So much for that economic forecast

[Goose]

82

I also took away from the Buffett meeting that he and Munger felt that speculation inflated the market over the past couple of years. His comments on giving guidance were also interested, IMO. I watched 90% of the event and did not come away feeling we are in a robust economic cycle. I very much enjoyed watching the meeting and hope the old guys are back next year.

[dgies9156]

Bought a place in FL on the ocean less than three years ago. Paid about 5-8% more than I wanted to then, it is now valued at 60% higher than what I paid. It’s absolutely insane.

Tried to buy another place in the same city (single family home) sold in basically a weekend, over asking, for cash. These are not small numbers either, lots of New Yorkers coming down and buying up properties.

No kidding. We just sold our place in Vero Beach that we bought in 2014. 125% price increase in eight years. Most of the appreciation came in the past 18 months.

We bought our new place nearby. Good news was we made good money. Bad news was what we paid for the new one.

[muwarrior69]

He's suggesting the FBI tried to assassinate a governor and ran Jan. 6 as a false flag operation ... and your instinct is to defend him with a rambling, nonsensical whataboutism that might even make rocket blush.
Well done, sir.

I am not suggesting anything at all. The FBI has track a record of doing this sort of thing. It was clear to the jury that the FBI instigated the Whitmer assassination attempt. Fifteen years ago they entrapped a group of middle eastern men in an attempt to bomb Fort Dix. When the authorities encourage people to act on their ill founded instincts we should all agree we have a problem.

https://theintercept.com/2015/06/25/fort-dix-five-terror-plot-the-real-story/

[The Hippie Satan of Hyperbole]

I am not suggesting anything at all. The FBI has track a record of doing this sort of thing. It was clear to the jury that the FBI instigated the Whitmer assassination attempt. Fifteen years ago they entrapped a group of middle eastern men in an attempt to bomb Fort Dix. When the authorities encourage people to act on their ill founded instincts we should all agree we have a problem.

https://theintercept.com/2015/06/25/fort-dix-five-terror-plot-the-real-story/

You claimed that the FBI "tried to assassinate Gretchen Whitmer."  That is NOT what the jury ruled.  They ruled that they entrapped the defendants in an attempt to make a conspiracy charge.  You can't understand that difference?

[MU82]

82

I also took away from the Buffett meeting that he and Munger felt that speculation inflated the market over the past couple of years. His comments on giving guidance were also interested, IMO. I watched 90% of the event and did not come away feeling we are in a robust economic cycle. I very much enjoyed watching the meeting and hope the old guys are back next year.

I'd agree with that after also having watched it. But I'd also say they did not come close to presenting a hair-on-fire view that the economy's doomed.

More than what they said was what they did -- put $51B of new money into the market, something they historically have not done lightly.

I am NOT claiming that the economy is swell, nor am I claiming Buffett/Munger believe it's swell. There are issues. There are always issues. Over time, however, the U.S. economy grows, and the stock market advances, right?

[Goose]

82


I am a big Buffett and Munger guy and always believe that you should not bet against America. I do not think it was doom or gloom either, but it sounded to me that they are well prepared for the next potential crisis, regardless of what causes it or when it happens. That said, he spent a fair amount of time talking about the last two financial crisis and mentioned the gambling mania of the market quite a bit. I took that he might believe the crazy run up during the pandemic might not be a good thing and it our reached the earnings of many companies.

[MU82]

82


I am a big Buffett and Munger guy and always believe that you should not bet against America. I do not think it was doom or gloom either, but it sounded to me that they are well prepared for the next potential crisis, regardless of what causes it or when it happens. That said, he spent a fair amount of time talking about the last two financial crisis and mentioned the gambling mania of the market quite a bit. I took that he might believe the crazy run up during the pandemic might not be a good thing and it our reached the earnings of many companies.

We agree again, Goose.

He also reacted to the crazy run-up by buying $51B in stocks.

[Goose]

82

Pretty sure that those three purchases were not part of the gambling mania stocks he was referring to. They normally are hard on Wall Street and banks, but this time it seemed to be more of a warning than a scolding to me.

[MU82]

82

Pretty sure that those three purchases were not part of the gambling mania stocks he was referring to. They normally are hard on Wall Street and banks, but this time it seemed to be more of a warning than a scolding to me.

One could argue ATVI was a pretty speculative buy, but I get what you're saying.

Personally, I'm looking for opportunities in companies I'd like to own (or own more of) that were too expensive, but I'm certainly not going crazy. Capital preservation matters to me.

Interesting times, Goose!

[PBRme]

82


I am a big Buffett and Munger guy and always believe that you should not bet against America. I do not think it was doom or gloom either, but it sounded to me that they are well prepared for the next potential crisis, regardless of what causes it or when it happens. That said, he spent a fair amount of time talking about the last two financial crisis and mentioned the gambling mania of the market quite a bit. I took that he might believe the crazy run up during the pandemic might not be a good thing and it our reached the earnings of many companies.

https://www.msn.com/en-us/money/news/china-offers-so-much-better-companies-at-so-much-lower-prices-charlie-munger/ar-AAWOvC1?ocid=uxbndlbing

Munger says China companies better run than US

[JWags85]

https://www.msn.com/en-us/money/news/china-offers-so-much-better-companies-at-so-much-lower-prices-charlie-munger/ar-AAWOvC1?ocid=uxbndlbing

Munger says China companies better run than US

That sounds like Munger trying to talk up his book, otherwise he's delusional.

Better opportunities to get good companies at a discount?  Sure.  Tied to the inherent risk on government intervention and accounting irregularities, as well as market risk.  But "much better" companies?

Stick to making old man yelling at cloud comments about crypto and dumb soundbytes on gold.

[rocket surgeon]

Well, quite a few of us Boomers don't think it was good clean fun to stage a deadly coup attempt against the U.S. government; we actually care about the planet; we don't blame the deep state, antifa and CRT for all of America's ills; we don't think every man woman and child needs 2 dozen guns; we believe in science; we don't believe in stealing reproductive rights from women; we believe racism continues to be a scourge in this country; etc.

So it's not all that productive to generalize.

But I do absolutely wish more of y'all Millennials, Gen-Zers and the like would nominate and elect more good leaders. America, and the world, could use 'em.

  did raychel get her show back yet?  i'm trying not to envision 82 with a short dark bob and a lisp...trying real hard

[ZiggysFryBoy]

  did raychel get her show back yet?  i'm trying not to envision 82 with a short dark bob and a lisp...trying real hard

Madcow has a bigger adams apple than the majority of us.

[Mutaman]

Madcow has a bigger adams apple than the majority of us.

Ziggy is always such a class act.

[TSmith34, Inc.]

I am saying that AMZN and NFLX are in the same boat post-COVID. Consider that their year ago comparison was as the Delta variant was reeking havoc across the U.S. People were staying home and hunkering down, at least in comparison to 1Q22.

Now, people are out, spending directly rather than ordering through Amazon to the same degree. Travel has skyrocketed, as have hotels, rentals, etc. People are spending less from their couches, and top line price increases are not going to make up for the volume decreases.

I think AMZN will have an easier recovery once their YoY comparisons normalize. Supply chain will still be an issue, but I believe they can continue to other segments until that works itself out. NFLX I think will have a bit more difficult road due to the level of capital that has flocked to streaming. It's really difficult to create content at a price consumers are willing to pay given how many streaming options they have out there. I'm still tempted to buy some NFLX here as I think in the long run they will be fine as the clear leader, but I would guess some of these streaming services are in for a world of hurt.

To build on the above, this from the Yahoo Finance morning letter:

"Let’s break these down. Earlier on during the pandemic, consumers stuck at home had shifted spending toward goods, and away from in-person activities like traveling, dining out or seeing movies or sporting events that could have exposed them to a potentially lethal virus.

‌But now, the pendulum has swung in the other direction, and Americans are finally going out again. And with inflation running at multi-decade highs and cutting into consumers’ disposable income, that increase in services spending has come, in many cases, at the expense of purchases on goods.

The latest batch of economic data underscores this phenomenon. March's retail sales report from the Commerce Department showed consumers were pulling back on buying big-ticket items, with motor vehicle and parts dealer sales down by 1.2% on a year-over-year basis (and by 1.9% on a monthly basis), and electronic and appliance store sales down 9.7% year-over-year. By contrast, bar and restaurant sales were up 19.4% compared to March 2021.

U.S. manufacturers have also begun to show signs of slowing growth. The Institute for Supply Management’s manufacturing index fell to the lowest level since September 2020 in April, reaching 55.4.

‌The second trend reversal is related: Many tech companies, like goods-producers, had seen a significant pull-forward in demand during the height of the pandemic that’s now rapidly turning around.

‌
The past two weeks’ worth of tech earnings have been a clear — and for many investors, painful — reflection of these trends. And the fear for investors has been that the surge in demand seen during the pandemic was not, in fact, the kick-starter of sustainable growth, but was instead a temporary spike in business that cannibalized future growth.

Case in point: Netflix (NFLX) suffered its first subscriber loss in more than a decade in the first quarter of this year, shedding 200,000 users after adding as many as 15.8 million in a single quarter in early 2020. It also guided toward a drop of another 2 million users in the current quarter this year.

Even Amazon (AMZN) was not immune to this reversal, posting its slowest revenue growth since 2001 in its latest quarter as sales increased just 7% over last year. Online store net sales — one of the business segments that had most benefited from pandemic-era online shopping — fell 3.3%, in the largest decline since Amazon first broke out sales for the unit in 2016."

[MU82]

To build on the above, this from the Yahoo Finance morning letter:

"Let’s break these down. Earlier on during the pandemic, consumers stuck at home had shifted spending toward goods, and away from in-person activities like traveling, dining out or seeing movies or sporting events that could have exposed them to a potentially lethal virus.

‌But now, the pendulum has swung in the other direction, and Americans are finally going out again. And with inflation running at multi-decade highs and cutting into consumers’ disposable income, that increase in services spending has come, in many cases, at the expense of purchases on goods.

The latest batch of economic data underscores this phenomenon. March's retail sales report from the Commerce Department showed consumers were pulling back on buying big-ticket items, with motor vehicle and parts dealer sales down by 1.2% on a year-over-year basis (and by 1.9% on a monthly basis), and electronic and appliance store sales down 9.7% year-over-year. By contrast, bar and restaurant sales were up 19.4% compared to March 2021.

U.S. manufacturers have also begun to show signs of slowing growth. The Institute for Supply Management’s manufacturing index fell to the lowest level since September 2020 in April, reaching 55.4.

‌The second trend reversal is related: Many tech companies, like goods-producers, had seen a significant pull-forward in demand during the height of the pandemic that’s now rapidly turning around.

‌
The past two weeks’ worth of tech earnings have been a clear — and for many investors, painful — reflection of these trends. And the fear for investors has been that the surge in demand seen during the pandemic was not, in fact, the kick-starter of sustainable growth, but was instead a temporary spike in business that cannibalized future growth.

Case in point: Netflix (NFLX) suffered its first subscriber loss in more than a decade in the first quarter of this year, shedding 200,000 users after adding as many as 15.8 million in a single quarter in early 2020. It also guided toward a drop of another 2 million users in the current quarter this year.

Even Amazon (AMZN) was not immune to this reversal, posting its slowest revenue growth since 2001 in its latest quarter as sales increased just 7% over last year. Online store net sales — one of the business segments that had most benefited from pandemic-era online shopping — fell 3.3%, in the largest decline since Amazon first broke out sales for the unit in 2016."

Yep, makes sense. When these companies report, the figures they are comparing are year-over-year for that quarter - Q1 2022 vs Q1 2021. And they were setting records for revenue and profit in Q1 2021 because of the pandemic. For some, it's impossible to show growth.

And not just tech companies. For example, Clorox stock was a huge winner in the first 6-9 months of the pandemic but it's bombed since.

[TSmith34, Inc.]

I am moving this to get it out of the recruiting thread:

Did I call Pakuni a liar or simple minded after his post? Of course not.

Here’s an up to date article on a study that gives overall rankings on how the states fared during the pandemic.

https://www.wsj.com/articles/states-of-covid-performance-economic-schools-study-working-paper-lockdowns-11649621806

Holy crap, you are actually using as a source Stephen Moore and The Committee to Unleash Prosperity???!?!!  LMAO.

[MU Fan in Connecticut]

FWIW, I just did my beginning of the month price updates for customers based on the previous months international traded metal commodities prices and there was 10% decrease in price on everything except nickel.  Last day of April prices were still trending down too.   It means decrease in costs to make things.   

[Goose]

MU Fan

That is good news. Do you see that trend continuing?

[Pakuni]

I am moving this to get it out of the recruiting thread:

Holy crap, you are actually using as a source Stephen Moore and The Committee to Unleash Prosperity???!?!!  LMAO.

If one were to take the time to read this working paper (note: even the authors don't call it a study), one might find that the benchmarks were chosen to get a specific result.
For example, a third of their "grade" is based on how well they believe states did with education. And how well states did with education isn't based on things like test scores or graduation rates, but only how much in-person learning took place.
But if you take out the education component, Florida did not, as Lenny claims, fare especially well, even according to this working paper he cites. The working paper places Florida 13th in overall economic performance and 28th in mortality.

https://www.nber.org/system/files/working_papers/w29928/w29928.pdf

[MU Fan in Connecticut]

MU Fan

That is good news. Do you see that trend continuing?

Goose,
Yes I do.
I have the April summary Excel sheet from the LME (London Metals Exchange).  I'll PDF a few pages later when I have a chance so you can see the trends on a few metals.

[Goose]

MU Fan

Thanks. I also sent you a PM with my email address. Would love to keep in touch on this topic without boring the fellow scoopers.

[MU82]

FWIW, I just did my beginning of the month price updates for customers based on the previous months international traded metal commodities prices and there was 10% decrease in price on everything except nickel.  Last day of April prices were still trending down too.   It means decrease in costs to make things.

That's both super-interesting and hopeful. Thanks for posting.

[TSmith34, Inc.]

If one were to take the time to read this working paper (note: even the authors don't call it a study), one might find that the benchmarks were chosen to get a specific result.
For example, a third of their "grade" is based on how well they believe states did with education. And how well states did with education isn't based on things like test scores or graduation rates, but only how much in-person learning took place.
But if you take out the education component, Florida did not, as Lenny claims, fare especially well, even according to this working paper he cites. The working paper places Florida 13th in overall economic performance and 28th in mortality.

https://www.nber.org/system/files/working_papers/w29928/w29928.pdf

Exactly, and they use "adjusted unemployment" and "adjusted GDP" to fudge by industry rather than the actual numbers.

But Stephen Moore is a great economist if 1) You always want to be wrong, and 2) you want someone to justify any crazy policy you want to propose.

The fact that Lenny proposed this as a reliable source is just another case of eagerly swallowing whatever one wants to hear without any critical thinking.

[Uncle Rico]

Goose,
Yes I do.
I have the April summary Excel sheet from the LME (London Metals Exchange).  I'll PDF a few pages later when I have a chance so you can see the trends on a few metals.

I think these updates are informative, too