Market Bottom, Electric Vehicles, Housing Prices, and Cell Phones

Monday morning news drop

• One Year Since the Bottom One of the big lessons from 2020 is that risk is always present, even if we don’t always feel it. Things were smooth sailing until they weren’t. The other big lesson: Survival is the name of the game. It’s not about maximizing returns or beating the market. It’s about staying the course. And you can only stay the course if you have a course to stay on. (Irrelevant Investor)

• Big Market Delusion: Electric Vehicles The “big market delusion” is when all firms in an evolving industry rise together, although as competitors ultimately some will win and some will lose. The electric vehicle industry, with its astronomical growth in market-cap over the 12 months ending January 31, 2021, is a prime example of a big market delusion. In the highly competitive and capital-intensive auto industry, the January 2021 valuations of electric vehicle manufacturers are simply not sustainable over the long term. (RAFI)

• What If Housing Prices Aren’t As High As They Appear? Mortgage rates were more than 10% in 1989. So while prices were far lower in the past, borrowing rates were much higher. Taking the median sales price and applying the prevailing 30 year fixed mortgage rate (after accounting for a 20% down payment) shows a different story when it comes to monthly payments: (A Wealth of Common Sense)

• If You Look at Your Phone While Walking, You’re an Agent of Chaos An experiment by Japanese researchers revealed how just a few distracted walkers really can throw off the movements of a whole crowd. (New York Times)

Penny Stocks, Conspiracy Theorists, Google, Tobacco and Cannabis, Piazza

Weekend news drop

• Penny Stocks Are Booming, Which Is Good News for Swindlers Penny stocks — the name given to more than 10,000 tiny companies — have been around forever, but they’re booming as small investors flood the market. Retail investors see the tiny companies as the next big opportunity after meme stocks and cryptocurrency. This time around, social media is fueling the craze. But shares are an easy target for fraud. (New York Times)

• What Conspiracy Theorists Don’t Believe The question “How could anybody believe this stuff?” comes naturally enough. That may not be the most helpful question, however. Conspiracy theorists believe strange ideas, yes. But these outlandish beliefs rest on a solid foundation of disbelief. (The Atlantic)

• The government’s lawyers saw a Google monopoly coming. Their bosses refused to sue. FTC memos suggest Obama-era regulators passed on an opportunity to rein in Google when the company still had viable competitors. (Politico)

• Our Strange Addiction The transformation of tobacco and cannabis into early modern global obsessions. The 1610s were a key decade in tobacco’s transformation into a new global obsession. Before long, the gift (or curse) of smoking had given rise to one of the world’s most lucrative industries, emerged as a key driver of the Atlantic slave trade, and initiated a global bad habit that humanity still hasn’t kicked more than four hundred years later.. (Lapham’s Quarterly)

• The Year Live Music Stopped Most musicians’ primary source of income is gone, venues everywhere are struggling, and the government hasn’t come through on an aid package. It’s hard not to lose hope, but in talking with professionals across the industry and looking to regions around the world, we gain perspective on how to rebuild live music from the ground up. (Pitchfork)

• The Amazin’ True Story of Piazza, Clemens and the Broken Bat. With so much for Mets fans to be excited about in 2021, one lifelong masochist reminds us: In New York, nothing ever changes. The Mets are gonna Mets. Case in punishing point: This 21-year-old tale about two dudes, a beef and a splintered chunk of wood (Sports Illustrated)

Investing, Bank CEO pay, Nerf, Amazon, Marvel, and Videos of the Week

Friday news drop and videos of the week

• Prices peak on hot softwood lumber demand If there was ever an incomprehensible year for forestry and sawmilling, it was 2020. Macroeconomic conditions in Canada and the U.S. weren’t any easier to decipher. However, one sector that clearly did well was housing: home building and selling activity across the continent revved up to white-hot levels. Indeed, according to the latest U.S. employment data, job gains in the construction sector entirely offset all the other job losses put together. (Forest Industries)

• Marvel’s Most Superhuman Feat Was Saving Itself In 1996, Marvel filed for bankruptcy. Its business was in shambles. That wasn’t the first time in the company’s history that it stumbled hard—but each time it’s reemerged, stronger than before, like that supervillain you think you’ve defeated who suddenly reappears in the final battle. How is Marvel so resilient? Seems like its real superpower is making comebacks. (Slate)

• The engineers building ridiculous dart blasters that Nerf won’t touch Out of Darts is at the forefront of a cottage industry selling original blasters and parts that can leave the official Nerf brand (owned by giant Hasbro) in the dust. It’s almost something of an arms race, where the Nerf internet community one-ups each other by making their toy blasters shoot more foam faster, farther, and more accurately, whether to show off or to perform that much better in an actual game of Nerf. (The Verge)

• CEO Pay Tied to ESG Sets Canadian Banks Apart From the Crowd Canada’s six largest banks have all added ESG components to their chief executive officers’ compensation frameworks, putting them in a small minority of companies that tie executive pay to such measures. (Bloomberg)

• How Amazon Crushes Unions In a secret settlement in Virginia, Amazon swore off threatening and intimidating workers. As the company confronts increased labor unrest, its tactics are under scrutiny. (New York Times)

• The Longest Winter - How Parks Got Us Through a Tough Winter The pandemic showed just how important green spaces are to our mental health. How can we keep them accessible during the coldest months? (Walrus)

• What Happens When Investment Firms Acquire Trailer Parks The financial industry’s pursuit of profits from mobile-home communities is undermining one of the country’s largest sources of affordable housing. (New Yorker)

• Reverse Wealth Transfer on Steroids Stop scrolling, stop gaming, stop trading, stop making memes. Stop collecting things that don’t function and will, with the passage of just a year or two, become completely laughable. Nobody’s going to want to buy any of this stuff from you because they’re going to make 70 billion versions of everything you’re buying now. It’s artists today, but eventually it will be corporations. They will sell you limited edition ziploc bags filled with air if you demonstrate a willingness to buy it from them. (Reformed Broker)

• P/E Ratios and the Case of the Dueling Denominators The E, not the P, is the driving force behind P/Es these days—and shows why stocks aren’t overvalued. (Fisher Investments)

• It’s A Bubble If you know nothing else about a bubble, know this: “Assets whose prices more than double over one to three years are twice as likely to double again in the same time frame as they are to lose more than half their value.” (Irrelevant Investor)

Chapter 11 TV - SURFERS - Matt Mccabe, Craig Anderson (One shit wave from when we got skunked in PR) , Eithan Osbourne (Maybe only clip of the trip), Dane Reynolds, Dylan Graves (Fly’s through frame), Jake Anderson (He’s either going hate or love this),Andrew Doheny (Last track is the first song he ever wrote)

Into the gnar - Crazy steep lines on the North Shore in Vancouver in the rain with Steve Vanderhoek

Hitting Rowdy Loamers on The Shore with Gully & the Crew in 'Weekend Slayer' The local crew on the steep, and wild loamers of Mount Seymour! We link up with Geoff Gulevich, Scott Mackay, Brian Serneels, and Fraser Vaage for an insane ride, packed with loose moments and hilarious trail banter.

Rémy Métailler Pushing the limits with Yoann on some steep terrain.

Quiver Collective is a series that invites the viewer to look into a collection we might not otherwise ever get to see. From professionals to enthusiasts these collections might be fit for a museum someday, but for now here is the visual archive. Join in as we go to private homes, garages, closets, backyards, vaults, even shoeboxes. These are the stories of the collectors of memories because it's important to them. Maybe the collections are important to you too.

Brute SF in Miami Video Jafin Garvey, Jonathan Perez, Blake Norris and the Brute crew bring the Bay vibes to MIA’s steep steps and sketchy rails.

Trump, Inflation, Artificial Intelligence, and Movie Theatres

Thursday morning news drop

• Inside Trump’s Ailing Business Empire Donald Trump upended the American presidency after stepping away from the company that made him rich and famous. Four years later, returning to his empire after losing the White House, what he finds may upend him. (Bloomberg)

• Inflation is coming: Signs that everything is about to get much more expensive A rundown of all the reasons that your loonies could soon be losing up to 5 cents of value every year (National Post)

• Inflation Is Just a Monster Under the Bed for Investors Despite all the fuss about expectations for higher prices, there’s little indication that a worrisome jump is coming.(Bloomberg)

• The Secret Auction That Set Off the Race for AI Supremacy How the shape of deep learning—and the fate of the tech industry—went up for sale in Harrah’s Room 731, on the shores of Lake Tahoe. (Wired)

• Rich Millennials Are Splashing Millions on Crypto Art The pandemic hit the art world hard. But an influx of young, tech-savvy collectors has kept the market buzzing. (Bloomberg)

• The pandemic won’t be the end of movie theaters, but it will forever change them Is the abandonment of the movie-house a temporary aberration forced by social distancing, or a sweeping lifestyle change? That conclusion may not be entirely clear until several of the big movie franchise films (the studios call them “tentpoles”) give it a go in the theaters this summer. (CNN)

• Credit Suisse Global Investment Returns This report contains extracts from the full hardcopy Credit Suisse Global Investment Returns Yearbook. In the Yearbook, renowned financial historians Professor Elroy Dimson, Professor Paul Marsh and Dr. Mike Staunton assess the returns and risks from investing in equities, bonds, cash, currencies and factors in 23 countries and in five different composite indexes since 1900. This year, the database is broadened to include 90 developed markets and emerging markets, and the Yearbook presents an in-depth analysis of nine new markets.(Credit Suisse)

Non-Fungible Tokens, Asset Bubbles and Baseball's Pace of Play Crisis

Wednesday news drop

Out at the bike park some random person stops by and asks if he can have 30 seconds of my time for a business pitch. I try to say no, but he proceeds to inform me that NFT’s (non-fungible tokens) are all the rage and that I have to get some. Meanwhile I hear some other random people shout out that Bitcoin is the future global currency, while another person chirps that it is going to be the next Beanie Baby fad. Kids these day say NFT’s are the future. I guess every generation has had their share of confusing and uncertain times.

• The climate controversy surrounding NFTs There’s a case for more sustainable crypto art, but it’s hotly contested (Verge)

• Still haven't learned what NFTs are? Well, this one just sold for $69M Digital artist Beeple now one of the top 3 most valuable living artists, auction house says. (CBC) Meanwhile a digital-only artwork has sold at Christie's auction house for an eye-watering $69m (£50m) - but the winning bidder will not receive a sculpture, painting or even a print. (BBC)

• Asset bubbles and where to find them There's only one sure way to identify an asset bubble, and that's after the bubble has burst. Until then, a fast-appreciating asset may seem overvalued, only for its price to keep rising. Anyone who has tried to breathe one last breath into a balloon and finds it can accommodate two or three more breaths can relate. (Vanguard)

• Howard Marks: 2020 In Review We are left to contemplate the jaw-dropping list of extremes compiled during this turbulent year: We had a health emergency, an ailing economy, the most generous capital market of all time, and strong stocks and bond markets. This seemingly anomalous relationship between the pandemic and recession on one hand and the strong capital and stock markets on the other can be explained by the Fed’s and the U.S. Treasury’s aggressive actions. (Oaktree Capital)

• Wikipedia Is Finally Asking Big Tech to Pay Up The Big Four all lean on the encyclopedia at no cost. With the launch of Wikimedia Enterprise, the volunteer project will change that—and possibly itself too. (Wired)

• Not tonight, darling: how the world lost its libido – and how it can get it back After a year of lockdowns, home schooling, social distancing and stress, sex drives are suffering – among both couples and single people. Can we do anything about it – or do we just have to wait till the end of the pandemic? (The Guardian)

• MLB Can't Wait Any Longer to Fix Its Pace of Play Crisis Willy Adames stepped to the plate to bat against Julio Urías. His job: find any way to get on base, which would bring the tying run to the plate for the Tampa Bay Rays in Game 6 of the 2020 World Series. If he failed, their season was over, and the Los Angeles Dodgers would be world champions. What happened next provided a fitting end to not just the game, but also another season in a decade of baseball’s declining entertainment value. (Sports Illustrated)

House Hunt Victoria, Financing Revenue, and Bond Investors

Tuesday morning news drop

• Ain’t So Bad For the 11th time since 1994, long-term bonds are in a 10% drawdown. The most interesting thing about this chart is that an all-time high followed all of them. And just eyeballing it, it looks like it didn’t take too long for investors to get their money back.

  Bond investors got. (Irrelevant Investor)

• Macro Thinking There is a lot of buzz going around about the size of the latest Covid relief bill and the national debt. $1.9 Trillion is a lot of money. Democrats call it the minimum amount of support needed to help individuals struggling through the pandemic, while Republicans call it a “liberal wish list” of pork barrel spending. I think we can be confident that the truth lies in between these two analyses. (Belle Curve)

• From Bowie Bonds to Pipe: Financing Recurring Revenue The idea that a predictable set of cash flows can be traded for cash proved alluring. A special financial structure called a whole business securitization emerged to channel sticky cash flow streams to investors. Today, it is used by companies which generate steady streams of income without the tangible assets that would provide the backbone for more conventional securitizations. (Net Interest)

• Why Bond Investors (and Wise Men) Got Inflation Wrong Recent history has tended to mock the financial worrywarts, and for understandable reasons. (Bloomberg)

• How Facebook got addicted to spreading misinformation The company’s AI algorithms gave it an insatiable habit for lies and hate speech. Now the man who built them can't fix the problem. (Technology Review)

• The Housing Boom That Never Ends Already Wiped Out All the Short-Sellers Real estate dominates Canada’s economy to an alarming degree (Bloomberg)

• Are investors driving the market? Prices are ripping upwards, and it’s natural to wonder where all that demand suddenly came from. It’s true that the market reversed trend and started heating up in mid 2019, but low interest rates and other pandemic impacts drastically accelerated that trend. (House Hunt Victoria)

The Bond Market, Inflation, Value Investing, 4 Day Work Week, and Crypto Trading Cards

Monday morning news drop

• Bond Market’s ‘Game of Chicken’ With Fed Is Set for a Reckoning Investors are again reassessing one of the bond market’s premier reflation trades -- the curve steepener -- as expectations for growth and inflation perk up at a clip that was hard to imagine just a few months ago. (Bloomberg)

• On Inflation How inflation drives asset prices and how to predict inflation Inflation is the economy’s Jay Gatsby: talked about by many, understood by few. Inflation can have big impacts on markets, yet predicting inflation is notoriously difficult and most investors’ portfolios are not optimized for inflationary environments. Since the 1980s when inflation peaked in the United States, research on this important economic topic has all but completely dried up. (Verdad)

• 16th-Century Traders Could’ve Predicted Zero Rates A Q&A with Paul Schmelzing, author of a paper that traces 800 years of borrowing costs, on central banks, inflation and the U.S.-China rivalry. (Bloomberg)

• Is Value Investing Really Back? Value investing is back. But is it really? Jack Forehand showed that despite the impressive results over the last 12 months, there is more to the story than just value leading the charge. (Irrelevant Investor)

• From Crypto Art to Trading Cards, Investment Manias Abound Each market frenzy seems crazier than the last. But all have the same roots. This past week, a trading card featuring the quarterback Tom Brady sold for a record $1.3 million. The total value of the cryptocurrency Bitcoin hit $1 trillion. And Christie’s sold a digital artwork by an artist known as Beeple for $69.3 million after bids started at just $100 (New York Times)

• Tell Your Boss the Four-Day Week Is Coming Soon A century after the invention of the weekend, more companies are adding another day.(Businessweek)

• How Unfair Property Taxes Keep Black Families From Gaining Wealth Flawed assessments for America’s $500 billion in annual property taxes hit Black neighborhoods hardest. (Businessweek)

• In Boost for Renewables, Grid-Scale Battery Storage Is on the Rise Driven by technological advances, facilities are being built with storage systems that can hold enough renewable energy to power hundreds of thousands of homes. The advent of “big battery” technology addresses a key challenge for green energy — the intermittency of wind and solar. (Yale Environment 360)

• How Lease Deals Have Truckers Hauling a Load of Debt Like many long-haul truckers, Frank Merrill dreamed of being his own boss. Some day, he told himself, he would buy his own big rig and become an owner-operator, king of the road, choosing what loads and routes he would take and carving out more time for a life outside the truck. (Westword)

Mark Carney, Pickup Trucks, Electric Cars, Wealth Transfer, and Double D in Duncan

Weekend news drop

• Mark Carney: ‘I didn’t want the Bank of England job. But I was asked to fix something’ He earned a fortune at Goldman Sachs, but now the banker wants the financial sector to reassess its values and tackle the climate emergency (Guardian)

• What Happened to Pickup Trucks? As U.S. drivers buy more full-size and heavy-duty pickups, these vehicles have transformed from no-frills workhorses into angry giants. And pedestrians are paying the price. (Bloomberg)

• The great generational wealth transfer is under way Recent reports on the frenzy in the real estate market have often referenced a somewhat surprising element: Millennials have largely been driving the rush. It would appear it’s millennials, not investors from mainland China, largely responsible for the head-spinning amounts of money being put down on properties. And there is likely a perfect explanation. (Globe and Mail)

• Debranding Is the New Branding From Burger King and Toyota to Intel and Warner Brothers, major brands are discarding detail and depth. Why now, and what’s the rush? (Bloomberg)

• Excel Never Dies The Spreadsheet That Launched A Million Companies. Most software we use at work exists in one of two categories: 1. It’s new and we love it for now. 2. It’s old but we have to use it and we hate it. But there’s one software product born in 1985 that inhabits its own category: it’s old, but we love it, we always will, and you’ll have to pry it from our cold, dead, fingers. That product, of course, is Microsoft Excel. (Not Boring)

• Big Market Delusion: Electric Vehicles The “big market delusion” is when all firms in an evolving industry rise together, although as competitors ultimately some will win and some will lose. The electric vehicle industry, with its astronomical growth in market-cap over the 12 months ending January 31, 2021, is a prime example of a big market delusion. In the highly competitive and capital-intensive auto industry, the January 2021 valuations of electric vehicle manufacturers are simply not sustainable over the long term.(Research Affiliates)

• How Facebook got addicted to spreading misinformation By the time thousands of rioters stormed the US Capitol in January, organized in part on Facebook and fueled by the lies about a stolen election that had fanned out across the platform, it was clear the Responsible AI team had failed to make headway against misinformation and hate speech because it had never made those problems its main focus. The company’s AI algorithms gave it an insatiable habit for lies and hate speech. Now the man who built them can’t fix the problem. (MIT Technology Review)

• Bitcoin is a mouth hungry for fossil fuels The story of Bitcoin isn’t a sideshow to climate; it’s a very significant and central force that will play a major role in dragging down the accelerating pace of positive change. This is because it has an energy consumption problem, it has a fossil fuel industry problem, and it has a deep cultural / ideological problem. Years of blood, sweat and tears extinguished by a bunch of bros with laser-eye profile pictures. (Ketan Joshi)

• Weight Watchers Isn’t Fooling Anyone The company rebranded as WW in 2018, but it’s still selling the same unhealthy diet culture. The whole idea of dieting and losing weight is increasingly seen as unhealthy and sometimes misogynistic and really just uncool. The cult of thinness hasn’t disappeared, but the body positivity movement has begun to chip away at it. (Slate)

• The Greatest Pool Player In History Just Wanted To Hustle He spent his teenage years and his twenties as a hustler, living in what the New York Times once called “lucrative obscurity.” He traveled to the United States and played under different names, returning to the Philippines tens of thousands of dollars richer. His unassuming nature suited him as a hustler. But you can only hide from your own shadow for so long. It got to the point that Efren Bata was a known commodity in billiards halls around the world. So he did the only thing he could do—he turned pro. (Defector)

A lap down Double D in Duncan Bas Van Steenbergen RAW

BC Economy, Data Privacy, Inflation, and the Role of Luck

Friday morning news drop

• B.C. expected to outperform other provinces in economic rebound The pandemic lockdown severely restricted a growing economy in 2020, but that’s all set to change this year as the majority of Canadians begin to access COVID-19 vaccines. (Douglas)

• Building confidence and trust The path ahead for privacy and data regulations in Canada. Canadian governments are working on legislation with the goal of balancing data privacy and protection without sacrificing innovation. (RBC)

• Inflation Isn’t Happening, and It Likely Won’t. Here Are 7 Charts Showing This. Inflation may be on many investors’ minds, but it has yet to show up in the numbers. Moreover, a close reading of the data suggests that inflation won’t be a problem for some time, if ever. (Barron’s)

• Companies That Rode Pandemic Boom Get a Reality Check While the pandemic battered the economy, tech companies and consumer companies powered by digital technology stood out as islands of growth. But with coronavirus cases and deaths falling, more than two million Americans a day getting vaccinations and the overall economic outlook improving, investors are starting to turn elsewhere. (New York Times)

• Bitcoin As A Meme And A Future: Most people who ask the Bitcoin Question admit that they weren’t imagining any particular use for the currency. They don’t predict that the banking system is going to collapse, leaving only Bitcoin. Nor do they really think that the value of the U.S. dollar will crash so radically and permanently that Bitcoin becomes a more stable asset. But still, they ask, butstill? (Noema)

• How Lucky Are You? The highly unlikely happens surprisingly often. Nassim Taleb wrote “We tend to underestimate the role of luck in life in general (and) overestimate it in games of chance.” A special basketball randomness edition in honor of March Madness (Better Letter)

• Inside ‘The Firm’: How The Royal Family’s $28 Billion Money Machine Really Works “I don’t know how they could expect that after all of this time, we would still just be silent if there is an active role that The Firm is playing in perpetuating falsehoods about us.” The Firm—also known as “Monarchy PLC”—are the public faces of a $28 billion empire that pumps hundreds of millions of pounds into the United Kingdom’s economy every year. Here’s how it affects their 1,000-year-old business. (Forbes)

Jeff Grosso, the regular man’s skateboarding legend For decades, Jeff Grosso lived and breathed skateboarding, spreading his passion for the sport in person and in his digital series with Grosso’s YouTube series is “Loveletters to Skateboarding” His friends and family recall his passion, his character and what made him a skateboarding legend. Because style matters more than anything.

Finding Unrideable Lines with Chris Akrigg | The Old World Behind the Scenes Trial bike legend Chris Akrigg is a man of an exquisite taste when it comes to bikes and ways of using these beautiful machines. Same could be said for the Tillmann Brothers when it comes to filming bikers & choosing places to film them. Therefore it is not hard to imagine that joining forces & travelling to Scotland resulted in an absolute banger of a segment in The Old World Movie.

GME Gamestop, Tesla, Women on Boards, and the New BMW M3

Thursday morning news drop

• Bank of Canada will hold current level of policy rate until inflation objective is sustainably achieved, continues quantitative easing The Bank of Canada today held its target for the overnight rate at the effective lower bound of ¼ percent, with the Bank Rate at ½ percent and the deposit rate at ¼ percent. The Bank is maintaining its extraordinary forward guidance, reinforced and supplemented by its quantitative easing (QE) program, which continues at its current pace of at least $4 billion per week. (Bank of Canada)

• GME, Doge, Supreme: How Getting Rich Went Full Internet The idea has always been that value — in stocks, art, precious metals, whatever — is inextricably tied to “fundamentals.” But it seems the internet changed that (hello, GME and Dogecoin!). Felix Salmon explains that if you want to understand finance now, you’d be better off studying Supreme than an annual report. (Wealthsimple)

• Seven More Ways to Fool Yourself Into Good Financial Decisions Being boring has its advantages, behavioral economists say. (Businessweek)

• Tesla owner spends $160 driving cross-country in all-electric 2021 Mustang Mach-E My problem with Tesla is their quality of service and workmanship. Some people accept it. When I had a 2019 Model X 100D, I used to hit a puddle and water would shoot up from the dashboard in my car. That car cost me almost $90,000. They couldn’t figure it out. In the Mach-E, everything looks nice (Detroit Free Press)

• Fixed mortgage rates have increased. But for home buyers willing to gamble, variables are getting cheaper Major lenders have hiked fixed five-year mortgage rates over the past few weeks in response to rising government bond yields, but new home buyers willing to take a gamble may be tempted by another option: declining borrowing costs for variable mortgages. (Globe and Mail)

• Shut out: A well-qualified millennial home seeker throws up his hands after losing multiple bidding wars In a hot housing market, it means nothing that you have a household income of more than $200,000 and a down payment of $450,000. (Globe and Mail)

• The Empty Religions of Instagram How did influencers become our moral authorities? Are we truly nonreligious, or are our belief systems too bespoke to appear on a list of major religions in a Pew phone survey? (New York Times)

• Report Regarding Women on Boards and in Executive Officer Positions This report outlines key trends from a recent review of public disclosure regarding women on boards and in executive officer positions as required by Form 58-101F1 Corporate Governance Disclosures. The review was completed for the purposes of identifying key trends. A qualitative assessment of compliance with the disclosure requirements was not conducted. (Canadian Securities Administrators)

The New BMW M3 Looks amazing except for the front… how did they make a car look soo good and soo ugly at the same time?