What we’re reading (11/7)
“Investing When Everything Is Expensive” (Morningstar). “Previous bull markets forced them to either 1) join the crowd, accepting that the consensus had correctly identified future trends, or 2) retreat into solitude, by buying that which had become neglected. The latter approach came with no guarantee, but at least it offered the solace of low prices. Today, there is no analogous choice. Yes, some investments are cheap, for example energy stocks or emerging-markets debt, but they account for only a small part of the global financial markets. They cannot form the whole.”
“Government-Bond Swings Burn Wall Street Investors” (Wall Street Journal). “A rapid U-turn in government-bond markets has sparked deep losses for some of Wall Street’s biggest investors, a stark demonstration of how even small shifts in expectations for economic growth and central-bank policy can upend the most carefully laid bets. Behind the losses are recent abrupt moves in government-bond prices. With central banks signaling plans to end their extraordinary stimulus measures, short-term bonds have tumbled in price, sending yields—which rise when prices fall—to touch their highest levels since March 2020.”
“Will We Be Sorry We Shut Down?” (City Journal). “It’s not clear…that everyone will experience the return to normal as a liberation. The pandemic caused us to worry, but it also delivered us for a while from a still-greater worry: the anxiety of freedom. To parody Pascal, who explained that the misfortune of humanity consisted in the inability to sit quietly in one’s room, alone, we might say that the misfortune of humanity after Covid will perhaps be to be shut up in one’s room—and like it.”
“Peloton's Founder Is No Longer A Billionaire After The Stock’s Violent Post-Earnings Sell-Off” (Insider). “John Foley's net worth fell to about $850 million during Friday's session as investors dumped shares and drove a sell-off that extended as far as 35%, Bloomberg first reported. Foley would still stand to gain if he exercised those options even after the sell-off, according to Bloomberg. He's also pledged 3.5 million shares as collateral for a personal loan, according to a regulatory filing.”
“The Man Who Called Bullshit On Uber” (Mother Jones). “Horan says he’s occasionally seen other companies use ‘these totally bullshit accounting games.’ But he adds they are the equivalent of a neon sign reading ‘Danger! Management Isn’t Trustworthy—Don’t Invest Here!’ In 2020, for example, Uber reported a net loss of $6.7 billion on $11.1 billion of revenue. But according to the company’s adjusted profit measure for the year, it came up $2.5 billion short. More than $4 billion in losses were accounted away.”
