The Long Term Investor

MY one IPO holding....SNOW....is facing LOCKUP EXPIRATION......at least partial expiration. With any IPO......it is nice to get beyond LOCKUP and have ALL the shares actively available to trade. I never feel comfortable with gains before the lockup expires.

https://seekingalpha.com/news/3644076-snowflake-shares-drop-4_7-ahead-of-first-lockup-expiration

• "Snowflake has two official lockup expiration dates and one milestone-triggered release.
• The first expiration allows current and former employees to offload up to 25% of outstanding vested stock options and shares subject to vested stock options and RSUs. As of July 31, this represented up to 1,295,695 shares.
• Non-employee shareholders can sell up to 25% of their vested options once SNOW has traded at more than 133% above the $120 IPO price (or $159.60) for 10 days of a 15-day trading period following December 14. Snowflake has easily beaten that milestone. As of July, this expiration represented up to 37,904,494 shares.
• On the second trading day after the second public quarterly report in March, the full lockup expiration will hit."

 

Good summary of the UPSIDE of ZM....T0rm3nted. I dont follow the stock....but....I see them as a LEADER in their space.

The negatives that I see......just based on a very cursory view........and.....more importantly as someone that has never used their service.......are:

1. Perhaps 20-25% of their work force is in China. The worlds most BRUTAL dictatorship. As business owner I dont know that I would trust ALL of my content going straight to China.

2. OBVIOUSLY....I know nothing about coding or computer software.....but....I dont see that creating this sort of product would be very difficult. It is basically a video phone conference call. We have been doing AUDIO conference calls for at least 80 years. Yes the catch is integrating all the customers business assets, the cloud, etc, etc, to work in the one video/audio/technical platform seamlessly......a BIG JOB....but, again in the tech world of today....I dont see anything special.

3. I see them as similar to BLACKBERRY.......a product that might be the product of the moment.....but at any time they could disappear in an instant. Everything they do looks pretty GENERIC to me.

4. While I agree with T0rm3nted in his post above......what he outlines is WHY people..........in general.......are using this sort of service......NOT why ZOOM.....specifically...... is or will stay dominant.

5. I looked at their service packages......I dont see anything shockingly original to what they do.

6. SECURITY is and will always be the BIG issue in this sort of business......and.....I see that they have had a number of serious security issues.

BUT......WTF do I know......nothing about this company really. You have to give them credit....they seem to have become profitable very quickly. NOW that this little discussion has raised my awareness of them I will pay a little more attention to watching them. BUT......that does not mean I am interested in owning this business. I have NO INTEREST.

 

TYPICAL open today. Seems to be following the recent trend. Open strong based on the vaccine and stimulus hopes.....than over the day fade away as it becomes clear that the stimulus is not happening TODAY. At some point the markets need to just GET OVER this short term obsession......which is being pushed in the political media......and just say SCREW IT and move on. Perhaps today will be the day.

THIS STUFF.....is ALL totally irrelevant to the medium to long term for investors.......a TRUE........."tempest in a teapot".

 

I agree Jwalker.......I see them.....like a lot of one product companies in the tech world......as an acquisition target. If it happens.......while they are in their PRIME........probably a good payday for shareholders. For those that follow this company......is there any SERIOUS talk of anyone acquiring them?

 

Yeah Zukodany. ANYONE that is an investor has had companies like that. Great companies....but for some reason the timing of purchase just did not work out. Give it a while and reevaluate.

I DO think......even though I own it....that TSLA has potential for some pretty BIG drops in share price sooner or later.

 

HERE is a WARNING......for anyone that uses SCHWAB and owns COSTCO. I looked at my accounts today and noticed that the cash in each account seemed HIGH. So I want to the "history" tab and saw that COSTCO had paid their "special dividend" on 12-11-20.....last Friday. I ALSO saw from the history that it had NOT automatically reinvested and that was why the cash in each account seemed high.

I called and talked to an actual broker at Schwab and they researched what was going on. The conclusion.......even though it was a dividend......it was a "special" dividend and they DO NOT automatically reinvest. I had to invest the funds manually by putting in a buy order for Costco.

SO........if you own COSTCO and invest through SCHWAB.......your "special dividend" WILL NOT automatically reinvest.....even if you picked the option to automatically reinvest all dividends and capital gains.

If you have another broker....and own Costco.....and automatically reinvest......you might want to check and make sure your reinvestment actually occurred.

I HATE for funds to be out of the market for even one day. BUT....in this case....it worked out since COSTCO was down today and yesterday......so I benefited by about $2 to $3 in the lower share price.

 

NICELY green today. A good day. Got beat by the SP500 by .31%....but it is nice to have the warm feeling of being well into the green today.

 

There CERTAINLY is......ZM does NOT define you as an investor. There is NOT an investor alive that has not bought some company and within a few weeks to a few months changed their mind and sold out the position. I know I CERTAINLY have.

I just move on and take heart in the fact that the money is now in something better.

On ANOTHER TOPIC......I post this as social and cultural commentary.....NOT for politics:

The Rescue From Madness

https://www.aier.org/article/the-rescue-from-madness/

(BOLD is my opinion OR what I consider important content)

"In his memoirs, written in the 1940s but not published until after his death, the great economist Ludwig von Mises wrote, “I set out to be a reformer, but only became the historian of decline.” Most people contemplating the political and economic climate of 2020 can probably relate.

Many of us, frustrated at the loss of liberty and overreach by governments in the single-minded battle to eradicate a virus they don’t understand, have reached for George Orwell or Aldous Huxley. In their novels, 1984 and Brave New World, they explored incredibly dystopian worlds. Real-world events that resemble anything in those books invite the fear that we’re destined for the same tyrannical lives.

While literature captures something deeply real about what it means to be human ‒ particularly during the first half of the despicable 20th century in which these authors lived ‒ they ultimately depict something unreal. The superstate of 1984’s Oceania hasn’t quite emerged anywhere, except perhaps North Korea; the foolish quest for unstructured and uninhibited pleasure in the World Statehas so far restricted itself to communes and sections of woke university campuses.

Instead, I find Mises, or his contemporary, the novelist and poet Stefan Zweig, much more revealing. Both came of age in fin de siècle Vienna with its coffee houses, intellectual advancements, literary achievements, famed circles and aura of learning for learning’s sake that posteriority much envied. Both witnessed the prolonged and enduring collapse of their civilizations.

In contrast to Orwell and Huxley’s unreal worlds, the demise that Mises and Zweig discuss actually happened, and just a few generations ago. In our times, in our worlds, with roughly our civic institutions and social structures and values.

We are watching, in real time, the destruction of our own civilization. In the history books, events like these seem so quick and inevitable, following one upon the other until rescue from madness is too late. With the benefit of hindsight that plagues most history, this makes caricatures of the past: really, ask even precocious middle schoolers, couldn’t the secessionists or democrats or the nationalists or the Bolsheviks have anticipated what their inane beliefs and actions would lead to?

Yes, they could, but they discarded them as unrealistic, low-probability outcomes that we didn’t have to care about right now: look at all the beautiful things we are trying to achieve! When the disasters that these movements had unleashed upon civilization were more clearly visible, it was too late to roll them back.

Beginning in the 2010s, and rushing to the forefront in the god-awful year that is 2020, we have been chipping away at the base that made the West great: individualism, restrained state power, competing scientific advances under a shared commitment to truth ‒ objective, verifiable, provable truth.

In the 2010s, with the intellectual bastion of universities and mainstream media as the center of power, we demolished truth. Per critical theory, nothing is and anything goes; narratives dominate statistical facts, and cherry-picked events are enough to advance conspiratorial beliefs about structural harm. We have grievance studies and wishy-washy words of oppression; logic is white supremacy; competence hierarchies and meritocracy are nefariously designed to harm those left behind. All is power struggles.

With governments around the Covid world suspending everything that people value, we suddenly warped society. Truth-speakers are only listened to if they are politically expedient. Individualism has been effectively de-anonymized by the mandated use of masks. There is something overwhelmingly sinister by measures that inhibit person-to-person communication and aggregation, the very features which the state most fears. We impaired the workings of a free society, voluntarily, for a promise that someone, somewhere might not catch the flu. We directed attention, suspicion and later blame to those among us, friend or foe, who got infected instead of the governments from whence the power grab stemmed.

Somehow, we jumped from an Enlightenment and scientific method-based understanding of the world to suddenly blaming whoever tests positive for their flaws. If anyone gets infected, or the overall infection rates rise, being the docile sheep we are and having the hysterical media outlets we have, we conclude that people must have flaunted the rules. Take better precautions, you irresponsible virus spreader! Instead of asking whether the rules even work, we ask what moral flaws fuelled the guilty.

The Salem Witch Trials called and want their rationality back.

Julia Marcus, the Harvard Medical School professor who’s on record for calling many political actions “pandemic theatre,” wrote recently in The Atlantic

“As cases surged in the fall, elected officials blamed the trend on misbehavior at private social gatherings. Restaurants, stores, and other workplaces aren’t the problem, the talking point goes; people just need to behave better everywhere else—in parks, playgrounds, and their own homes.”

Instead, we must

“consider the possibility that when huge numbers of people indicate through their actions that seeing loved ones in person is nonnegotiable, they need practical ways to reduce risk that go beyond ‘Just say no.’”

Take the pandemic clown at the Department of Justice’s press briefing, viewed online by millions of people. First, he walks by staff without wearing a mask. Then he takes one out of his pocket, mishandles it and repeatedly touches his face, before he walks the few steps to the DoJ podium where he takes it off. Whatever the scientific assessment is on the effectiveness of masks in preventing the disease to spread, the hypocrisy and make-believe doesn’t get clearer than this.

That segment indicates to us what we already knew about our House of Cards-like governments. They play charades and make nonsensical rules for us, their subjects, before they themselves routinely flaunt them: Ferguson and Cummings in the U.K., Cuomo and Newsom in the U.S. In Memoirs, Mises wrote, “I recognized the corruption that is an inevitable concomitant of [government] interventionism.” Decades later, we can sympathize.

Forty years before Robert Higgs explored the Ratchet Effect ‒ governments grabbing power in the name of some emergency but never returning all of it when the threat of doom has passed ‒ Zweig wrote of the civilization that tyrannical governments and the great wars had destroyed. Apart from grand technical advances between the two total wars that plagued us from 1914 to 1945, Zweig wrote in The World of Yesterday: Memories of a European that “There is not a single nation in our small world of the West that has not lost immeasurably much of its joie de vivre and its carefree existence.”

Expect the same of today’s bloated government, filled with delusions of grandeur, always shoving down one-size-fits-all “solutions” to its underlings. Every step along the way they overthrow the fundamental liberty and live-and-let-live conviction that make civilized life bearable.

The only good news in all this madness is that large sways of the public are slowly starting to ignore their overlords. From this, the cynic assumes that it’s useless and the tyrants will win anyway; the optimists say that they will bravely fight till their dying breath ‒ and both find support in Memoirs. Reflecting on his time in Austrian policy making, Mises wrote


“I fought a battle in the [Austrian Chamber of Commerce] for sixteen years in which I achieved nothing more than the postponement of catastrophe. I made weighty personal sacrifices, even though I always foresaw that I would be denied success. But I do not regret having attempted the impossible. I could not act otherwise. I fought because there was nothing else I could do.”


You have a similar choice. Welcome to our brave new world."

MY COMMENT

As a LIBERTARIAN and free market CAPITALIST what I see happening in this country makes me sick. ACTUALLY a bunch of people living in some geographic area is NOT a country. What makes a country is SHARED....history, culture, morals, ethics, aspirations, etc, etc, etc. I saw today that San Francisco was moving to eliminate a school named after Abraham Lincoln. The HEADLONG rush to eliminate and destroy our history and the basis of this country is going to quickly lead to disaster. It takes ONLY about 10-20 years to completely destroy a country and install some other form of government. We are WELL ALONG that path.

 

OK....back to hard core investing talk. THE.......race to year end. ELEVEN market days to year end. At that point 2020 will be set in stone and we start FRESH....from zero. At the moment the SP500 is at......using the total return figures from Vanguard for their SP500 Index......the envelope please.....16.36%.

This would be a GREAT result....even in a normal year. At this rate an investor will double their funds every 4.4 years. There is STILL a very good likely-hood that we will hit 20%.

I remember the 2008 time period and the ten years following. I cant tell you how often I saw in media articles and all over.......people talking about the LOST DECADE for investors. I remember posters on the site I was on......commenting that investing is OVER....that the lost decade proved it. BUY & HOLD is dead. I kept thinking and posting.......lost decade.....WTF do you mean......I am making money.

Sure...the SP500 lost 37.03% in 2008....the first year of the so called lost decade. Over the next nine years it racked up GAINS of.....26.49%, 14.91%, 1.97%, 15.96%, 32.18%, 13.51%, 1.25%, 12.34%, and 21.67%. SO MUCH for the lost decade.

I SUSPECT that we will hear about the COVID era being a time of great losses for investors. It will be the same as the LOST DECADE......total baloney. From what I am seeing money is POURING into stocks and funds right now. Those that got SCARED out of the markets are now pouring back in. Many of these people are market timers....or think they are. UNFORTUNATELY for them....they have now missed out on a MASSIVE recovery. ABSOLUTELY TYPICAL. These people will tell the story of the brutal year, 2020, when investors lost their shirts. Those of us that held or invested through the year will have a very different story. A story of ABOVE AVERAGE return for stocks and funds.

The POWER of long term investing.

 

If it makes you feel any better..Zukodany....or anyone else....HERE are a couple of my SAD investing stories.

At the HEIGHT of the day trading era in the 1990's I was doing some MOMENTUM trading outside of my normal long term account.....ON MARGIN. I was doing 1000 share lots and holding for a few days and taking my profit of anywhere from $1000 to $2500. Mostly in SBUX and COST...over and over and over. I had 25 straight positive trades in a row. One of the BIG tech leaders of the era was reporting earnings.....I expected the stock to POP after the results....so I did my usual 1000 shares on margin. It was a higher price stock than my normal momentum trade buy. The earnings were good....but the stock tanked. So I held for the expected bump and over the course of a few weeks I was DOWN by about $60,000. I could NOT take that loss....so I gutted it out for a month or month and a half....till I could sell at a LOSS of about $40,000. That was my LAST momentum trade.

Later as the MANIA of the 1990's and into the early 2000's got long in the tooth......I sold off some of my more risky stocks in anticipation of a BIG market hit. I kept CISCO since they were a BIG mainstream tech holding at that time. LONG STORY SHORT.......I had a basis of $25,000 in Cisco.....I rode that position up to a value of $250,000.....and.....I rode it right back down to a final value of $25,000 before I finally sold it.

These two are.....MY....investing horror stories. One was a short term trade that blew up in my face. One was a long term holding that should have been sold or at least profit taken since I DID anticipate the DROP.....but.....I thought that stock, CISCO, was immune. AND.....of course my success stories MORE than make up for these two situations.....way more. But these two really PISSED me off.

 

I read that story about the drop when it enters the SP500. I did not see any REALITY to it. My view.....it was a writer putting out SENSATIONALISM to get media attention.

NOW....on the other hand....I DO feel that TESLA is over valued...perhaps by a lot. I could see the stock EASILY taking a 20-30% hit.....not because of the SP500 entry....just due to overvalue that will NOT be supported by production numbers and financials going forward.

OR.....there is the issue of TESLA making a big chunk of their money from the sale of regulatory credits. If this source of money is impacted by some situation........the stock will drop SIGNIFICANTLY.

I have NOT done anything yet....but....I am considering taking my initial investment off the table.....WHILE...... leaving the profits that I have on the table in the form of stock. That would give me a nice FREE position in the company. I have NOT decided yet.