hogFeast

The stakes at university are miniscule. If your kid needs shoes, if your landlord is calling before the interview asking where their money is, if you have a medical condition (which universities account for, but most employers do not)...I am not having a pop at you, but what world do you live in? The purpose of university is to study, the purpose of a job interview is not to study. As I explain below, it is clear to me why Google make this error in confusing the too...it is baffling that anyone else views this as logical.

Btw, be totally clear, this has been a bad outcome for Google. Google's failure has been well-hidden by the fact that they have a monopoly product that is a cash machine requiring low/zero marginal investment...once you start from that premise, you realise that management has destroyed monumental amounts of capital (your comparison with university is very apt, Google is functionally a bureaucracy operating like a 11th century monastery, you have to spend years studying pointless trivia to get in, a totally institutional mindset).

I gave you a definition (once again, you are starting from the viewpoint that my view is invalid because I refuse a definition...a pattern is appearing).

The actual epistemic logic is more complex but, for the purposes of this discussion, the point is that you can define these things as things that reasonable people can disagree about because: there is no clear evidence, and people will weigh that evidence differently. It makes no sense to say that these things should be removed from the internet because they are "irrational"...Galileo was regarded as "irrational" too, the nature of new information is that it breaks down existing systems of thought.

To be clear too, believing in rational universalism is an example of irrational thinking. No "rationalist" philosopher ever believed in universalism. Theories like logical positivism were explicitly non-universal in regarding some things as unknowable. The only real application of universalism has, typically, been in German fascist political philosophy with ideas like the Volk...it is in an inherently political/cultural concept...again, the irony of this is a bit much but the precise reason why these theories exist is because they are people who think that we just need to shut discussion down.

It isn't. Thinking that it is objective is an example of non-rational thinking.

Have you ever considered the possibility that sense is not objective?

If you need reminding, sensible opinion was that masks didn't work. If you need reminding, sensible opinion was that a lab leak was impossible. If you need reminding, sensible opinion was that a vaccine wouldn't come for years. On and on.

Sense is inherently subjective. You are subject to the same flaws of logic and reasoning as anyone else. People believe that everyone else is an irrational fool, and their view is correct (and yes, this is the only thing that has changed recently...as people have become more exposed to people who aren't like them, they have retreated into their shell).

Btw, you should also consider whether your own view here has any "sense". Part of living in a society with other people is the right to disagree with others (isn't it odd that you use this right when considering the views of others but don't believe they have the same right? That their views just make no sense and can be ignored...irony).

It is unfortunate that fewer and fewer people today understand the principles on which their freedom is built.

Great, the solution is for government to take control over social media...what could go wrong?

Some of the whistleblowing stuff about FB's numbers being fake was interesting. Quite why the whistleblower is making statements about democracy is unclear to me.

It seems like democracy has been harmed far more by removing popular politicians from social media, and throwing them down the memory hole...democracy is inherently about differing opinions and conflict, that is how it works (when political pamphleteering started in the late 16th century, there wasn't lots of political analysis...it was salacious gossip about whether a certain well-known public figure was a secret Catholic or possibly having sex with the Devil). I see more politicians who believe their opponents are bad and should be silenced than actual concern for democracy.

Build a solid understanding of accounting/financial analysis. Read lots of similar documents. That is it. No magic.

Been there, tried it, failed.

It is extremely hard to monetise. I tried doing this once: the first time I made $250k for someone, and I got $50 of that...you really reconsider whether it is a good business.

Tbf, it would probably be much easier to do today but the easiest way to monetise is to just work in investment research (and I did that too, didn't care for that either...so am a dev).

Also, you can't write what I wrote above using your real identity (and it is very hard to build credibility without using your name, imo). Companies are extremely litigious, and it isn't worth the flak from people who don't want to know (again, been there...I spent a long period in the mid-2010s trying to stop people investing in a fraud...didn't work, just made people angry).

Maybe I will give it another shot this year though. The market has changed. And I have had a few people ask me for a newsletter when I do long answers.

It is a typical example of how B2C companies interpret their own results.

But this is an example of extremely bad/misleading financial modelling which has also been typical with B2C IPOs/IR...so it doesn't really reflect how they make money...because they aren't actually making any money doing this.

There are, to be frank, so many errors that it would take multiple blog posts to go through...some classics from one read through:

* "Product ROI - Revenue" - this will go down for me as a real DTC classic...I had to check if the CFO perhaps did stand-up comedy on the side, this is surely indicative of great comedic talent? But no, just a neck made of solid brass.

* "Product ROI - Profit" - after deducting almost no costs. Again, if this company doesn't work out then the executive team should surely consider comedy.

* The big issue with all these analyses is that they are very sensitive to the recent past. You are not getting a random sample of history, you are getting the sample where everything works out, and all the metrics (whether fictional or not) produce the right outcomes. That is fine, but it is worth understanding that over the long-term, it will go wrong eventually and the estimate for turn will drop significantly. So whatever number they produce sounds great but it is best case. You see this over and over (turn, churn...it is usually some measure like this that is clearly very favourable and unrepresentative).

* With this company specifically, another big problem is that management controls D&A...they are saying clothes will last three years...okay...my feeling here is extreme doubt. Burberry used to literally set fire to clothes that were more than a year old...my view is that management have (somehow they convinced their auditor to go along with this) turned an immediate business cost into something they can depreciate over three years so their "financial model" doesn't look like total dog shit. Btw, you can actually back this out, I am not going to bother because I can see the "model" is unprofitable once you do this...obviously.

* If I was inclined to analyse this business (I am not, it looks like a dumpster fire), I would need to really interrogate the claim of 20 turns per unit and exactly when those turns are occurring. I could be convinced this model works. But if management is depreciating over three years...all I am clear of is that management are up to something.

* No deduction of marketing costs in ROI calculation? They have gone for "Product ROI"...okay but the business model depends very heavily on efficiency of marketing spend. I understand what the game is with IPOs but is this a real example of their "financial model"? No, it is fictional.

* Their G&A is crazy. I don't know how this is possible (the other thing I would look carefully at would be their Linkedin, it is so large that one wonders if costs aren't also being moved here from somewhere else)...again, I understand why this isn't "Product ROI"...but they are spending huge amounts here, which really should be taken into account in any analysis.

* Fulfilment is part of the model but I didn't see a real explanation for that cost. They are obviously having to clean/repair clothes but where are they in their capital cycle (this is very important for DTC because it is something the market frequently gets wrong)? It looks to me like they invested heavily pre-Covid, haven't really seen things recover...so I would guess they lever costs quite quickly on fulfilment when they recover (which is good: simply, their cap utilization is probably low so revenue can go much higher with little marginal costs...I do wonder why the selling shareholders are so generous) but, again, I would question the value of their inventory...and if they don't recover then those fulfilment costs can sink them too.

Yep...so I would be cautious about reading too much into this. The stuff about "Product ROI - Revenue" and depreciation are real classics though...when you think you have seen it all, the investment bankers will continue to give (I have no idea how they got KPMG to sign off on their depreciation policy). Very generous.

EDIT: would love to see more two years financials too...like that is highly, highly, highly sus...is that just the norm now (I don't do this kind of thing professionally anymore). You have to look at cash flow with these businesses to see "real" profitability, and capital is just pouring into the business with very little in the way of return...it just makes me wonder whether they weren't also losing tons of money in 2019, and realise that no-one will buy the Covid turnaround tale if they were also losing crazy money in 2019. I notice that one of the first search terms for the company name on Google is "...are they still in business?"...which isn't encouraging.

This has been true for quite a while, the stock price keeps going up but it can take quite a while for the break to actually come.

Also, I think what people heavily underestimate with FB and GOOGL is that the majority of their growth is coming from volume, which they are 100% in control of over the short-term.

All they need to do is add another ad to the page, and their revenue goes up. The problem is that, over the long-term, this results in less and less product. With the targeting changes, with the valuable US/young userbase shrinking rapidly (amongst young people, Facebook isn't even in the top five social networks), it is very clear that management are turning all the dials they can now but this can only end one way (I also suspect a lot of the "international growth" is not real).

Footfall for retail, property, also could be useful with commodities.

But they have other data: they have your bills, emails, app usage data...again, not sure how legal it is or whether some of this isn't hacked data (App Annie is a, presumably, legal source...but there are far more).

It is mainly used by hedge funds.

I have heard it is used by some marketing firms, I have heard that some corporates use it for data on their own properties/competitors (the former may not be obvious, but some malls may do this to check on tenants, malls also usually have their own tracking stuff on site too btw) but the main user are hedge funds.

Not all of this data is useful by itself but it is useful once you integrate it with everything else (lots of firms have tried to use this data on it's own, and then complained it "doesn't work" when they employ no-one who actually understands the restaurant business, for example).

Also, I will say too...99% of this data is coming from free apps whose only purpose is to harvest data from the unwitting. I don't understand fully how this is possible because, presumably, it should be quite obvious to App Stores that a flashlight app does not need to know your location...but it keeps happening. Some of the big data aggregators are actually pretty creepy, I have seen some companies retailing personalised data on every person in the US, I don't think anyone knows where it is all coming from apart from them (I also wouldn't discount hacking tbh, there is so much money in this that I think they have to be doing it).

Imo, all this shit should be blocked. Even within hedge funds, you are seeing funds that are using this data, no-one knows where it comes from, how it was collected, and they making piles of money from it but no-one else can access it...they just call up a firm, tell them they will pay $50m/year if you don't sell this to anyone else, it is all very opaque.

He isn't. And the standard of proof in finance for claims is slightly higher than that...he isn't predicting "things will go down", he is making specific predictions that occurred (again, you seem to have these very specific views about someone whose work you have never read...interesting).

No, it isn't. Bank stocks aren't macro. There are macro consequences but Grant's wrote extensively about individual stocks pre-08.

How many hedge fund managers are paying Kiyosaki for resarch? :)

The same James Grant that predicted the junk bond meltdown, the same James Grant that predicted the dot-com bust, the same James Grant that predicted the housing crash, the same James Grant that predicted the meltdown in Chinese resi...if you have experience in markets, you will learn two things: everyone makes wrong predictions, and you can be wrong now/right later.

Also, you appear (for some reason, have you ever read Grant's?) not to mention any of the numerous calls on individual stocks they have got right. The macro is only part of what they do.

When you are read by pretty much every hedge fund manager in the world, when they will pay $2.5k to come to your conference, and $1.3k/year for a subscription...you are doing something right (also, as someone who studied economic history, his book are first-rate...compare his books to Philip Coggan, a columnist at the Economist who has written books on economic history, it is night and day...Grant's books are academic tier quality, people who work in finance today still read books he wrote three decades ago).

How it started: come on let's just oust the baddies...who can disagree with this?

How it ended: I am from a different culture, I have no idea what any of this means.

Classic.

I love stuff like this. Pure comedy gold. It reminds me that someone can have all the knowledge, all the statistical tools in the world and still make huge mistakes (no, not explaining it, making too much money atm...maybe in a few decades). To the man with a hammer.

Not an investor. Never worked as an investor. Only worked for charities. Marc Lasry, however, is a very well-known investor.

Investing and charity does seem to be merging in quite a puzzling way. Saying that this company has been "so successful" after the founders have been caught committing fraud (not in the legal sense) is inexplicable.

I worked in finance. If this happened at a company that I recommended, I would have lost my job (I actually know a fund manager who had a well-publicised 5% position in a company that failed, they had institutional money only so the reaction was swift...50% drop in AUM, investors demanded they fire 75% of the analyst team...this does happen in finance). I guess not everyone has to play by those rules.

Ironically, it sounds just like old media. Pay a few good 'ol boys to put out the stuff I like and agree with. I will lose all my money but...who cares?

Not really. The ones who are angry about this are lobbyists representing haulers.

Most people in the UK are very supportive of HGV drivers finally being paid a fair wage. It is unfortunate that political leaders side so quickly with large corporations (although not surprising in Germany, it isn't usual in the UK, the public won't take it).

The shelves in the UK aren't empty. The press in Europe appears to be eagerly reporting this fact. Where I am, the supply of fresh food has improved significantly since the start of Covid. I don't know of anyone who has had problems buying food (if anyone did, there would be panic buying). There has been industrial action at some places, and some individual producers have driver shortages. It is not widespread at all (and btw, I live in rural area...we have had shortages before due to bad weather, but what is happening now isn't noticeable unless you are familiar with the grocery supply chain...this stuff is just being reported because it relates to Brexit, which journalists care about). It is fair to say there were probably problems due to Brexit for the supply of some fresh food...but that was months ago, and I didn't notice any disruption even then. And btw, if drivers were going to leave because of Brexit, they could have left between 2016-2020, the UK didn't ask anyone to leave, they all had the right to stay and work...most left in 2020, due to Covid, before we left. The timeline makes no sense.

The companies blame visa rules because they don't want to pay staff more. It is that simple (what people don't understand, even in the UK, these stories are all coming from a lobbying group of haulers...not drivers, the people who are having to pay staff more and are very angry about doing so, they just want the cheap labour back).

One of the companies that has had persistent shortages for months is a bread producer making £30m/year, they have 150 driver vacancies. I know someone who talked to a hiring manager there, they pay below market, they are experiencing massive attrition, when he asked what pay rises they were offering...2%, "the rise is satisfactory, workers should be happy"...meanwhile other firms are paying 10-30% raises, some HGV drivers are being retained on £50-60k salaries (this producer pays people £27k for multi-drop, starting at 2am, I believe it is mostly class 2 but their wages are a fantasy). Some firms in the UK have glutted themselves on cheap labour. They have no idea how to operate any other way (and btw, this bread producer is throwing away product every day because they don't have drivers, at no point have they tried to raise wages, they believe the low wage labour will return it seems).

In terms of the trucker shortage: the govt said today that the fuel driver shortage is small (150-300, tanker drivers make more than HGV drivers so probably true). BP said they were having no problems hiring but experiencing high levels of attrition (likely due to competitors offering pay increases)

BP met with the govt on Thursday, they said that supply levels were roughly at the level they had been since the start of the summer, low but manageable. Allegedly, they said they were only closing 10 or their 1,200 locations. They also said stock was low below normal levels.

Someone leaked this information to the media for the Thursday night news (it is very unlikely that it was anyone but the RHA). The person who did this left out several important details, in particular the fact that BP planned to close almost no locations. BP briefed the media later they were closing 20 (it was assumed initially that they were behind the leaks as the initial report was that the meeting was lobbying to lift visa rules, it seems not to have been the case). Other retailers briefed they had no issues with stock at all. Too late.

And the reason why people suspect the RHA is because they have been lobbying aggressively for most of this year to change visa rules. Visa rules were changed for them a few hours after this all kicked off (they also did poultry workers, this group have been working closely with RHA on lobbying)...this alone should suggest who is responsible.

RHA are, however, not backing down. This is not surprising as they are traditionally one of the most combative lobbying groups (the BMA is the other, SMMT has quietened down, NFU is combative but prefers to operate in the shadows when they are in govt). But, given that their lobbying has been successful, it is notable that they are continuing to push hard for further concessions (their line has modified ever so slightly though, they are talking about improving conditions...although they still sound quite angry that some HGV drivers are being offered £50k packages).

Unfortunately, lobbyists have worked out they have the media and the public in the palm of their hands. The outrage cycle in the UK has become rapid. After May folded to Nissan/SMMT (another lobbying group), lobbyists have realised there is a lot of money in briefing aggressively against the govt with a very pliant media (the RHA has been most aggressive by far, and has aligned itself with the big food lobbyists too). Brexit is inevitably part of this: 95% of journalists voted Remain, and there is a subset of the population who read a lot of news and talk about nothing but Brexit (if you are from the US, it is basically: what Trump did to Dems, what Obama did to Reps...it is non-stop).

EDIT: I made an error. The actual date of the govt meeting is not clear. Shapps may have said it was ten days ago, I am sure I read somewhere else it was on Thursday...I don't know. If it was ten days ago, that is obviously...unusual because the leak, most likely, wasn't accidental but premeditated. BP have completely washed their hands of it and claimed they weren't operating in the media on Friday morning...I don't quite believe that.

But companies don't deduct stock-based comp from adjusted EPS? It is deducted for taxes, but not deducted when the board is setting targets...very selective definition of profit being used.

Btw, I did make a quick examination and some information is not accurate. For example, I knew that NKE don't have huge stock-based comp. The reason they paid no tax in 2020 was tax benefit from stock-based comp AND "Foreign-derived intangible income benefit". In 2019, they took most of their income overseas. Sometime in 2020, they stopped doing this. And in 2021, they paid $500m in income tax.

Interestingly, their effective tax rate actually fell even though they are now paying more income tax in the US (the tax-benefit from non-cash comp is now the more significant contributor to income-tax deductions, they are still gaining 370bps of effective income tax from IP shenanigans though...which is interesting given that this was supposed to have stopped from 2018).

I had the same experience with ultra-light switches, I couldn't use anything heavier than reds. Then I tried very smooth lubed linears (Alpaca v2, which are 62g), and they were totally fine.

I am not sure if they helped ergonomically but I found I was accidentally pressing keys far less.

We have already seen it. In 2020, you saw macro funds (the ones often targeted for "underperforming") that were running max drawdowns of 5% make 20%, 30%, 40% in a few months.

The issue, as you imply, is that in a bull market people lose almost all ability to exercise reason and view the opportunity cost of capital as the S&P.

But a lot of hedge funds aren't running high levels of beta, and investors in their funds don't demand that (unf for some hedge funds, who demanded low vol and then went into index funds when beta did well).

And, ofc, most equity hedge funds have had very strong performance. All the Tiger group hedge funds have private companies, everyone owns tech companies, you are even seeing value hedge funds in FAANG stocks...it is quite something.

It isn't. Funding in first half of 2021 was larger than the whole of 2020...and London in 2020 was already many multiples than Paris. Additionally, the UK has a large startup scene outside London. Manchester was roughly equal to Amsterdam in 2020, it grew significantly in 2021 and is likely going to approach top-tier mainland cities soon. Edinburgh and Belfast are growing fast.

It isn't even close (tbh, the UK isn't really competing with the EU anymore...the EU is just so far behind).

Btw, the reason why people have moved out of Silicon Roundabout is the same reason banks moved out of Canary Wharf. Rents too high, office space not growing fast enough (Google moved into Holborn, outgrew that, moved to Victoria, outgrew that, and is now building a huge new office in King's Cross). VC funding is up something like 15x since the Roundabout was created, the growth was just too rapid for such a small area.

Again, the problems that people were having 10, 50, 100 years ago are largely the same ones as today.

The financial industry has changed in some ways but most of it is exactly the same.

Viewing everything as personal is why people don't learn from history. This is why financial markets have cycles.

A lot of the very old marketing in financial services was content marketing. So you have seen relatively little disruption amongst the most sophisticated marketers...they do the exact same thing they were doing three decades ago, they just send it by email instead of calling or mailing.

There are differences: Motley Fool and Simply Wall St are two example of "innovators" (nominally SEO but in reality they just got into Google Feeds when it was easy to get in).

My point though is that industry hasn't really changed. They are still selling the same dogshit products. As a startup, you have to literally drag your customers kicking and screaming away from stuff that will bankrupt them...every...single...one.

(I say this as someone who ran a startup in the space that failed and then went into wealth management...the industry is horrible, horrible, horrible...with my startup, I made a couple of thousand and had individual clients who made $100k+ with my advice...still wouldn't listen to reason. When I worked in wealth management, we had clients who had money with us, were doing well, and then sold their business and decided they needed the "big name" financial advisor who would rip their face off in fees...I remember seeing the marketing docs for one of these pitches...$2.5m liquid cash account, I actually laughed at how bad it was (they had tried to construct a stock portfolio to generate fees, it was basically an index tracker)...I now do something else because I was just so jaded...but the irrational behaviour of people is brutally different to comprehend...it is anything to do with financial literacy either, some people just have no common sense, Warren Buffett is an example of how to do things, he decided what he was going to do, only people who aligned with the mission joined him...obviously, that doesn't really work outside of asset management).

It isn't.

The same things have been happening in financial markets for two centuries. I will say it is remarkable how few people take an interest in looking at this kind of thing. History, particularly in the US, is regarded with derision. Economists believe that nothing in the past could be relevant any more...their expert guidance has moved us to a higher plane of existence...

...and if you look at history, you will see that almost everyone back then thought the exact same thing too (I say almost, when things really went to shit you find that humility tends to last a bit longer...there is zero humility today).

This all applies to personal finance too. All the financial problems that people have are problems of human nature.

From memory, Romney was close to even to win.

Even when you have a market with immense amounts of liquidity, the market won't be efficient if all the participants are wrong.

I remember back in 2012 InTrade had a market for the US Presidential election, the odds were wrong, stayed wrong for months, and actually got more wrong close to the event. You could get hourly liquidity in the tens of thousands almost throughout (I put on $20k in this market, I wasn't touching the sides, it was incredible).

Most of the people who talk a lot about prediction markets haven't worked in markets. Markets aren't magic. They work better with binary outcomes but they cannot be smarter than the people making bets in that market...and they aren't (I have most experience with financial markets, which just don't work well at all, but have quite a bit of experience with binary markets too...they have only become more accurate as our knowledge about the underlying events increased...if you look at binary markets where knowledge is limited in some way, markets are not efficient).

He has written a new book about HFT which covers some of the same ground.

The person you replied to is conflating the economic and social side. The justification is in social not economic terms. So it really doesn't matter what the market says, the point is whether it is socially sustainable not to re-distribute that.

As an aside, the US seems like a very weird place to me. There are homeless people everywhere. I have never seen so many homeless people anywhere in my life...even in developing countries. It is crazy. I don't understand how people tolerate that. Not only poor people but the US seems to be a country which breeds a total lack of empathy, I don't understand how wealthy people tolerate it...and then you read the hyperbolic comment elsewhere on this thread about a founder saying this is theft, this well end Silicon Valley, it is insanity, it is intolerable...try tolerating sleeping in a tent under a bridge.

Either way, the reason you tax the $100m is so you don't end up with a govt that will take more than your money. The notion that you can just take forever has never been a part of politics.

As an aside, I think most Americans perception of authoritarian govts is that they are anti-democratic in this way...but if you look at monarchies, there was always responsibility from the wealthy, there was always a safety valve...the US has no safety valve, there is no social responsibility from the wealthy, they have taken everything and are asking where the rest is (and sound utterly deranged when you suggest they should make $5m rather than $10m). There are things much worse than taxation, you have to live in the world with other people.

EDIT: I will add...I would kind of quibble with the notion that markets are free in the US. The amount of state support for capitalists since 2008 (not talking about TARP which was necessary) has been very significant. Free money for the wealthy, usurious interest and rent for the poor. In particular, the level of downward social mobility in the US is very low for a capitalist economy. Markets are free in the US...in one sense.