Monday, July 9, 2018

July 9th Links

  • We've had two break even months. The first was by accident in October 2013 because we had an unexpected revenue spike. For a moment we felt what it would be like to completely control our own destiny. The second time was in February 2014, because low growth in December scared the living shit out of us and it didn't look like our Series A was going to come together. My cofounders and I cut our salaries when we hit 3 months of remaining runway. There was no way in hell we would lose the incredible team we had meticulously built over the past six months. [link]
  • Cowen is just virtue-signaling. He actually understands how things work and occasionally lets some of the knowledge out. But he is also comfortable and addicted to his parasitic life, so he needs to balance every hint of heresy with messages of clueless progressivism. [West Hunter]
  • I knew guys in Taiwan about 15 years ago who started biotech companies whose labs were also shockingly small. They are shockingly cheap too, and that's the key point about bioengineering. Once you figure out how the underlying molecular biology works, developing the bioengineering to do something about it is quite cheap, compared to building a semiconductor fab or doing space launch. What makes medicine expensive is all of the regulation combined with the intense bureaucracy and parasitism of the healthcare industry itself. [Hsu]
  • The American energy industry has long suggested a simpler solution for Mexican energy incompetence: let American firms take over Mexico's oil business. It's not widely recognized in the U.S. media that the Bush dynasty's fundamental strategic vision over the last half century has been to knock down the barriers keeping American business out of Mexico in return for lowering the barriers keeping Mexican people out of America. (It's not a coincidence that two President Bushes' oil firms were named Zapata and Arbusto.) [Sailer]
  • Presently, we observe a combination of extreme valuations and divergent market internals. This combination suggests that investors have shifted toward risk-aversion at a point where risk premiums are unusually low, and it opens up a trap door that has historically permitted very steep market losses, as we observed in 2000-2002 and 2007-2009. While I'm inclined to view the January market high as the bull market peak for this cycle, which would suggest that stocks are already in a bear market, we also have to allow for the possibility that investors will again take the speculative bit in their teeth, which we would infer from the behavior of market internals. [Hussman]
  • Though the amateur videos showed pieces separating from the shuttle along the entire path over the United States, and though search parties backtracked all the way to the Pacific coast in the hope of finding evidence of the breakup's triggering mechanism, the westernmost piece found on the ground was a left-wing tile that landed near a town called Littlefield, in the Texas Panhandle. Not surprisingly, the bulk of the wreckage lay under the main breakup, from south of Dallas eastward across the rugged, snake-infested brushland of East Texas and into Louisiana; and that is where most of the search took place. The best work was done on foot, by tough and dedicated crews who walked in tight lines across several thousand square miles. Their effort became something of a close sampling of the American landscape, turning up all sorts of odds and ends, including a few apparent murder victims, plenty of junked cars, and the occasional clandestine meth lab. [Atlantic]
  • I am sure Philip is right that a low angle of approach is safest for the recreational pilot. There is no question that this is the easiest way to land a plane. As someone who learned to fly gliders first, this mode of landing does however take the fun out of it. Much more entertaining is to approach the numbers at 1000' AGL on final, then turn to exclaim to your passengers, "Oh my, it looks like it is time to drop this puppy." Then dial in full flaps and enter a steep dive with fully crossed controls approaching 100 knots if flying a 172. The angle and speed of the descent (2,000 fpm?) ensures that the ground will loom up in a way that results in paralyzing fear in most passengers, especially those experiencing a light plane ride for the first time. Many will never fly in a small plane again and thus measurably improve their life expectancy. [Greenspun]
  • In 2009, therefore, it was decided to make a drastic change. NJAS set up a non-profit foundation, The OEIS Foundation Inc., whose purpose is to own, maintain and raise funds to support The On-Line Encyclopedia of Integer Sequences® (OEIS®). On October 26, 2009, NJAS transferred the intellectual property of The On-Line Encyclopedia of Integer Sequences to the Foundation and work was begun on moving the database from NJAS's home page at AT&T to a commercial hosting service. [OEIS]
  • I can find no warrant for such an appropriation in the Constitution, and I do not believe that the power and duty of the General Government ought to be extended to the relief of individual suffering which is in no manner properly related to the public service or benefit. A prevalent tendency to disregard the limited mission of this power and duty should, I think, be steadfastly resisted, to the end that the lesson should be constantly enforced that though the people support the Government the Government should not support the people. [Cleveland]
  • That insidious and crafty animal, vulgarly called a statesman or politician, applies police power to achieve his ends. And why not? All men strive and in different ways. Some are superior in production and exchange, some in intellect, some in military coercion, some in personality and rhetoric. The militarist extols the military, the politician extols government and socialism, the artist extols art, and the intellectual extols intellect. Each exploits his own talents as he may. [Alchian]
  • On the day that everybody knew would be the last of the Morsi Presidency, Atiyat arrived with her fingernails painted in the colors of the Egyptian flag. She took out some red, black, and yellow crayons, and she instructed the twins in the production of little flags. Should my three-year-olds be celebrating a military coup in advance? But I was too distracted to think about it; soon I would have to leave to cover the day's events. [New Yorker]
  • "The danger of grizzlies really turned my crank because I was an adrenaline junkie," he told me that night at the bar in Republic (where the evening's chief threat turned out to be a bartender who didn't have Wielgus's preferred whiskey). He got his doctorate studying grizzlies in western Canada and northern Idaho, then went to the Pyrenees for a year to help with bear recovery. [NY Times]
  • You can measure everything about a bubble except the most important part: When investors will stop believing in it. The end of the bubble is just the end of enthusiasm. And enthusiasm isn't a tamable statistic. It's a hormone that owes nothing to the logic of your data. [link]
  • Perhaps the most striking example of technological stagnation is to be found in general aviation, in which one needn't look further than the Cessna 172, the most popular airplane in the world, which first flew in 1955; the Piper PA-28, the second most popular airplane in the world, which first flew in 1960; the Cessna 150/152, the third most popular airplane in the world, which first flew in 1957; the Cessna 182, the fourth most popular airplane in the world, which first flew in 1956; and the Piper J-3, the fifth most popular airplane in the world, which first flew in 1938. Flight students across America are unironically training in the same airplanes as their great-grandfathers. [link]
  • As I've studied Tesla more closely, I've come to realize that Elon Musk appears to be running a Ponzi Scheme disguised as an auto-manufacturer; where he has to keep unveiling new products, many of which will never come to market, in order to raise new capital (equity/debt/customer deposits) to keep the scheme alive. The question has always been; when will Tesla collapse? [AiC]
  • I'm long-term bullish on Florida. It has great weather, endless coastline, and no state income tax. Florida has been drawing people from the rest of the country for nearly a century and the pace of migration will only accelerate due to the recently implemented Federal tax changes. I can think of no better way to play that structural view than St. Joe (JOE – USA), owner of 177,000 acres of undeveloped land on the Florida Panhandle. [AiC]
  • Next in June came an analysis by Gordon Johnson, an analyst at Vertical Group, estimating that the Model 3 cancellation rate is as high as 66%. No wonder Tesla—which never fails to report a favorable data point (even if it has to fabricate it)—refuses to update the current net Model 3 reservation number (and by net I mean net of requested refunds too, as numerous Twitter posts indicate that the cash-strapped company is delaying those requests for weeks or even months). [AiC]
  • San Francisco is the Schelling point for high-openness, smart, energetic, optimistic people. [link]
  • Grant reasons that the new immigrants were of different races and were creating separate societies within America including ethnic lobby groups, criminal syndicates, and political machines which were undermining the socio-political structure of the country. [Wiki]


Midwest Pete said...

I'm old enough to remember when James Cramer had made JOE on of his personal portfolio picks.

I can't remember how long ago that was. Might have been 04 or 06. Maybe times have changed, but Cramer, as is his wont with his "publicly disclosed" positions, more or less top-ticked JOE.

CP said...

Price came down a lot on JOE.

The problem with these land development companies is always that SG&A chews up so much of the land sales revenue.