Spekulatius Posted May 12, 2020 Share Posted May 12, 2020 Trump doing his best to put a bullet in the back of their head. https://twitter.com/realDonaldTrump/status/1260206276216266754 Yeah a day after the St Louis Fed came out stating that they don’t want low interest rates. You can’t make it up. He may need the negative interest rates to keep his cardboard box empire from collapsing. Link to comment Share on other sites More sharing options...
stahleyp Posted May 12, 2020 Share Posted May 12, 2020 Trump doing his best to put a bullet in the back of their head. https://twitter.com/realDonaldTrump/status/1260206276216266754 Yeah a day after the St Louis Fed came out stating that they don’t want low interest rates. You can’t make it up. He may need the negative interest rates to keep his cardboard box empire from collapsing. It's quite possible negative rates may actually be what causes his cardboard box to collapse. Link to comment Share on other sites More sharing options...
plato1976 Posted May 12, 2020 Share Posted May 12, 2020 this does look like a value trap to me at this point (together with most other big banks) WFC Link to comment Share on other sites More sharing options...
valueinvestor Posted May 12, 2020 Share Posted May 12, 2020 XPEL - Small Starter Position (Thanks Snowball82) AER, TDG, PK, AEO Link to comment Share on other sites More sharing options...
bskptkl Posted May 12, 2020 Share Posted May 12, 2020 MFCB owns a royalty on an iron ore mine that has shut down in Canada. Tacora, the private company that owns the mine announced they had closed the funding on the 27th. This is a big deal, as it should be $20 MM+ in annual revenue at 100% gross margins for a company that has a market cap of ~$60MM after the move. We talked a but about it in the ALS thread. I couldn't resist, have a small position in SRL again...after feeling so good to be rid of Michael Smith last year too. The 20F out yesterday shows $28 book value. Link to comment Share on other sites More sharing options...
valueinvestor Posted May 12, 2020 Share Posted May 12, 2020 MFCB owns a royalty on an iron ore mine that has shut down in Canada. Tacora, the private company that owns the mine announced they had closed the funding on the 27th. This is a big deal, as it should be $20 MM+ in annual revenue at 100% gross margins for a company that has a market cap of ~$60MM after the move. We talked a but about it in the ALS thread. I couldn't resist, have a small position in SRL again...after feeling so good to be rid of Michael Smith last year too. The 20F out yesterday shows $28 book value. Why not have a larger position? I don't see the mine being affected by COVID-19 and iron prices have been relatively stable. I have a position too but it's relatively small compared to other position sizes, I think it's 2.5-5% of my port. Link to comment Share on other sites More sharing options...
TwoCitiesCapital Posted May 12, 2020 Share Posted May 12, 2020 Trump doing his best to put a bullet in the back of their head. https://twitter.com/realDonaldTrump/status/1260206276216266754 Yeah a day after the St Louis Fed came out stating that they don’t want low interest rates. You can’t make it up. He may need the negative interest rates to keep his cardboard box empire from collapsing. It's quite possible negative rates may actually be what causes his cardboard box to collapse. Honestly. Can you imagine what would happen if the RESERVE CURRENCY OF THE WORLD had negative rates?!?!?! I think that'd be quite a bit different than the euro having negative rates, but you could still expect the destruction of the U.S. banking sector and their profits a la Europe. Might be a time to jump into gold if you seriously expect that to happen as I imagine Central Banks all over the world would be moving some dollars into gold at that point in time. Link to comment Share on other sites More sharing options...
Lance Posted May 12, 2020 Share Posted May 12, 2020 Added to ALX, ESRT, PGRE, SLG and WFC. Thanks Lance Link to comment Share on other sites More sharing options...
Castanza Posted May 13, 2020 Share Posted May 13, 2020 BRK, WFC, MSGS, RTX Link to comment Share on other sites More sharing options...
sleepydragon Posted May 13, 2020 Share Posted May 13, 2020 USB, MTB, BOH, PM Link to comment Share on other sites More sharing options...
LC Posted May 13, 2020 Share Posted May 13, 2020 Sold out of MO, bought PM with proceeds. Bought a little WFC and cloudflare Link to comment Share on other sites More sharing options...
thepupil Posted May 13, 2020 Share Posted May 13, 2020 sold Prosus, purchased on 3/24 mostly, for a 40% gain. still "cheap" to 700HK/NAV but this is my way of sizing down the big cap tech exposure, selling out the chinese one. holding onto the other ones is hard given the absolute/relative valuations, but I'm doing it. Link to comment Share on other sites More sharing options...
Gregmal Posted May 13, 2020 Share Posted May 13, 2020 ESRT and PCYO Link to comment Share on other sites More sharing options...
sleepydragon Posted May 13, 2020 Share Posted May 13, 2020 Wfc Link to comment Share on other sites More sharing options...
plato1976 Posted May 13, 2020 Share Posted May 13, 2020 The heated up discussion about WFC and the increased number of ppl buying WFC here scared sh*t out of me sold Prosus, purchased on 3/24 mostly, for a 40% gain. still "cheap" to 700HK/NAV but this is my way of sizing down the big cap tech exposure, selling out the chinese one. holding onto the other ones is hard given the absolute/relative valuations, but I'm doing it. Link to comment Share on other sites More sharing options...
thepupil Posted May 13, 2020 Share Posted May 13, 2020 The heated up discussion about WFC and the increased number of ppl buying WFC here scared sh*t out of me sold Prosus, purchased on 3/24 mostly, for a 40% gain. still "cheap" to 700HK/NAV but this is my way of sizing down the big cap tech exposure, selling out the chinese one. holding onto the other ones is hard given the absolute/relative valuations, but I'm doing it. sorry what does that have to do with Prosus/700HK? do you mean the performance/resilience of big cap tech is scaring the shit out of you or do you mean the dip buying in WFC is? or both? Link to comment Share on other sites More sharing options...
LC Posted May 13, 2020 Share Posted May 13, 2020 It is interesting all the people buying WFC whereas WB was selling. (And WB may be fully exiting his WFC stake - if you recall during the annual meeting he mentioned "We don't trim positions") Makes me fear I am missing something big and obvious. Link to comment Share on other sites More sharing options...
Mephistopheles Posted May 13, 2020 Share Posted May 13, 2020 It is interesting all the people buying WFC whereas WB was selling. (And WB may be fully exiting his WFC stake - if you recall during the annual meeting he mentioned "We don't trim positions") Makes me fear I am missing something big and obvious. Is WFC fundamentally broken? For him to unload WFC and not BAC means it must be WFC specific. Yes WFC is like toxic waste right now in the banking world, but it is also like half of TBV and very well capitalized. He bought into BAC when not only was it toxic but also had tens of billions of legal liabilities. Is he saying it was possible to turn around BAC but not WFC? Did he like the odds of BAC in 2011 more than WFC today? BofA was not too much lower in total market cap then what WFC is today, and capital levels at all these banks are much better now. Or does he think it's an industry wide problem, interest rates, great depression? In that case he should be selling both off. Link to comment Share on other sites More sharing options...
fareastwarriors Posted May 13, 2020 Share Posted May 13, 2020 What about CM and DJCO? What are they doing with their WFC stake? Link to comment Share on other sites More sharing options...
karthikpm Posted May 13, 2020 Share Posted May 13, 2020 It is interesting all the people buying WFC whereas WB was selling. (And WB may be fully exiting his WFC stake - if you recall during the annual meeting he mentioned "We don't trim positions") Makes me fear I am missing something big and obvious. How do we know he is selling now ? Link to comment Share on other sites More sharing options...
JRM Posted May 13, 2020 Share Posted May 13, 2020 It is interesting all the people buying WFC whereas WB was selling. (And WB may be fully exiting his WFC stake - if you recall during the annual meeting he mentioned "We don't trim positions") Makes me fear I am missing something big and obvious. How do we know he is selling now ? He reduced his position by about 15% as of Berkshire's last 13f filing. Link to comment Share on other sites More sharing options...
LC Posted May 13, 2020 Share Posted May 13, 2020 Mephistopheles - this is exactly the questions I am asking myself. If his reason to sell is WFC-specific, what is it? He mentioned in an interview prior to the Annual mtg that he was still confident in the WFC brand. Now that is just the brand - it doesn't speak to the cost structure, the loan book, management, or anything else. As to whether it is WB selling - this is a pure guess, partially trying to think of the "wort case scenario. As JRM mentioned the 13F filed in Feb shows 323.2MM WFC shares help by Berkshire which is a reduction of 15%. Combine that with the excessive selling in the past month or so (compared to other banks) , and combined with WB's comments at the AGM, this is my less-than-educated guess. Link to comment Share on other sites More sharing options...
valueinvestor Posted May 13, 2020 Share Posted May 13, 2020 SE, AER, TDG, PK, GSY, EVBG, COUP, XPEL Link to comment Share on other sites More sharing options...
alwaysdrawing Posted May 13, 2020 Share Posted May 13, 2020 Mephistopheles - this is exactly the questions I am asking myself. If his reason to sell is WFC-specific, what is it? He mentioned in an interview prior to the Annual mtg that he was still confident in the WFC brand. Now that is just the brand - it doesn't speak to the cost structure, the loan book, management, or anything else. As to whether it is WB selling - this is a pure guess, partially trying to think of the "wort case scenario. As JRM mentioned the 13F filed in Feb shows 323.2MM WFC shares help by Berkshire which is a reduction of 15%. Combine that with the excessive selling in the past month or so (compared to other banks) , and combined with WB's comments at the AGM, this is my less-than-educated guess. I have no idea if Uncle Warren is selling, however WFC seems likely to lose a lot of money in the short term, and the actual business seems impaired in at least the medium term. It wouldn't surprise me if WFC lost 75%+ of its value over the next 5 years. They have too many branches, cannot grow, and their business model (taking in 0 cost checking deposits and making safe loans) seems impaired by the current marketplace for loans over the short term, and the Fed crushing their profitability with 0 or negative rates. The fact is, with persistently high unemployment, the market for safe loans might be significantly smaller for years....that's not good for WFC. Note: I have no position in WFC long/short and no position via options. I have a small position in puts on other banks. I am not long any banks. Link to comment Share on other sites More sharing options...
LC Posted May 13, 2020 Share Posted May 13, 2020 alwaysdrawing - Thanks for the counterpoints. Link to comment Share on other sites More sharing options...
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