Short-selling obsession with the number 4
James: I had a great session with a short seller. They were raising some serious red flags about the company. The main one was to look for when an officer or director sells stock or suddenly quits. Doug Tynan had a great thing about the number four. They use an algorithm to do a statistical analysis of various company statements, and if number 4 is infrequent in those statements, that’s a red flag. Why? Because CFOs don’t like the number 4. Of course, they prefer the number 5 because it allows us to round the number up. So if a company doesn’t come close to his 4th place, we’d say it’s a little aggressive when it comes to accounting. …I’m a left fielder who sees the world, but I think it’s pretty cool.
Anthony: You must love shortsellers. They just have the guts to say what we think, right? Everyone can really get it back to basics and cut out the crap that often sticks in their throats and clear their heads pretty well.
Underestimating the stickiness of inflation
James: The consensus of many who attended the Alpha Live event (Future Fund CEO Raphael Arndt, well-known investor James Aitken, and fund managers such as Christopher Joy and Rob Arnott) does not believe inflation will subside. That’s it. They think financial markets may be wrong and central banks, including the RBA, need to do more to keep inflation in check. That could involve further rate hikes or holding rates on hold for longer.
Anthony: Sure. The inflation problem stems from this government stimulus, it’s all in the system and you can’t change it. Rising wages are now hitting bank accounts. An EBA is being negotiated with more than 2-3 percent pay increases over the next few years. … a 15% wage increase is expected in the aged care sector. I’m not saying people don’t deserve these raises, but clearly it’s more money in the system, higher costs of doing business, higher prices. I think there is
This week’s best of the Chanticleer column
Ray Dalio’s 5 megatrends help explain what happens next Billionaire investors believe that a period of upheaval has arrived and that the current holding pattern will not continue in any way.
Where Goldman Sachs puts its private equity money in Australia Goldman Sachs has raised significant amounts of private equity and credit funding around the world and is looking to invest in Australia.
This Ruthless Step Might Change Aires If CEO Marcus Price passes the “rule of 40” test, the group will be on par with software-as-a-service companies Xero and WiseTech.
Why the Inflation Problem Won’t Be Solved Soon The latest inflation data could decide whether the RBA will keep rates on hold next week. But central banks and investors need to look beyond quarterly numbers.
Do you know your prejudices?Take the test and see how it costs James Montier, GMO’s head of asset allocation, says understanding how humans make decisions can help investors avoid common traps.
Blackmore drama ends with Japanese slam dunk Every year or two, a major Japanese conglomerate buys a high-profile Australian company, and the deal is always clean, fast, and at a high premium.
Australia’s lithium division can win from Chile’s own goal Plans to partially nationalize Chile’s lithium sector could drive up prices and divert capital to friendlier lithium hubs, including Australia.
In this week’s The Fin, technology reporter Jessica Sier explains why MilkRun was shut down and how its failure marks the end of the easy money era for Australian startups and aspiring entrepreneurs. I’ll explain what it means for you.
