Husayn

[Husayn @whossaynn]

@BichonRedux what are the unit economics on new stores?

feels like deleveraging could be the prudent move here for fcf allocation but what do i know..

[🇵🇸 @JoeDaActivist]

5 bedroom 4 bath house for sale in Louisiana dm for details.

[Devon Eriksen @Devon_Eriksen_]

This is a fair question, so I'm not going to give you the Emmett treatment, but the answer is "no".

See, most people think that the problem with communism is that people aren't perfectly altruistic, or central planners aren't smart enough, but neither of these is the real issue.

The real bottleneck is data, not intelligence.

See, economics is the study of choice. Specifically, it's about the choice of how you allocated limited resources that have alternate uses.

Do you make desks out of wood, or steel? How much water do you allocate to filling swimming pools vs growing almonds?

In a communist system, there tends to be some kind of central planning entity that makes these kinds of decisions. In capitalism, the decisions are spread out, with many individual actors making small decisions about what THEY will do, based on what effects THEM.

The advantage of capitalist distributed and emergent decision making is not only that it makes far more neurons (and lately CPUs) available to this decision making process. I mean, that's a big deal. It really has orders magnitude more processing power.

But the real, insurmountable advantage of capitalist distributed decision making is that it brings those decisions close to the information they are based on.

A communist central planning committee is many layers removed from the guys in the forest cutting trees, and the guys smelting steel, and the guys making and selling furniture.

They truly can't figure out how many desks to make out of steel, and how many of wood, no matter how smart they are. They just don't have the data.

Capitalist decision makers are closest to the data that corresponds to their specialty, and they get an aggregate of other data from prices, which emerge from other people's decision making.

The dudes cutting trees know fucking everything about wood, but nothing about furniture. So they set the price of wood (based on their abilities and needs and expenses), and the guys who make furniture can work out how many wooden desks to make based on that price, because they know how many desks people buy, whether they prefer wood or steel, how much it will cost them to make each based on prices, etc.

In other words, capitalist systems farm out decisions to domain experts, while communism relies on bunch of isolated generalists.

This is why communism not only doesn't work, but can't work in any possible universe.

[Shrug Life @shekfu]

Trying to keep track of this amazing back and forth Twitter thread between a novelist and the guy who was temporary CEO at Open AI for a hot second.

It all started when CEO dude starts pontificating about redistribution of wealth...

[Husayn @whossaynn]

@F_Compounders I thought this was compelling. Looks like it ended up in bankruptcy again. Walmart pushed them to manufacture oversees and when they refused, Walmart left. Received court approval in Oct 2003 to sell assets off for $128 million, I’d easily guess equity holders were wiped out.

[Husayn @whossaynn]

@BradoCapital why would your KPI for constellation and topicus differ?

[juju 💰 @ayeejuju]

Jada Pinkett Smith reveals she was in the car that night with Tupac.

When the bullets started flying, she was heard screaming, "Take Will Smith instead" 😳

[Husayn @whossaynn]

@PaulAndreola search function was significantly better before, need to either revert but update aesthetics or make the current one a lot more user friendly

[🅿️ @the_P_God]

Yeah DCF looks good

[Buyback Capital @Larryjamieson_]

Made this mistake more than I’d like to admit

H/t @YetAnotherValue

[Husayn @whossaynn]

@2by4Value @stonkmetal point taken. 2 play devils advocate, i’d flip that and say it’s not terrible to own a business that anyone could run. not trying to understate the importance of strong capital allocation though. is management really running it so poorly that it somehow wont continue compounding?

[unusual_whales @unusual_whales]

The top 10% of earners (estimated average income of $174,000 – $176,000 Canadian Dollars) in Canada do not qualify for a mortgage to purchase the average Canadian home at its current cost of $754,700, per DollarWise.

The minimum income required is $180,075.

[Husayn @whossaynn]

@stonkmetal *rather than up

[Husayn @whossaynn]

@stonkmetal $etsy, trading for like ~12x free cash flow. holding up well in cyclical environment, leader in its niche, don’t need to explain the moat behind marketplaces or negative working capital. looking down then rather up, seems hard to see permanent capital loss at current valuation.

[Husayn @whossaynn]

@HotDogCap are there many cases of truly distressed companies that didn’t result in equity holders getting wiped out? wonder if there’s a reason distressed equity doesn’t have a large crowd — obviously, a huge part of distressed debt is LGD inputs, let alone being higher on the cap table.

[Husayn @whossaynn]

@WalMouk @Simonzx22 @LongHillRoadCap @sb9721p to be clear, i think this is a decent business with interesting tailwinds and appreciate its balance sheet stability and profitability. i just think you can aim for more significant IRRs if you’re playing in the small/micro cap space.

[Husayn @whossaynn]

@WalMouk @Simonzx22 @LongHillRoadCap @sb9721p business does what, $5-6mm ebitda? EV is like ~$150-160mm?

i appreciate their profitability, but their margins are not “outsized” compared to SaaS average, and at ~30x+ EBITDA with low S&M spend, how on earth do you realize significant IRR? you don’t have twin engines.