Let's talk again about $NFLX amortization.

I see a lot of ppl worrying about it, but v few actually going deep on it (at least on here).

Here's an example of the questioning:

https://twitter.com/CapitalShipyard/status/1516782106180997125?s=20&t=1QWs-osi96iwOEi225WnWQ

Then there are many like this, dunking on $NFLX's accounting after the recent declines:

https://twitter.com/HedgeyeComm/status/1518267245897650177?s=20&t=1QWs-osi96iwOEi225WnWQ

First, props to anyone who was short. I do a good amount of shorting and can recognize a good call!

But I don't think amortization accounting is the problem here.

I recently did an “update” to my sumzero post partially related to this. I’m not too concerned and here’s why.

https://twitter.com/searching4value/status/1512400174533988357

First off, the key thing to understand is that nearly 100% of the gap between FCF and net income is due to Netflix- produced content.

For this content, $NFLX spends all the cash up front and amortizes over a period of years.

Many interesting slides in the JPM Q2 guide to the markets. Here are a few that caught my eye.
1) Debt to EBITDA by size and style box... large caps have the least debt
2) Valuations by sector... who is paying 17x for energy and 19x for utilities names? Not me... 3) Recessions and bear markets... typically have gone together
4) Household net assets up to 120 Trillion, and debt service rates down a bunch from 2007
5) Population growth: consensus says the US won't have any going forward
6) Yield curve: looks a lot different than 6 years ago