Stocks

[Pimpin]

Everytime i think elon has lost his plot, after a few week that talk subsides and we get something new in our hands. This guy called a cave diver a pedophile, lied about funding to take firm private, and now straight up said the firm is overvalued. At what point does he go too far? He has cult following, like trump said for himself, he could kill a man and people would still follow him.

It is very comforting to know that Buffet himself stayed on the sidelines during the market dip. I won't bet against the fed, but honestly people that were buying low got really lucky. The companies will be even more leveraged, even more struggling, and at certain point fed will stop bailing them out.

 

[Pimpin]

Buffet said the D word, Monday could be a bloodbath

- - - Updated - - -

he is so bearish, thank God, for a moment i was feeling so stupid during the rally

- - - Updated - - -

airlines will be absolutely hammered

 

[Adriano@10]

Buffet said the D word, Monday could be a bloodbath

- - - Updated - - -

he is so bearish, thank God, for a moment i was feeling so stupid during the rally

- - - Updated - - -

airlines will be absolutely hammered

HAAHA same man i was a bit scared though when he started out talking about the great depression. Imho easily the most bearish i ve ever heard him.

Gonna be intresting to see whats the markets takeaway from all this but yeah airlines will probably take another big fucken dip.


BTW have you guys seen the rules on casinos? I m starting to wonder wether that push to reopen is actually good for business, reading the restrictions on casinos: max 4 per poker table, max 3 per black jack and so on with pool and clubs closed i just dont see how the fuck are they not gonna loose more money being open ike this than being closed.

There s also reports coming in from georgia restaurant owners saying they re loosing more money now being open cause customers are somply not willing to come out yet.

Not sure we re doing the owners of these establishments a favour by letting them open early, might as well be the nail in their coffin as they wont get any assistance any more and they wont be able to run their business like this for long if customers dont return.

 

[brehme1989]

It's not viable to reopen most shops and industries yet. There will definitely be more cost than revenue but at least the business owners can get some needed cash and perhaps some liqudity from credit, but that will probably force even more bankruptcies than we'd have. It feels inevitable.

People are bored and afraid at the same time so they want to return to what they know and also want to be able to afford their dues. We've definitely not seen the light at the end of the tunnel here.

 

[Adriano@10]

Thats exactly my point brehme but competition will most likely lead to em opening as soon as they are allowed to even though it s not a smart financial decision.

Also good sunday read on the history of speculative bubbles: https://investoramnesia.com/2020/05/02/speculative-booms/

 

[brehme1989]

Where do you find these links?

I get Financial Times, CNBC, Bloomberg etc. Then others such as Seeking Alpha and that sort. But I see some "random" ones that have some great stuff, just curious as I'd like to check them out as well.

 

[Adriano@10]

Where do you find these links?

I get Financial Times, CNBC, Bloomberg etc. Then others such as Seeking Alpha and that sort. But I see some "random" ones that have some great stuff, just curious as I'd like to check them out as well.

Mostly from some fin_twitter accounts or the teslaq community theres some pretty smart people on there... also some bs but compared to the average twitter community there s a lot of quality imho.

There s always a couple of interesting links on there that you dont find on FT/wsj/bloomberg.
The muddywaters research on lukin which turned out to be true i found there like 6 months before it became public sadly i did not believe em back then.
adventuresincapitalism.com is also a blog i found through twitter i dont always agree with Kuppy but the dude is very intelligent and it s worth listening.

 

[brehme1989]

Oh sure, I'm following several outlets not just the mainstream ones. But there's loads of them I've never seen before that look like quality and would be interested to know if there was a place where many of these are gathered.

I've found a lot through Twitter but I keep stumbling on more.

 

[Pimpin]

https://www.ft.com/content/b8639ab6-8936-11ea-9dcb-fe6871f4145a

this was a good weekend read

 

[Adriano@10]

https://www.ft.com/content/b8639ab6-8936-11ea-9dcb-fe6871f4145a

this was a good weekend read

Good but also scary.......like most FT articles these times.

Also are we at the end of the dead cat bounce? Asia is painting a very grimm picture atm Markets way down indian pmi shockingly low and Hk gdp with a contraction of 8.9% yoy.... Gonna be a fun month..

Us futures accordingly down 1.2% gonna keep on playing the waiting game atleast for this week i ll probably add a short or two here and there but as long as that idiot in charge of the US threatens another trade war with China and refuses to give additional stimulus if there s no tax cuts, i dont see to much positives in the Us.
Also as i ve said before this crisis is not simply solved by injecting liquidity to the markets and we have yet to see round 2 and 3 of this game. With rent due today in most of the US round 2 is just about to start and with reports of around 30% not paying or not being able to play and no regulation in place one has to wonder whats gonna happen to the Housing market in the us both commercial and residential have a huge problem.
Thinking of all the REITS that got hyped these last couple of years, would not wanna own any of these atm.

EDIT: Goldman downgrading chevron to buy and upgrading conoco to conviction buy

Edit2: My tanker bet is starting to pay off: https://www.wsj.com/articles/oils-crash-prompts-record-push-to-store-fuel-at-sea-11588510803

EDIT3: El Erian was on cnbc with becky quick good interview dude has been on point since the start of this shit show.

Edit3: Adam Jonas of MS just upgraded tesla man oh man way to loose the little reputation you had left. Saying that once this pases tesla will be the most profitable OEM (behind ferrari) and the fastest growing. WTF are those people smoking?
The company that never made a yearly profit in it s existence is gonna emerge from a recession as the most profitable of em all. Who ever gave him his finance/econ diploma should take it away.

Reading those analysts and cathie woods take on Tesla makes me wonder whether there is another field of finance and business where they teach the opposite of what i learned at the universities i was at.

i know it should not but seeing them leading retail to the slaughterhouse makes me fucken angry.


Edit4: In case you guys are bored here s FAQ on the NYFed Credit facility: https://www.newyorkfed.org/markets/primary-and-secondary-market-faq/corporate-credit-facility-faq

A bit boring read but good to know, especially if your invested in lower credit companies.

 

[Pimpin]

https://www.ft.com/content/53cb3f6a-895d-11ea-a109-483c62d17528

the first part of this article infuriated me so badly

" So today, governments sell bonds to protect something more valuable than gold: a well-guarded secret about the true nature of their fiscal capacities, which, if widely understood, might lead to calls for “overt monetary financing” to pay for public goods. By selling bonds, they maintain the illusion of being financially constrained.

In truth, currency-issuing governments can safely spend without borrowing. The debt overhang that many are worried about can be avoided. That is not to say that there is anything wrong with offering people an interest-bearing alternative to government currency. Bonds are a gift to investors, not a sign of dependency on them. The question we should be debating, then, is how much “interest income” should governments be paying out, and to whom?"

- - - Updated - - -

my guy is solid gold

 

[Pimpin]

https://www.ft.com/content/b3817772-ff39-42f5-af0e-4744fa07389b

another great article

 

[Adriano@10]

https://www.ft.com/content/53cb3f6a-895d-11ea-a109-483c62d17528

the first part of this article infuriated me so badly

" So today, governments sell bonds to protect something more valuable than gold: a well-guarded secret about the true nature of their fiscal capacities, which, if widely understood, might lead to calls for “overt monetary financing” to pay for public goods. By selling bonds, they maintain the illusion of being financially constrained.

In truth, currency-issuing governments can safely spend without borrowing. The debt overhang that many are worried about can be avoided. That is not to say that there is anything wrong with offering people an interest-bearing alternative to government currency. Bonds are a gift to investors, not a sign of dependency on them. The question we should be debating, then, is how much “interest income” should governments be paying out, and to whom?"

- - - Updated - - -

my guy is solid gold

LOL yeah i ve seen those arguments a lot lately like wtf? I still fear that all this money printing will eventually bite us in our ass.
Just because we did not see consequences when we did it in the GFC does not mean that it does not come at a cost.

Also with hertz and J crew being next in line for chapter 11 i m still amazed at what the market is doing. I mean those two wont be the last filing for bankruptcy and i d personally still expect a bigger name to go belly up on top of that you got United cutting 30% of it s management other big guys will follow and industries like Car manufacturing and flying are not gonna be profitable for a long time. As they wont be running at even 90% of capacity and thats what they need. On top of that most oil companies will be making losses as long as the oil price is below 50 so there will be more bankruptcies. I just dont see how spending of both housholds and businesses does not drop dramatically.

Also the crisis has not hit the housing market fully yet but i can guarantee you it will and it s gonna be ugly. That all being said i m gonna throw some 20% of my money back on the markets. Mainly cause it does not look like the market reacts to bad news, so i m gonna put some money in till before we get to Q2 and i ll probably pull it again once we get to Q2 results cause their gonna be a very ugly.

Also did you put money on the hertz thing? Oh and there are many more companies out there were the stock is trading at ridiculous heights when you compare it to where their outstanding debt trades and what the implied financing costs for that companie are.

Also with the us re opening when their cases are still rising and they just shot past Trumps goal of 60k deaths from covid, one might think that they ll see another big outbreak of which might very well lead to markets crash again.
I know no politics but the way they handle this is beyond me and i m honestly thinking of focusing on Europe and switzerland for the time being a valuations seem more reasonable and i m pretty sure will get the virus under control faster and better than the us.

Side note i wanted to re enter Pernod Ricard (RI) but wanted to check out the competition shortly before i re entered as their P/e is still pretty high. ABEV looks pretty damn attractive on a quick glance with a P/e of around 9 while the industry sits at 25, Anybody know what i m missing, so that i dont need to do the research my selfe?

 

[Pimpin]

LOL yeah i ve seen those arguments a lot lately like wtf? I still fear that all this money printing will eventually bite us in our ass.
Just because we did not see consequences when we did it in the GFC does not mean that it does not come at a cost.

Also with hertz and J crew being next in line for chapter 11 i m still amazed at what the market is doing. I mean those two wont be the last filing for bankruptcy and i d personally still expect a bigger name to go belly up on top of that you got United cutting 30% of it s management other big guys will follow and industries like Car manufacturing and flying are not gonna be profitable for a long time. As they wont be running at even 90% of capacity and thats what they need. On top of that most oil companies will be making losses as long as the oil price is below 50 so there will be more bankruptcies. I just dont see how spending of both housholds and businesses does not drop dramatically.

Also the crisis has not hit the housing market fully yet but i can guarantee you it will and it s gonna be ugly. That all being said i m gonna throw some 20% of my money back on the markets. Mainly cause it does not look like the market reacts to bad news, so i m gonna put some money in till before we get to Q2 and i ll probably pull it again once we get to Q2 results cause their gonna be a very ugly.

Also did you put money on the hertz thing? Oh and there are many more companies out there were the stock is trading at ridiculous heights when you compare it to where their outstanding debt trades and what the implied financing costs for that companie are.

Also with the us re opening when their cases are still rising and they just shot past Trumps goal of 60k deaths from covid, one might think that they ll see another big outbreak of which might very well lead to markets crash again.
I know no politics but the way they handle this is beyond me and i m honestly thinking of focusing on Europe and switzerland for the time being a valuations seem more reasonable and i m pretty sure will get the virus under control faster and better than the us.

Side note i wanted to re enter Pernod Ricard (RI) but wanted to check out the competition shortly before i re entered as their P/e is still pretty high. ABEV looks pretty damn attractive on a quick glance with a P/e of around 9 while the industry sits at 25, Anybody know what i m missing, so that i dont need to do the research my selfe?

ABEV is very highly leveraged, and in these circumstances that could be end game for many companies, that combiend with the threat of people drinking "hipster local" beers and with the corona closing down all bars, it could explain the low valuation. But i think it is mainly with their debt, i think at one point they were on brink of becoming a zombie.

I did not short hertz no, as Keynes said, the markets can stay irrational far longer than you can stay solvent . I closed all my shorts, greggs included (marginal profit but still not worth the stress).

this..

BREAKING: Norwegian Cruise Line said there is “substantial doubt” about its ability to continue as a “going concern” as the coronavirus pandemic wreaks havoc on the industry

its funny to see if the buyers on these companies balloon up on robinhood . What's your portfolio consisted of? oh just bear sterns, lehman brothers, I bought them at an all time low

- - - Updated - - -

I am thinking of getting into wells fargo, super long term. I think american banks are sole assets priced right, you can't have banks -50% and the rest of sectors 15-30%. You can't have -50% banks if the economy is ok..

 

[Adriano@10]

ABEV is very highly leveraged, and in these circumstances that could be end game for many companies, that combiend with the threat of people drinking "hipster local" beers and with the corona closing down all bars, it could explain the low valuation. But i think it is mainly with their debt, i think at one point they were on brink of becoming a zombie.

I did not short hertz no, as Keynes said, the markets can stay irrational far longer than you can stay solvent . I closed all my shorts, greggs included (marginal profit but still not worth the stress).

Yeah realized that went with heineken in the end... Nothing that i expect to much from...
Also valuations are crazy in that industry Boston Brewing company trades at 50 P/E......

this..



its funny to see if the buyers on these companies balloon up on robinhood . What's your portfolio consisted of? oh just bear sterns, lehman brothers, I bought them at an all time low

- - - Updated - - -

I am thinking of getting into wells fargo, super long term. I think american banks are sole assets priced right, you can't have banks -50% and the rest of sectors 15-30%. You can't have -50% banks if the economy is ok..

Man if those saudis would not have jumped in my CCL puts would have made me a ton of money.......
Robinhood dumping into RCL CCL and AAL is hilarious

Yeah US banks seem fair Valued my only fear is that their bad debt will balon even further in Q2, cant see them writing down their loss reserves in q2.

Also i m not ready to buy on the very long term i still think will get some bad news wether the virus comes back or someone nobody has on the radar yet files for ch 11.

Theres just so much high priced trash out there, which usually is not the case in the midst of a recession.

Side not my snap puts are fucked.... should have gone longer not sure if i should sell em and roll em over or hold on and short em again before Q2 if they are still at current prices.

 

[Adriano@10]

https://www.cnbc.com/2020/05/05/consumer-debt-hits-new-record-of-14point3-trillion.html

Record consumer debt, I wonder if record consumer debt + record unemployment= New all time highs for Nasdaq?

Also pins showed what i ve been fearing their ad rev dropped quite drastically in q1. Think FB and Google will also get to feel this their probably last in line in the ad space to take a hit.

Anybody got an opinion on gerneral dynamics?

Uk construction PMI: 8.2 estimates were at 21.7 !!!!!!!

 

[Pimpin]

everything is overpriced, except a few airlines that got battered.

I do not understand how car manufacturers dropped less than airlines. 1 they are leveraged as fuck, on other hand there are a few airlines that have solid balance sheets. 2 it will take years before consumer spending picks up to the point of people being like ok fuck it, i need a new car. On the other hand, you stop the virus, and you tell me people wouldn't jump on 20 euro flights across europe to some shady eastern european city like immediately?

My point I guess is that take IAG, it has 9 bn in liquidity, and it still lost 70% of their pre-corona value. On other hand you ahve dog shit car companies like Ford who still trade only 45% lower than pre-corona.

- - - Updated - - -

Also I have a gut feeling that this oil squeeze is due to some country stockpiling on oil and in a few days/week there may be news on it, and oil will collapse further

- - - Updated - - -

BREAKING: China considers dropping a numerical GDP growth target for 2020 https://trib.al/5oRhTrn

this keeps getting better

 

[Adriano@10]

everything is overpriced, except a few airlines that got battered.

I do not understand how car manufacturers dropped less than airlines. 1 they are leveraged as fuck, on other hand there are a few airlines that have solid balance sheets. 2 it will take years before consumer spending picks up to the point of people being like ok fuck it, i need a new car. On the other hand, you stop the virus, and you tell me people wouldn't jump on 20 euro flights across europe to some shady eastern european city like immediately?

My point I guess is that take IAG, it has 9 bn in liquidity, and it still lost 70% of their pre-corona value. On other hand you ahve dog shit car companies like Ford who still trade only 45% lower than pre-corona.

Fully agree only difference with the car companies is that their revenue did not completely dry up like the airlines.
Also while i agree that the young will probably take cheap flights without thinking twice i guess the over 50 crowd will think twice and i think a lot of business travels will be cut back anyways. Imho they both have the same problem of needing to run at capacity and to turn profits and many plans are gonna be grounded for some time just like most car factories wont produce at capacity.
And that stupid assumption of people as well as businesses just going to spend like pre crisis levels I dont understand anyway,

Also I have a gut feeling that this oil squeeze is due to some country stockpiling on oil and in a few days/week there may be news on it, and oil will collapse further

I fully agree or it s traders playing with volatility and then playing the game of chicken again once settlement comes close. The two friends i have in the industry dont get whats happening they tell me storage capacity if anything is less than a months ago from what they can tell.
There simply is no way that current supply does not still exceed consumption by quite a bit.

- - - Updated - - -

BREAKING: China considers dropping a numerical GDP growth target for 2020 https://trib.al/5oRhTrn

this keeps getting better

With everything that happened in china i dont even wanna get back into anything over there not even tencent that i really like.

Also i m currently looking at defense contractors mostly general dynamics but again debt levels and accounts receivable make me hold back plus their exposure to commercial aviation.

Also on the cars to much focus seems to be on q1 when q2 is gonna be a disaster i mean GM rallies 5 % on making a profit in Q1......
Airlines already felt a bigger hit in Q1 then the car industry might also be a reason.

Another example of the weirdness of the market raymond james just lowered pelotons 2021 Earnings but increased it s target price and effectively it s p/e...

 

[Pimpin]

@ adriano check bunge

 

[Pimpin]

I have a friend who works in this industry and he told me about Bunge, did a bit of research and I liked everything that I was reading. It has a decent 5.8% div yield, solid balance sheet, and is in an industry where I do not have exposure and which seems to be a safe bet even in downturns (agriculture), I mean nothing is safe, but s&p is down 16% pre-corona and i got in at this at almost 40% down from pre-rona. Either I am losing my mind or there is something very wrong here, if rest of s&p is down only 16%, why tf is a company that is in Agriculture down 40%?

I understand the reasoning to some extent, its depression and all, but if this is down 40%, how low should brick and mortar coffee shops be? Or restaurants? Oreverything else minus tech and healthcare

update, china just posted fucking outlandish numbers in exports.


Trinh Nguyen
@Trinhnomics
China April exports rose +8.2%YoY in CNY vs estimate of a contraction!!!


Imports fell -14.2%YoY so that's bad news for the rest of Asia & world!!!