Value

  • Interesting long term chart of value and growth outperformance.
  • The development of share prices has long vindicated this theory: from 1926 to 2007, Value stocks recorded around 5% higher annual returns than Growth stocks. Over the last five years, Value stocks have underperformed Growth stocks by an average of nearly 6% per year.

Viruses & Bats

  • Fascinating article about why viruses, like the current Corona virus outbreak, tend to come from bats.
  • Why Bats? They are mammals, so sufficiently close to us, not domesticated, and live in huge flocks
  • Bracken Cave, in Texas, is home to roughly 20 million breeding Mexican free-tailed bats, similar to the (human) population of the Mexico City urban area. In places there are 500 bat pups per square foot on the wall. To a virus that represents a tasty buffet.

UK Housing

  • This is a chart that shows how, after a change in planning policy (NPPF) in the UK in 2012, the amount of land permitted for construction went up.
  • New building starts and completions on the other hand didn’t.
  • In other words house-builder hoarded the land and constrained supply.
  • On the other side help-to-buy continued to keep demand strong inflating prices.
  • Margins went up to 20%

Google Project X

  • Great article from Wired on Google X.
  • We are a creativity organisation, not a technology organisation.” 
  • The real test is 15 to 20 years from now, when the dust is settled and we look backwards. Then how are we doing?” Teller says. Until then, there will always be more crazy ideas worth chasing. “The world’s got more than enough problems, sadly.

Schrodinger

  • Citron Research, famed for short selling reports, are recommending long this stock – Schrodinger (SDRG).
  • They describe it as – “the most disruptive software platform to ever hit the pharmaceutical industry, which also happens to be backed by the world’s most sophisticated investors, has just gone public.
  • Looks interesting and is worth investigating. The shares are sadly ca. +100% since IPO already.
  • As always with investing – this is not a recommendation, do your own work, use common sense.

Labour vs. Profits

  • A great set of charts from Bridgewater Research.
  • The left hand shows how US company profit margins have trended up largely thanks to productivity gains outpacing real wage growth.
  • In other words profits rise because workers are getting paid a smaller share of the output they produce.
  • Part of this is due to wages being driven down globally by the emergence of China (right hand chart).
  • China has seen rising wages outpacing productivity growth and hence companies grabbing a smaller share.
WordPress Cookie Notice by Real Cookie Banner