Old School Value Nugget Fest (August 29th Edition)
My kids went back to school this week, and my youngest started kindergarten. It’s bittersweet because it marks the end of the summer and the passage of time, but it also means I get the time and space to focus and get back to big projects.
I enjoyed the slower summer, but I also really like getting to go deep on projects and problem-solving. Mentally, though, it’s not such an easy shift. The startup phase of new projects is harder for me to get into, and I feel pretty distracted still.
It’s times like these that I find starting my day with writing down the top few things I want to accomplish that day can really help. (Or, sometimes I’ll write them at the end of the previous day when I’m in a flow but need to put things down.)
Taking that time to evaluate priorities vs. the time chunks available for the day, plus breaking large work items down into smaller tasks, can really help me make forward progress. Maybe it’ll help you if you find yourself in a similar spot!
‘Big Short’ Investor Michael Burry Is Now Going Long on GameStop (Barrons)
“The streaming narrative dovetailing with the cycle is creating a perfect storm where things look terrible. [But] it looks worse than it really is.”
“All you have to do is sit there and wait until something is really attractive that you understand. And you can forget about everything else. That is a wonderful game to play in.”
Markets & Investing
Five Questions: Hidden Risks in Investing with Corey Hoffstein (Validea’s Guru Investor Blog)
“Given the high level of risk that is inherent in investing, it doesn’t make sense to take more risk than you have to. But many of us do. The reason is that we often take risks that we don’t even know we are taking.”
Contrarian Investing in Commodity Cyclicals (Verdad)
“We found first that markets price in the cyclicality, with these companies trading at low multiples at peak cycle and high multiples at cycle troughs. There is a strong inverse relationship (ranging from a -28% correlation to a -80% correlation) between EV/EBITDA multiples and industry economic data.”
Company & Strategy
Whole Foods CEO on plant-based meat boom: Good for the environment but not for your health (CNBC)
John Mackey on plants-based meats – “I don’t think eating highly processed foods is healthy. I think people thrive on eating whole foods. As for health, I will not endorse that, and that is about as big of criticism that I will do in public.”
Investing based on Armageddon is an oxymoron (The Reformed Broker)
“I’m investing based on the scenario where life goes on somewhat normally and the goods and services I will have to pay for gradually go up in cost each year or are replaced with new wants and needs we cannot now foresee.”
Podcast of the Week
Ian Cassel – Intelligent Fanatic, A Masterclass In Microcap Investing (The Acquirer’s Podcast)
MicroCapClub founder and friend of the OSV blog Ian Cassel chats to Tobias about his specialty. My best stocks this year have been microcaps, and I’m increasingly interested in the opportunities here.