I've been reading articles about zoonotic (animals to humans) disease and am starting to realize our drive to eat meat is an existential threat to the human race. At some point, we will need to reduce our meat consumption. I expect consequences, if we reduce meat consumption to zero, but we don't need nearly as much as we eat. It appears that it will come down to statistics. Eating a small amount of meat seems like the right balance between lowering disease risk while maintaining the health benefits of meat. I don't think Beyond Meat or Impossible are the answer, as they are fundamentally unhealthy. In 2016, I knew Tesla would do well, over time. People hate change and have fabricated all sorts of lies about Tesla over the years but it has been clear to objective people, for years, that Tesla would one day be turbocharged with demand as luddites awaken to the threat of climate change. At that point, we will need to do something very quickly. When that day comes, and it's just around the corner by now, the world will look to any company with a product that can help. This is how I look at meat products now. Only a small group of people realize the need to mostly replace meat with alternative protein. Everyone else thinks we can continue as we are and perhaps God will take care of us. I'm keeping an eye peeled for products which could be part of this solution. It's an odd mindset, for an old guy like me.
As someone who LOVES meat, I totally agree with you. And like you said, it has to be a balance. I like both the soy based stuff and the real deal but not everyone feels that way. People eating meat will never change. The endgame will have to mean less in our diet though and a strict free roaming meat production system where animals graze in open fields like they are supposed to. It will lead to higher costs, but there really is no other alternative. Anthropogenic methane emissions are insane. We cannot continue like this.
I've been crabbing about not being able to predict macro factors since I got here but there is mounting evidence to suggest this thesis is incorrect. Even the election is going as predicted, so far. Specifically: - a pull back of 5~10% pre-election - a much deeper pull back between election and inauguration (deeper pull back if Biden wins) - return to full value several weeks after the inauguration I have no plan to start event trading but it no longer seems as irrational to do so.
I wonder how many of the COVID deniers now realize it's a real problem? Some seem to but I don't have much visibility into that world. At this point, many people who took COVID seriously at the beginning, don't seem to realize COVID is morphing and spreading in a way that is going to make it impossible to eradicate. A vaccine is not a magic bullet but it will increase our chances of survival. We are going to need annual inoculations into the variants of the moment to remain reasonably safe. This is one of the reasons I desperately hope we source our vaccines domestically so we aren't dependent on foreign companies that may have political motives. Vaccines will become national security concerns. Ocean cruises? Man... that's gone. Carnival may survive but they will never again thrive. Even if they can re-start their business, they won't be able to pack the boats full of thousands of people, like they used to. The old financial model of cruising is out the window. Will rental car companies ever thrive again? It's time for mergers and downsizing. Any industry has the potential to thrive but it can't happen with the rental car industry until the industry is right-sized. Airlines? I don't think airlines will go away as an industry, just many of the players. There are several bad years ahead. Tech seems to be the primary bright spot. Other bright spots seem to be very specific. Any thoughts on other bright spots?
Biden is currently ahead in the polls and my portfolio inched up a bit in the last hour. At this point, Trump seems to be leading nearly all of the undecided districts so it could go either way. I'm starting to believe the market will respond well to the election being over, regardless of who wins. Perhaps there is some negative anticipation of violence, rioting, looting? Whatever the case, so far no doomsday.
The casino's have Trump as about as big a favorite now as they had him a dog yesterday morning (edit: now Biden is the fav again). Regardless of who it is, markets looking very strong!
The election drama isn't over but here is a situation update. The IPO we participated in early this year, which was supposed to close in Q3, closed last week. We were at 25% cash prior to the IPO. Now we are at 14. That's low considering the WBI is currently at 170.5 but it's a guideline and my hope is that, 10 years from now, the new holding will be doing well. Our core holdings are all doing well. That is to say, they are, at least, at their pre-pandemic values. The companies I had been "fooling around" with are mostly not doing well. There are three companies we own very little of that I have been watching for 1.5 to 4 years. The idea is to scale up these holdings if they do well and are well managed. All were doing OK before the pandemic but three were hit extremely hard by the pandemic. One of these companies is conducting itself in a way that causes me to want them to loan them a piece of my nest egg. It is being scaled up, as opportunity arises. We have been operating in a high cash configuration for 18 months. That will continue into the foreseeable future. There is no end date on our cash position. Our cash position will shrink with either with a reduced WBI or as good deals on companies are found. There are good deals on companies, right now. I never see a need to hang onto money to wait for a potential crash when a good value is available. "good value" means something different in an extreme WBI market, such as we have, because I value the company with no regard for current market conditions.
It's near market close and today has been one of the best single days in my 35 year investing career. If we had pulled out prior to the rally, we would have been as disappointed as someone who pulls out.
WBI = 173.6 Unemployment is said to be improving because only 706K new claims were filed, last week. New claims are down but unemployment is very high. ***** In order to do well these past couple of years, investors had to prevent fear and good judgement from holding them back. Economic indicators and financial indicators have been summarily ignored by the folks who did the best. At this point, every indicator I have points to a market contraction. We are at record highs and there is no question the boom could go on forever, but that seems like a corner case. A far more likely case is that growth will slow, at least, relative to inflation. In a normal economy, we would be grumbling about stagflation. In this economy, we complain about single digit investment returns. It seems inevitable that, sometime soon, we will have to admit the emperor is stark naked.
One of the problems with owning well run, decent valued, companies is they tend to get bought out during times like this. Before the end of the year, another one of our core holdings is going to collapse into cash at a 14% premium. Like the last one, I would much rather have a good company that the short term boost. We made out ok last time. Hopefully we will do as well this time. This will put us into the mid 30% cash range, depending on market conditions. That's not a bad place to be, at this point in time, but finding good companies that meet my long checklist of attributes is neither a small nor quick task.
I just had a conversation with someone who started trading three weeks ago and is now up 35%. What's more, three weeks ago, he told me of two stocks that would go through the roof. Both stocks have gone down a smidgen but really have been flat. It's getting increasingly difficult to smile and say, "Wow. That's great." when people explain to me they have discovered financial perpetual motion. I know damn well he is still going to be working 10 years from now and, if he keeps trading, he is going to have a small pot of cash that will surely explode into vast wealth one of these days; he will be able to just feel it! Never under estimate the power of ego.
That is a shame....really. Lots of potential for him to lose a good amount of money before he gives up. Not just ego.......delusion. BUT....a common one unfortunately.
REITs are definitely going up. I believe the market is bracing for a crash. At least, some small part of it.
When you say crash, do you mean: 1. Routine correction? 2. Reaction to anticipated economic slowdown due to COVID wave? 3. Stimulus related? 4. Political related? 5. Global economy? Something else?
I have no idea. The extent of the information I have is that REITs are expanding while the rest of the market is flat or a tiny bit down. This seems to suggest some people are "safing" their money but who knows. This could just be an anomaly but it is somewhat counter to recent trends. That is all I know. It's not much.
Ah, gotcha. I'm not all that knowledgeable in REITs, so to me it could be that people investing there are seeing light at the end of the tunnel before others. A "get in cheap because tenants will eventually be back in action" play?
At this point, the only honest assessment of our portfolio is that Tesla has thrust us into an extreme return situation. We just took a 32% gain on a tranche we picked up 12 days ago. It's crazy. I've typed on and on about various value analysis schemes, all of which are deeply held points of view, but the only honest assessment of our portfolio is that Tesla is responsible for the bulk of our 2020 returns. Tesla is incontrovertibly one of our core holdings, at this point. It was not by design and I would not have been OK with this two years ago but Tesla has earned this position. It is entirely possible that Tesla will become 90% of our retirement and I would have done well to put all our wealth into Tesla, much like people would have done well to invest the Hell out of Microsoft, back in the late 1980s.
Great deals don't happen at the end of each year but it is the most frequent and reliable sale on stock. We are prepared to buy, however, others will undoubtedly stop any market correction before my buy thresholds are triggered.
