“One of the most dangerous phrases in investing is ‘it’s different this time.’ The second most dangerous is ‘this company is so good it deserves a higher multiple.’ No company deserves anything. The price you pay determines your return and your risk.
I have watched investors pay 50, 60, 100 times earnings for companies that were growing 30% a year because they were convinced the growth would never stop. When the growth slowed to 15%—still terrific—the multiple collapsed and the stock fell 70 or 80%.
The quality of the business didn’t protect them at all. The absence of a margin of safety destroyed them.
The margin of safety is not a function of how good the company is. It is a function of how cheap the stock is relative to a conservative appraisal of value. Everything else—management quality, competitive advantage, growth prospects—is interesting conversation, but it is not the margin of safety." - Howard Marks
When will American overreach stop??
The last week global media have been full of stories about indictment against the Adani Group by an American Prosecutor.
It is time the world starts asking when American overreach will stop? Lets turn the table for a second and assume that an Indian Court charged top American business executives for crimes allegedly done in the US. Would this be acceptable to America? Would American media find it appropriate?
Added it is now clear that the accusations are not against the top Adani leaders, Gautam and Sagar Adani.
Nor is there evidence that bribes were paid by Adani executives to Indian government officials. The indictment solely rest on claims that bribes were promised or discussed.
This American overreach has serious consequences for peoples lifes. It makes it harder for one of Indias economic power houses to finance its operations. It forces the Adani Group to spend time and resources in court rather than building solar and wind plants. It simply slows down the green transformation of India.
Its time to put a stop to American overreach!
One thing I'm sure. As a receiver of ad revenue payout, I've first hand knowledge of what is happening there. Still how many people faked yesterday. How much people would then fake their portfolio returns, trading profits and so on?