HQ2: Amazon expands its data empire
Amazon has all but confirmed the two winning cities of its search for a second headquarters (“HQ2”) – Crystal City, VA and Long Island City, NY, in the suburbs of Washington, DC and New York City, respectively. The project was initially proposed as an equal to the company’s Seattle headquarters with a promise of 50,000 […]
The difference between a good product and a good business
Last month, Instagram co-founders Kevin Systrom and Mike Krieger caused a stir in the tech community when they walked away from the app they created due to tensions with parent company Facebook and CEO Mark Zuckerberg. According to various tech publications, the co-founders had become annoyed at the increased meddling by Facebook executives with Instagram’s […]
The clandestine threat from China
Earlier this month Bloomberg Businessweek published an article with allegations that were, to say the least, explosive. The article asserts that during the manufacturing process, China had inserted trojan-horse chips into the motherboards of servers destined for the U.S.–an extraordinary feat, if true, as well as a grave security threat to any company or government agency […]
The Collision of Fundamentals and Technicals: New GICS Sector Definitions
Fundamental bottom-up investors like ourselves generally steer clear of technical indicators as they often lay diametrically opposite to our value investing framework (i.e. top-down, short-term, algorithmic, etc.). However, significant changes to the Global Industry Classification Standard (GICS), one of the most widely used frameworks to delineate sectors, will come into effect on Friday, September 28, 2018 and is worth reviewing given several names […]
The Class 8 Frenzy
Recent months have seen U.S. Class 8 truck orders hit all-time records. The current cycle is arguably the strongest ever, and is being driven by a combination of structural and cyclical factors. For a number of reasons, this cycle is different from the one that came before it, and there are potentially nuanced ways to […]
Keep on trucking
“Truck drivers: the unsung heroes on the road” read the title of an article discussing the key role served by U.S. truck drivers. Despite the accolades, one thing remains for certain: driving trucks in the U.S. is a demanding job, with fewer and fewer people opting for this career. The resulting truck driver shortage in […]
Large Consumer Goods with a Side of VC
Autonomous vehicles, artificial intelligence, augmented reality, … consumer goods? One of the latest trends in venture capital funding has been the growing proportion of funds directed toward startups aiming to disrupt the consumer staples market. Recent shifts have removed many of the barriers to entry that for decades cemented the same brands’ spots on retail […]
Colliding Federal Debt and the Rate Hike Cycle
Following the U.S. Federal Reserve Bank’s recent decision to raise short term interest rates by 25bps (to 1.75-2.00%) and indicate 2 more are on the way this year, we thought it was an opportune time to revisit one of ourfavorite asymmetries when looking at businesses from the short side, namely debt and leverage. Generally speaking, if a […]
What Lies Beneath the Increasingly Unstable European Union / Euro Currency
With the recent violent market reaction across equities, bonds, FX, etc. in response to fears of Italy leaving the European Union / Euro Currency, we thought we’d take a closer look at what is happening in Europe and across the world. Populist movements are on the rise globally, from the U.K., U.S., Australia, Italy, etc. […]
The emergence of a new economic idea
What if it were true that government debt did not matter? That governments could borrow as much as they liked to fund social programs to keep their citizens educated, employed and healthy? Socialist utopian nonsense is probably the first thought that jumps to most readers’ minds. And while your author is far from convinced that […]
