Request for feedback; shorting conf videos & slides; Cooperman & Carreyrou podcasts; Jho Low; Brexit; location tracking; smartphone decline
1. Thank you to the many folks who replied to my last email with so much helpful feedback. If you haven't had a chance to do so, I'd be grateful!
I haven't nailed down all of the details yet, but it looks like I'll be launching a new investment newsletter venture in early 2019.
I and the folks working with me on this would love to include feedback from people who know me, have followed my work, been on this email list, attended my conferences, seminars/webinars, cocktail parties at the Berkshire meeting, etc.
If my emails, research, ideas, advice or events have benefited you in any way, I'd really appreciate a short reply to this email telling me how.
We're not primarily looking for testimonials (though we might want to use some for that – with your permission of course!), but rather looking for input as we think about what things I might do, products we might develop, content to include, etc.
I assume you signed up for and have remained on this email list – in a world in which we're all drowning in too many emails – because you perceive some value. What is it? What have you found most valuable among the things I do and/or write about? Replies to questions you've emailed me? Long stock ideas? Short ideas? Exposing bubbles (bitcoin, cannabis, 3D printing)? A good general article curation service? My crusades about scammy companies and industries? Stuff about Buffett and Munger? Occasional political views? Life lessons? Personal stuff like mountain climbing and World's Toughest Mudder?
I'd love to hear your thoughts, thank you!!!
2. Five speakers from our shorting conference last week have given us permission to share their slides and videos – enjoy!
- Aphria (APHA) short presentation by Gabriel Grego of Quintessential Capital Management; video here and slides here
- "ActivisM Short Selling: Purely Moral Short Theses" by Carson Block of Muddy Waters; video here and slides here
3. Daniel Shvartsman of Seeking Alpha covered the shorting conference and posted an article and podcast about it here. Excerpt:
Topics covered:
- Intro to Kase conference – 0:00 minute mark
- Favorite ideas Aphria and Michael's – 4:15
- Other stand-outs – Axon, CarGurus, Ideal Bike, CarGurus – 11:00
- Is the market turning? – 21:15
- Favorite presentations, as far as the actual approach – the David Berman thesis – 24:15
- Carson Block's presentation on activism in short selling – 34:30
- Takeaways from the conference as a whole – the community, and the limited number of new pitches – 48:00
4. Speaking of podcasts, I really enjoyed these two from Barry Ritholtz's Masters in Business series:
- Leon Cooperman, one of the all-time greats, on Finding the Overlooked Investment
- John Carreyrou on Breaking Open the Theranos Scandal (his book, Bad Blood: Secrets and Lies in the Silicon Valley Startup, is the best business book of the year in my opinion)
5. Another great business book is Billion Dollar Whale: The Man Who Fooled Wall Street, Hollywood, and the World, about Jho Low and the 1MDB scandal, which has engulfed Goldman Sachs (rightly so). Here's a WSJ article about authorities' attempts to recover what Low bought with his stolen funds: A Yacht, a Monet, a See-Through Piano: The U.S. Collects on a Fugitive's Shopping Spree. Excerpt:
The van Gogh and the Monet are safely in storage in Switzerland. The Oscar that once belonged to Marlon Brando is in a federal warehouse in Texas. Those were easy enough to corral.
But when the $250 million yacht was finally captured in Bali, the United States government couldn't let it bob in the water unattended, so it had to pay for a crew. The $35 million Bombardier jet has been grounded, but it needed an engine test costing up to $25,000.
And no one is quite sure what to do with the see-through grand piano now sitting in a supermodel's Malibu home. It won't fit through the door.
All of the items, and many more, had been bought by a flamboyant Malaysian financier named Jho Low, who prosecutors say helped siphon billions of dollars from a Malaysian government investment fund, then went on a colossal spending spree. It is one of the largest international kleptocracy cases the United States has ever pursued.
It is so expansive that just tracking down, retrieving and maintaining the loot has become a complex multinational operation in itself.
6. It's looking more and more likely that my long-held view that Brexit isn't going to happen will come to pass. Here's The Economist, calling for a re-vote: The best way out of the Brexit mess. Excerpt:
It is true that a second referendum would cause lasting anger and undermine faith in politics. But so would pushing through a deal in the name of the people amid evidence that the people were unconvinced.
Brexit is often likened to a divorce. In fact the two years since the referendum have been more like a rocky engagement. Voters were swept off their feet by the promises of the Leave campaign, only to discover that the future relationship was not going to be as they had imagined. Calling it off would be mortifying. Yet seeing it through could be a serious, permanent mistake. If the British are determined to plough on, that is their right. But now that they know what Brexit really means, they deserve the chance to say whether they still want it.
7. This is really creepy, a total invasion of privacy, and should be banned: Your Apps Know Where You Were Last Night, and They're Not Keeping It Secret. Excerpt:
At least 75 companies receive anonymous, precise location data from apps whose users enable location services to get local news and weather or other information, The Times found. Several of those businesses claim to track up to 200 million mobile devices in the United States — about half those in use last year. The database reviewed by The Times — a sample of information gathered in 2017 and held by one company — reveals people's travels in startling detail, accurate to within a few yards and in some cases updated more than 14,000 times a day.
These companies sell, use or analyze the data to cater to advertisers, retail outlets and even hedge funds seeking insights into consumer behavior. It's a hot market, with sales of location-targeted advertising reaching an estimated $21 billion this year. IBM has gotten into the industry, with its purchase of the Weather Channel's apps. The social network Foursquare remade itself as a location marketing company. Prominent investors in location start-ups include Goldman Sachs and Peter Thiel, the PayPal co-founder.
Businesses say their interest is in the patterns, not the identities, that the data reveals about consumers. They note that the information apps collect is tied not to someone's name or phone number but to a unique ID. But those with access to the raw data — including employees or clients — could still identify a person without consent. They could follow someone they knew, by pinpointing a phone that regularly spent time at that person's home address. Or, working in reverse, they could attach a name to an anonymous dot, by seeing where the device spent nights and using public records to figure out who lived there.
8. An insightful article: We're No Longer in Smartphone Plateau. We're in the Smartphone Decline. Excerpt:
Smartphone growth began to slow starting in 2013 or 2014. In 2016, it was suddenly in the single digits, and in 2017 global smartphone shipments, for the first time, actually declined — fewer smartphones were sold than in 2017 than in 2016.
Every smartphone manufacturer is now facing a world where, at best, they can hope for single-digit growth in smartphone sales — and many seem to be preparing for a world where they face declines.
... We're already fairly far along this plateau — from 2015 to 2017, global smartphone shipments have held firm at about 1.4 billion per year — but talking to analysts and reading the tea leaves of what the major manufacturers are doing, it's looking like we're reaching the end. Not because sales are picking up again, but because we're heading toward the downslope. "I think we're well over the plateau," says Ben Stanton, senior analyst at Canalys. "We'll see little pockets of growth in the global market, but on the whole it's a declining picture."
... Some manufacturers and analysts may hope that flat sales in the developed world could be offset by strong sales in other markets. Fat chance. The markets where smartphone saturation hasn't set in yet — such as India, Southeast Asia, pockets of Latin America, and Africa — are different than the markets that fueled the first decade of smartphone growth. "In those markets, there are extremely competitive devices down near the equivalent of $200," says Stanton. "It's becoming a real battlefield, but it's a low-margin business and consumers down at the those price points tend to be not very brand-centric. That really plays into hands of a few really hyperaggressive brands of smartphones, most of which are coming from China."