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Frederik Profile picture
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28 Sep, 6 tweets, 2 min read
Rolex and hyper-inflation, fantastic by @DoombergT
"Rolex is the government, dealers and shady resellers are the corruptible intermediaries, a trading app is the back alley, and desperate buyers are seeking monetary calories for future consumption."
doomberg.substack.com/p/what-does-pr…
"Rolex cares deeply about the resale value of its watches and has a long tradition of carefully managing new supply to protect historical buyers. ... their value as an inflation hedge has made them especially interesting, ... as a data point for trends in consumer psychology."
"For reasons nobody fully understands, supply has dried up. Visit any authorized dealer today and you will find almost nothing to buy. The display cases are literally empty."
"To discover the true price of a new Daytona, head over to Chrono24 –...The price ranges from $32,500-$40,000, or roughly three times the official Rolex list price."
"The juxtaposition of gorgeous branding and store design with empty display cases and bored salespeople is the perfect metaphor for our time. This is a façade of commerce, and it is hard to see how it reverses."
"there is a true price for everything – be it bread, watches, or yes, even interest rates. Attempts to control or distort those prices must eventually backfire, moving commerce below ground."

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More from @NeckarValue

Frederik Profile picture
28 Sep
"Almost to a person, the biggest technology successes were thought of as idiotic at the time, or going after small prizes"

"Almost all great companies go through a desert of disillusionment, where investors decide that they're not worthy of sticking with"
Financing Netflix after the dotcom bubble popped
"And the company had not yet achieved cashflow positive. There was not a penny available in the world, much less millions for a consumer facing eCommerce company in the spring of 2001. It really was a post bubble nuclear winter"
Fundraising
"We gave 188 presentations around the globe to ultimately raise $100 million, TCV One. But there was incredible stress during that point in time. One of the stresses was people didn't like Crossover. They wanted it either a private fund or a public fund."
Read 5 tweets
Frederik Profile picture
15 Sep
If you're thinking at all about inflation and China, this piece by @ByrneHobart is a fantastic read.

"There was a vigorous debate in the 90s about why inflation had dropped so much. One school of thought credited Greenspan...But a lot of it was Deng Xiaoping and Malcolm McLean."
"something interesting happened in the 90s and early 2000s: commodities price spikes didn't get passed through to consumers."

"the higher cost of components was offset by the lower cost of the people who turned those components into finished goods."
"if you want to compete with Shenzhen's human and institutional capital—the people, the experience, the dense network of suppliers—step one is to start about thirty years ago."
Read 6 tweets
Frederik Profile picture
27 Aug
Love the story of the Chandler brothers, Richard & Christopher, who turned $10mm into $5bn.

They hopped the globe searching for value facing off with CEOs and oligarchs. It’s a wild sequence of concentrated bets from Hong Kong to Brazil, from Korea to Russia.
The brothers grew up in New Zealand where their parents built Chandler House, a leading department store. The kids learned about business early on.

"We are great believers in the idea of having audacious goals, breaking out and doing something out of the ordinary."
Richard wrote his thesis on corporate governance and the gap between owners and managers.

They sold the family biz for $10mm and started their investment firm, Sovereign Global in 1986.

"We said, 'Let's do something that we love to do, not just something that we are good at."
Read 29 tweets
Frederik Profile picture
27 Aug
Great thread with Wall St career/life wisdom

"There is nothing worse than people who hide mistakes, that’s how disasters happen."

"Mark to Market. Accept reality, and know where you stand. Don’t hide from the facts."

"Be a team player. Finance isn’t a solo sport."

"No single trade is ever going to be that big.

I have seen nothing destroy more lives and careers than greed."
Read 4 tweets
Frederik Profile picture
26 Aug
"there is no drearier, sorrier creature in nature than the man who has evaded his own genius and who squints now towards the right, now towards the left, now backwards, now in any direction whatever." Nietzsche

brainpickings.org/2015/09/30/nie…
"No one can build you the bridge on which you, and only you, must cross the river of life. There may be countless trails and bridges and demigods who would gladly carry you across; but only at the price of pawning and forgoing yourself."
"There is one path in the world that none can walk but you. Where does it lead? Don’t ask, walk!"
Read 4 tweets
Frederik Profile picture
26 Aug
Bill Miller wrote about value investing and tech in 1999. Wild that we had the debate all over again a decade+ later

"Many value investors have chosen to ignore technology companies despite ... the ability to create substantial, long-lasting shareholder wealth." @B3_MillerValue
Reasons typically given: difficult to understand, rapid change, too expensive.
"All of these reasons are weak."

"Although technology changes reasonably rapidly, it doesn't follow that such change is random or unpredictable."
"If technology is difficult, it is not incomprehensible. Investors who rule out the largest sector of the market, and the most important driver of economic growth and progress, because it takes work to figure it out have little to cavil about when others get the rewards."
Read 8 tweets

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