Geoff Lowe

Humanist, rationalist, yachting, cricket and rugby tragic, market researcher, husband and half the explanation for two kids who call me Dad!

[Geoff Lowe @GeoffLoweItools]

@wholemars Can’t wait to see all the follow up coverage in the media! Yeah, right!

[Geoff Lowe @GeoffLoweItools]

@ConnectingODots Or just… “Made on Earth by Humanoids”, because that includes both organic and inorganic versions of the form factor!

[Geoff Lowe @GeoffLoweItools]

@wholemars Remember BlackBerry!

[Geoff Lowe @GeoffLoweItools]

Good news - you can have your cake and eat it too… In rugby, the clock is stopped at defined times (injury breaks for example) so everyone - the players, the crowd and TV viewers know how much time is left. What keeps the players going at the end of the match is that play continues after the full 80 minutes are done until the next stop in play. If the side coming second at that time has possession, they do all they can to keep the ball alive and score. The other side usually, but not always, ends it by putting the ball out.

[Geoff Lowe @GeoffLoweItools]

@SawyerMerritt Elon has led companies that have now created… He’d be quick to credit the great people in his companies.

[Geoff Lowe @GeoffLoweItools]

@globeandmail What an idiotic thing to think let alone write! 🤦‍♂️

[Marc Andreessen 🇺🇸 @pmarca]

Time is a flat circle. “AT&T’s lawyers submitted into evidence a Department of Defense position paper asserting that the breakup of AT&T would threaten the nation’s defense communications system and harm national security.” https://t.co/UG9YJog35u

[Geoff Lowe @GeoffLoweItools]

@wholemars 😳

[Geoff Lowe @GeoffLoweItools]

@MarioNawfal I’m picking up on your sarcasm… 😬

[Geoff Lowe @GeoffLoweItools]

@EdwardJDavey 🤦‍♂️

[Geoff Lowe @GeoffLoweItools]

@drtimpearce @elonmusk @engineers_feed Ironic that irony is missed by most!

[Geoff Lowe @GeoffLoweItools]

@stevenmarkryan I just set automations on my iPhone so dark mode turns on when I start X and it turns off again when I close it. Not ideal, but pretty good.

[AJ Investment Research @alojoh]

Subscriber asked about the impact on share price from a reduction in share buy backs (sbb) amongst big tech companies.

The short answer is the impact is limited. There are much bigger movers to worry about.

Why?
1. Even thought the absolute dollar amount of shares repurchased looks high the fact that these SBBs are being executed at higher multiples >20x implies that their impact on EPS accretion (increase) is rather small over a short time horizon (1-1.5 years). However, over longer periods it does make a difference. SBBs have the biggest impact at a low forward multiple. For exmaple, GM's SBB is very impactful since GM trades at low forward multiple.
2. SBBs' share price boosting effect is limited due to the large relative trading volume in large tech companies: SBBs account for a small share of overall demand. Some of the big tech companies have close to or over a trillion dollar in trading volume providing large absolute and relative (relative to MCap) liquidity in a single quarter while even the largest SBBs hardly ever exceed $15B per quarter.
3. Of course, point 2. ignores second order effects but SBBs have limited effect in highly liquid and high P/E stocks is the point. However, in low-liquidity stocks and low P/E names the effect can be quite material and is quantifiable.
4. All of this ignores the other side of the coin: all this capital, capital that was spent on SBBs now goes into productive assets: large scale compute. This is often missed in this discussion.

As I stated in other notes: the most likely scenario is that all major tech companies turn into an Amazon-type company, meaning: super large scale, massive operating cash flow, but significantly lower profitability. Cash earnings will be strong but accounting earnings will be weaker. We learned from Amazon, which experienced strong share price appreciation for the last 3 decades, that investors will accept low accounting profitability in exchange for buying into a major scale player. I typically refer to this as the "Amazon scenario".

Why the low profitability? ...you may ask. It's driven by enormous depreciation charges. However, these charges reflect spend of yesteryears and hence investor will look past them. This is a 'sunk-cost' fallacy exploit. But that's a whole different topic. Peace

[Geoff Lowe @GeoffLoweItools]

@farzyness Looks like it's just the Home page. Go to the You page and it works...

[Shawn Ryan @ShawnRyan762]

@MarioNawfal Awesome.

[Geoff Lowe @GeoffLoweItools]

@farzyness Elon was speculating on what they could do in a disaster scenario, not what that will do with Cybercab…

[Geoff Lowe @GeoffLoweItools]

@wholemars Just had a squiz at the top questions... You need to increase your reach because your message clearly hasn't gotten through! 🤦‍♂️

[Geoff Lowe @GeoffLoweItools]

@wholemars But very few will be sold to the public!

[Geoff Lowe @GeoffLoweItools]

@AktyonCo @farzyness @elonmusk That was a surprise!