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Nate Tobik
@oddballstocks
, 6 tweets, 2 min read Read on Twitter
Since everyone keeps talking about bubbles we must not be in a bubble. #contra
We're climbing a wall of worry from retail investors who somehow mistakenly believe the market has the ability to decline. #contra
A few other stupid takes I enjoy:
-since indexes grow at 7% forever it's never a bad time to invest!
-they aren't making any more land, land prices can't decline
When the market only goes up there is a stigma around selling, because only idiots and energy investors would ever need to sell something.

There is no shame in purchasing, holding for a while, then selling. Even if you miss gains after the sale.
If everyone is sitting on their hands making money from playing tennis and ignoring their stocks it creates complacency, and at some point attentiveness will be rewarded.

There are a lot of wolves in sheep's clothing levitating
The goal is to know what are wolves and what are sheep, and when complacency isn't rewarded anymore pick up the discarded sheep at good prices.

But if you're lulled into the mindset that those wolves are actually sheep it will be hard to pull off.
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More from @oddballstocks see all

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Nate Tobik
@oddballstocks
I think you can reduce scuttlebutt/in-depth DD to two factors:

1) How good is the sales team
2) How good is expense control

Most analysts can identify #2 easily and focus on that. But #1 is as if not more important.
Lumped into #1 is marketing as well. How is a company identifying prospects, warming them, and then selling.

What is their sales process? What's their close rate, most common objections, how is the team organized, leads tracked etc.
I've found investors who are/were entrepreneurs or business owners "get" this and often identify opportunities the market misses because they see talent.

Investors usually see sales as a "solved problem" but don't realize how unsophisticated most companies are.
Read 7 tweets
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Nate Tobik
@oddballstocks
The old phrase: "In a panic correlation approaches one"

We're now approaching a perfect correlation without even needing a panic.

Might be fascinating to muse on the "but what happens in a crash" scenario.
The cynical take is everything crashes terribly and the bottom falls out like never seen before.

But there is also another take: That if passive money doesn't sell then it's possible for a small portion of funds to move the market up due to limited float
I think that's what we're seeing. Funds are gobbling everything up and the market float is shrinking.

If you have a few percent decline and passive doesn't sell a buy the dip from quant and the funds left can push things back quickly.
Read 6 tweets
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Nate Tobik
@oddballstocks
Not trying to pick a fight but VC's I've talked to:
1) Already know what can go wrong and know how to avoid it
2) Understand operationally how to run a biz and get from A->B->C
3) Optimistically biased vs value (pessimistic view)
I am a dye in the wool value investor, but I also have come to realize:
1) Finance people can't run businesses
2) Finance/capital allocation is maybe 5% of what running a business actually is
3) It's easier for an operator to learn investing vs investor learn biz
No one bats an eye when <large cap> spends $100m to build out a new speculative division.

VC is enabling people to build out those divisions divorced from a large cap.

There's a lot of speculative stuff that makes headlines, and a lot of profitable stuff that never does.
Read 8 tweets

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The “Dirty” Truth ™
@AKA_RealDirty
Tonight’s @seanhannity Thread special host @GreggJarrett.

Trace Gallagher with the updated Jeffrey Epstein death. Some of the prison staff is not cooperating with the investigation.
The still worry about the bones and Jeffrey Epstein‘s neck been broke has not been confirmed yet. It was a story from the #FakeNews @washingtonpost.
After years of practice and thousands of autopsies this doctor has never seen or heard anything like this.
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Shem Horne
@Shem_Infinite
Ugh, time for round two. The "Everyone is a racist" debates live on CNN.com at 8 pm eastern.

cnn.com/politics/live-…
Van Jones is excited to see Andrew Yang, said he is Yang Gang all the way. That's like the kiss of death, his presidential run is now over.
CNN keeps talking about how Sleepy Joe Biden is the guy to beat, I'll be interested to see if they treat Joe Biden tonight like they treated Bernie Sanders last night. Just all out trying to destroy him. I'm guessing yes.
Read 129 tweets
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modest proposal
@modestproposal1
You often seen the claim that retail investors have missed out on upside by growth co's staying private longer. Here are S&P 500 annualized total returns by time period.

5 years: 10.6%
10 Years: 16.4
15 years: 8.5%
20 years: 5.9%
25 years: 9.5%
30 years: 10.1%
Since 1957: 10.1%
The idea that retail investors would somehow turbocharge their returns by buying and holding Amazon is completely at odds with what we know about investor behavior. In fact, they likely would've chased at the highs.
Overall market returns, absent the starting condition of the peak of the bubble, have on a long enough timeline, been fairly consistent. Had Uber gone public in 2013, I don't think retail investors would be any better off than if they dollar cost average into SPY.
Read 3 tweets
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Jane Natoli 🥑🚲
@wafoli
I forgot it was @aeaken's first @sfmta_muni board meeting today. Exciting times!
Already getting warned it's gonna be a long meeting and they are rejiggering the agenda. 6th/Taylor up first, then Howard, then taxi medallions, then Great Highway. You have been notified
Current questions from Director Heinecke about more outreach about new train designs. Outreach!
Read 101 tweets
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Robin Wigglesworth
@RobinWigg
The leveraged loan boom is storing up some nasty, nasty problems.
ft.com/content/ffeda2…
To hammer the point home, here are some charts. Here's one that shows how the leveraged loan market has exploded even as the covenants have weakened.
How much have they weakened? According to Moody's index of their quality, loan covenants are at their weakest level since at least 2014, when this index began.
Read 9 tweets
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Larry Cermak
@lawmaster
1/ As we wrote in the last issue of Diar, the exit scams only account for a small percentage of the total amount raised through ICOs. The far larger issue are ICOs that raised millions and are slowly siphoning money away with no products in sight.
2/ They are paying employees six digit salaries, flying first class and traveling the world to attend countless of crypto “decentralized” conferences (see @julianhosp). The worst part is that they have literally no obligation to disclose their financials.
3/ Remember, people bought access to a platform, not equity. The founders’ incentives to actually build a valuable company are very limited because there is no contractual obligation to deliver a product.
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