Mason Sexton's "map"; Hedge Fund Manager Chris Brown Is Coming Out – and Fighting Back; Legendary investor Seth Klarman on investing; Five objections to the new weight-loss drugs

June 29, 2023

1) Few are better at predicting big market turns than my old friend Mason Sexton.

The Chicago Tribune said Mason "called the 1987 stock market crash practically down to the minute."

He nailed Black Monday, the bottom of the '09 crisis, the pre-COVID crash, and the EXACT top of the market last year... which is why hedge funds pay him as much as $10,000 a month for his predictions.

But what he sees coming on July 12 is unlike anything he says he's ever seen before. Click here for more information. But don't delay, because this video is only available until tomorrow.

2) Speaking of people who are both old friends and great investors...

Michelle Celarier just published in Institutional Investor a powerful, in-depth article about Chris Brown of Aristides Capital, which is "the top long-biased equity hedge fund of its age (or older) based on risk-adjusted performance": Hedge Fund Manager Chris Brown Is Coming Out – and Fighting Back. Excerpt:

It was almost noon on a Thursday in mid-May, and Chris Brown found himself putting work aside to mull over a letter he was writing to the legislators in his home state of Ohio.

Brown wasn't alone; some 237 other Ohio residents were also taking to their laptops to fire off written testimony expressing their opposition to – and outrage about – a proposed bill that would ban gender-related medical treatment for minors in the state. The legislation is among about 650 anti-trans, anti-gay bills that have been circulating in mostly Republican-controlled statehouses throughout the country.

"I am writing to you today as a native Ohioan, an Air Force veteran who served seven years of active duty at Wright-Patterson Medical Center, and an MD," Brown's letter to the state representatives began.

"HB68 does not 'save adolescents,'" Brown wrote, referencing the legislation and its stated intent, "but rather it endangers their lives. The bill's reasoning is based not on medical science – all mainstream physicians, including the AMA, AAP, and Endocrine Society, support the standard, safe, effective stepwise approach to gender-affirming care for transgender and nonbinary youth."

Such care can include puberty blockers, cross-sex hormones, and – very rarely – surgery. Instead, Brown argued, the bill was "propagated... by a misguided subset of Christian fundamentalists."

Brown's letter went on to say that "being trans is not a delusion, nor is it a psychological malady" and that recent studies have shown that trans women's brains are "statistically significantly different" from those of people who identify as male from birth, known as cisgender.

What the letter didn't say is that 46-year-old Brown is a top-performing hedge fund manager whose firm, Aristides Capital, has had a 15% annualized return since its launch in 2008, earning it Barclayhedge's classification in 2022 as the top long-biased equity hedge fund of its age (or older) based on risk-adjusted performance. The performance is all the more stunning because Aristides has maintained a value orientation during a time when the strategy has been largely out of favor.

More to the point, following three years of treatments, the twice-married father of four has come out as trans/nonbinary.

3) Another old friend, investing legend Seth Klarman of hedge fund Baupost Group, made a rare public appearance Tuesday on CNBC's Squawk Box.

He was there to promote the release of the seventh edition of the investing classic, first published in 1934, Security Analysis: Principles and Technique, which Klarman edited (and Warren Buffett wrote the foreword):

I just downloaded the Audible version and can't wait to listen to it!

Here are two clips CNBC posted from the interview:

If you're a CNBC Pro subscriber, you can watch the entire interview here.

Lastly, here's a seven-tweet thread with the main takeaways. Excerpt:

4) Continuing my series on the miraculous new weight-loss drugs...

I've heard five main objections to these drugs:

They can cause severe bloating, gassiness, burping and diarrhea.

This is common among those taking Ozempic and Wegovy, but is much less common with Mounjaro, which is a major reason why all of my friends are on this drug (it also results in greater weight loss).

What about more serious side effects?

Anyone who takes any of these drugs should do so while being monitored by a doctor because there are indeed a number of serious, though rare, known side effects, which are listed on the Mounjaro website.

For example, one friend stopped taking Mounjaro after he read that one possible side effect is tumors, even cancer, of the thyroid.

But I Googled "does being overweight increase your risk of cancer?" and the first hit is the CDC saying "that being overweight or having obesity are linked with a higher risk of getting 13 types of cancer. These cancers make up 40% of all cancers diagnosed in the United States each year."
Every drug has a long list of potential side effects – just Google "ibuprofen side effects" or "aspirin side effects."

The vast majority of people who take Mounjaro have few or no side effects – and lose a lot of weight, which has huge long-term health benefits.

We don't know their long-term effects.

The oldest of the drugs, Ozempic, was approved for diabetes six years ago and, to my knowledge, those taking it have had no issues. And we do know the horrific long-term effects of being significantly overweight, so I think the risk-reward is heavily skewed toward taking the drugs.

They have to be taken for life (for most people, if they stop, the weight comes right back).

So what? Millions of people are on countless drugs for life. My dad, after developing A-fib last year and having two ablations, is on a drug for the rest of his life to control his A-fib. Ditto for the statin I just started taking to reduce my high cholesterol and the resulting plaque and calcium that's built up in my heart. And ditto for people taking drugs for diabetes, high blood pressure, coronary artery disease, asthma, kidney disease, depression, etc.

It's somehow cheating (I only hear this from skinny people, usually accompanied by an air of superiority).

Every study shows that almost nobody is able to lose a lot of weight and keep it off in the long run. It's just too hard to significantly and permanently modify exercise and, far more important, dietary habits.

One friend who lost 40-plus pounds in two months on Mounjaro and then stopped taking it because he bought into this "cheating" narrative. He wrote: "I decided it's time to stop taking the easy way out of not exercising. I just gotta exercise and not eat so much cake!" Sure enough, he quickly gained back every pound.

I think my friend (who's my age) is making a big mistake that markedly increases his chances of major health problems in coming decades and will likely shorten his life by 5-10 years.

For more on this, see this podcast: I Lost Weight on Ozempic. Here's What the Debate Gets Wrong. Why one doctor believes obesity should be treated like any disease – with medication.

I've just created a new personal e-mail list to which I'll send articles and commentary about these new drugs. To subscribe to it, simply send a blank e-mail to: weightlossdrugs-subscribe@mailer.kasecapital.com

Best regards,

Whitney

P.S. I welcome your feedback at WTDfeedback@empirefinancialresearch.com.