Thoughts on Investing
This manager commentary provides insight into our global, concentrated absolute value investing philosophy and the key tenets that have consistently underpinned our value investing approach.
The purpose of C&B Notes is to pass along ideas, concepts, stories, and information that are informing and influencing our worldview and “latticework of mental models.”
There is no substitute for being on the ground to assess how businesses are really performing. Accordingly, international and domestic travel is a critical component of our research. This Travelogue includes snippets from some of these international trips.
In his recently released annual letter, JP Morgan Chase’s Jamie Dimon opined on how the lower depth of inventory in the Treasury market could create liquidity problems in a panic. While still only a theoretical concern, it is a noteworthy potential by-product of the manipulation happening in the Treasury market by the Federal Reserve and other central banks. This series of charts by The New York Times helps illustrates the unprecedented environment.
China’s National Bureau of Statistics reports that new home prices dropped 5.7% year-over-year, the biggest annual decline since the survey began in 2011. Month-over-month, new home prices fell in 66 of the country’s 70 major cities in February, up from 64 in January. Premier Li Keqiang has promised to support the national economy if it continues to slide (are there any other pages in a central bank’s playbook anymore?), but the balance sheets of municipal, regional, and the national governments are already over-leveraged from previous stimulus efforts.