- Reading what other respected fund managers do is very important.
- Howard Marks has made a name for himself as a distressed debt investor and founder of alternative asset house Oaktree.
- His memos found here are always worth reading for their commentary on market cycles and economics.
- Most importantly they are a great source of common sense in financial markets.
- The latest memo (from July) is a perfect example of this – how to understand the Fed’s actions in the current environment.
Author: Snippet.Finance
Market Currents
- Seeking Alpha has an excellent page called Market Currents.
- It is a feed of all the news going on in the US market with several bullet points on each news item.
The Bloomberg Keyboard
- The astute observer will notice that our logo resembles the buttons on a Bloomberg Keyboard.
- Here is a fun look back at the history of the Bloomberg Keyboard.
- https://www.bloomberg.com/professional/blog/look-back-bloomberg-keyboard/
Altice Disrupting
- Altice are being very aggressive in the US mobile market.
- Their new plan prices at $20/month for life unlimited everything (incl roaming and calls to 35 countries) for their existing cable customers and $30 month otherwise (for those near their 21-state footprint).
- This is roughly half the cost of rivals.
- You bring your own phone or buy one with 36 month zero financing.
- US Mobile is very high margin for the incumbents AT&T and Verizon …
Amazon Fires
- Scepticism is a huge part of investing.
- T.H. Huxley said – “I am too much of a sceptic to deny the possibility of anything” (h/t The Browser – more on this site later).
- The Amazon Fires probably caught your attention recently. We don’t mean to stir controversy and the attention is well deserved but …
- Did you stop and question some of the claims in the press you read?
- These two sources did. Here and Here.
- Yes there was a large increase in fires vs. last year but it is only 7% more fires than the average … always check the comparison!
- Lungs of the planet? – the Amazon is a huge producer of oxygen but also a huge consumer. Overall it is closer to balanced!
China
- Some of the most insightful writing on China is done by Michael Pettis (@michaelxpettis)
- The financial press often gets key economic concepts, like imbalances, wrong (for example the idea that every deficit has to have a surplus).
- Pettis writing illuminates these topics which are vital to understand the Chinese economy and what is going on in the world.
- For example the latest piece on US-China Trade war is a must read.
Short Positions
- The FCA requires that any short position >0.5% be disclosed.
- You can find a spreadsheet on FCA website with all these positions – by stocks and by disclosing fund manager. Updated daily.
- You can then easily make a pivot table to see top shorted stocks etc.
- Kier, Thomas Cook and the AA are in the top.
US Manufacturing ISM
- US Institute of Supply Management (ISM) dips below 50.
- First time since 2016.
- It suggests a manufacturing contraction. Not to be confused with a full recession (see 2016 dip).
- New Export Orders, not surprisingly, was the biggest loser among the sub-indices.
- Always interesting to give the full report a glance.
UK Election Opinion Polls
- Many in the financial profession, especially those on the buy-side, will know that keeping up with reading is both vital and overwhelming.
- One app that is fantastic is Pocket.
- No time to read the interesting articles (posted on Snippet)? No problem. Just click the pocket button at the top of your browser to save it for later.
- You can then see all your articles in the app, and they all get downloaded to be read offline (like in the tube on the way home).
- It is very easy to use – you can then archive read articles, it gives you an estimate of how long each one takes to read etc.
- No more lost gems!
Supreme
- Long read from GQ on history of the brand
- Some good lessons on how to build a successful brand
Graham & Doddsville
- Columbia Business School publishes an interesting newsletter interviewing various fund managers mainly pitching stocks
- The link the latest one is here
- This issue pitches long Dollarama, Align Technology, Carsales.com and Dean Food Bonds
Burry Long Gamestop
- Dr. Micahel Burry of Big Short fame is long Gamestop.
- Nearly 60% of the stock is out on loan to shorts. Often this is a great set up for going long a stock if you believe things won’t be that bad.
- He has written a letter to the board advocating a buyback in the face of short sellers. You can find it on this Market Folly link. There is also an interesting interview in Barrons with the man himself on the thesis.
- NB Market Folly is a great site that tracks what big names in the US Hedge Fund world are up to.
IAC Shareholder Letter
- If you don’t already, IAC’s Quarterly Shareholder Letter is a must read.
- IAC is the holding company for Barry Diller.
- Since 1995 the company shares have outperformed the S&P by 1.6x; and 4x in the last 3 years.
- In that time they created and spun-off several public companies – Expedia, TripAdvisor, Match Group (owner of Tinder), ANGI Homeservices. The latter two IAC still holds >80% stakes in.
- They continue to build and invest in new business like Vimeo (Online Video), DotDash (online publishing), Blue Crew (online recruitment) and the latest Turo (car sharing). In other words at the tech forefront.
- The latest letter is here and each quarter you can find them here.
UK Economy at a Glance
- A very useful dashboard from the FT on the state of the UK Economy
- https://ig.ft.com/sites/numbers/economies/uk/
UK PMI
- The UK is looking very weak on the eve of Brexit, inventory re-stocking boost has run out
- IHS Markit/CIPS UK Manufacturing PMI Release hit 47.4 in August – the lowest level since 2012 (https://tinyurl.com/y5qrhe75)
- “The high levels of economic and political uncertainty pervasive across domestic and global markets continued to weigh heavily on the performance of UK manufacturing during August. Output volumes fell as intakes of new work contracted at the fastest pace for over seven years, while business optimism dropped to a series-record low.“
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Welcome to Snippet.Finance. We aim to bring you lots of interesting snippets from reading widely about the financial world aimed squarely at those already engaged with it. Topics will include stocks, macroeconomics and strategy. We also plan to add useful personal finance tips for those in the UK and eventually provide some useful excel based tools for a small nominal charge. Feel free to subscribe or follow us on Twitter and LinkedIn (links on the side). Our disclaimer is simple – in no shape or form shall any of the content be considered financial advice. We will credit all and every source with a direct link. Happy reading!