public:sotm:reading_2023
Table of Contents
2023-12-21
- a call-center company like Concentrix or Teleperformance
- value stocks
- low price/earnings multiple
- a high free-cash-flow yield
- HealthSouth Rehab
2023-12-18
- Uniqlo
- Its parent company is Fast Retailing (ticker: FRCOY)
- known for its inexpensive, reliable clothing
- Heattech innerwear
- There are four types of RFID tags: hanging tags, waist tags, sticker tags for packaged goods and header tags for those socks.
- Fast Retailing (ticker: FRCOY)
- company’s mission is to “wow the customer”
- it controls the supply chain from the factory to the sales floor
- RFID tags
- 4 cents per tag
- Takahiro Tambara
- the architect of Uniqlo’s self-checkout
- chief information officer at Fast Retailing
2023-12-11
Notes from https://www.barrons.com/amp/articles/berkshire-class-b-stock-discount-7574d193
- Many companies have two classes of stock outstanding
- Buffett holds virtually all his roughly 15% economic stake in Berkshire through the A shares
- The Class B stock was issued in 1996 and now is more liquid and widely owned than the A stock due to its lower share price and inclusion in the S&P 500 index.
- 1 Class A share = 1,500 Class B shares in terms of economic stake.
- 1 Class A share voting power = 10,000 Class B shares voting power.
Notes from https://www.barrons.com/amp/articles/hp-sell-berkshire-hathaway-d9c8cf6b
2023-12-10
Notes from https://www.barrons.com/amp/articles/home-mortgages-cdfi-treasury-rules-13fd0663
- federally certified lenders known as Community Development Financial Institutions (CDFI)
- “ability-to-repay” rules
- nonqualified mortgages: loans with features such as interest-only periods and balloon payments
- The Treasury unit that administers the CDFI program, the CDFI Fund
- a financial-reporting method known as pushdown accounting
- When a company gets bought, it can choose whether to revalue all the assets and liabilities on its own separate set of books, in effect “pushing down” the acquirer’s purchase price and using that as the basis for the new values. The method is optional. Companies have wide discretion on whether to apply it. But if they do, the decision is irrevocable.
Notes from https://www.wsj.com/finance/why-treasury-auctions-have-wall-street-on-edge-8385f15e?mod=hp_lead_pos4
- When the yield is higher than expected, investors call that a “tail.” When it’s lower, that is a “stop-through.” Auctions that meet expectations are said to be “on the screws.”
- The government has been advised to maintain T-bills at around 15% to 20% of the overall debt load.
2023-12-06
Notes from https://www.barrons.com/amp/articles/blackrock-investing-2024-forecast-b2b3ee5a
- BlackRock Large Cap Value exchange-traded fund
- portfolio manager: Tony DeSpirito
- AUM: $6.6 million
- active fund
- launched in May 2023
- Tony DeSpirito
- likes Low-beta, quality stocks
- $8.3 trillion in money-market funds sitting on the sidelines
2023-12-05
Notes from https://www.barrons.com/amp/articles/bargain-priced-closed-end-funds-45bf3f94
- Muni funds, which make up about one-third of all closed-end fund assets, tend to deploy leverage.
- Banks issue a lot of preferreds
- Top credit managers like Apollo, KKR, Blackstone, and BlackRock
Notes from https://www.wsj.com/health/healthcare/prescription-drug-costs-cvs-pharmacy-56acb623?mod=hp_lead_pos2
- CVS Health
- largest drugstore chain in US
- 9,500 retail pharmacies
- Chief Pharmacy Officer Prem Shah
- CostVantage payment model
- “cost plus” payment model
- Mark Cuban’s eponymous pharmacy company
- drug discount card
- Pharmacies are mostly paid by pharmacy-benefit managers
- CVS Caremark, a sister company to the retail-pharmacy unit
2023-12-04
Notes from https://www.efinancialcareers.com/news/2023/11/jpmorgan-nomura-technology
- The bank announced plans yesterday to cut $100m in costs in its wholesale banking division.
- These are in addition to the $340m of cost reductions it says will be completed by 2025.
2023-12-03
Notes from https://www.youtube.com/watch?v=vT5-cV4oMY8 - Why Aldi Is America’s Fastest Growing Grocery Store | WSJ The Economics Of - 2023-10-31
- grocers
- Aldi, Grocery outlet, publix, sprouts, H-E-B, Whole foods market
- Aldi
- no-frills approach
- growing at a rate of 100 stores per year
- 90% of items are private label
- Average supermarket ~ 48,415 sq ft; Aldi and Trader Joes's ~ 12,000 sq ft
- Average number of items per store
- Supermarket - 31,530
- Trader Joe's - 4,000
- Aldi - 1,650
- compensatory inferences
- peers: Aldi, Trader Joe's, Albertsons, Whole foods, Walmart, Dillons, Costco, Kroger, Sam's club, Target, Safeway
- known value items
- Trader Joe's
- Ube Mochi pancake & waffle mix
- Butternut squash mac & cheese
2023-12-01
Notes from https://www.barrons.com/amp/articles/fed-jerome-powell-speech-rate-hikes-today-4f518694
- CME FedWatch Tool - https://www.cmegroup.com/markets/interest-rates/cme-fedwatch-tool.html
2023-11-30
- Boston Properties (BXP)
- one of the leading office REITs
- buildings in key markets like New York, Boston and San Francisco
- CEO Owen Thomas
- Healthpeak
- a REIT that leases office space to doctors’ practices and lab space to biotech and other drug companies
- will merge with Physician Realty Trust
- CEO Scott Brinker
2023-11-27
Notes from https://www.barrons.com/amp/articles/shein-ipo-news-sec-fe778f69
- Shein
- Singapore-based fashion retailer
- was founded in China but shifted its headquarters to Singapore in 2019
- valued at about \$66 billion in a \$2 billion May 2023 fund-raising round
- famed for its ultralow apparel prices
- world’s most popular shopping app
2023-11-13
- The federal government ran a deficit of $1.7 trillion in its fiscal 2023, which ended in September.
Notes from https://www.acquired.fm/episodes/charlie-munger
- Richard Galanti
- Jim Sinegal
- covenant-free debt
- Costco
- Costco parking spaces were 10 feet wide instead of eight or nine feet or whatever they normally are.
- They have no investment in inventory. They make the suppliers wait until they've been paid and then they're scheduled to pay only after they're scheduled to sell.
- Costco just specializes in the good locations, where the rich people lived.
- is successful because of its culture and model.
- Sol Price wanted the rich man trying to save money. Picky wealthy customers.
- That little grocery store chain here in Los Angeles, Gelson Brothers
- do a lot of reading, thinking, and visiting
- Jeff Brotman
- You don't want to make money by screwing your investors and that's what a lot of venture capitals do.
- ride pari passu
- Bernie Marcus
- Floor & Decor is a Costco imitator
- Home Depot is a Costco imitator
- Walmart was too weathered by the ideas they already had
- Sam Walton
- Japan's trading companies were really entrenched old companies. They had all these cheap copper mines and rubber plantations.
- Charlie Munger does not like style companies such as Nike
- Hermes is on the eighth generation. It is a great company.
- Hermes, LVMH got a brand people trust so much. It took them a century to do it.
- Kirkland is a brand the way Tide is a brand
- Charlie See was a playboy, and his brother ran the company, his older brother, and dominated it completely. And when he died, Charlie made his brother as executor, and now he needs a lot of money to pay death taxes. He doesn't have it. It's due eight months or something later. They really wanted to sell it so they can pay the death taxes. See, it was only making $4 million pre tax when we bought it.
- Heinz is able to have pricing power while Kraft is not
- Heinz ketchup
- Kraft cheese
- In Korea, one guy, a Chinese guy, controls all the sauces. Every single major sauce, he controls at least 95% of them.
- Once I had enough money on my own, I'd rather just operate with my own money. That is a much better way of doing it than being forced to sell, being forced to deal with investment bankers, being forced to deal with investment consultants, being forced to deal with venture capital.
- You don't need other people. The point of getting rich is so you don't have to need other people, so you don’t have to get along with other people.
- almost everything has three things: intelligence, hard working, and being lucky.
- It takes a very patient person to get rich in insurance. It takes forever to get anything, and it takes forever to push anybody aside. It's very hard to make money.
- crumbums of the world
- Charlie Munger does not carry fire insurance anywhere.
- Everybody needs some significant participation in the 12 companies that do better than everybody else. You need two or three of them, at least.
- Apple got to about 10 times earnings when Warren bought in.
- venture capital that's classically power law–distributed
- if something is really cheap, even though it's a crappy company, Charlie Munger is willing to consider buying it.
- Howard Marks
- One type of company is the cigar butt. Other type of companies are great brand companies.
- the system that nature uses to get smart is kind of unpleasant for the people who are losing
- you only have to get rich once. You don't have to climb this mountain four times. You just have to do it once.
- When Costco tried to open their first store in China, somebody wanted a $30,000 bribe. Chinese culture. Costco wouldn't pay it. That made such a bad impression on Jim Sinegal. He wouldn't even talk about going into China for about 30 years thereafter.
- “a young man knows the rules, and an old man knows the exceptions” - an old saying of Peter Kaufman
- hanging out my hat while I lurch around the track
- BYD, this year will sell at least two and a half million cars. Most of them are electric, that's unheard of. That's way more than Mercedes, for instance.
- The California Club
- Cash flow margins
- John Malone
- specialized industrial company
- Half of the marriages in America work pretty damn well. And they would have worked just as well if they were both married to somebody else, by the way.
- The best way to have a great spouse is to deserve one. As long as both parties feel that way, then it's a recipe for success.
- boondoggle
2023-11-10
Notes from https://www.ft.com/content/b08c3159-982e-4831-8897-e35f8aca49e1
- US Treasuries is $25 tn market
- Fedwire, a real-time payments platform operated by the US Federal Reserve
- BNY, the world’s largest custodian bank
- US Treasury secretary Janet Yellen; China’s vice-premier He Lifeng
- The Securities Industry and Financial Markets Association (SIFMA), which represents banks and asset managers
- ICBC is the only Chinese broker with a securities clearing licence in the US. It created the business after buying the prime dealer services unit of Fortis Securities in 2010.
- Charlie McElligott, a cross-asset strategist at Nomura
2023-11-09
Notes from https://www.barrons.com/amp/articles/mondelez-ceo-weight-loss-drugs-ozempic-sales-eaf31b4b
- airlines, insulin pumps, food stocks
- Ozempic
- GLP-1 class medication
- made by Novo Nordisk
- Wegovy
- Mondelez International
- CEO Dirk van de Put
- Its brands range from Oreo cookies to Cadbury chocolates to Philadelphia cream cheese
- only a fifth of its business is in the U.S.
- better-for-you options and meal replacements like Clif Bars and belVita products
- exceptional brand loyalty in confections that tend to be stronger than in other categories
- postpandemic consumer behavior, in which snacking is a daily behavior, particularly for younger generations
- Côte d’Or
- the leading chocolate brand in Belgium
- part of Mondelez’s portfolio
Notes from https://www.barrons.com/amp/articles/warren-buffett-berkshire-hathaway-bonds-buy-a1ba6dc0
- Chubb (ticker: CB) one of the largest P&C insurers
- At the end of Q3, it had about \$100 billion in bonds, \$17 billion in equities (mostly private), and \$5 billion in cash
2023-11-05
Notes from https://www.barrons.com/amp/articles/berkshire-hathaway-earnings-stock-price-8f61fc76
- Union Pacific (UNP) is the chief rival of the Berkshire railroad unit
- AAPL makes up nearly half the Berkshire equity portfolio
- Berkshire bought back $1.1 billion of stock in the third quarter
- Warren Buffett, 93, and Charlie Munger, 99
Notes from https://www.berkshirehathaway.com/qtrly/3rdqtr23.pdf
- pg-49 (Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations → Financial Condition)
- Berkshire paid $7.0 billion in the first nine months of 2023 to repurchase shares of its Class A and B common stock
- pg-53 (Item 2. Unregistered Sales of Equity Securities and Use of Proceeds and Issuer Repurchases of Equity Securities)
- contains a table of shares (BRK.A and BRK.B) repurchased and the average price
2023-10-31
- independent financial advisors
- nonretirement accounts in the custody channel
- retail brokerage clients
- Fidelity FCash rate = 2.26%, Schwab sweep rate = 0.45%, SPAXX = 5%
- custody clients
- financial advisors that use Schwab as a custodian
- Schwab's $300 billion bond portfolio has a yield of 2%
- Schwab holds $3.6 trillion of assets for independent advisors
- Schwab is the leading custodian with a roughly 50% market share. Fidelity has close to 25% share.
- custody accounts
- RIA firms
- Fidelity’s direct brokerage customers
Notes from https://www.barrons.com/amp/articles/treasury-bond-market-quarterly-refunding-bee4bf23
- “Quarterly Refunding” report
2023-10-27
- Annaly Capital Management (NLY)'s dividend yield is 17%
- splashy colors on a rainforest frog
- herpetologist
- South America’s fire-bellied snake is said to be the only natural predator of the golden poison dart frog
- NLY cut its payment early this year to 65 cents a share each quarter from 88 cents
- NLY share price has already fallen by nearly half over three years
- Mortgage REITs
- lend money to developers, both commercial and residential, or buy mortgage securities, including ones that are backed by government agencies.
- They make money from a lending spread—for example, by borrowing shorter than six months to buy securities that mature in two to five years
- they use more leverage than equity REITs - sometimes two to three times as much as a percentage of assets.
- Dividends for mortgage REITs are more of a slide whistle than a steady drumbeat
- Resi MREITs
- TBV is tangible book value, or what securities are worth
2023-10-24
Notes from https://www.barrons.com/articles/pultegroup-stock-price-mortgages-dacc0f4c?mod=hp_LEAD_5
- PulteGroup
- the fourth-largest home builder by market capitalization
- Q3: (eps = \$2.83; revenue = \$4.1 billion)
- Pending-home sales, a measure of deals for previously owned homes that have not yet closed
- mortgage rate buy-downs
2023-10-23
Notes from https://www.barrons.com/articles/engagesmart-stock-to-be-acquired-fc70914f?mod=hp_LEAD_2
- Chevron (CVX) is buying Hess (HES)
- deal is valued at $53 billion, or $60 billion when including debt
- 1 HES share → 1.025 CVX shares
- deal values HES shares at $171 each
- Exxon Mobil (XOM) is buying Pioneer Natural Resources (PXD)
- for $59.5 billion, or $64.5 billion when including debt
2023-10-22
Notes from https://www.barrons.com/articles/china-graphite-exports-ev-batteries-4bdab59?mod=hp_LEAD_4
- The batteries found in an average electric vehicle each need about 175 to 200 pounds of graphite
- In the U.S., there are 4 lithium-ion battery plants in operation and 21 in development.
- spherical graphite — a refined form used as anodes in lithium-ion batteries
- Graphite can be produced either from naturally mined material or in a synthetic process using petroleum feedstocks.
- China is the largest miner of natural graphite, followed by Mozambique and Madagascar, and Brazil.
- Bipartisan Infrastructure Law
- Graphite can also be manufactured from other carbon-based products such as petroleum coke. The process is more expensive and energy intensive, but the synthetic graphite anodes usually perform better, helping batteries charge faster and last longer.
- gallium and germanium - metals critical to the manufacturing of semiconductors.
2023-10-20
Notes from https://corporatefinanceinstitute.com/resources/equities/direct-stock-purchase-plan-dspp/
- Direct stock purchases are managed by transfer agents, which are third-party institutions that record transactions, issue certificates, and perform administrative duties.
- Some of the world’s largest transfer agents include Computershare Trust Company and American Stock Transfer & Trust Company (AST).
2023-10-18
- Israel has 2 million Arabs and 6.7 million Jews
- West Bank
- has 3 million Palestinians, 460,000 Jewish Israelis
- Israelis refer to it by its biblical name, Judea and Samaria
- evangelical Christians
2023-10-16
- Re/Max and Anywhere Real Estate Inc.
- Redfin
- Chief Executive Officer Glenn Kelman
- withdrew from the National Association of Realtors (NAR)
- In Australia and the UK, total commisions for each sale are 2%
- median existing home sales price is $407,100
- NAR
- collects $150 in annual dues from more than 1.5 million agents
- the biggest spender on lobbying in the US, laying out more than $80 million in 2022.
2023-09-29
Notes from https://minesafetydisclosures.com/blog/2018/6/18/costco
- Costco stocks only 4,000 SKUs vs. Walmart'ts 120,000 and Amazon's 600,000,000.
- Costco has the highest “revenue per employee” and “profit per employee” of all major retailers.
- Costco generates highest “revenue per store” and “profit per store” than any other major big box retailer.
- Inventory is turned over (i.e. from supplier → Costco → customer) once every 26 days.
- Accounts Payable: Inventory
- Working Capital
- The average Costco employee makes $22/hr, receives health insurance, 401k, company stock, etc.,
- Costco's annual employee turnover rate is 5% vs. the retail industry average of 59%.
2023-09-27
- cable firms with wireless businesses like Charter (CHTR) and Comcast ‘s (CMCSA) Xfinity Mobile
Notes from https://www.barrons.com/articles/apple-stocks-growth-recession-resistant-6bd672f7
- Defensive stocks are conventionally less volatile than the broader market.
- stable businesses such as groceries, small household products, healthcare insurance, drug makers or utilities
2023-09-25
- Sesame, a New York-based startup that’s backed by Alphabet Inc.’s venture unit
- $4.3 trillion US health-care market
- primary-care chain ChenMed
- Amazon purchased One Medical for $3.5 billion
- Kroger and Best Buy have health-care divisions
- Costco purchased a minority stake in a pharmacy benefits manager, Navitus Health Solutions LLC, in 2020
- Sesame is aimed at people without health coverage
2023-09-20
- Burma, Rhodesia and Ceylon changed their names to Myanmar (in 1989), Zimbabwe (in 1980) and Sri Lanka (in 1972) respectively.
- the top level web domain .bh is taken by Bahrain
2023-09-19
Notes from https://www.barrons.com/articles/instacart-ipo-stock-price-18556f27?mod=hp_LEAD_1
- Instacart
- based in San-Francisco
- founded in 2012
- formally known as Maplebear
- last year revenue = $2.55 billion
- 75% from delivering groceries; 25% from ads (retailers pay to show ads to customers)
- net income = -\$70 million 2020, -\$73 million in 2021, \$428 million in 2022 (includes \$358 million tax benefit)
- Instacart IPO
- sold 22 million shares @ $30 each
- market value $9.9 billion, based on fully diluted share count
- raises \$660 million out of which \$420 million goes to the company
- ticker CART
- price to sales = 4
- competitors - DoorDash, UberEats, Shipt
- Shipt is owned by Target
Notes from https://onepercentamonth.com/2023/08/28/instacart-profitable-yet-with-real-business-concerns/
- Instacart
- 1,400 retail partners including Costco, Aldi, Kroger, Publix, Wegman, Bestbuy and Walgreens.
- Customer Acquisition Cost (CAC)
- Walmart
- based in Arkansas
2023-09-15
- CDFI = Community Development Financial Institutions
- Tom Wolfe
- documentary, Radical Wolfe
- was a reported for the Washington Post in 1961
- bestseller Beat the Dealer
- Wrote the great American financial novel, Bonfire of the Vanities, satirizing and immortalizing the excesses of 1980s Wall Street.
- his second novel, A Man in Full is a fictional work. It combines accurate insider accounts of quant finance with broader human and social considerations.
- 2013 essay, Eunuchs of the Universe
- the capital asset pricing model in the 1960s
- the Black-Scholes option pricing model in the 1970s
- Fischer Black and Myron Scholes published the option pricing model
- Edward Thorp
- a mathematics professor
- gave a talk in Jan 1961 at the American Mathematical Society entitled “Fortune’s Formula,” outlining the secret for winning at blackjack.
- tell-all quant
- gave away his trading secrets in the 1967 bestseller Beat the Market
2023-09-01
Notes from https://tradingeconomics.com/united-states/non-farm-payrolls
- the bankruptcy of Yellow, a major trucking company, left about 30,000 workers without jobs
2023-08-31
Notes from https://www.barrons.com/articles/dollar-general-stock-sinks-retailer-sales-c9b71d7?mod=hp_LEAD_5
- value-focused retails - Walmart (WMT), TJX Cos (TJX)
- inventory shrink, the industry term that refers to merchandise theft and damage
2023-08-30
- Johnson & Johnson (JNJ)
- projected cash flow in 2024 = $26 billion
- Kenvue (KVUE)
- 135-plus-year-old consumer health company
- sells iconic brands such as Tylenol, Band-Aid, Listerine, and Neutrogena
- the S&P 500 Dividend Aristocrats Index
- companies that have raised their dividends for at least 25 consecutive years
- has 67 stocks
- run by S&P Global (SPGI)
- average aristocrat yield = 2.5%
- average price to estimated earnings = 22.4
- Dividend aristocrats
- S&P Global (SPGI), Johnson & Johnson (JNJ), Kenvue (KVUE)
2023-08-28
Notes from https://www.barrons.com/amp/articles/shoplifting-shrink-what-retailers-say-fdea150a?mod=hp_LEAD_3
- inventory shrink, the industry term that encompasses merchandise theft and damage
- combed through earnings conference-call transcripts
- shink levels
- Topanga, California
- bear spray
2023-08-22
Notes from (https://www.youtube.com/watch?v=PdvGEI-P3-M ; Stack vs Heap; Abdul Bari; 2015-09-07)
- A computer memory is divided into three major sections: [code, stack, heap]
- code can access stack memory directly by using address
- code can only access heap memory indirectly by using pointers
| stack memory | heap memory | |
|---|---|---|
| access | direct | indirect |
| size | static | dynamic |
Notes from (https://www.youtube.com/watch?v=OqLt2GfX6jg ; Why Pointers?; Abdul Bari; 2015-09-15)
- pointers are called as address variables.
- They store address of the data.
- They are useful for indirectly accessing the data.
- Usages of pointers
- Accessing heap memory
- Call by reference
- Accessing files
- Accessing any peripherals (ex:- keyboard, monitor, printer, disk etc.,)
2023-08-17
Notes from https://www.barrons.com/articles/walmart-earnings-stock-price-retail-e6e1086c?mod=hp_LEAD_6
- LIFO, an accounting measure
- Comparable-store sales, which measure growth in stores open for at least a year
- Walmart
- trades at 23.9 times forward earnings, slightly higher than its five-year average of 22.5
- competitors: Target and Kroger
- sales growth was largely driven by groceries this quarter
- is often seen as a bellwether for U.S. consumer health
Notes from https://www.barrons.com/articles/cvs-stock-caremark-amazon-1bfcc05c?mod=hp_LEAD_4
- Blue Shield of California
- is dropping CVS Caremark, its current pharmacy-benefit manager, and largely replacing it with a selection of other companies.
- Its new offering will include at-home drug delivery from Amazon (AMZN).
- CVS will continue handling specialty drugs
- 4.8 million members
- Cost Plus Drug Company
- the mail-order pharmacy owned by Mark Cuban
- Mark Cuban
- the billionaire owner of the Dallas Mavericks
2023-08-15
- D.R. Horton (ticker: DHI) is the industry leader in home-building
- Celanese (ticker: CE)
- home builders Lennar (ticker: LEN), NVR
- Berkshire owns Clayton Homes, the biggest producer of manufactured homes
- Berkshire owns Shaw, a maker of carpeting and flooring
- Berkshire owns Benjamin Moore in paints
- Berkshire’s equity portfolio of about $350 billion
2023-08-09
- Novo Nordisk's (ticker: NVO) Ozempic is the most well-known obesity drug. It is an injectable that can curb users’ appetites.
- Eli Lilly's (ticker: LLY) Mounjaro is approved for diabetes but used by some for weight management
- anti-obesity medication (AOM) patients
- foods high in sugar and fat: confections, baked goods, salty snacks, sugary drinks and alcohol
2023-07-31
Notes from https://www.barrons.com/articles/walmart-stock-stake-flipkart-india-a67256b5?mod=hp_DAY_Theme_1_1
- Flipkart is now valued at $35 billion
- Apple opened its first two stores in India in April 2023.
- Amazon cloud computing unit is planning to invest $12.7 billion in India by 2030.
- Flipkart is a major competitor to Amazon in India.
- Flipkart's market share in India = 48%; Amazon's market share = 26%
2023-07-21
Notes from https://www.barrons.com/articles/oil-sales-non-dollar-currencies-564d9d6?mod=hp_LEAD_1_B_3
- Russia accounts for about 10% of oil production
- Venezuela has the most oil reserves in the world
- Oil has long traded in an inverse relationship to the dollar. When the dollar gets stronger, oil tends to get weaker, on the margin.
- Indian refiners have begun paying for Russian oil in dirhams, the currency of the United Arab Emirates. The value of the dirham is pegged to the dollar, which offers some stability to traders.
- This de-dollarization trend in the commodity trade is a boon for the countries like India, China, Brazil, Thailand and Indonesia, which can now not only buy oil at a discount, but pay for it with their own local currencies
- 55% of the world’s reserves were still in the greenback
- Russia's state-controlled Rosneft PJSC is its biggest crude exporter. It owns an almost 50% stake in Nayara Energy Ltd., India’s second-largest oil refiner.
2023-07-11
- Hastings, Minnesota
- Benchmark Class III milk futures, a type that’s used in cheese-making
2023-06-29
- Uniqlo
- parent company is Fast Retailing Co.
- Daisuke Tsukagoshi, Uniqlo’s chief executive officer for the US and Canada
- has 61 stores in North America
- operates 112 outlets in Europe
- 900 stores in China
- CEO Tadashi Yanai, Japan’s richest man
- first Uniqlo store opened in New Jersey in 2005
- fiscal year ends in August
- Chief Financial Officer Takeshi Okazaki
- $291 billion retail clothing market
- Hennes & Mauritz AB has 740 H&M stores in the Americas
- Gap Inc. has more than 2,000 stores in the Americas
- S&P Global Market Intelligence economists
https://www.barrons.com/articles/ford-layoffs-engineers-hiring-deere-cnh-e4e6cd57?mod=hp_columnists
- Ford Motor
- is laying off about 1,000 workers, including engineers
- 173,000 employees at the end of 2022
- CNH Industrial (CNHI)
- a rival of Deere (DE)
- makes tractors and heavy-duty machinery
- employs about 40,000 workers
- is buying Hemisphere
- Hemisphere
- a global leader in high-performance satellite positioning technology
2023-06-02
- Amazon’s US Prime subscription
- $139 a year.
- It used to be $119 before
- free grocery delivery for orders > $150
- 167 million subscribers
- Walmart+ membership
- competitor to Amazon Prime membership
- $98 a year
- free grocery delivery for orders > $35
- T-Mobile and Verizon unlimited plans
- $60 a month
- AT&T unlimited plans
- $65 a month
- Amazon
- plans to start testing a satellite-internet service called Project Kuiper next year.
- reseller, otherwise known as a mobile virtual network operator or MVNO
- MVNOs
- ESPN Mobile and Virgin Mobile failed
- Alphabet's Google Fi service runs on T-Mobile’s network and has about 2 million customers
- Cable companies - Charter Communications Inc. and Comcast Corp
2023-06-01
Notes from https://www.barrons.com/articles/blackstone-stock-price-breit-redemptions-c76143a9?mod=hp_columnists
- The Blackstone Real Estate Income Trust, Breit
- AUM is $69 billion
- received \$4.4 billion of redemption requests in May and paid out 30% of those requests to investors, or \$1.3 billion
- Redemption limits are {monthly: 2%, quarterly: 5%} of NAV.
- Redemption requests were {Jan: \$5.3 billion, Feb: \$3.9 billion, Mar: \$4.5 billion, April: \$4.5 billion}
- Blackstone has paid out $7.5 billion since November
- six-year-old fund
- higher percentage of redemption requests are from international investors than those in the U.S.
- a nontraded real estate investment trust sold through major brokerage firms and financial advisors
2023-05-28
Notes from https://wwsg.com/speaker-news/ex-fdic-chair-what-bank-depositors-really-need-from-regulators/
- Bair serves on the corporate board of Bunge BG (pronounced BUN-ghee), an oilseed producer and agribusiness based in St. Louis
- Banco Santander, the large Spanish bank
- US is the highest in terms of number of banks
- 4,100 FDIC insured institutions
- Russia is next with ~400
- Canada has ~80 banks. Canada's population and GDP are 10% of US.
- a George Bailey moment - a reference to the protagonist, played by Jimmy Stewart, of It’s a Wonderful Life—a banking movie from a previous era.
- Bair wrote
- Money Tales
- Billy the Borrowing Blue-Footed Booby
- Princess Persephone Loses the Castle
- Daisy Bubble
2023-05-26
Notes from https://www.barrons.com/articles/yield-hungry-investors-are-feasting-on-t-bills-5185e488
- noncompetitive bids at T-Bill auction is a good proxy for individual investor demand
- Data source for the amount of noncompetitive bids in Treasury auctions - U.S. Treasury Department
- junk bonds, emerging market debt, high-grade corporates, mortgage securities
- unlike CDs and corporate bonds, interest from Treasuries is exempt from state and local taxes.
- The Treasury auctions 4-week, 8-week, 13-week, 17-week and 26-week T-bills each week and 52-week bills every four weeks.
- reinvest the proceeds of maturing T-bills in newly auctioned ones, a process known as rolling
- It’s best to hold a T-bill until maturity; a sale prior to the redemption date can be costly, due to fees charged by securities brokers
- BIL and SGOV have average maturities of just over a month
- one risk in T-bills is “reinvestment” risk - the next bill you buy might yield less than the one you own
- US delayed some payments in 1979 (in part because of a debt-ceiling debate)
- When the ceiling is raised, there could be a deluge of T-bill issuance over two months - perhaps up to $700 billion
2023-05-24
Notes from https://www.federalreserve.gov/monetarypolicy/fomcminutes20230503.htm
- commercial and industrial (C&I) loans
- Mid-sized banks - those that have total consolidated assets in the range of \$50 billion to \$250 billion
2023-05-14
- \$7.1 trillion is indexed to the sp500 at year-end 2021 and just under \$40 billion indexed to the Dow
- Dow was created in 1885 by Charles Dow
- sp500 was launched in 1956
- Weights of Apple and United Health in sp500 index are 7.47%, 1.34% respectively.
- Dow Jones, which owns Barron’s, spun off its index business in 2010 to S&P.
2023-05-12
Notes from https://www.barrons.com/articles/debt-ceiling-medicare-healthcare-dd8c586d?mod=hp_LEAD_3
- the federal government is a large source of revenue for many medical providers, in the form of payments for Medicare and, to a lesser extent, Medicaid
- The average payer mix at U.S. hospitals is an estimated 20.5% Medicare and 13.2% Medicaid
- hospitals could respond by canceling all elective procedures and focusing on emergency services
- Federal law bars hospitals that participate in Medicare and have a dedicated emergency department from discriminating against ER patients on their ability to pay
- nursing homes and rehabilitation facilities
- Many nursing homes get a large portion of their revenue from Medicaid
- Medicaid is jointly funded by the federal government and the states. The exact breakdown varies by state but it is roughly 70% federal and 30% state.
- Rehabilitation facilities, where patients go to recover from surgeries
2023-05-10
- telematics, or usage-based insurance, which adjusts customers’ rates based on how they drive
- Geico uses more than 600 distinct tech platforms
- most competitors moving to precision-scheduled railroading
2023-05-03
- defensive sectors like healthcare and staples
2023-05-01
Notes from https://www.ft.com/content/da9f8230-2eb1-49c5-b63a-f1507936d01b
- Charlie Munger
- He lives in Greater Wilshire, a leafy neighbourhood of Los Angeles. He lived there for 60 years and designed the property himself.
- He grew up in Omaha, Nebraska, a few hundred feet from where Buffett now lives. The two met in 1959, when Buffett was 28 and Munger 35. Munger, who at one point worked in a grocery store owned by Buffett’s grandfather, trained as a lawyer before being coaxed into investment by his soon-to-be partner.
- “Forget what you know about buying fair businesses at wonderful prices; instead, buy wonderful businesses at fair prices.”
- He made most of his money from just four investments: Berkshire, Costco, his investment in a fund managed by Li Lu’s Himalaya Capital and Afton Properties, a real estate venture that owns apartment buildings in California and New Jersey.
- “In the good times you get into bad habits . . . When bad times come they lose too much.”
2023-04-27
- Commercial paper is a short-term fixed-income security that is typically sold to institutional investors like hedge funds, and multinational corporations, although indirect investments are possible for retail traders through exchange-traded funds.
- BlackRock Ultra Short-Term Bond exchange-traded fund (ticker: ICSH), had 26% of its investment in commercial paper.
- Retail investors can also access CLOs through ETFs like the Janus Henderson AAA CLO ETF (JAAA)
- United Parcel Service (UPS) - ships packages
- Packaging Corp. of America (PKG) - makes the boxes things get shipped in
2023-04-25
- KIA, an affiliate of South Korea-based Hyundai Motor Group
- Hyundai Mobis, the company’s parts supplier
- First Republic had total assets of \$233 billion as of March 31, including \$173 billion of loans and \$35 billion of investment securities
Notes from https://www.barrons.com/articles/amazon-microsoft-alphabet-meta-big-tech-earnings-fa13851
- Combined market cap of Amazon, Alphabet, Microsoft, and Meta = \$5.1 trillion which is ~15% of the SP500's aggregate market cap.
- SP500 is up 8% ytd.
- The Invesco S&P 500 Equal Weight Exchange-Traded Fund (RSP) is up 2.6% ytd.
2023-04-21
- the world needs 100 million barrels a day
- economic textbooks by Paul Samuelson
- Tulip Mania lasted three years. It went from 1634 to 1637.
2023-04-18
Notes from https://www.barrons.com/articles/earnings-stocks-gains-rally-outlook-fff4ad0c
- S&P 500 year-over-year earnings growth
- ISM Manufacturing Index, a measure of the level of activity in that part of the economy
- ISM dropped to about 46 for March from a post-Covid peak of just over 60.
- Such weak ISM results historically have correlated to fewer than 70% of S&P 500 companies beating quarterly profit projections
- the S&P 500’s price/earnings multiple is at a not-inexpensive 18.3 times analysts’ full-year forecast
- Full-year guidance often accompanies first-quarter reports.
2023-04-17
Notes from https://www.barrons.com/articles/berkshire-class-a-stock-premium-b-warren-buffett-c8ed2dd3
- Buffett holds virtually all his roughly 15% economic stake in Berkshire through the A shares
- The Class B stock was issued in 1996
- Class B stock is more liquid and widely owned than the A stock due to its lower share price and inclusion in the S&P 500 SPX index
- Class B share carry 1/10,000th of a vote
- Economically, Class B share is 1/1,500th of a Class A share
- Buffett maintains a 31% voting stake with just a 15% economic interest
2023-04-11
Notes from https://www.cnbc.com/2023/04/11/berkshire-japan.html
- Japan’s five largest trading companies — known as sogo shosha — are conglomerates that import everything from energy and metals to food and textiles into resource-scarce Japan.
2023-04-06
Notes from https://www.barrons.com/articles/constellation-earnings-stock-price-dividend-d8cb7af2
- The 20 largest companies in the S&P 500 have added nearly \$2 trillion in market cap this year, versus \$170 billion for the remaining 480 stocks
Notes from https://www.barrons.com/articles/bird-flu-vaccine-egg-prices-chickens-65602fd9?mod=hp_LEADSUPP_2
- Cal-Maine Foods (ticker: CALM), the largest producer of eggs in the U.S.,
- The U.S. is one of the world’s largest poultry exporters; it exported $6 billion worth of poultry meat in 2022
- spring - a season when avian flu typically flares
2023-04-03
- Extra Space Storage (ticker: EXR)
- Life Storage (ticker: LSI)
- operates more than 1,150 storage facilities in 37 states and the District of Columbia
- Public Storage (ticker: PSA)
- EXR is acquiring LSI
- for $12.4 billion
- combined company will be the largest U.S. self-storage space operator by store count
- all-stock deal
- EXR's lead financial adviser was Citigroup Global Markets
- LSI's financial advisers were Wells Fargo Securities and BofA Securities
2023-03-29
Notes from https://thefinancebuff.com/brokerage-account-safe-no-fdic.html
- Charles Schwab has a banking arm — Schwab Bank
- Vanguard, Fidelity, and Charles Schwab all have a money market fund that invests only in Treasuries and government bonds.
- The federal government guarantees to pay the principal and interest on Treasuries.
- The big-3 brokers Charles Schwab, Vanguard, and Fidelity
- You can buy Treasuries either as new issues or “pre-owned.”
- Customers were eventually made whole after MF Global went bankrupt but it took five years.
- Brokerage accounts are insured by SIPC up to $500,000 but the insurance doesn’t cover the payback from your investments. It only covers missing assets if the broker goes down. If customer assets aren’t missing, the SIPC insurance isn’t needed.
- from comments
- Schwab Value Advantage Money Fund Investor Shares (SWVXX)
- Schwab U.S. Treasury Money Fund Investor Shares (SNSXX) invests primarily in Treasuries
- All money market fund yields are quoted after fees are already deducted
2023-03-27
- overexposed to crypto like Silvergate Capital and Signature Bank
- overexposed to venture capital like Silicon Valley Bank
- Charles Schwab Corp
- Fewer than 20% of Schwab’s depositors exceed the FDIC’s $250,000 insurance cap
- 34 million accounts
- $7 trillion of assets across all of its businesses
- based in Westlake, Texas
- Chief Executive Officer Walt Bettinger
- operates one of the largest US banks
- grafted on to the biggest publicly traded brokerage
2023-03-24
- BlackRock's AUM - $8.6 trillion
- Larry Fink used to work at First Boston, Credit Suisse’s investment banking business
- senior bankers at Perella Weinberg
- BlackRock has long been one of Credit Suisse’s biggest investment banking clients, particularly its fixed-income trading desk
- The Swiss National Bank (SNB)
Notes from https://www.ft.com/content/fbd9e3d4-2df5-4a65-adbd-01e5de2c5053
- BlackRock’s consulting arm
- SVB hired BlackRock’s Financial Markets Advisory Group in October 2020 to analyse the potential impact of various risks on its securities portfolio, examine the risk systems, processes and people in its treasury department
2023-03-23
- Nostr, the decentralized alternative to Twitter
- Jack Dorsey
- co-founder of Block (ticker: SQ)
- Block (ticker: SQ)
- facilitates payment through its widely popular Cash App platform
- Accenture PLC
- 19,000 jobs or 2.5% of its workforce, over the next 18 months
- employs about 738,000 people globally
- Chief Executive Julie Sweet
- IT positions being cut or automated are those in data-center operations and telecommunications
- large skills gap remains in areas like cybersecurity and software development
- Capital One Financial Corp
- laid off 1100 employees in the “agile” group within its technology department
2023-03-22
Notes from https://www.federalreserve.gov/newsevents/pressreleases/monetary20230322a.htm
- the federal funds rate is raised to 4-3/4 to 5 percent.
- the Committee will continue reducing its holdings of Treasury securities and agency debt and agency mortgage-backed securities
Notes from https://www.federalreserve.gov/newsevents/pressreleases/monetary20230322a1.htm
- Implementation Note
2023-03-20
Notes from https://www.wsj.com/articles/credit-suisse-bond-wipeout-threatens-250-billion-market-10be7d04
- AT1 bonds - also known as contingent convertible bonds, or CoCos - were introduced after the financial crisis as a way to transfer banking risk away from taxpayers and onto bondholders.
2023-03-11
- Founders Fund started a capital call.
- Capital call - a VC firm asks its investors, or limited partners, to send it money in order to make investments in startups.
2023-03-10
Notes from https://www.barrons.com/articles/svb-financial-stock-portfolio-outlook-loss-93287f3d?mod=hp_LEAD_1
- On Friday, the California Department of Financial Protection and Innovation closed down Silicon Valley Bank and appointed the FDIC as receiver.
- The FDIC created the Deposit Insurance National Bank of Santa Clara and immediately transferred all insured deposits of SVB to the DINB at the time of closing.
- FDIC’s standard insurance amount is $250,000 per depositor, per insured bank.
- SVB Financial Group (ticker: SIVB) is the parent company of Silicon Valley Bank
- Nasdaq will delist SVB’s stock
Notes from https://www.xtb.com/int/market-analysis/news-and-research/svb-financial-bank-closed-by-fdic-decision
- SVB was the 18th largest bank in the U.S., with $212 billion in assets
Notes from https://www.fdic.gov/news/press-releases/2023/pr23016.html
- As of December 31, 2022, Silicon Valley Bank had approximately \$209.0 billion in total assets and about \$175.4 billion in total deposits.
- First Republic and Brex - to transfer money out of SVB
- SVB CEO Gregory Becker
Notes from https://www.sec.gov/Archives/edgar/data/1428439/000142843923000010/wk-20230310.htm
- $487 million of Roku's cash is held at SVB. It is all uninsured.
2023-03-07
Notes from https://www.barrons.com/articles/china-us-taiwan-conflict-confrontation-a818d490?mod=hp_LEAD_3
- China’s foreign minister Qin Gang
2023-03-06
- Silvergate Capital Corp is based in California.
- money-transfer businesses - MoneyGram International, Western Union
- 82% of Silvergate's deposit base is crypto customers
- highly liquid - Deposits at the Federal Reserve or other banks, short-term Treasury bills
- Large banks must keep enough high-quality liquid assets to cover 30-days’ worth of deposit withdrawals under stressed conditions.
- JPMorgan Chase & Co., for example, held \$733 billion of such assets at the end of 2022 against \$2.3 trillion of diverse, traditional deposits.
- Three-quarters of those liquid assets were on deposit at the Fed and other banks, the rest was in a mix of Treasuries, and government-sponsored mortgage bonds.
2023-03-03
Notes from https://www.barrons.com/articles/crypto-silvergate-bank-bitcoin-ea6943b4?mod=hp_LEAD_1
- Silvergate Capital
- ticker = SI
- warned about its ability to “continue as a going concern.”
- based in La Jolla, Calif
- founded in the late 1980s
- had $14.3 billion in deposits at the end of 2021
- deposits dropped to $3.8 billion in Q4 2022
- created the “Silvergate Exchange Network” (SEN)
- to handle transfers of traditional currency between its customers
- In Q4 2021, it handled $219.2 billion in U.S. dollar transfers
- By 2021, it had 94 crypto exchanges and 894 institutional investors as customers
- Made U.S. dollar loans to customers who posted Bitcoin as collateral
- The SEN network allowed crypto companies to avoid ACH transfers
- slippage - the difference between the price at which a trade is expected to happen and where it actually executes
- Signature Bank (SBNY)
- Runs a network similar to SEN
2023-02-28
- Augusta, Georgia is known for hosting the US Masters golf tournament
- two-hour drive east of Atlanta
- Home to a military base, universities and power plants
- big market for rentals
- the median home price in Jacksonville, Florida is less than half that of California
- Sun Belt states
2023-02-27
- At the end of 2021, China held 383,935 acres of land in the US
- pork producer Smithfield Foods
- There is a chart that shows the agricultural landholdings by country at the end of 2021. The source of the data in the chart is US Department of Agriculture.
- China's population is 4 times that of US.
- Secretary of Agriculture
- the Committee on Foreign Investment in the US
- oversees inbound investment
2023-02-16
Notes from https://www.barrons.com/livecoverage/stock-market-today-021623?mod=article_inline
- The producer price index measures wholesale inflation
Notes from https://www.barrons.com/articles/treasury-yields-bonds-inflation-995b9911
- The two-year Treasury note TMUBMUSD02Y
https://quickbooks.intuit.com/r/cash-flow/critical-difference-profit-cash-flow/ - explains the difference between cash flow vs. profit. Easy to understand.
2023-02-07
Notes from https://www.wsj.com/articles/blackstones-hefty-concession-is-a-warning-to-investors-11672840068 dated 2023-01-04
- University of California’s endowment, known as UC Investments
- put $4 billion into BREIT fund, locked up for five years with a two-year limited withdrawal period afterward, for an average of six years
- BREIT fund
- fees for small private investors - 1.25% a year and 12.5% of profits
- chose to focus on Sunbelt housing, warehouses and data centers
- In December 2022, investors asked for 5.44% of the fund back, but only 0.23% was available because of withdrawals in the two prior months.
- Blackstone will use up to $1 billion to pay UC Investments if it fails to earn 11.25% a year after fees.
- During the height of the 2008 financial crisis, Warren Buffet put $5 billion into Goldman Sachs for 10% annual dividend and option to buy discounted shares
2023-02-01
Notes from https://www.barrons.com/articles/gold-prices-gaining-how-to-invest-51675211440?mod=hp_LEADSUPP_2
- Inflation usually helps gold, but a strong U.S. dollar and rising interest rates can hurt it.
- State Street Global Advisors, or SSGA
- manages the $57 billion SPDR Gold Shares (GLD)
2023-01-31
- The total valuation of India’s stocks has dropped to $3.2 trillion, or 3.1% of the global share market capitalization.
- So global share market cap is $103.23 (= 3.2 * 100 / 3.1) trillion?
- Foreigners have been net sellers of India for most of January
- Global funds pulled a net $784 million from Indian shares on Jan. 25 and Jan. 27
- Life Insurance Corp. of India, the country’s biggest insurer
- Anchor investor
Notes from https://www.wsj.com/articles/whole-foods-asks-suppliers-to-lower-prices-as-costs-ebb-11675115155
- Whole Foods Market
- Rival grocers - Kroger Co. and Albertsons Cos.
- discounters - Aldi Inc. and Trader Joe’s
- Operates more than 500 stores in the U.S., Canada and the U.K.
- merchandising teams that oversee categories of products
2023-01-20
Notes from https://www.reuters.com/business/softbanks-66-bln-sale-arm-nvidia-collapses-ft-2022-02-08/
- Arm
- would go public before March 2023
- SoftBank acquired Arm in 2016 for $32 billion
- Jeff Dean leads Google’s artificial intelligence and research efforts
- data platform for care teams, called Google for Clinicians
- The robotics unit
- will cut 12,000 jobs (6% of its global workforce)
- AI is a “key investment area”
- Google spokesperson Jason Freidenfelds
- ChatGPT from the research lab OpenAI
- ChatGPT prompted Google’s management to declare a “code red” within the company
2023-01-17
- IDR Investment Management - tracks an index of the open-end diversified core equity funds
- John Murray, head of global private commercial real estate at PIMCO
2023-01-12
- Subway
- based in Milford, Connecticut
- 37,000 locations in more than 100 countries
- first shop opened in 1965
- 20,000 US locations
2023-01-11
- Anthony Scaramucci’s SkyBridge Capital
- venture firms like Sequoia Capital
- an investor who buys claims from creditors in bankruptcies
- Genesis Digital
- one of the world’s largest bitcoin miners
- two German co-founders
- Marco Streng and Marco Krohn
- three Kazakh entrepreneurs
- commodities giant Trafigura Group
2023-01-03
- Cardiac arrest is when the heart abruptly stops beating.
- It occurs when the heart’s electrical system malfunctions.
- Abnormal heart rhythms or arrhythmias can be triggered by congenital defects, heart damage and certain medications
- arrhythmias can lead to cardiac arrest
- ventricular fibrillation, a serious type of arrhythmia
- commotio cordis
- Both heart attack and heart failure can lead to cardiac arrest. But they are separate conditions.
- A heart attack occurs when blood flow, which carries oxygen, to the heart muscle is reduced or stopped. It is usually caused by blockages in the coronary arteries.
- Symptoms of a heart attack can include chest pain, shortness of breath and pain in the arms and back
- Heart failure is a chronic and progressive condition in which the heart can’t effectively pump blood around the body. Possible contributors include build-up in the coronary arteries, previous heart attacks, high blood pressure, obesity, congenital defects, lung disease and diabetes.
- Cardiac arrest is sudden and characterized by abrupt collapse and loss of consciousness. A person in cardiac arrest will have no pulse and won’t be breathing.
- Defibrillator is a device that delivers an electric shock to the heart and can restore a normal heartbeat in cardiac arrest patients
- While waiting for a defibrillator to arrive, CPR should be administered.
- Chest compressions can help to manually circulate blood, which can be life-saving to a person whose heart is not beating properly.
- Everyone should learn how to administer CPR and use an AED (automated external defibrillator).
- Cardiac arrest is usually fatal. Fewer than 12% of people who have a cardiac arrest outside of a hospital survive. CPR significantly increases the odds of survival.
public/sotm/reading_2023.txt · Last modified: 2023/12/21 17:33 by raju