Become a Better Investor Newsletter – 15 October 2022
Noteworthy this week
- Ben Bernake gets the (not a real) Nobel Prize for inventing the money printer
- UK inflation-linked bond has performed like crypto
- REITs haven’t been safe, either
- Trouble continues for UK pension funds
- Rules for thee but not for me
Ben Bernake gets the (not a real) Nobel Prize for inventing the money printer: “…significantly improved our understanding of the role of banks in the economy, particularly during financial crises. An important finding in their research is why avoiding bank collapses is vital.” We’re still dealing with the QE era he started.
They gave Bernanke a Nobel Prize for fixing the paper jam at the Fed’s printing press?? For fuk’s sake!! This is twisted. He started the QE death spiral that we cannot get ourselves out of. Should be in prison… https://t.co/HllQzHKY6F
— Kuppy (@hkuppy) October 10, 2022
UK inflation-linked bond has performed like crypto: While it’s definitely a case of cherry-picking, it’s quite an awakening to see a bond fall by 70-80%.
Mind blown. The longest-maturity UK government bond has crashed worse than bitcoin over the past year or so. https://t.co/83MJa8KBxq pic.twitter.com/PV4tyOqeT5
— Robin Wigglesworth (@RobinWigg) October 11, 2022
REITs haven’t been safe, either: MSCI US REIT Index had fallen 28% YTD as of September 2022. As I’ve said before, REITs typically don’t offer diversification benefits.
Are REITS really down 38% this year? Wasn’t this supposed to be an inflation hedge? Asking for a friend…. pic.twitter.com/9vaPUHHTA3
— Andrew Beer (@andrewdbeer1) October 10, 2022
Trouble continues for UK pension funds: Bank of England has extended its support, so the threat is real. Let’s hope British retirees will still get their money.
All of these pensions were acting like over-leveraged hedge funds.
Is anyone going to be fired for taking such crazy risk with all of the big pension funds in the UK ? pic.twitter.com/86ZFi7Vvz8
— Wall Street Silver (@WallStreetSilv) October 11, 2022
Rules for thee but not for me: While it’s somewhat written as a joke, it’s not a joke.
Investigated by the SEC: Bored Apes, Kim Kardashian, guy who made $5k on an options trade
Not investigated by the SEC: Members of congress
— Genevieve Roch-Decter, CFA (@GRDecter) October 11, 2022
Poll of the week
US inflation
— Andrew “The Worst” Stotz (@andrew) October 14, 2022
Results from last week’s poll
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Weekly market performance
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Chart of the week
Discussed in the Become a Better Investor Community this week
“Banks and their connection with governments”
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Podcasts we listened to this week
RWH013: MOVE SLOW, WIN BIG W/ THOMAS RUSSO
As usual, there were many interesting things in this episode from RWH. A leading beer brand in an emerging or frontier market could expect massive demographic dividends. As more people enter the legal drinking age, your addressable market grows. Another change in these countries is the move to “western-style” beers from traditional ones.
RWH014: THE RESILIENT INVESTOR W/ MATTHEW MCLENNAN
“Selectively curating something, and letting time take its course it can be very rewarding.”
Readings this week
Three Rules for Making a Company Truly Great
“(1) Better before cheaper—in other words, compete on differentiators other than price; (2) revenue before cost—that is, prioritize increasing revenue over reducing costs; and (3) there are no other rules—so change anything you must to follow rules 1 and 2.”
Return on Invested Capital
“This report is about return on invested capital (ROIC), a financial metric that can help with assessing whether a company is creating value with its investments. We will discuss how to calculate ROIC, show how it is connected to free cash flow, economic profit, and growth, work through some of the practical challenges in estimating it properly, show empirical data, and review how the introduction of intangible investments can reshape the figures.”
Memes of the week
— Steve Grasso (@grassosteve) October 11, 2022
When your portfolio down so bad you ask the Fed to cut rates https://t.co/Fs242uU4Ll
— Dr. Parik Patel, BA, CFA, ACCA Esq. (@ParikPatelCFA) October 10, 2022
New My Worst Investment Ever episodes
Ep605: Harriet Mellor – Do You Have the Time to Invest and Take Action?
BIO: Harriet Mellor is a Sales Transformation Coach, Serial Entrepreneur, Consultant, and CEO of Your Sales Co. She is passionate about growing businesses and removing the stigma from sales.
STORY: Harriet invested thousands of dollars in courses, programs, and coaches she never used because they didn’t align with her values.
LEARNING: If you don’t take action, you won’t see any results from your investment.
Ep604: Hugh Grover – Choose to Listen to Your Gut Feeling
BIO: Hugh Grover is the founder of the Digital Sales Community. He has helped Fortune 100 companies and some of Australia’s leading businesses massively turn the dial on revenue.
STORY: Hugh spent over six years studying a course he was uninterested in and working a job that he hated just because he thought that’s what people thought was right for him.
LEARNING: If something doesn’t appear right, listen and unpack why your gut feeling is off.
Ep603: Mihir Koltharkar – Don’t Count Your Chickens Before They’re Hatched
BIO: Mihir Koltharkar is a Global Award Winning Trainer, TEDx and Keynote Speaker, and Author with a rich experience spanning 22 years.
STORY: Mihir partnered with a friend to offer his services to a government company in Mauritius. The profits from this deal would have been in millions in just about 45 days. Then, out of the blue, the company declared bankruptcy nullifying the contract.
LEARNING: Don’t count your chickens before they’re hatched. Be careful not to get into the entrepreneurial seizure. Even if you have a signed contract, the deal is not done until the money is in your bank account.
Published on Become a Better Investor this week
Esso (Thailand) Public Company Limited (ESSO TB): Profitable Growth rank of 2 was up compared to the prior period’s 4th rank. This is World Class performance compared to 320 large Energy companies worldwide.
Read Esso (Thailand) – World Class Benchmarking
China Resources Pharmaceutical Group Limited (3320 HK): Profitable Growth rank of 9 was same compared to the prior period’s 9th rank. This is poor performance compared to 380 large Health Care companies worldwide.
Read China Resources Pharmaceutical Group – World Class Benchmarking
China Resources Beer (Holdings) Company Limited (83 HK): Profitable Growth rank of 2 was up compared to the prior period’s 4th rank. This is World Class performance compared to 600 large Cons. Staples companies worldwide.
Watch China Resources Beer – World Class Benchmarking
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Read Your Wealth Engine – 10 October 2022
CJ CheilJedang Corporation (097950 KS): Profitable Growth rank of 8 was same compared to the prior period’s 8th rank. This is below-average performance compared to 600 large Cons. Staples companies worldwide.
Read CJ CheilJedang – World Class Benchmarking
DISCLAIMER: This content is for information purposes only. It is not intended to be investment advice. Readers should not consider statements made by the author(s) as formal recommendations and should consult their financial advisor before making any investment decisions. While the information provided is believed to be accurate, it may include errors or inaccuracies. The author(s) cannot be held liable for any actions taken as a result of reading this article.