indices - data as at the end of 31Mar2024 - sector and top 10 stock weights, returns, risk, P/E and P/B -
NSE indexogram - monthly factsheets -Nifty 50, Nifty Next 50, Nifty
500, Nifty Midcap 150, Nifty Smallcap 250, Nifty Total Market, Nifty
Bank, Nifty IT and Nifty FMCG, Nifty Auto, Nifty Metal, Nifty Pharma and Nifty Healthcare indices
29Feb2024 Nifty Indices
- screenshots /
images of NSE indices - data as at the end of 29Feb2024 - sector and top 10 stock weights, returns, risk, P/E and P/B -
NSE indexogram - monthly factsheets -Nifty 50, Nifty Next 50, Nifty
500, Nifty Midcap 150, Nifty Smallcap 250, Nifty Total Market, Nifty
Bank, Nifty IT and Nifty FMCG, Nifty Auto, Nifty Metal, Nifty Pharma and Nifty Healthcare indices
31Dec2023 Nifty Indices
- screenshots /
images of NSE indices - data as at the end of 31Dec2023 - sector and top 10 stock weights, returns, risk, P/E and P/B -
NSE indexogram - monthly factsheets -Nifty 50, Nifty Next 50, Nifty
500, Nifty Midcap 150, Nifty Smallcap 250, Nifty Total Market, Nifty
Bank, Nifty IT and Nifty FMCG, Nifty Auto, Nifty Metal, Nifty Pharma and Nifty Healthcare indices
30Sep2023 Nifty Indices
- screenshots /
images of NSE indices - data as at the end of 30Sep2023 - sector and top 10 stock weights, returns, risk, P/E and P/B -
NSE indexogram - monthly factsheets -Nifty 50, Nifty Next 50, Nifty
500, Nifty Midcap 150, Nifty Smallcap 250, Nifty Total Market, Nifty
Bank, Nifty IT and Nifty FMCG indices -
31Jul2023 Nifty Indices
- screenshots /
images of NSE indices - data as at the end of 31Jul2023 - sector and top 10 stock weights, returns, risk, P/E and P/B -
NSE indexogram - monthly factsheets -Nifty 50, Nifty Next 50, Nifty
500, Nifty Midcap 150, Nifty Smallcap 250, Nifty Total Market, Nifty
Bank, Nifty IT and Nifty FMCG indices -
30Jun2023 Nifty Indices
- screenshots /
images of NSE indices - data as at the end of 30Jun2023 - sector and top 10 stock weights, returns, risk, P/E and P/B -
NSE indexogram - monthly factsheets -Nifty 50, Nifty Next 50, Nifty
500, Nifty Midcap 150, Nifty Smallcap 250, Nifty Total Market, Nifty
Bank, Nifty IT and Nifty FMCG indices -
30Apr2023 Nifty Indices
- screenshots /
images of NSE indices - data as at the end of 30Apr2023 (last trading was 28Apr2023) - sector and top 10 stock weights, returns, risk, P/E and P/B -
NSE indexogram - monthly factsheets -Nifty 50, Nifty Next 50, Nifty
500, Nifty Midcap 150, Nifty Smallcap 250, Nifty Total Market, Nifty
Bank, Nifty IT and Nifty FMCG indices - 31Mar2023 Nifty Indices
- screenshots /
images of NSE indices - data as at the end of 31Mar2023 - sector and top 10 stock weights, returns, risk, P/E and P/B -
NSE indexogram - monthly factsheets -Nifty 50, Nifty Next 50, Nifty
500, Nifty Midcap 150, Nifty Smallcap 250, Nifty Total Market, Nifty
Bank, Nifty IT and Nifty FMCG indices -
13Mar2023 BQ Prime - Contract Development and Manufacturing Organisation - CDMO - CDMOs, like, Divi's Labs, Suven Pharma, Gland Pharma, Neuland Labs, Syngene International, Hikal Ltd and Piramal Pharma - Indian Pharma -
Tweet 13Mar2023 - Ekansh Mittal of Katalyst Wealth - break-up of Indian steel pipes sector
30Sep2019 JP Morgan Guide to Markets - asset class returns - asset class matrix - yearly returns from 2004 to 30Sep2019 - asset classes -
NSE 500 index - Sector weights as on 31st of December every year from 2010 to 2022 (for 13 years) > sectors, like, financials, info tech, materials, consumer discretionary and consumer staples > InCred Asset Management >
25May2023 Tweet - Context: when NVIDIA Corp stock jumped 25% on a single day after quarterly results announcement
- meme - fun - humour - TOMO - Terror of missing out - new phrase coined -
23Mar2023 Tradingview - Top US stocks by market cap end-23Mar2023 - today, Nvidia Corporation stock is the fifth biggest by market cap in S&P 500 index, dethroning Berkshire Hathaway Inc which is now in fifth place
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