Louis-Vincent Gave on China (Dec 2023)

I'm a big fan of Louis-Vincent Gave, and given that he is an expert on China, it is very finely to look at what is happening in China. This is a good interview from December 2023 by Manifold touching on many issues including China's future growth issues, possible future trajectory of its economy, US debt concerns, and some longer term investment ideas of you think US dollar will weaken due to inflation from potential monetization of US debt (LVG thinks Latin American debt, value stocks, commodities and maybe gold are with looking into.)

Purchase: Cineplex (TSX: CGX)

Purchased Cineplex (TSX: CGX) which is the dominant movie theatre chain in Canada. It was distressed due to COVID-19 shutdown and took on debt to survive.  I don't think movies are going away and theatres are still important. I think business is stabilizing and if it recovers to what it was before, it is cheap. Historically, movie theatres have been somewhat resistant to recessions as well (movies are cheaper than many other entertainment options.) Canadian dollar is also weak against US$ so I'm mostly looking at Canadian stocks nowadays. Purchase price: $8.10

Michael Lewis podcast on his FTX cryptocurrency book

Michael Lewis has a book out on FTX scandal, the cryptocurrency exchange that collapsed. The following Bloomberg Masters in Business podcast is pretty good and goes over many topics.

Purchase: Disney (DIS)

Don't think you will get rich off this but shouldn't lose money either. Trading near 10 year lows (was about 5% lower before) and coming off pandemic business decline. They recently cut dividend, which is always a bad sign, but their streaming losses are declining.  Risk with Disney (NYSE: DIS) is that they make a lot of money off sports cable television (ESPN) and that is declining and don't know how long they can earn so much off that. Long-term ROE should be 12-15% (median 10 year ROE is around 12%.) Purchase price: $88.78

Purchased more: Southwest Airlines (LUV)

Added more to Southwest Airlines (LUV.) Stock might fall a bit more during recession or due to higher oil prices, but that's hard to predict (recession appears to be mild.)  Stock price is trading near 10 year lows (ignoring 2020 COVID low.) Earnings should go back to what it was pre-covid so you are buying around P/E of 7. Airlines deserve discount but Southwest has historically been the best-run airline. Price: $28.95

Purchase: Southwest Airlines (LUV)

Stock might fall more depending on how recession plays out but I decided to take a small position in Southwest Airlines (LUV.) Going to add more later. Historically, the airline industry hasn't been good for investors but I think Warren Buffett was onto something a few years ago when he took stakes in airlines (before it all went astray due to covid-19.) Southwest is rarely at the current valuations so decided to invest. Hope to write up my research and thinking when I get some time. Purchase price: $29.50

S&P500 sector performance 2022 YTD (Q1-Q3)

As of end of Q3 of 2022, here is how the s&p500 sector performance looks: Source: Visual Capitalist , Who would have thought communication services would be the worst YTD so far? I never would have. Communications, especially media companies, is sensitive to the economy but telecom/cable/etc tend to be more stable so this sector usually does badly but is not the worst during bear markets. There are two reasons communications has underperformed: Recession/economic slowdown: Although the US economy is doing ok, the market is pricing in major slowdown. In particular, market is forecasting big declines in advertising revenue for media companies. This makes sense given that stock markets usually lead actual recessions by something like 6 months. High leverage: Telecom companies leveraged up to crazy levels and riding interest rates adversely impact them. Although the smarter ones (like Charter) took