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3rd Quarter 2020 Commentary

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Revised to include supplemental information, this quarter’s review is about the energy sector. Investors fear a permanent failure to recover (if not an impending collapse) due to the fossil fuel divestment movement and alternative energy growth. Stock prices already reflect that outcome.  Yet, the most comprehensive multi-factor analyses of long-term global energy consumption do not … Continued

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2nd Quarter 2020 Commentary

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The goal of our quarterly reviews is to address topics that we think are most important for our clients to understand. This time, an about-face: these are responses to questions that our clients have been posing in recent roundtable events. The thing is, the questions were consistently of a kind. Almost all were about inflation and oil prices: Why will they rise? And how does that even work? Inflation is the greatest threat that investors can face, but is not widely acknowledged, or is largely dismissed. By the time it is recognized, it will be too late. And more importantly for us, the workings of inflation are not well understood, but really should be, and it might be that the immediacy and frankness of a Q & A session will be more illuminating and accessible. That’s “what’s inside,” along with supplementary information and how to incorporate the sorts of business models that can be sound in any environment, but are particularly poised to flourish in the years to come.

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Asset Light, Real Assets – Economically Resilient Business Models (Recorded in May 2020)

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It’s no secret that we have viewed money debasement and inflation as the most serious risk facing investors. Government responses to the COVID-19 pandemic, though necessary, are only exacerbating this risk. This view has yet to become part of the public conversation, much less be adopted by more than a very small contingent of investment firms. Our early arrival at this conclusion has allowed us to position the portfolios in a number of business sectors that tend to be direct beneficiaries of certain inflation vectors. The purpose of this presentation is to describe additional business models that can also be either direct inflation beneficiaries or, if not, that can thrive in such an environment in the months and years to come. These will be introduced by a few of our analysts: James Davolos, Utako Kojima, and Ryan Casey.

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1st Quarter 2020 Commentary

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It is not an overstatement to say that we are in the midst of a paradigm shift in the financial markets. We believe that what’s coming down the road is going to be a reversal of the conditions that existed for the prior three decades; all the accepted wisdom and the statistics and correlations will be out the window. Understanding that is probably the single most important preparation any investor can undertake right now.

We have seen significant risks in the market  for some time now, and have been preparing accordingly; the current pandemic has accelerated and magnified the risks, not changed them.

As in everything, context is key. This review covers how we got here, what has changed and, in preparation for a money-debasement world, what kinds of business models and assets one  doesn’t want to own as well as what kinds one should consider.

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Steve Bregman on Debt Debasement (Recorded on April 8, 2020)

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A review of the economic and investment implications of the CARES Act stimulus package. The U.S. and global economies have entered a historically new phase that is, for practical purposes, permanent. The debt and money creation are of an unprecedented scale, and will mark the beginning of an indefinite period of inflation and money debasement. … Continued

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Steve Bregman on Energy (Recorded on March 31, 2020)

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In this sequel, a review of facts in the world of energy, to be differentiated from what is often reported (and not reported): the political dimension, the supply and demand picture, and Texas Pacific Land Trust.  Slides to accompany this audio are accessible here: Slides 1 and 2: The Royalty Business Model – time stamp: … Continued

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Steve Bregman on What to Make of the Market Right Now (Recorded on March 25, 2020)

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As a sequel to Murray Stahl’s recent webinars, a brief discussion about what this month’s wild price changes in stocks mean – or, more importantly, don’t mean. Examples from Utilities, Gold, and the Energy sectors are used to highlight how these changes in prices have become untethered from economic reality; they do not reflect actual … Continued

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