whatfor1

Love America 🇺🇸

[whatfor1 @globalmarkets93]

@michaeljburry Worldcom wasnt growing GAAP earnings at 30% CAGR and customers were not prepaying money to build capacity (ORCL is 12x GAAP NTM)

Rolling out broadband was like digging ditches - very different from building DC which is severely capacity constrained with a lot of pushback

[whatfor1 @globalmarkets93]

@the_transit_guy So did Europe and we just did fine - thank you!

[whatfor1 @globalmarkets93]

They are hedging ai debt risk by buying CDS on NVDA - it doesn’t necessarily mean that there blownup is imminent.

Biggest buyer probably are investment banks hedging their residual exposure till they pass to end holders like pension funds or insurance companies

CDS unlike GFC no longer as good a predictor - once markets knows it gets arbitraged away.

[whatfor1 @globalmarkets93]

It’s easy to over complicate - orcl is 12x forward earnings and growing at 25% CAGR for next 5 years

They have a very sticky user base from legacy database business

Their DC customers are giving them advances to build - that’s a sign of tight market for a long time and also ensures higher returns

People forget hyperscalers are more leveraged vs their history because they were essentially net cash previously. Today, we n absolute basis, these comp have tiny debt vs their b/s or their cash flow

[whatfor1 @globalmarkets93]

@MichaelJBurry__ Could this also mean that supply for everything will remain more constrained and hence longer runway?

[whatfor1 @globalmarkets93]

Schwab is diff from GS

Folks who have acc at GS are not looking for same service as Schwab and moving acc is very complicated due to estate planning etc.

Not to mention wealth management is small part of GS. Capital markets activities are not negatively effected by this at all, in fact -

if Muse succeeds it means longer runway for Ai and better for capital markets

[whatfor1 @globalmarkets93]

It’s easy to over complicate - orcl is 12x forward earnings and growing at 25% CAGR for next 5 years

Their have a very sticky user base from legacy database business

Their DC customers are giving them advances to build - that’s a sign of tight market for a long time and also ensures higher returns

[whatfor1 @globalmarkets93]

@kashyap286 This issue is timing - Corp leverage overall is at 40 year lows

[whatfor1 @globalmarkets93]

All growth comp have negative FCF in early part of their cycle.

All utilities have negative FCF but they get 3% ROA on run rate basis.

CRWV ROA is in low DD plus leverage - on a run rate basis. So very high returns. Their ebitda would be $18bil next year so it’s 4x ev/ebitda and gets better as time passes

They signed up 4 year constructs on a100 which was released in late 2020

Obv risk is if there is a compute glut by let’s say 2028-29 their returns will be lower

Orcl debt issues are simply Wall Street trying to sell what’s on their books once it clears pricing should stabilize

[whatfor1 @globalmarkets93]

@rdd147 @jeffreyleefunk Not sure why everyone is so focused on Dr Burry?!

He has one great macro call but otherwise he is a deep value manager - think lulu etc

Reminds me of Elaine Garzarelli who predicted 1987 crash - was a hot star for a decade post 1987 till people moved on

[whatfor1 @globalmarkets93]

@partners_road Long term returns suggests he is a bull market genius?

[whatfor1 @globalmarkets93]

@breadcrumbsre People always believe the prior generation was stupid - till we get a bear market!

[whatfor1 @globalmarkets93]

@TimmerFidelity Other reason - it’s just consolidating after massive spike in June

Earnings revisions continue to be very strong even over last few weeks &
Most Taiwanese supply chain indicators remain strong

Obv could be peak cycle but odds seem low at this point

[whatfor1 @globalmarkets93]

@hkuppy Nothing is permanent - everything is cyclical - be careful taking victory laps while running tiny pools of money (couple of $ billion or less)

Even the so called “GOATS” haven’t done well over past 10-15 years which is why you don’t see their record in public.

[whatfor1 @globalmarkets93]

@michaeljburry All this leads to more compute demand - more & more corporates have begun to come out publicly (non tech) and suggest they are increasing their AI spend

[whatfor1 @globalmarkets93]

@negligible_cap Actually it’s a very bullish number - since compute now is divided into atleast 3 parts - open ai, anthropic and open source. All growing VERY rapidly!

[whatfor1 @globalmarkets93]

@jackprandelli 1971 is just not comparable - that was a Bretton woods collapse - so not repeatable.

Gold was fixed from 1932 till 1971 and hence was massively undervalued

China is slowing massively and is still the biggest buyer of copper

So picture is far more nuanced?

[whatfor1 @globalmarkets93]

@CRUDEOIL231 Wouldn’t memory do even better in that case? If global economies are doing well then both copper & memory will do well but memory names are far cheaper than most mining names.

Memory market is under supplied by atleast 1/3 this and probably next year ?

Just wondering

[whatfor1 @globalmarkets93]

@MichaelJBurry__ Not sure how can anyone jump to that conclusion this quickly? What steps of his are triggering that view?

One could argue he would probably do better job than WB did over past few years as he can be more ruthless than WB wanted to be at the end of his career

[whatfor1 @globalmarkets93]

@OddStats Except it wasnt flat for a year before and it wasn’t 12x NTM earnings