Gregmal

Zoom is the coronavirus inspired GoPro. Eventually real players will take this space too. Probably MSFT imo.

No the government cannot bailout the entire economy. While the headline number of $2T is large, a lot of this is jut loans and liquidity bridges, it has to be paid back. The US economy is ~$22T in size, so $2T is roughly equivalent to one month of GNP. It is too large to bail out. The $2T is just a stopgap measure to prevent dominos from falling. They pro half will still fall, but slower and more controlled. Also as you noted, a lot of folks will fall though the crack, have no health insurance, might get sick from the virus. How to restart this is going to be a difficult task and a fine line to walk. The Eastern get back to business date seems quite unrealistic to me, but numbers will dictate what is going to happen. Infection rates need to be way doen in order to open up again and even then, it will partly feel like quarantine. As it imagine a lot of measures still remain in place like no large crowds etc. I think this year you can forget about sports for example. might actually be a golden time for esports - Formula 1 did already an esports race they found quite an audience. Another thing, think about litigation risk. You go to work, get infected though a colleague and go into the ICU. Sue the company and then get a good lawyer who proves that the companies practices were endangering employees, which I I can guarantee you almost any company does. Examples - Dirty door handles which are not cleaned, no contactless entry possible, no contactless operation of bathrooms, shared microwaves in cafeterias. In litigation friendly America, that’s going to be a feast for lawyers. The government is and will continue to take measure that down the line, create absolutely massive amounts of inflation. I agree as well re: litigation. A few very well respected lawyers Ive spoke with, including at public firms like Burford, have this entire thing circled and are just waiting to cash checks.

What we know for sure is that the government has basically guaranteed a bailout to bridge the gap between pre corona and a return to normalcy. The tricky part, really the only one, is to avoid getting snagged in an investment or business that doesnt have a firm footing on its own, or an ironclad bailout. From another thread, here's a interesting scenario to highlight. Two working parents, one a party/event planner for a reasonable sized corporation. The other a consultant to the energy industry and thus an independent contractor. Both made good money in 2018 and 19. The contractors work dries up and the event planner is laid off. Away goes their health insurance. Away goes their income. Their eligibility for stimulus money is nil because of their previous year income levels. And the contractor cant even file for unemployment....Their only fallback? An rental property in NYC, where the mayor just told tenants to stop paying rent... This is potentially the scenario of a friend of mine, and one that could very easily apply to companies in jeopardized industries as well. (Note to myself and other small cap value investors: think twice or maybe three times before buying that distressed microcap hotel operator with owned real estate at 30% of book) But all in all, the funny money being pumped into the system makes it impossible for stocks to ever get too cheap, for too long a period of time. If nothing else the scarcity and supply demand aspect for HNW and institutional dollars will keep the valuations elevated. More dollars and less assets can really only lead to higher prices.

Bought a few SDS calls into the close. Kind of hoping to hedge out and "get ahead" of those looking to "get ahead" of those getting out of the market before the weekend...

Yup, this thread started out pretty interesting and informative(Viking and Spekulatus for instance I found greatly helpful in their shared thoughts) but I moved on as it became clear there was little useful discussion for investing but rather became an echo chamber for people to ramble like drunken clowns and drum up nonsensical doomsday hysteria, zombie apocalypse wet dreams, with an overcoat of political bias. I think the best investable ideas I could pry from anyone was Dalals "RCL puts" which was basically retail investor on twitter worthy, ignorant of its 200%+ annual negative carry cost. Some people just lost it. A forum full of value investors and BRK was recently trading under book but everyones scared and I guess their cash is currently earning 0% in quarantine.

I guess my bigger point is that there’s a few greater things to be cognizant of. Bad companies and those exposed have been destroyed. So have some good companies. Just in my universe FRPH traded to 30s. GRIF saw a $29 ask. MSG(obviously effected) traded to a 30% discount to just the Knicks if you factor in the $400m for Forum. AYR traded less than 1x EBITDA. These are maybe/maybe not the bottom but unsustainable. So a lot is priced in, in certain areas. That said, we also saw a mega year period of low volatility. It would not be unreasonable to now see an extended period of super volatility. Just be on your toes stick to what you know. The demise of some is the opportunity of others. The strong tend to come out stronger. Everyone loved BRK at 225, and still probably likes it, but even there I’ve sensed some love lost. Noise comes in many shapes, sizes and mediums. My 2c guess is that anything can and will go anywhere, short term. But once we get through this, if you stuck with the right stuff, those things are going to go ballistic. I don’t need to remind anyone what decade came after the Spanish Flu... and that’s without helicopter money getting poured on everything.

I thought the general point was obvious, and didn't think things would devolve into stupid nitpicking. Since it didn't technically go down exactly 40% in exactly 4 weeks, there s obviously no reason this employment print shouldn't have gapped us down another 10%....got it.

In basically 4 weeks S&P basically went from 3400 to 2250. So it’s a little odd people are so caught off guard by, a bounce.

Yea, the numbers may change and will short term get worse, but for Christs sake, shit just went down 40% in a couple weeks. Some things are definitely priced in.

Ackman is a character, but absolutely worth paying attention to. Very similar to Berkowitz. Does a lot of shit that initially you think is crazy, half the time it turns out to be genius, the other half it just ends up being crazy.

Either almost every major govt and world health organization is blowing this way out of proportion for the first time in history - or you misunderstand the risks associated with the disease. Which do you think is more likely? These people suffer from some of the most extreme commitment and consistency bias I've seen. Don't waste your time - not worth engaging w/ these people Or, maybe, you know, on a investment board, some people look at a short term situation, call it the flu, call it coronavirus, call it whatever you please, and realize that there will be a time where this passes and that in between the baby often gets thrown out with the bath water and as such find the overreaction to be silly. Or that there will opportunities both long and short, and that "all cash" in a zero rate environment, or "shorting RCL" with a 200%+ annualized carry isn't the only investment on the table. Has little to do with commitment bias. Has to do with your outlook and time horizon. A consistency bias would be, I dont know, riding a second rate FNMA thesis through the greatest bull market in history, clinging to every bs legal filing, and then still seeing a 60% drawdown via the zombie apocalypse virus. To each their own.

Just my 2c, but arent there easier targets here than a premium company that targets the ultra rich? It can/could work, but Ferrari is a great company, with a huge moat, and product with insatiable demand. Id gander Ford is a better short than Ferrari. I mean we just saw Ballmer pay $400M for a stadium-yesterday! Its possibly a one off. But its also not farfetched wealthy folks will continue to be better off than average folks. Why get cute going after a world class business when you can go after turds? Even if you hit, you still have to nail the landing trading wise, because like other best of breed companies, these do bottom and rebound hard. Disclosure, I shorted some F today.

This is a super-flu with a social media following. Thats it. The reactions have all been magnified by social media as well. Fed cuts rates? OMG thats because the situation is sooo dire! Fed doesnt do anything? What are they waiting for! Theyre going to kill the economy... Damned if you do, damned if you dont world we live in. If you're an investor, just try to get by and stick to the golden rules....Sanity will eventually prevail. You're starting to see the magic equation, unlimited stimulus, free money for one of the first times ever, going straight to the consumer, rates at 0, and subsidies for business who are jeopardized.... I'll pose a simple question, with a simple context. Look at the economic figures present when the S&P was at 3200...jobless rate, wages, etc. Its probably going to be a little bit, but where do you think SPY is when the figures get back there? Higher or lower than 3200? It's a really simple equation that just involves the ability to ignore the short term noise.

$400m for the Forum, more than double my estimates. So yea, coronavirus what? Billionaires will still buy billionaire toys. EDIT, I'll also add, this against a total cost from purchase date of about $140M. Not a bad IRR over 7 years.

From what I heard, the mortgage deferral also only refers to owner occupied units, not investors. I could be wrong through.

The Forbes valuation has always been lower than the actual transacted prices, by a significant margin. This is basically just a time arbitrage right now. You're buying the whole thing for less than the Knicks value. This "super flu with a social media following" isn't impairing anything, and will blow over. When it does, you've got a lot of upside even with a discount. People regularly said Dolan wouldn't sell Cablevision either. Its "he'll never sell, until he does". Its hard to make the case Dolan isn't working for shareholders when you look at all the corporate actions taken by companies he's controlled over the years. Its just a lazy narrative that looks a little easier to throw on top of the companies when everything appears to be in the gutter. Its much like all the "I knew company XYZ was a piece of shit" going on at several other investment sites with companies that were multi baggers and are now down 50%.

I hear what you're saying with (1). Perhaps I should rethink my options. I figure, I'd rather have that intrinsic value stored up. If I buy OOM options it frees up a bit more cash; but my exposure is very conditional. I'm always a bit nervous with OOM options because in the case of (2), it seems like they are only useful if prices run up enough. And you have to sell at the right point i.e. maximum upwards movement and volatility - do you find these OOM calls have a limited lifespan where you can make decent money? Or do you plan to hold until expiration and count on being right on both direction & timing? You're right on volatility - LEAPs past 2021 were very expensive today. This is a unique subject. Personally, I prefer to cut the stock via deep ITM. How much depends on my confidence and ability to really get under the hood. Being honest with myself this usually eliminates much over the market cap of day $10B. Companies bigger than that, even ones we all know well like BRK pose zero analytical edge and even when they do, have parts that move too quick. If I really like it but am uncertain, I try to use the ITM as a stop loss. Similar to what I did with WFC in January. $45 strike. If it goes below there, I’m out. With stuff I’m dedicated to, you go deep ITM, figure that your margin of safety, and then of, let’s say something extraordinary like this happens, and you find yourself below the strike, you should still have reasonable confidence in valuation and time sorting things out, to load the boat on those same now OTM calls. Example let’s say BRK $150 calls. In the money now, and if they ever go below, you can swing big as OTM

https://denver.cbslocal.com/2020/03/20/coronavirus-greffex-vaccine-john-price-aurora-covid-19-development/

Anyone think we've come full cycle. Back while part of GGP, the HHC assets were long considered the rubbish. half decade later, 2015 or so, trophies. Now? Rubbish again.

TMO edit, didn't really read the title of the thread as much as the op. GOOG, BRK, ILMN, SPG, in addition to TMO. I'd also add MSG but its a smaller cap. Moats galore here. SPG probably seems quite speculative here, but so does basically all RE. I mean HHC for instance is at $40...

Do sucker bids really work in RE? price expectations from sellers are quite sticky and need to grind down, which takes a while. Public market rerate much faster, as we have seen with SPG, VNO and pretty much everything else. In the long run, I see the low interest rates as a tailwind at least for residential RE. Keep in mind that mortgage rates are still ~3.3%, so haven’t really followed down the treasuries all that much. I expect to see the lower 2% range some time later this year. Depending on what you're buying, they can work in some cases. Examples where its worked for me are with older/wealthier folks who simply want to move on. In a stagnant market, realtors are hungry for a check and after a while, owners get tired of paying bills. Maybe 5 years ago I got a great rental simply because the previous owner was retiring and moving to the west coast. He owned the unit as an income property. Even later on said he didn't care about holding out for a 5-10% better offer.

People give great weight to what they see and think today. Do you know how many people who swore Amazon or Netflix where overvalued in 2012-2015 became dip buyers on those names in 2018 onward? What was truly insane was looking at institutional filings for 2019 Q3 and Q4. Basically FANGM for everyone.

Yea I’d agree that the housing market is on hold, but not for any reason other than the fact that you can’t get a showing. Folks who buy homes for the most part will still have jobs when this shakes out. Rates are zero. Liquidity is and will continue to be pumped into the system. And we re starting to see much more liberal concessions made to help people out. That’s said, if you’ve got cash and know an area, for instance I own multiple units in an specific HOA, now is a great time to start floating out some sucker bids. I don’t need to see these units, period. Here’s my offer. Wait a week and see if anything comes in, and then make a decision... easy enough if someone really wants out.

Got some GRIF(new ticker for super levered inverse etf) under $30.

Why? What exactly did they do wrong? Let’s jack up the Capex on all of these companies so the already razor thin margins in the airline industry tighten even more and increase prices putting air travel back out of reach for the average American. The issue is 2008-09 is still fresh in many people's minds. Lots of ordinary people lost everything in the housing crash. Lots of big corporations got bailed out. Same thing looks to be happening again. Warren feels the scale is tipped too much one way. Lots of voters agree with her. I don’t disagree that lending should be sparingly and stringent. But you cross a line when you start mandating wages etc. There are simply better ways to structure this. They would be mandating wages if they take the offer. They don't have to take the offer. That's fair. The executives have "compensation consultants" to help them make more. Employees don't have that. You have to level the playing field. That’s not leveling the playing field. That’s straight up intervention and beyond. The business was fine before the pandemic. If you want to say “keep more cash on hand because next time you’re not getting a bailout” fine. Are you going to make that same mandate for every small business across the country? Ridiculous. The ordinary people that would bitch about a bailout would be the casualties. Retail/hospitality/airline/small business. Its not bankers and mortgage brokers this time.