@mjmauboussin on real option frameworks.

@ShaiDardashti spread the good word. @IgnoreNarrative and @HaydenCapital both referenced it.

Probably worth a read!

capatcolumbia.com/Articles/FoFin… Thinking about this a bit...

Conversely, this is a potentially different way of thinking about avoiding value traps. Yes, the current business might be “cheap” but you have this negative momentum which should be viewed as a put to add to your price.

There was something important I wanted to say on today's pod. Hope this goes OK...

As a Wells shareholder I was concerned about Scharf's comments about there not being enough minority talent to fill the roles. I heard a similar thing from a buddy at a Big 4 accounting firm. He complained that there weren't qualified candidates to hire. In that same conversation he mentioned that they hire from schools that invested in accounting.

I’d go with “The public is smart enough to attribute economic weakness to a global pandemic and it’s also very very hard to start figuring out what policy responses could have helped. Especially in an election year.”

But, no doubt CARES act helped a lot.

https://twitter.com/jbarro/status/1308367410462896129

Would also note I think most people (maybe I’m just seeing myself here) worry about the economic impact of staying closed more than the fear of COVID at this point. And, while that may be a false choice, I haven’t seen nuance in politics lately.

I think has a very very strong possibility to dominate audio. They will not realize that potential censoring podcast content. You either go all in or you don't.

Can't sign @joerogan and then be mad when he acts like Joe Rogan.

metro.co.uk/2020/09/02/joe… @eldsjal Don't back out on this. Sirius didn't censor Stern. Rogan is a comic, not some sage.

You start letting society determine what is acceptable for him to say and you will destroy what you acquired.

#facts

Transaction Tuesday. I like the common the best out of anything in the capital structure. This one is not for amateurs or the faint of heart. Do NOT follow anyone into this!

Thank you to @FrancoOlivera for pushing me on this, regardless of outcome.

sullimarcapital.group/2020/09/02/qur… But, above is why I put the common equity against ZM.

TL/DR - The common's duration has shrunk massively. While the entity is highly leveraged, short to medium term cash flows, combined with who is at the helm, makes the actual risk much lower than perceived.

Talking to a buddy in PE. He's getting pitched non stop on starting a SPAC. His question to me "Do you have any clue how easy it is to start a SPAC right now?"

Sounds like something people should invest in...

#sarcasmfont "I normally get 20% of carry. IBs are pitching me to keep 20% of the company! Just for showing up."

Here’s the really interesting part of this game. Most of us are at least aware of Malone. Most of us are aware of You Can Be A Stock Market Genius.

QRTEA is sitting right here, right now. I’ve bet on it. But, I can argue the other side. Terminal value uncertainty, levered asset, old customer base, higher CaC going forward, cord cutting, etc.

Or, you can look at some other stuff. Like the super users they cite, the potential (though uncertain) FCFCE/mkt cap, historical cash generation that’s always doubted...

Must listen stuff from @profplum99 and @ttmygh + @fleckcap. I don’t know whether it’s “true” but I do believe there’s at least some truth to it. This, it’s worth considering.

FWIW - confirms some priors so that may be why I liked it so much.

podcasts.apple.com/us/podcast/the… @SuperMugatu has me thinking some important thoughts about why I take certain positions, when, and how to structure. That discussion adds to the thoughts.

@AntoineGara continues to do great work with @Forbes.

And yes, this is the problem.

forbes.com/sites/jeffkauf… And this is why people like myself and @KonyCapitalism find @gengster1 claim about democratizing investing a bit tough to stomach/believe. #incentivesmatter

https://twitter.com/konycapitalism/status/1296446571270332421?s=21

https://t.co/9ZFcA4TJC6

“One general observation I’ve made is the very best businesses often find a way to leverage someone else’s capital...Facebook gets to use AT&T’s capital investments for its own gain, but doesn’t have to put AT&T’s debt on its own balance sheet.

https://twitter.com/JohnHuber72/status/1295449014826160128

Note to self: remember this

Y’all heard it here first. The Buffdogg 100% has a FinTwit burner and is sitting back chuckling at the reactions.

That burner tweets obscure thoughts that no one hears about cuz it’s not momo stonks. And it even holds companies through bad periods. *gasp* He’s just sitting around on his new Apple devices, bought with all those gains, chuckling at all us idiots groveling over his 13-F.

Has a DM with Charlie like “These idiots haven’t learned a thing. They don’t think for themselves at all. Watch this.”

@gregmaffei on QRTEA call demonstrates why he’s a great person to partner with. Listen if interested.

Liberty gets it. Yes investors, we realize you think this is a cigar butt. What is it y'all usually complain about in cigar butts? Oh, trapped capital. How about this?

PS. We anticipate potential tax consequences of hoarding capital so we are going to do right by you, our partners.

"If you haven't prepared you wont be able to seize the opportunity."

-Munger

This is why you should study potential investments even if the current valuation isn't compelling.

On the pod a viewer asked why we don't discuss more obscure companies. My answer is two fold.

1. I dont know enough of them and dont want to talk about things I have no clue about.
2. My best investments havent been obscure companies. They've been pretty well known...

Thoughts from the road -

@AndrewRangeley has me wondering why I own CMCSA despite likening both CHTR (and entities) + DIS. Could create my own top tier conglomerate rather than betting on cheapness in one of the entities. Note - I own all 3. Just questioning weighting and why. Great point made on NBCU could have been even better buying in shares. Need to think about that for a while and put myself in the shoes of when it was done.

" advnatge is its very low cost base, but where does that advantage come from? Not from low cost land, or cheap wages or any one big thing but from a thousand daily decisions to save money where it is not needed to be spent."

-Nick Sleep Capitalism at it's finest folks

Hung out with a consulting friend last evening. This is an interesting thought for leaders:

When a new analyst/associate gets staffed to his team for the first time they have 2 weeks to do research. Then they have to present to him about:

What the firm does
Who the client is
What the goal of the engagement is
Why the firm is best suited to execute the engagement

The goal isn’t to see whether that person knows everything. It’s to confirm interest, hunger and chutzpah.

Last WFC tweet for a while (there a much higher uses of time than pitching a company that’s broken people’s hearts for years) -

In my view the thesis will hinge on whether one can implement centralized complaince functions without killing what that bank is actually good at. In the past compliance reported to the heads of the lines of business. That’s a laughable incentive set up. Now that’s changing.

@kylerhasson mentioned Koch Industries had a similar set up back in the day. It backfired. Bigly.

Wells Fargo is BY FAR my best investment idea right now. Scharf is not messing around. And the asset base generates recurring revs. Much of the thesis hinges on Scott Powell.

Get interested. Or don’t. Or subtweet me. I could care less. The skew is good and the actions are too. Also, it could be my best idea because I’m a moron. Fully admit I don’t understand much of tech. Have to play where I know. And, I’ve been wrong on this name before. I do think this time is different.

"We estimate over 150mn Disney+ subscribers by 2025, which could prove conservative as it would represent only 22% of our estimated global TAM of 712mn."

Is that good? Seems good. DIS+ is valued at a discount to NFLX. VIAC DTC valued at a discount to DIS+. Put it all together and...

For the intersection of business, FinTwit, and hip hop:

I’ve been listening to this dude for 3-4 years. My most listened artist of 2019.

Kid never signed to a major label. Does all his own stuff. Runs his business. And he’s super talented.

open.spotify.com/track/6xMXdsrq… Unfortunately @calscruby had a tour scheduled and, like many artists, had to cancel it.

So I’m highlighting him because I want his business to success. I respect his grind.

@wolfejosh @ReformedBroker @ShaneAParrish and anyone else that likes hip hop - check him out.

Good article by @nathanielpopper here.

nytimes.com/2020/07/08/tec…

I have a high degree of confidence that most people would be better off not investing rather than trading. I’ll believe @RobinhoodApp cares about wealth building when I hear people say how easy it is to find low cost ETF products. I’ve heard they are very very hard to find. Also heard how easy options are to find. Makes sense once you think about the business model.