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Newsletter - January 21st, 2023

Updated: Mar 24, 2023

Dear Reader,


Attached is our latest list of apparently cheap stocks generated from basic value screens (low p/e, ev/ebitda, debt/equity, etc.), which don’t meet our investment standards - and our reasoning.


This may help you avoid a few ‘value traps’ or stocks that aren’t sufficiently attractive compared to the opportunities available today.


For reports of stock ideas that pass our quantitative and qualitative standards, join at the link below:




 

WealthTrack


We've been watching a few Wealthtrack videos this week - some learnings presented below:


Marty Whitman


Marty Whitman is an investor we feel closer and closer to over the years in our investment philosophy. His background is similar to Ben Graham's - they came from a background of credit analysis - specifically distressed debt investing, which is the soundest approach to common stock investment in our view.



Marty's description of the "fulcrum security" is most insightful, and his application of this principle to common stocks is fundamental to investing safely and profitably.




Hersh Cohen


Never heard of this investor before but he must've been reasonably good managing a $150bn investment fund for decades. It's encouraging to see that a simple dividend strategy that he doggedly pursued could be so successful over time:





Matthews Asia Fund


This fund has been focused on Asia for decades - so it was useful to see what the fund manager thought of the geo-political risk posed by China:



He may be underestimating the long-term risk of war and disruption; and simply under-weighting China exposure in response (see end of interview) - but insightful talk nonetheless.




Niall Ferguson


We've always regarded Niall Ferguson with respect since first watching his 'Ascent of Money' documentaries in 2008 - certainly a well-researched, insightful, and independent-minded historian.


'The further you look back, the further you can see ahead'


Part One:


Referring to the Lyndon Johnson government policies of deficits and balance sheet expansion in the 1960s, his assessment that we may be entering a period of persistently higher inflation than the last three decades is worth thinking about.


Part Two:


Back to the US-China rivalry, we'd arrived at the same conclusion that Niall advises here - bailing out may not be necessary, but an exit strategy probably is.

 

Until next time, Have a great week!


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