The Business Brew

Charles Frischer and Asheef Lalani stop by The Business Brew to discuss why they like Fairfax as an investment. Quick reminder to do your own work!!!

Asheef Lalani as an independent director to the board of Sailfish Royalty Corp. Mr. Lalani graduated from the University of Waterloo with a Bachelor of Mathematics and Masters of Accounting, earned the CA/CPA designation in 2002 and is a CFA charterholder since 2003. Asheef first started his career with PricewaterhouseCoopers in 1998 and went on to become a portfolio manager at UBS Securities. Currently, Mr. Lalani is the Chief Investment Officer at Berczy Park Capital – a private family office in Toronto, Canada.

Sponsor Info:

⁠⁠Daloopa ⁠⁠is founded by a former hedge fund analyst to bring simplicity into the investment process. ⁠⁠Daloopa ⁠⁠offers an AI driven single source for all company reported data, and allows for investment teams to ake the most informed decisions in the shortest amount of time. ⁠⁠Daloopa ⁠⁠scales the velocity of an investment team’s idea gen. Analysts spend less time locating and manually inputting meaningful disclosures into Excel and more time synthesizing in the minutes after the print. ⁠⁠Daloopa ⁠⁠captures data from all company reported sources, including from footnotes, MD&As, and investor presentations. Our data sheets include GAAP to non-GAAP adjustments, guidance, and all company specific KPIs. Each datapoint is auditable to the source for easy verification and accuracy. ⁠⁠Daloopa’s ⁠⁠Excel plugin can also update your existing models for the latest quarter in just a single click.

Bulge-bracket banks and major multi-managers are trusting Daloopa for use in initiating coverage, building and maintaining industry dashboards, and keeping their models up to date.

Visit ⁠⁠⁠Daloopa.com/BusinessBrew⁠⁠⁠ to create a free account and learn more about how ⁠⁠Daloopa ⁠⁠can help increase your team’s speed to differentiated insight.

Detailed Show Notes

4:24 - Backgrounds

9:01 - Fairfax gets interesting in Asheef's mind

11:43 - Pushback to the thesis

13:00 - Does Fairfax underwrite well?

17:00 - Why insurance companies shouldn't under reserve

25:00 - How good is Fairfax at investing in equities?

30:00 - The potential upside India brings to Fairfax

34:20 - Fairfax India background

42:55 - What people might not like about Fairfax India

45:40 - Fairfax's advantages

56:40 - What is the catalyst here?

62:00 - Does this pitch even need a catalyst?

64:00 - What does a bad outcome look like?

Arvind Sanger stops by The Business Brew to discuss his views on the world's sustainable energy transition. Mr. Sanger has a ton of experience and is a wealth of knowledge. He is the founder of Geosphere Capital, a global long-short fund manager currently investing in natural resources, new energy and Indian equities. Prior to that, between 2002 and 2007, Mr. Sanger was a Portfolio Manager at SAC Capital (his portfolio grew very quickly), running one of the largest equity portfolios and managing a global team based in New York and Singapore. Prior to his tenure at SAC, Mr. Sanger had a 15-year career as a top-ranked sell-side oil services & equipment analyst at a number of firms, including Deutsche Bank, DLJ and Kidder Peabody among others. Mr. Sanger graduated from the Indian Institute of Technology, Bombay, with a B.Tech in 1984 and received his MBA from Tulane University in 1987. Mr. Sanger is on the board of the Alexander Hamilton Society, Pratham USA and Pratham Educational Foundation in India.

Sponsor Info:

⁠⁠Daloopa ⁠⁠is founded by a former hedge fund analyst to bring simplicity into the investment process. ⁠⁠Daloopa ⁠⁠offers an AI driven single source for all company reported data, and allows for investment teams to ake the most informed decisions in the shortest amount of time. ⁠⁠Daloopa ⁠⁠scales the velocity of an investment team’s idea gen. Analysts spend less time locating and manually inputting meaningful disclosures into Excel and more time synthesizing in the minutes after the print. ⁠⁠Daloopa ⁠⁠captures data from all company reported sources, including from footnotes, MD&As, and investor presentations. Our data sheets include GAAP to non-GAAP adjustments, guidance, and all company specific KPIs. Each datapoint is auditable to the source for easy verification and accuracy. ⁠⁠Daloopa’s ⁠⁠Excel plugin can also update your existing models for the latest quarter in just a single click.

Bulge-bracket banks and major multi-managers are trusting Daloopa for use in initiating coverage, building and maintaining industry dashboards, and keeping their models up to date.

Visit ⁠⁠⁠Daloopa.com/BusinessBrew⁠⁠⁠ to create a free account and learn more about how ⁠⁠Daloopa ⁠⁠can help increase your team’s speed to differentiated insight.

Detailed Show Notes forthcoming.

Derek Pilecki stops by The Business Brew to discuss Financials.  Derek is a Financials specialist with a track

Derek currently manages a long/short financials strategy, long-only financials strategy, and various other individual portfolios. He has managed a private fund for 11 years. He also launched one mutual fund and took over management of another mutual fund.

From 2002 through 2008, Derek was a member of the Goldman Sachs Asset Management (GSAM) Growth Equity Team (Co-Chair of the Investment Committee for the Growth Team and a Portfolio Manager).

Prior to GSAM, Derek was an Analyst at Clover Capital Management in Rochester, NY and Burridge Growth Partners in Chicago, IL. He covered the Financials sector at both firms. Before entering graduate school, Derek worked at Fannie Mae providing interest rate risk analysis for the company’s mortgage investment portfolio.

Derek holds an MBA with honors in Finance and Accounting from the University of Chicago and a BA in Economics from Duke University. He is also a CFA®

Sponsor Info:

⁠⁠Daloopa ⁠⁠is founded by a former hedge fund analyst to bring simplicity into the investment process. ⁠⁠Daloopa ⁠⁠offers an AI driven single source for all company reported data, and allows for investment teams to ake the most informed decisions in the shortest amount of time. ⁠⁠Daloopa ⁠⁠scales the velocity of an investment team’s idea gen. Analysts spend less time locating and manually inputting meaningful disclosures into Excel and more time synthesizing in the minutes after the print. ⁠⁠Daloopa ⁠⁠captures data from all company reported sources, including from footnotes, MD&As, and investor presentations. Our data sheets include GAAP to non-GAAP adjustments, guidance, and all company specific KPIs. Each datapoint is auditable to the source for easy verification and accuracy. ⁠⁠Daloopa’s ⁠⁠Excel plugin can also update your existing models for the latest quarter in just a single click.

Visit ⁠⁠⁠Daloopa.com/BusinessBrew⁠⁠⁠ to create a free account and learn more about how ⁠⁠Daloopa

Detailed Show Notes:

3:38 – Derek’s background

6:54: - How Derek defines Financials

7:12 – Thoughts about Silicon Valley Bank

13:08 – Was it rational for regulators to ignore mark to

21:03 – What is going on with office and how big of a deal

25:08 – Is there an opportunity in regional banks?

29:45 – Mortgage REIT preferreds

33:15 – How much of a Financials analyst’s job is focusing

36:35 – A discussion about First Republic’s failure

41:45 – Thinking about constructing a long/short portfolio

44:45 – Why Genworth, why now?

50:55 – Puerto Rican banks and the potential for regional

54:10 – How building a business can impact investment outcomes

57:30 – Why does Derek run a mutual fund today?

1:05:10 – How to think about Banking as a Service and have traditional

1:09:35 – Outlook for alt managers

ValueStockGeek (“VSG”) stops by The Business Brew to discuss his evolution as an investor.  VSG can be found on Twitter at @valuestockgeek, his portfolio can be found at https://portfoliocharts.com/portfolio/weird-portfolio/, and his blog is at https://www.securityanalysis.org/

We hope you enjoy the conversation.

The Business Brew will be off for a few weeks after this episode. We shall return.

Sponsor Info:

⁠⁠Daloopa ⁠⁠is founded by a former hedge fund analyst to bring simplicity into the investment process. ⁠⁠Daloopa ⁠⁠offers an AI driven single source for all company reported data, and allows for investment teams to make the most informed decisions in the shortest amount of time. ⁠⁠Daloopa ⁠⁠scales the velocity of an investment team’s idea gen. Analysts spend less time locating and manually inputting meaningful disclosures into Excel and more time synthesizing in the minutes after the print. ⁠⁠Daloopa ⁠⁠captures data from all company reported sources, including from footnotes, MD&As, and investor presentations. Our data sheets include GAAP to non-GAAP adjustments, guidance, and all company specific KPIs. Each datapoint is auditable to the source for easy verification and accuracy. ⁠⁠Daloopa’s ⁠⁠Excel plugin can also update your existing models for the latest quarter in just a single click. Bulge-bracket banks and major multi-managers are trusting Daloopa for use in initiating coverage, building and maintaining industry dashboards, and keeping their models up to date.

Visit ⁠⁠⁠Daloopa.com/BusinessBrew⁠⁠⁠ to create a free account and learn more about how ⁠⁠Daloopa ⁠⁠can help increase your team’s speed to differentiated insight.

Detailed Show Notes

4:40 – VSG’s Background

12:00 – Is value a macro bet?

17:00 – Are computers better suited to exploit the value

24:30 – Thoughts on dividends and whether they mitigate some

30:00 – Are quants bound to win and will computers take over

32:22 – What VSG’s goals are for his substack

40:00 – The realization that “high multiple” doesn’t necessarily

43:45 – A potential blindspot that “value” might create

47:00 – Asset allocation discussion

54:00 – How Bill and VSG got into investing and some thoughts

1:00:00 – The types of companies VSG owns

1:09:00 – Shareholder base characteristics

Ian Bezek stops by The Business Brew to discuss his thesis on why emerging markets, specifically Colombia and Mexico, might be

His primary focus is Latin America. So much so that he moved from New York to Guatemala. He now resides in Colombia, which gives him unique perspective on the political landscape in that country.

Mentioned in the episode:

John Hempton on “averaging down” - http://brontecapital.blogspot.com/2017/01/when-do-you-average-down.html

Ian’s Twitter account - @irbezek

Ian’s Seeking Alpha Page - https://seekingalpha.com/author/ian-bezek

Sponsor Info:

⁠Daloopa ⁠is founded by a former hedge fund analyst to bring simplicity into the investment process. ⁠Daloopa ⁠offers an AI driven single source for all company reported data, and allows for investment teams to make the most informed decisions in the shortest amount of time. ⁠Daloopa ⁠scales the velocity of an investment team’s idea gen. Analysts spend less time locating and manually inputting meaningful disclosures into Excel and more time synthesizing in the minutes after the print. ⁠Daloopa ⁠captures data from all company reported sources, including from footnotes, MD&As, and investor presentations. Our data sheets include GAAP to non-GAAP adjustments, guidance, and all company specific KPIs. Each datapoint is auditable to the source for easy verification and accuracy. ⁠Daloopa’s ⁠Excel plugin can also update your existing models for the latest quarter in just a single click. Bulge-bracket banks and major multi-managers are trusting Daloopa for use in initiating coverage, building and maintaining industry dashboards, and keeping their models up to date.

Visit ⁠⁠Daloopa.com/BusinessBrew⁠⁠ to create a free account and learn more about how ⁠Daloopa ⁠can help increase your team’s speed to differentiated insight.

Detailed Show Notes

4:40 – Ian’s background

5:23 – Why Ian moved to South America (specifically Guatemala)

11:30 – Are emerging markets inherently lower quality than the US?

13:40 – Why Colombia, why now?

25:40 – How Ian is thinking about specific companies in Colombia

30:30 – What is the Colombian banking market structure?

36:50 – Memories of March 2020

40:20 – Why Ian prefers the airports to the rest of aerospace

46:50 – Thoughts about Mexico as a market

51:50 – Home country bias

58:05 – What Ian’s writing enables for his investments

1:05:50 – In many ways Latin America might be what the US was after WW2

1:10:35 – More discussion on Zoom vs. Qurate

1:16:20 – How Ian and Bill have evolved as investors and then chit chat

Braden Dennis, founder of Stratosphere.io, stops by The Business Brew to discuss how he developed the product, running a startup, sales, investing, and much more.  The Business Brew is grateful for Stratosphere.io's sponsorship and can unequivocally state that this episode would run regardless of the sponsorship.  Bill has enjoyed getting to know Braden and the team and wishes them the best.
Detailed Show Notes:

Meb Faber, CIO and CEO of Cambira Investments returns to The Business Brew.   Bill wanted to chat with Meb about the global diversified portfolio and Meb agreed to come on.  The conversation also discusses drawdown emotions, the merits of ETS vs mutual funs, Meb's thoughts on marketing, and much more. Meb is a great thinker, entrepreneur, and podcast host. He's also one cool dude.

You can find Meb's writing here.

You can find his podcast on Apple here and on Spotify here.

Other links mentioned:

Ray Dalio Book: Principles for Dealing with a Changing World Order

Bridgewater All Weather Paper.

A Tweet of Meb's about Global stocks ex-US

Recent Jesse Livermore tweet RE: P/Es CAPE, etc

Sponsor Info:

Daloopa is founded by a former hedge fund analyst to bring simplicity into the investment process. Daloopa offers an AI driven single source for all company reported data, and allows for investment teams to make the most informed decisions in the shortest amount of time. Daloopa scales the velocity of an investment team’s idea gen. Analysts spend less time locating and manually inputting meaningful disclosures into Excel and more time synthesizing in the minutes after the print. Daloopa captures data from all company reported sources, including from footnotes, MD&As, and investor presentations. Our data sheets include GAAP to non-GAAP adjustments, guidance, and all company specific KPIs. Each datapoint is auditable to the source for easy verification and accuracy. Daloopa’s Excel plugin can also update your existing models for the latest quarter in just a single click. Bulge-bracket banks and major multi-managers are trusting Daloopa for use in initiating coverage, building and maintaining industry dashboards, and keeping their models up to date.

Visit ⁠Daloopa.com/BusinessBrew⁠ to create a free account and learn more about how Daloopa can help increase your team’s speed to differentiated insight.

Detailed Show Notes 

Conversation starts with Berkshire weekend and Buffett discussion

4:55 – Meb’s take on global diversification

7:50 – The best compliment you can give someone

10:05 – Drawdowns are like a Ricther Scale

14:00 – The single biggest investing myth right now

39:30 – Meb’s thoughts on marketing

45:00 - Sell criteria

47:50 - What you need to launch an ETF

52:00 - Mutual Fund to ETF conversions

55:00 - Tax minimization

58:00 - More cases for foreign stocks

1:03:00 - The merits of private/angel investing

1:07:50 - Why Russia might not be "a zero"

Dave Waters of Alluvial Capital Management, LLC stops by The Business Brew to discuss how he approaches investing.  You can find all his letters, partnership info, etc., at https://alluvialcapital.com/
Dave primarily focuses on investments that you probably haven't heard of.  He invests in illiquid securities, foreign securities, companies coming out of bankruptcy, and more.  His portfolio is as unique as his path to investing.
We hope you enjoy the conversation.
Sponsor Info:
Daloopa is founded by a former hedge fund analyst to bring simplicity into the investment process. Daloopa offers an AI driven single source for all company reported data, and allows for investment teams to make the most informed decisions in the shortest amount of time.
Daloopa scales the velocity of an investment team’s idea gen. Analysts spend less time locating and manually inputting meaningful disclosures into Excel and more time synthesizing in the minutes after the print. Daloopa captures data from all company reported sources, including from footnotes, MD&As, and investor presentations. Our data sheets include GAAP to non-GAAP adjustments, guidance, and all company specific KPIs. Each datapoint is auditable to the source for easy verification and accuracy. Daloopa’s Excel plugin can also update your existing models for the latest quarter in just a single click. Bulge-bracket banks and major multi-managers are trusting Daloopa for use in initiating coverage, building and maintaining industry dashboards, and keeping their models up to date.

Visit Daloopa.com/BusinessBrew to create a free account and learn more about how Daloopa can help increase your team’s speed to differentiated insight.
Detailed Show Notes:
6:45 – Why Dave likes to look at obscure areas of the market
10:30 – When Dave found P10 Holdings
15:30 – Why your threshold for buying needs to be higher in microcap
21:15 – Rebuttable presumptions against microcap companies and the need for cheapness
23:00 – How Dave got interested in Garrett Motion
35:30 – Assessing incentives
41:50 – Community Development Financial Institutions
43:40 – What got Dave interested in investing
54:00 – Are microcaps destined to underperform?
59:30 – Potential risks and rewards around international investing
1:08:00 – Using subsidies to your benefit
1:10:40 – SPV banter
1:19:00 – Where Dave sees himself in 10 years

Josh Clarkson stops by The Business Brew to discuss alternative credit investments. Josh is a managing director at financial communications firm Prosek Partners, stops by The Business Brew to discuss communications, branding and marketing for alternative asset managers and his passion for working with clients in the private credit space.  Josh has over a decade advising a wide range of financial sector and corporate clients on matters from corporate narrative building, positioning and profile raising to activism, M&A and contentious restructurings. Currently, he focuses on working with credit-oriented alternative asset managers to help them better compete for capital, deals and talent by better utilizing communications, branding and marketing.

In addition to taking a deep dive on the current private credit landscape and how managers benefit from developing and effectively communicating a differentiated narrative, we also take a trip down memory lane and discuss some of Josh’s prior work in shareholder activism, which, as with many things in Josh’s life, intersects with his interest in private credit.

Josh’s full biography can be found here: https://www.prosek.com/people/joshua-clarkson/ along with more information about Prosek Partners and how they work with leading alternative and traditional asset managers to achieve their business goals.

We hope you enjoy this conversation.

Sponsorship Note

This episode is sponsored by ⁠Daloopa⁠. ⁠Daloopa ⁠is founded by a former hedge fund analyst to bring simplicity into the investment process. ⁠Daloopa ⁠offers an AI driven single source for all company reported data, and allows for investment teams to make the most informed decisions in the shortest amount of time.

⁠Daloopa ⁠scales the velocity of an investment team’s idea gen. Analysts spend less time locating and manually inputting meaningful disclosures into Excel and more time synthesizing in the minutes after the print. ⁠Daloopa ⁠captures data from all company reported sources, including from footnotes, MD&As, and investor presentations. Our data sheets include GAAP to non-GAAP adjustments, guidance, and all company specific KPIs. Each datapoint is auditable to the source for easy verification and accuracy. Daloopa’s Excel plugin can also update your existing models for the latest quarter in just a single click. Bulge-bracket banks and major multi-managers are trusting ⁠Daloopa ⁠for use in initiating coverage, building and maintaining industry dashboards, and keeping their models up to date. Visit Daloopa.com/BusinessBrew to create a free account and learn more about how Daloopa can help increase your team’s speed to differentiated insight.

Kritof Gleich, President and CIO of Harbor Capital Advisors, stops by The Business Brew to discuss his views on picking managers.  Kristof has over 20 years of investment experience with stints at Goldman Sachs, JP Morgan, and BlueCove Asset Management (which Ares purchased a stake in).  Harbor Capital Advisors spcializes in partnering with boutique investment managers in an effort to create superior investment outcomes.

Kristof has spent a lot of time developing a “factor framework” for evaluating a managers’ skill. You’ll hear Kristof say that our starting premise/hypothesis is to assume all managers’ historical excess return is due to luck and then look to reject that hypothesis (or not) by using deep analytical rigor. This stems from his physicist background to continue to understand subjects more deeply. Recently Kristof has been overseeing Harbor’s expansion from a factor framework to introducing “behavioral analytics”.

We hope you enjoy this conversation.

Sponsorship Note

This episode is sponsored by Daloopa. Daloopa is founded by a former hedge fund analyst to bring simplicity into the investment process. Daloopa offers an AI driven single source for all company reported data, and allows for investment teams to make the most informed decisions in the shortest amount of time.

Daloopa scales the velocity of an investment team’s idea gen. Analysts spend less time locating and manually inputting meaningful disclosures into Excel and more time synthesizing in the minutes after the print. Daloopa captures data from all company reported sources, including from footnotes, MD&As, and investor presentations. Our data sheets include GAAP to non-GAAP adjustments, guidance, and all company specific KPIs. Each datapoint is auditable to the source for easy verification and accuracy. Daloopa’s Excel plugin can also update your existing models for the latest quarter in just a single click. Bulge-bracket banks and major multi-managers are trusting Daloopa for use in initiating coverage, building and maintaining industry dashboards, and keeping their models up to date. Visit Daloopa.com/BusinessBrew to create a free account and learn more about how Daloopa can help increase your team’s speed to differentiated insight.

Detailed Show Notes

5:52 – Kritof’s background

11:55 – Picking managers that can handle scale

18:55 – What Kristof is doing to transform Harbor

30:10 – A discussion about banks

42:52 – Passive vs ETF and why they might be different

47:40 – Will the 60/40 portfolio do well going forward?

52:40 – A case study about providing an inflation “solution” and some of the complications investors can run into with commodities

1:07:10 – Picking good managers

1:22:05 – Behavioral finance based investing