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https://twitter.com/SteadyCompound/status/1414394128243195907

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Thomas Chua

@SteadyCompound

Dec 14

1/ Howard Marks just dropped 5 decades of investing wisdom in one conversation.

5 market calls in 50 years. $218 billion under management. Zero blowups.

Here's what separates him from everyone else: 🧵

2/ The dinner that changed everything:

In 1990, a pension fund manager told Marks his portfolio stayed in the 27th-47th percentile for 14 straight years.

Sounds mediocre.

But over 14 years total? 4th percentile.

How? He never blew up while everyone else occasionally did.

3/ This became Oaktree's motto:

"If you can avoid the losers, the winners will take care of themselves."

Most investors shoot for the stars and occasionally shoot themselves in the foot.

Once you have a big loss, it takes years to recover. The math is brutal.

Read 25 tweets

Thomas Chua

@SteadyCompound

Dec 10

Just finished Gavin Baker's latest interview with Patrick O'Shaughnessy.

It's one of the most insight-dense conversations on AI infrastructure economics I've encountered.

Key insights that matter for investors 🧵

First, the big one: Gemini 3 confirmed pre-training scaling laws are still intact.

This matters because no one actually knows why scaling laws work. It's an empirical observation, not a theoretical guarantee.

Every confirmation that it still holds changes forward projections.

Here's what most people missed:

Between mid-2024 and now, there was no way to push pre-training forward. You can't get more than ~200,000 Hoppers coherent, and Blackwell was delayed.

Reasoning models bridged an 18-month gap where progress would have otherwise stalled.

Read 16 tweets

Thomas Chua

@SteadyCompound

Dec 9

Everyone's blaming Chipotle's 44% decline on Slop Bowls.

The real threat? Casual dining.

A former Regional VP who ran 415 restaurants shared what management won't tell you:

Chipotle's average check: $18

Chili's: $21

The old advantage was no tipping. But Chipotle has embedded tipping into card readers, making it almost impossible not to tip.

That $3 gap with casual dining has nearly disappeared.

On Cava: Management points to Cava's slowdown as proof it's an industry problem.

"See, it's not us, it's the industry."

But internally? They'd never accept that excuse from their own people.

Read 13 tweets

Thomas Chua

@SteadyCompound

Nov 26

Fundsmith is on track for its 5th year of underperformance.

In a recent interview, Terry Smith explains the reasons why—and what he thinks is wrong with the market today.

Key insights: 🧵

Smith breaks down the underperformance into distinct phases:

2022-23: Interest rates rose from 0% to 5%
2023: Magnificent Seven concentration
2024: AI boom/hype
Throughout: Passive fund flows

He claims each one is a headwind for quality investors.

On interest rates:

Quality companies trade at higher valuations because more cash flows are in the future. When rates rise, they behave like long-dated bonds—they get hit harder.

"When rates go up, our type of companies suffer in share price terms and companies which we wouldn't own which are very cyclical or not very good actually relatively benefit."

Read 15 tweets

Thomas Chua

@SteadyCompound

Nov 23

Eric Seufert and Ben Thompson just released an interview that reframes AI monetization strategy.

Why affiliate links fail, why "agentic commerce" won't happen, the Netflix lesson OpenAI is ignoring, and Meta's first real bear case in years.

What stood out: 🧵

Context: Everyone assumes ChatGPT will monetize through affiliate links (Walmart, Etsy partnerships).

Seufert's argument: this is the wrong model. And the urgency is real—"OpenAI needs to launch its ads product today, they cannot wait."

Why affiliate advertising is wrong for ChatGPT:

1. It only monetizes queries with commercial intent

Seufert: "If you're using ads, you get to monetize everything because it's every single engagement. If you're just using affiliate links, you can only monetize the ones that are like, 'What's the DSLR camera?'."

Read 18 tweets

Thomas Chua

@SteadyCompound

Nov 21

This is what happens when you answer the "tell me about your weakness" question too honestly.

PayPal CEO Alex Chriss at Citi's FinTech Conference laid out the challenges so clearly it spooked the market.

Here's what he said: 🧵

1/ Consumer spending deteriorated suddenly mid-September and it's persisting into Q4.

Chriss: "We started to see a slowdown on consumers, particularly around discretionary spending, retail and really in middle to low income brackets, which play a significant role in PayPal."

The weakness is concentrated: "If we look at some of our cohorts of higher income spenders, they're still spending. But we are seeing pressure for middle to lower income."

Q4 branded checkout expected to grow slower than Q3 as a result.

2/ The branded checkout rollout is taking much longer than expected.

Only 20% complete after significant time. Chriss admitted: "That's probably the piece I underestimated the most in terms of just how long it would take to get that experience out to customers."

The timeline? "We're just going to have to go through the hard work over the next few quarters and maybe even a couple of years to get through our backlog of merchants."

Years, not quarters. That's a meaningful delay.

Why so slow? Technical debt worse than realized.

Chriss: "We have 15-plus years of really bespoke integrations across our merchant base. This was something I personally didn't appreciate when I got here of just how many different integration patterns there have been."

Read 8 tweets

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