Bakes’ Takes Podcast, Episode 8, Brian May rocks literally and figuratively, Saturday, 4/11/20

Bakes’ Takes Podcast Show Notes –Saturday April 11, 2020 https:/ /www.macrovoices.com/podcasts-collection/macrovoices-all-stars-podcasts/825-all-stars-100-dr-pippa-malmgren-socio-economic-implications-of-the-coronavirus-crisis Erik and Patrick do a great, thorough job as always. Dr. Pippa Malmgren discusses at 6 minutes inflation’s eventual return. Supply chain efficiencies and technology advancements deflationary forces now gone and money printing ongoing. She and WSJ point to egg price inflation, 229% in March! Her views at 25 minutes regarding multi-use properties, residential, urban farms, grocery stores, etc. are fascinating. I recommend them especially to my real estate friends. https://omny.fm/shows/the-james-altucher-show/571-andrew-huberman James produces one of my favorite podcasts. Period. Dr. Huberman’s proposed technique at 23 minutes or so is great. Put down your screen, defocus your eyes and take in a panoramic view of the horizon, as far as you can. Meaningful stress reduction. At 1:09, get as much sunlight in your eyes during the day as you can. At 1:14, avoid bright lights, i.e. computer screens, during the night. For better sleep, two inhales through nose, 2 seconds, exhale through mouth, eliminate carbon dioxide, 6 seconds. https://www.youtube.com/watch?v=jPboWUQNnrM Brian May teaching garage band guitarists like me how to play “Keep Yourself Alive” is fabulous. https://www.oaktreecapital.com/insights/howard-marks-memos we have to consider our situation “in the context of unprecedented uncertainty and the total absence of guidance from analogies to the past.” But no one can tell you this is the time to buy. Nobody knows. As I put it, “All great investments begin in discomfort.” One thing we know is that there’s great discomfort today. The investor’s goal should be to make a large number of good buys, not just a few perfect ones. To insist on buying only at bottoms and selling only at tops would be paralyzing. Clearly, this process is one of gradual readjustment, not a matter of all-or-nothing. It shouldn’t be the goal to do this only at bottoms and tops. That’s why I so like the headline from Doug Kass that I referred to above: “When the Time Comes to Buy, You Won’t Want To.” It’s not easy to buy when the news is terrible, prices are collapsing and it’s impossible to have an idea where the bottom lies. But doing so should be the investor’s greatest aspiration. . . . markets rarely clear after one massive decline. In 15 bear markets since 1950, only one did not see the initial major low tested within three months . . . In all other cases, the bottom has been tested once or twice. Since news-flow in this crisis will likely worsen before it improves, a repeat seems likely. 9/1/00 - 4/4/01 -27% 4/4/01 - 5/21/01 +19% 5/21/01 - 9/21/01 -26% 9/21/01 - 3/19/02 +22% 3/19/02 - 10/9/02 -33% 10/9/07 - 3/10/08 -18% 3/10/08 - 5/19/08 +12% 5/19/08 - 11/20/08 -47% 11/20/08 - 1/6/09 +25% 1/6/09 - 3/9/09 -27% And so it goes for a while. Thus, as Oaktree’s Wayne Dahl points out, it took until mid-May 2007, or almost seven years, for the stock market to regain the September 2000 highs, and it took until mid-March 2013, or five and a half years, to regain the highs of October 2007. The bottom line for me is that I’m not at all troubled saying (a) markets may well be considerably lower sometime in the coming months and (b) we’re buying today when we find good value. I don’t find these statements inconsistent. https://www.barrons.com/magazine/20200413 Barron’s cover and several articles highlight “the best week since 1974”, perhaps implying a bottom. A week is irrelevant, especially after the S&P 500 fell 34% in 33 days, as Al Root pointed out. https://www.barrons.com/articles/the-s-p-500-had-its-best-week-since-1974-next-up-an-economic-coma-51586560230?mod=past_editions The ’73-’74 bear was 2 years; this is 2 months. Proceed with caution indeed. https://www.economist.com/briefing/2020/04/08/an-unprece