We Study Billionaires - The Investor’s Podcast Network - TIP 091 : Mastermind Group 2Q 2016 (Business Podcast)

Starting point is 00:00:00 You study billionaires, and this is episode 91 of the Investors Podcast. Broadcasting from Bel Air Maryland. This is the Investors Podcasts. They'll take complex things and make them seem insanely simple. They make your boring drive-to-work feel exhilarating. They give you actionable investing strategies. Your host, Preston Pish, and Stig Broderson. Hey, hey, hey, how's everybody doing out there?

Starting point is 00:00:31 This is Preston Pish, and I'm your host for The Investors Podcast. And as usual, I'm accompanied by Stig Broderson out in Denmark. And I'm actually accompanied by the whole crew here because we've assembled the mastermind group again for the second quarter of 2016. We're recording this. Actually, Stig and I have been doing a bunch of recordings on this day because I'm getting ready to go to South Korea for a few weeks. So we're recording this actually on the 15th of May. 2016. And I believe this isn't going to be coming out until probably about the middle of June. So there's a little bit of delay in some of the conversation that we're having. But we'll try to keep our comments more general in nature so that we kind of hit the big hot areas and not kind of digging into stuff that has anything to do with next week. But as usual, I have Hari Rahma Chandar with us. He's from Bits Business. He lives out in Silicon Valley, a LinkedIn executive. We've got Toby Carlow. He's the author of Deep Value and his newly released book, Concentrated, investing. As usual, your level of research that you do below's my mind. It's awesome. If you haven't

Starting point is 00:01:36 gone out there and checked out this book, you definitely need to go to Amazon and look at it. And then we got Colin Yablonski up in Calgary, Canada, and he's from inbound interactive, and he's our SEO expert and small business expert as well because Colin, and we don't really talk about this too much, Colin, but you have a very successful small business owner. And he comes with that point of view as well. All right. So to kick this thing off, we're going to go ahead and throw over our first perspective, our first question to the group over to Hari Ramachandra,

Starting point is 00:02:04 and he's going to throw something out to us. Hey, guys, I was recently reading Bob Schiller's latest edition of Irrational Exuberance. And he calls the current period as a new normal boom. He says the current economic condition is pretty strange. And he says every boom has precipitating factors. And he identifies the precipitating factors for the current boom as end of depression scare. We were all looking at the abyss and everybody was scared. And once we got through it, people are much more relieved.

Starting point is 00:02:40 And the banks have been following an extremely loose monetary policy according to him. And then there is another factor. He says that is pushing asset prices higher. and that is a career anxiety or rather an end of career anxiety among many professionals because of what is now known as the fourth industrial revolution, which is essentially the coming together of various technologies like cloud, artificial intelligence, mobile, etc., which is disrupting a lot of industries and a lot of careers. And he says you would expect that aside prices would fall in such a

Starting point is 00:03:22 economic condition, but the way human psychology works, he says is very unpredictable. So what is happening, according to him, is people want safety, people want certainty. So they're going and bidding up asset prices. And I have seen this in my circle where a lot of engineers are worried, especially those in their 40s are worried about their career longevity. And then what they're doing is they're going and buying a lot of rental properties all over the place. Texas is especially popular. And back in 2010, the yield or cap rates were 15, 16%. Today, they might be in the 3 to 4%.

Starting point is 00:04:08 But they don't care. They just want some sort of safety. But most of them are not investors. So they don't even worry about cap rates. And add to that, they are. using leverage so they think that they will come out well in the end. In fact, even Buffett had a comment about it in his annual meeting at Omaha, where he said the asset prices, especially the home prices,

Starting point is 00:04:34 doesn't seem like a bubble, but he says it's not something that is inexpensive. So I just wanted to get your thought on the current economic condition. Do you guys think or do you agree with Bob Schiller that this is a new normal boom. So I think what you were really getting at Hari is where do you hide? Where do you hide in this current market? And I think that the answer for me is I have no idea. And you know, when we were out there listening to, you know, it didn't seem like they had an answer either. I think that their answer, the answer I took away and maybe I read it wrong was their answer was we don't know where to hide, but we think liquidity might be really valuable in the near future. And they didn't

Starting point is 00:05:18 say it that way, but that's how I interpreted their comments. I'm kind of curious if you kind of took it the same way, Hari, because Stig and I already recorded a previous episode on this that's going to, that's going to air before this episode. But did you kind of take away the same thing? Like, hey, the value here is liquidity, folks, because there's nowhere really to hide. Did you kind of hear the same thing? I agree with you. I got the same sense. However, I felt Buffett and Munger kind of wanted this question. They didn't really answer it head on. However, when I was listening to Tom Gainer at the Markle's brunch, he talked about optionality and he also talked about how much cash they usually carry.

Starting point is 00:06:01 He is probably the highest cash he would carry is 50% of his portfolio. And he says he's almost up there. And I'm sure Buffett might be having the same opinion, but for various reason, Buffett wouldn't really be frank about his opinions on this topic. Toby, you weren't there. So I'm kind of curious to hear your opinion without having been influenced maybe by some of the comments from the meeting. One of the things that I think is interesting that Buffett did is that the BSX acquisition, they talked about, I think it's either Buffett or Munger have talked about the fact that they expect about a 10% return from that, which 10% return on investment, which is not a huge. you know, if you expect a 10% return and investment,

Starting point is 00:06:46 he's not going to get the historical returns of Berkshire Hathaway doing that. And I think that that's tacit acknowledgement that it's not a great environment for finding good quality, cheap companies. They just aren't any around because they've all been bit up to the point where it's kind of a marginal proposition. I find it really hard to dig around and find anything. I don't find very many cheap businesses. The things that we find that are interesting at the moment are.

Starting point is 00:07:13 some special situations and things where the reason that they're cheap is because hedge funds that would typically arbitrage away those positions have have been hit really badly in various kind of positions. They've either been long valiant or they've been in some of those tax inversions that have been unwound and they just don't have the capital to invest. So that's created an opportunity, which is a special situation style opportunity, but I don't think there's any cheap businesses. So now when you say that, this is this is an interesting conversation about, you know, multiples, if you will, because Apple is just getting murdered. And I mean murdered. I don't know their P.E. off the top of my head, but I know it's below 10. Billionaire Carl Icon just literally

Starting point is 00:07:55 liquidated his entire position in Apple. And I guess one of the buyers of all of his shares was the Swiss Central Bank. I think it's a really interesting discussion because as people were out they're saying, all the market's so overvalued. But at the same time, there are some companies like Apple out there that's really kind of trading at a very low multiple of their earnings. Now, I'm going to caveat that with the whole reason Apple's falling apart is because everyone's seeing their sales or their revenue, which is their top line from an accounting standpoint, is starting to, it's plateaued and now it's actually starting to contract. And that's scaring the live and pulp out of anyone that owns the shares. And that's why you're seeing it getting

Starting point is 00:08:35 and punish so bad. That's the reason. But is it justified? Is this something that's going to be a trend that continues? And if so, how long can the multiples kind of stay at that level and be that low? So I'm kind of curious to hear some thoughts on that one. So about Apple in particular, I think the problem about Apple is that the market has realized that they need to reinvent themselves all the time. And I don't think it's more complicated than that. And it's getting harder and harder to reinvent themselves, giving that the need so much bigger head to keep growing the top line. I would probably be the first one to say five years ago, hey, they can't grow anymore. So I would have been dead wrong the previous five

Starting point is 00:09:16 years, but it just seems like that is what's happening right now. And the market is just used to these growth rates and they don't see them anymore. Perhaps that's why. The way I think most of the market looks at Apple is more like a movie studio. You know, they have to come up with one blockbuster of the other. But iPhone, I believe what Apple has done is it has slowly diversified and added some theme parks and some like, you know, copyright merchandise to the mix like Disney did. So what happens is even though they don't have a blockbuster in the near future, there is this trickling of their app store revenue is pretty significant by itself.

Starting point is 00:10:02 But it fails in comparison with their overall revenue. No, and I completely agree with you. Whenever I look at Apple and I think about what's the real competitive advantage, what's their intellectual property, if you will. And for me, it really comes down to the iTunes store because it has so much stickiness. A person that goes in there and buys all their music and then buys all these apps, the last thing they want to do is switch over to another platform. And so I think it really kind of has this ability to keep people on the platform

Starting point is 00:10:29 a lot longer than what maybe the market realizes how much of a barrier there is there. I think there's a big barrier there. I think that's a big moat, if you will, using the Warren Buffett term. I think that's a big moat for them. I don't own it. So I haven't bought at these prices. But I can tell you, I'm looking at it, I'm watching it. I think that if we have the downturn that I would kind of expect in the next 12 months or, you know,

Starting point is 00:10:53 year and a half to kind of occur, that's one of the ones that I think I'd be watching really close to just kind of see how much more the market could punish it. I think that it has darker days ahead. And the reason why is because as soon as these revenues start to turn a little bit, do I think that they're going to contract a little bit more moving into the next quarter? Yeah, I kind of do. I think that that's maybe a trend that's going to continue to persist a little bit more. And I think once you see that really start to plateau out on the revenue side of the house, I think that's maybe your point where you really take a strong look at maybe diving into it again. I think I would agree with Hari's stance.

Starting point is 00:11:28 I like the fact that they've diversified into a few other areas outside of just producing their iPhone as well as their computers. Really, though, I don't know, Apple's a tough company for me to look at, especially on the technology side, because they have a lot of competition. There are a lot of other startups that could be entering that type of market. Yes, they have a stickiness factor, but it's difficult for me. as an investor in, you know, that type of company to evaluate whether that's going to maintain their moat over the long haul. Yeah, I mean, the big consideration I would say from my perspective is how they've diversified some of their revenue stream. So using things like the iTunes store, having their applications. But I like Preston's point about the stickiness factor. I'm also an

Starting point is 00:12:17 Apple user. I have a laptop. I have an iPhone. And transitioning to a new platform would be really challenging. And this is something that I would be interested in hearing, Harry's feedback on is what is the likelihood of another company being able to enter a market to give Apple any form of competition? Actually, that's a very good point, Colin. The way I see Apple is that it's like a fashion company. Like Disney's theme park is popular as long as Disney can keep producing great movies or can keep creating new characters. As soon as that stops, the danger is it to even affect their theme park because people will lose interest and

Starting point is 00:12:56 they will move on to the next trend. And Apple faces that danger and maybe the market is rising in that risk in the current price. They always have to be this cool company and without Steve Jobs, it will be

Starting point is 00:13:12 hard to say whether Apple can continue to be cool because he personified Apple and he personified coolness. So in fact, Professor Bruce Greenwald at Columbia University, he doesn't agree that Apple will be what it is today, 10 years from now. So Tim Cook, if you're listening, that was Hari's way of saying, hey, man, you're not that cool. Go ahead. Toby, go ahead.

Starting point is 00:13:42 So I have an Apple laptop and the router is an Apple router. All of the other things that I use are just different means of access. content, right? So that Amazon fire is just a way of accessing content. I have a Kindle, like all of those things pull from Amazon. Google handles the email, various other things. I don't think that five years ago you would have predicted that Amazon would have been a direct competitor to Apple and maybe not Google either. I just think it's interesting. They've all come from pretty different industries to sort of come in and compete. I still think Apple's a very good stock and I do think it's very cheap at the moment. So I think it probably outperforms the market,

Starting point is 00:14:19 but not as well as it has done in the past. Yeah, I like how you phrase that, Toby, that it will outperform the S&P 500 or the Dow. I agree with you on that moving forward. I think if you took a five to 10 year snapshot and you had to buy one versus the other, I think Apple's going to outperform them over that period of time. But I definitely don't see it. I'm not buying it. Like going back to our original conversation, I think that I value my liquidity more

Starting point is 00:14:44 than I would value ownership of Apple at this point in time. So one of the things that I want to talk about real fast, because this was a really interesting thing that happened at the Berkshire meeting. And Stig and I didn't talk about this whenever we did our podcast when we covered it. Buffett's discussion of Amazon for me and Jeff Bezos in particular was really an interesting thing that happened at the last shareholders meeting. Those guys gave huge props. And I mean huge props to Jeff Bezos and kind of looked at him like, these guys are a force to be reckoned with because they've basically taken business and flipped it upside down.

Starting point is 00:15:21 with the fact that they don't need to have a bottom line. They're looking at, they're just basically like cannibalizing everything and anything. And they basically said, whenever we look at a business, we pretty much try to factor in the Amazon factor of, are we going to get crushed? Is this guy going to take us to the cleaners? And boy, that was an interesting discussion. So when you think about that and you're looking at these two guys, Charlie Munger and Warren Buffett and how much they're looking at Jeff Bezos like this guy is something else.

Starting point is 00:15:49 And this is a force to be reckoned with. I guess do you take a different approach than a value investing look when you're considering it? Jesse Felder, who was, I know you guys have recorded a call with him and he'll be coming out at some stage before this comes out. He made a very good point on his Twitter stream the other day that there's no reason why a stream of cash flow should be worth any more now than they were worth in the past. So I don't think that the laws of valuation changed that the laws of valuation. have always been the same. It might be that these companies are able to grow more quickly because they're more asset light and so they don't need to reinvest, which means they can throw off more cash. But that also means that the competition doesn't need as much capital to get in the

Starting point is 00:16:33 game. They can compete for much less. So those forces should still drive down ultimately the cash flows and the valuations we should find equilibrium at a lower sort of profit margin. So I agree with that, Toby. But, but, But I also know about Jeff Bezos from the book that we read, the Everything Store. He has an entire arm of his business that is doing nothing but trying to go out there and find competitors in the space. It's like, I forget what they called this department within his business, but it's like their competitive advantage annihilation department is what I would probably call it.

Starting point is 00:17:09 They go out and they try to find businesses that are competing with them and they do one of two things. They go to them and they say, A, we want to buy you. and if you don't let us buy you, we're going to make your lives absolutely miserable. And here's how we're going to do it. Whatever line, like I think the example they used in the book was about diaper or a diaper company or something like that stick. Was that right?

Starting point is 00:17:32 So they go to this diaper company and they're like, we're going to sell this at a loss. We're going to continue to sell this at a loss until you come back to us and you say you're ready to sell us your company. And oh, by the way, when you do that, we're going to be paying you at a lower multiple. because your numbers are going to be horrible by that point. That's how these dudes play. And so how do you compete with somebody like that? So I think here's something that we've got to get into when we're talking about value.

Starting point is 00:17:59 You've got to value the intelligence of the company itself. You've got to value the size of the company and their ability to basically create havoc in certain markets. And then you've got to really kind of value their ability to just have this unprecedented amount of growth in their revenue stream. And I think maybe it's something that you just watch it so closely. And maybe you don't take a big position, but maybe it's something that you just hop on for a little bit. I don't, I don't know what the right answer is. But I know it has my mind like going wild of, am I missing a big opportunity here because I'm not valuing things appropriately. And I'm so stuck in this Warren Buffett value, discount the cash flow kind of mindset. And I'm not thinking outside the box. I guess that's my

Starting point is 00:18:45 concern. I think when Moran Buffer talks about the Amazon factor, it's kind of like when he bought extra shoes and he figured out that he was losing to the outsourcing power of China. Now, basically, that's a threat to the current business. Amazon might be a threat if he was to buy a retailer, but it doesn't change the way that we should value Amazon as a company, in my opinion. Before they have proven that they can actually make money, and especially with the decline you also see in the revenue right now in the growth rates, I don't necessarily see. that it's a good investment at the price level that we're seeing right now. I would say that if you're going to invest in something, so there are a lot of retailers that are

Starting point is 00:19:23 cheap at the moment. And the reason that they're cheap is because Amazon's cannibalizing their business or Amazon's eating their business. But you can go back and read Buffett's letters from 30 years ago. And he would say that retailing has always been a really tough business. And there's always some other bigger guy who's doing it better coming along behind you. Amazon may be the apotheosis of that kind of process and there might be nobody whoever comes along who's bigger than Amazon. They might just lock the market. But then again, it might be Alibaba or it might be some other

Starting point is 00:19:52 company from outside the States. The point that I would say about value investing is you don't necessarily have to have an opinion on Amazon as an investment. They say you don't have to kiss all the girls. Amazon is an incredible business and I love shopping at Amazon because it's really fun.

Starting point is 00:20:08 But that doesn't necessarily mean I have to go and buy the stock. I agree with Toby. I think you don't have to kiss every girl. And that's fun to try. Buffett, in fact, mentioned this in one of his interviews. He said Amazon is doing to Walmart what Walmart did to Macy's and other folks. So, Kristen, to answer your question, maybe it would be worth looking at Walmart's valuation history, how things went along. And maybe Amazon will see what Walmart is seeing now a decade later.

Starting point is 00:20:42 I love that, Hari, and I think you're exactly right. Let's take a quick break and hear from today's sponsors. All right. I want you guys to imagine spending three days in Oslo at the height of the summer. You've got long days of daylight, incredible food, floating saunas on the Oslo Fjord, and every conversation you have is with people who are actually shaping the future. That's what the Oslo Freedom Forum is. From June 1st through the 3rd, 2026, the Oslo Freedom Forum is entering its 18th.

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Starting point is 00:25:13 I mean, the space side even with, you know, being a competitor to SpaceX, I mean, there's just so many different sides to this. But I really agree with you. I think that their bread and butter is really their retail side. That's the thing that's really, you know, just showing so much growth and giving them the legs to do the things that they've done. So really interesting point. So do we have anyone that wants to kind of throw things in a different direction than what we're when we've been.

Starting point is 00:25:38 Okay, go ahead, Stig. So the thing I would like to bring to the mastermind group today is talking about Moniz Pap Rai's new ETI's new ETAF. And this is something that we've really been looking forward to for a long time. And for those of you that don't know, Mourn's Pobrai, he has been called the new Warren Buffett. I know that a lot of people has been called the new Warren Buffett. In my opinion, he might just be the one. he is super, super smart. He has a significant track record.

Starting point is 00:26:05 But Moni's pop rye, he's launched a new ETF. He did that back in April. And he has three different strategies. And the way that he came up with those three strategies was actually through a dinner he had with Charlie Munger. And during that dinner, Charlie Munger mentioned that if an investor did just three things, he would be able to upperform the market significantly. And the first thing he said was he was looking at cannibals.

Starting point is 00:26:33 And what he meant by cannibals was he was looking at companies buying back stock really aggressively. The second thing Munger told Pabri was that he was looking at what other great investors were doing. So basically this is the 13Fs, right? And the third thing Chalonger told Pabri was that he should carefully study spin-offs. So according to Pabri, this is what he did. he composed a ETF with 100 securities and he was using each of these three strategies to merge into one ETF that should hopefully upperform the market. And what I would like to bring to the mastermind group today is to go through these three strategies one by one. And then after I presented

Starting point is 00:27:14 one strategy and my thoughts on that, I would like to hear your thoughts on that and whether or not you would agree with the thesis. So the first strategy that was buying back shares. That is how Mornis Papra wants to allocate 75% of the funds. What he wants to do is to study the companies that had bought back between 1 and 26% of the shares in the previous 12 months. And he will only be looking at companies with the market cap higher than $1 billion. And he would invest in the 33 with the highest conviction. So why would that make sense? Well, if you read what works on Wall Street. And what you could also do is listen to episode 57. There was an episode that Toby actually co-hosted with us where we interviewed Jim Ashaughnesset.

Starting point is 00:28:01 We talked about Jim actually following the same strategy these days. He is looking at companies or these cannibals, as childmongers calling them. And what Jim Assonesei found out, and I think this was a times years from 1964 to 2009. So a long period was that the desal that bought back stocks most aggressively outperformed the market by 3.8%. On the other hand, if you look at the companies that were issuing shares, and they typically do that for acquisition purposes or to commerce and management or whatnot, they were actually underperforming the market by 4.1%.

Starting point is 00:28:36 So there's a vast difference here of those that are most aggressive and those that issue shares by almost 8%. So again, yeah, why would this work? Well, some might argue that it's because the management feel that the stock is undervalued. I don't know necessarily if I think that's a good point because there are so many companies out there that were just buyback shares every quarter have done that for decades. So that might not be the reason why. But companies that are buying back shares significantly, they have strong cash flows.

Starting point is 00:29:07 There's a price support element before rebalancing. Clear the more undervalue stocks are, the more stocks they can buy. And they would be ranked higher in Pop-Wise algorithm. So I just want to throw that strategy out to the Massman group before we go. on to the two next, do you think this is a good strategy to follow? Yeah, I think it's an excellent strategy to follow. Buybacks, and I would be leaning on Ashorness's research in saying that buybacks have been predictive. I think that he's got some more granular research where he says that you need to find the ones that are maximizing the amount that they can buy back. I think it does indicate

Starting point is 00:29:44 cheapness of the stock because you're looking at a fundamental measure, like basically it's negative cash flow, negative investment. in cash flow, which you need to have some cash flow there or some cash on the balance sheet relative to the price of the stock that you're buying back and the market capitalisation. So I think it is kind of a derivative of value. One of the things that are shown us he says that's interesting, though, is that he favours rather than just simple buybacks, he favours a metric called shareholder yield, which includes dividends and capital returns as well.

Starting point is 00:30:16 And there's an ETF that deals with that directly, and that's Mb Favors, Cambria, shareholder yield. And the ticket for that is SHLD. I don't know how that's performed. It's only a fairly recent launch. But I think if you're looking for a pure shareholder yield approach, probably Cambriars is the better one. But Ashornesey uses that strategy. It's central to his flagship fund. So it's a very good metric.

Starting point is 00:30:43 I've got a quick comment. And it kind of relates to a book that I'm reading. right now, which is, it's called shoe dog. It's all about Phil Knight. He's a fantastic writer and kind of his rise to Nike and building Nike. And the one thing that was kind of amazing about that story is just how cash strapped he was for years. And I mean, years upon years of building Nike and how he was, you know, he was growing at like a rapid pace, but he never had enough cash on hand. And so when you're talking about share buybacks, when you're talking about a company that's buying back their own stock versus not buying back their own stock, when I look at like Phil Knight

Starting point is 00:31:22 in the early days of Nike, he could have never bought back any shares, let alone. I mean, he was just constantly talking about how can I raise more cash so I can buy more tennis shoes for the next quarter so I can continue to grow the demand that's out there. When you look at a company like Berkshire Hathaway, they are just flush with cash. And that's a company that if they're price did go down to appropriate levels, they would buy it back. Now, let's talk about IBM. How long have they been doing their buybacks? And I mean aggressive buybacks. And then you look at their stock price, it's gotten punished. So I guess my point is this. I guess I have not been able to look at things from the vantage point where I can say this is a situation where a share buyback is good,

Starting point is 00:32:11 Share buyback is bad, IBM example, or here's a company that can't even do a share buyback, Nike, but if you would have bought their, if you were been able to buy their stock way back when they were cash strapped and having difficult times, you would have done insanely well. So I guess my answer is, I don't know. I'd have to dig into it more. And I think maybe when you look at things not from the micro level of just three companies and three examples, but maybe if you're looking at it from a macro perspective and you're looking at a basket of 100 different picks and you're looking at buybacks versus not buybacks,

Starting point is 00:32:42 maybe you get better results. I think it's important for people to understand that there's caveats to this. It's not something that you can just go out and buy an individual stock pick because they're doing buybacks and expect to have phenomenal results. Bybacks tend to track along with the market. So when the market is up, there are, in an absolute sense, there are lots and lots of buybacks. And when the market is down, the buybacks disappear. And ideally, you would like your management to be doing the opposite run. You don't want them buying back stock when it's expensive, and you want them buying back as much as possible when it's cheap.

Starting point is 00:33:13 And the reason that they do that is because they're like everybody else. They're pro-cyclical, and it's only a handful of people who can sort of operate in a contrarian way. The nice thing about, I think, about a buyback type index or a buyback type ETF is it is kind of operating in a contrarian way in the market as it exists, because it is trying to maximize. it's finding the companies that are maximizing the amount that they're buying back, which means that, you know, the underlying business, the fundamentals,

Starting point is 00:33:42 are sufficiently big relative to the market capitalization, that they can have a material impact on the market capitalization when they're buying their back. But I think if you add in other factors in there, you know, if you were looking for, you want it to be undervalued. So you can use it as an indicator of it being undervalued, or you can go and look at other things. Is it cheap on an enterprise multiple basis? Is it cheap on a PE basis?

Starting point is 00:34:05 Is it cheap on a price? book basis. And if you do those things, you get better performance again. I'm glad you brought that up because when you go back and you look at the middle of 2015 to the end of 2015, that period of time was like, I mean, there were so many buybacks happening on the market. It was totally insane. And when you looked at the PE ratios across the board, we were at the highest market valuation that you could have. So that was literally the worst time that businesses could be buying back their own stock because of the multiples. Yeah, guys, after being at Berkshire, I have a new idol and that's Chalemonger because he's

Starting point is 00:34:41 just the best person that's sitting back and just grunting something negative at some point of time. It's really hilarious. So my Chalemonga comment to this would be that I was browsing through the previous core results from Exxon and I could see that they were buying back quite a few shares, which surprised me because they actually told the public that we're not going to do it. And then I dig into the numbers and it turned out that there were only buying back stocks that they had been issuing to the management and key employees.

Starting point is 00:35:13 So, and there was hundreds of millions of dollars. I can't remember the exact amount, but it's a significant amount of stocks for a company in that size. So I wasn't too heavy about that. It was just really to give Preston some points for being negative. And then I came on being, I guess, more negative. Harry, I saw you had a point as well. No, the point I had was my concern about buybacks is most CEOs are not capital allocators.

Starting point is 00:35:41 And they haven't risen to the position because of their skills in capital allocation. Rather, it might be in other functions. And number two is, I rarely see a company specifying its plan to buyback shares based on a ratio, a metric, as Toby mentioned. And Berkshire is probably the only company I know which affects its buyback to a particular book to price ratio. Do you guys know any other company which does that? I've never heard of it being done explicitly. I think that the better ones try to buy it back when it's added discount to value. Buffett would never use book value as a valuation metric.

Starting point is 00:36:22 But it's kind of interesting that he's – and he would say that the intrinsic value of Berkshire has far out stripped its book value growth. So I guess he's saying – and I think he's – he's for. I've had to do it at a premium to book, isn't it? It's like 1.2 times. That's correct. Stig, I know you want to keep going with our second point with Monash, but I got a quick point that I want to make. This whole 1.2 times book value price premium that Buffett would buy back shares for his company, I really think that during the next downturn, whenever that is, we have no idea when it's going to happen. But whenever the next downturn does happen, I think Berkshire is going to go below that 1.2. And I really think on this next one, I think Berkshire is going to be buying back their own stock at a record pace more than they've ever done in the history of that company because he knows what he's buying.

Starting point is 00:37:10 He knows what he's buying his own cooking. And I think at this point, both of those two are in a position where they don't necessarily trust every other company out there in the books of all these other companies and the dependencies of these other companies. but they do know their own business. And I really kind of see them going to their Berkshire stock and the next contraction. And it was interesting. During the meeting, Buffett had made the comment because this 1.2 premium share buyback thing kind of came up briefly. And Buffett goes, and if it does go down there, we will be extremely aggressive.

Starting point is 00:37:43 And then he kind of corrected himself. And he says, we will buy back whenever it's at 1.2. So that was me reading the tea leaves on this one of, I think that that's going to be Berkshire's play, but I could be 100% wrong. That's just kind of how I anticipated though. So, Stig, let's go to the next point with the Monish discussion. Yeah, so the next strategy is called select value investing manager holdings, and that accounts for 20% of the funds. So 75% for share buyback, and then 20% for select value investing manager holdings. And the introduction to this is really easy. So it's 22 managers that

Starting point is 00:38:22 Papry has selected and he really trusts from other managers of files 13Fs. And he would be looking at the holdings how much they have been, how much the weight is in those respective portfolio. And then he would put that into a given weight in his portfolio, which would be 34 stocks. If you think that my presentation is messy or whatnot, or if you would like to know the specific rules, we will link to the prospectus where you can read more about this. Would it make sense doing this? Well, Popra has always said that his stock screener is really the 13 afts of other

Starting point is 00:38:59 value-investing menus that he trust and respect. So without paying for it, you can actually go in and find perhaps the best stock picks. At least that is what the greatest minds in the world are investing in right now. And here, Papra is using his same strategy. And what is interesting is that he is removing himself from the equation. So it's not like, well, Warren Buffett just bought Philip 66. I think it's within my circle competence. Do I like the price?

Starting point is 00:39:24 He's basically saying, well, if Warren Buffett and clearly other people as well like that pick, then I would need to do the same thing. This is people like Warren Buffett, Kyle Icon is also included, and Tom Gaynor, who hardly mentioned before from Michael is also included among those 22 people. So I'm curious to hear your thoughts on whether or not you think this is a good strategy to replicate. and that Toby, I see you have a point. I'm going to refer to Med Faber again, but he's recently released a book called Hack the Market,

Starting point is 00:39:56 something like that, where he looks at precisely this. He set up a cloning tool maybe 10 years ago that looked at 13Fs, and I think it's called Alpha Clown. You can go in and you can select the managers who you like. There's a lot of research that says that managers who have performed well in the past do tend to continue to perform well in the future. The only caveat, and I read through the book when it first came out, that my main takeaway from it was if you're going to do the 13F investing,

Starting point is 00:40:23 you need to be aware that the position in a 13F manager's holding that is size the largest tends to underperform. And the reason is that's a position that they've put on that's already had its growth and they're about to chop that one back. So you can do this by yourself. You can set up 13F screeners and just find a concentration of, there are lots of sites that do it. I think that the list, I had a quick look through for Brise list.

Starting point is 00:40:49 I think it's a good list and I think it'll probably outperform. I'd be interested to know how he's going to deal with that, the largest holding. Because if you aggregate 22 managers and you're looking at proportionate to their portfolios, which is the largest holding, you need to be able to have some way of dealing with that particular issue. But aside from that, I think it should do very well. Yeah, I was just going to throw out the MEP Faber as well. He has the Ivy portfolio as well as a book that kind of hits on this. I know he has an ETF that is already doing this stuff.

Starting point is 00:41:21 That's another one that we'll have to do a little research on and add into the show notes. But my understanding, and I might be wrong here, but off the top of my head, I don't think that it's done so well in the last three years, this ETF. I think it's underperformed the market. But do not quote me on that. I could be 100% wrong. But we'll go ahead and find here. Toby, do you know?

Starting point is 00:41:41 I don't. I don't know if he's got that precise. when I was just going to say in relation to underperforming the market, and I meant to inject this before when Harry was talking about pro-briar's return. So, you know, I do, there are two sort of aspects to the business that I run, but one of them is quantitative analysis of value strategies. And so value has actually been in a bare market since for about a year. It topped out about a year ago.

Starting point is 00:42:04 And so when I say value, I just take a simple average of a whole lot of different value investing metrics like price to earnings, price to book. what would a portfolio if you had just bought cheap companies a year ago look like? So in February at the bottom, it was down more than 20%, which is the definition of a bear market. And it's now recovered, but it's still down almost 14%. So you can look at any individual managers returns and look at how they've done. So Buffett was down last year.

Starting point is 00:42:36 David Ironhorn was down last year. Bill Ackman was down significantly last year. for each one of them you can identify the particular stock or several that they bought that kind of impacted them. And so it always feels, and I know as a value manager, it always feels very personal when yours are underperforming the market. But basically it's something that it's systematic and it's impacted every kind of value manager out there simply because a blend of value stocks is down.

Starting point is 00:43:01 So I'd be guessing that's part of Breis's most recent troubles. They do tend to outperform over the long term, though. So that's the other corollary. And then the last one that's spin-offs. It's only 5%, but I think the strategy is really interesting to discuss. And just the example of a spinoff that comes to mind is when Conoco Phillips was spinning off Phillips 66. So in this example, you have vertical integrated oil and a gas company that is spinning off at downstream division, which mainly it's in refining. So why would a company do that, first of all?

Starting point is 00:43:35 Well, it's actually to unlock shareholder value. And think of this as you would now have, called the Philp 66, that can now focus on the core competence with this refining. And they also have a big division in chemicals. But basically, they can be more focused. Or at least that's the intuition, or one of the intuitions behind why this strategy would work. And so Pabra's ECF would look at issues that have been spun off

Starting point is 00:43:58 in a 12 to 84-month time frame, and he would be ranking those again to those that are most recent. And this would be in market cap in excess of $500 million. So I think it's really interesting that he is not looking at companies that are spinning off within the trailing 12 months. I know Green Black Tips looking at this. I know there is a there you go. Toby is holding up. You can be a stock market genius where he actually talks about this strategy.

Starting point is 00:44:26 And he's actually looking at the previous. As far as I remember, he's looking at the previous 36 months. So he's not looking up to 84 months. but he doesn't have the 12-month penalty that the Pabra has. And why not? Well, to me, it's probably because Pabra knows that there is a tendency to overselling right after the spinoff. The reason why that might be is that funds might not want to own it because it's too

Starting point is 00:44:52 small and they need to sell it. It could also be because the new spinoff company doesn't pay a dividend, which a lot of people don't like. So a lot of the reason why you might want to avoid that. the first 12 month. But basically, spin-off is an idea of buying something cheap, something that might be unpopular, something that is really focused on the core common senses and where there is a lot of drive to perform in the years to come. So my question to the mastermind group would be, do you think the spin-off strategy is a good strategy to include for pop right in his CTF?

Starting point is 00:45:27 I think it's a very good strategy. In my own business, I think about there are kind of two aspects to the business. We buy things that are quantitatively cheap and that performs sort of in line with value. And then we look at things that you can't screen for. So in that sense, we're trying to avoid competing with the bigger fund funds that we don't have any particular skill in, but we are able to beat them by digging up these little positions, one, because they're smaller and two, because they don't screen very well. So that's one of the things that we do look at, spin-offs. The only problem is I think that the returns to it have diminished a little bit in recent times. And the reason is that it's so well known now that you don't want to own the

Starting point is 00:46:08 continuing company, you want to own the spin company that I think that the margin has diminished a little bit. So it's a less good strategy than it used to be, but it still should perform. And it provides that little bit of performance that's not necessarily tied to the market. It's kind of a, it's its own idiosyncratic returns, which is the attraction of special situations. So overall, the way I look at Junoon, that is Bobra's ETF that you're talking about, that's a ticker symbol as well, is that, like, you know, in investing, it's the process that is more important

Starting point is 00:46:41 than the outcome because the outcome has a lot of other factors. So at least he's laying out his process and the process is sound, as Toby just mentioned. However, for the outcome, we will have to wait and watch. Let's take a quick break and hear from today's sponsors. No, it's not your imagination, risk and regulation are ramping up, and customers now expect proof of security just to do business. That's why VANTA is a game changer. VANTA automates your compliance process and brings compliance, risk, and customer trust together

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Starting point is 00:50:23 have been so excited about this ETF. I can't remember the last time I've been so excited about the launch, except for Tobis, by the way, and we're going to talk about that in a little bit here, but I've been super excited about it. The one thing I don't like about it, because I'm, as you can probably hear, I'm quite excited about this, and I think the empirical evidence speaks for itself. To me, it is quite expensive. The management fee is 75 basis point, which is not unusual for a fund like this. So it's not vastly above market rate. I can definitely understand why people want to make money of whatever product they come up with. One thing is that I don't think PAPRA has that many expenses to cover with this ETF.

Starting point is 00:51:03 There are some very strict rules and he hired two managers actually to implement them, but it's not like he has hired like 100 analysts screening for the best stocks, meeting with the management and so on. This is not what he is doing. This is a very mechanical system. So for me to charge 75 basis point for that, I don't know. I still like VAT, but it might be a bit pricey. Clearly not if you opt for the market, I call it 6% or whatnot, but it is pricey to me.

Starting point is 00:51:30 Yeah, I guess for me, I would probably, and maybe this is the business side of me coming out on how I would price it. I would probably price the fee a lot lower initially to get some investors into the fund. And then if it's performing well and you have a great track record, then I guess you could ratchet it up so that, you know, you got a premium that's worth the. Yeah, and this is not fair at all, Preston. because we actually haven't heard about Toby's. No matter what you're saying, you would be like, oh, guys, it was the worst handoff ever. Let's be quiet and let's listen to Toby. So I'm in the process of launching one.

Starting point is 00:52:04 I can tell you that out of the 75 basis points, he's not taking home a lot of money. It does depend on how much capital you raise. So at sort of below $20 million, they don't break even for the manager. Wow. There are very substantial costs that go into setting them up. And then in operating, I think they cost sort of in the vicinity of $150,000 a year to operate. So you're not really breaking even until you're above that level. My favorite strategy is the acquire as multiple.

Starting point is 00:52:35 Not necessarily just that strategy by itself, but just a deep value strategy that looks for companies that are going to be taken over. And so I had the trim tabs ETF to hand because I think that it's interesting. that that buyback yield is so predictive of takeovers. I don't think that they're necessarily good in and of themselves, just that they generate catalytic returns in the sense that they generate returns that aren't necessarily tied to the performance of the market.

Starting point is 00:53:01 So that's the challenge. What I have designed is something that sort of operates a little bit like a special situations fund, but it's a deep value fund. And so it's going to be called something like the acquirers fund, and it's going to find in about the last, are just a thousand or so companies, the 30 best ideas at any point in time. And those ideas are going to be the ones that are the most undervalued.

Starting point is 00:53:26 And they have, according to the research that I have done, they have the best chance of sort of attracting some sort of takeover offer from a buyout fund or an activist or something like that. So what I really wanted to do was to produce something that is a little bit unusual. And hopefully I'm going to attach a survey that your listeners can click into and tell me if this is a good idea or not a good idea, but I would produce this as a hedge fund. So it's a fund that will actually hedge on a tactical basis. So it will seek to avoid the big drawdowns. It's going to be unhedged through good periods of time. It's going to be hedged

Starting point is 00:54:02 when the market draws down. And usually that's a good thing because the underlying strategy should outperform the hedge. So even if it is hedged, it should generate positive returns. But you don't want it hedged all the time because there are periods when the market is cheap and it's not a good idea to be hedge. So basically concentrated deep value, which is my specialty with near-term catalyst to sort of generate returns that aren't necessarily tied to the market and a hedge. So you hopefully avoid the really big drawdowns. I don't think anything like that exists, which is why I'm interested in doing it. And you know, you don't pay two and 20 type fees for this. You pay there's no carry of course. I mean, there's no performance fee, of course. And then the

Starting point is 00:54:43 fees would be considerably lower than that. I'm interested. to know what everybody thinks and I'd love to hear from your listeners too. So let me throw it to you guys first. So Toby, first of all, so is it an ETF or is it a hedge fund? It's an ETF. It's an ETF. Okay. All right. That's the main thing. Yeah. So it's going to be, it's a hedge fund strategy in an ETF wrapper. I got you. So this is, I mean, this is my personal opinion. Some people listen in this might think that, you know, I'm obviously catering to Toby just because he's here on and on the show. But to be quite honest with you, his strategy, this deep value strategy, makes more sense to me than the Pobreys strategy. That's me, though. For me, I don't buy into the whole, and maybe it's because I don't have the stats.

Starting point is 00:55:28 Maybe if I talk with Patrick or James O'Shaughnessy and they showed me a bunch of these charts with the share buyback thing, maybe I'd buy into it more. But right now, I don't have that in front of me. I'm not an expert in that, and to be quite honest with you, when a company's doing massive buybacks, I actually maybe get a little turned off. off by it a little bit, especially when you're kind of at the top of a credit cycle. I just don't understand that at all. Makes no sense to me. Whereas a deep value strategy at the top of a credit cycle still makes sense to me because let's say a company's beat down and, you know, they're trading a very low multiple. And the market's screaming high, you know, the overall S&P 500 is very high. I think that, yeah, if the stock could get punished a little bit more, but relative to the market

Starting point is 00:56:12 as a whole, I think you're going to outperform it. I'm going to stop talking. I want to hear what other people have to say. And I'm really curious to hear what our community has to say, because Toby, we are definitely going to put that link up on the show notes for people to participate in that questionnaire because I want to hear what they have to say as well, because I think that that's really going to give us some good information to help you develop a great product for people that I'll probably personally use myself. So what do you guys got, Hari, or Colin or Stig? Hey Toby, when are you launching your ETF? Is it already available? It's not. So I have the strategy that I want to put into it has been set for a long time.

Starting point is 00:56:50 But, you know, there are lots of different ways that I can implement it. I can buy a hundred stocks in a sort of bigger universe or I can buy a concentrated portfolio. I can hedge or not hedge. So those are things that if I, if you ask me what I want to do, what I want to do is buy the 30 most concentrated stocks, sorry, 30 stocks are a concentrated portfolio in a pretty big liquid market where there's a good chance of a catalyst coming along with a hedge because I just can't stand 50 or 60% drawdowns. They sicken me. And I think that in the testing that I have seen, when you hedge, you get so far ahead

Starting point is 00:57:29 in the big drawdown that it sort of locks in a lot of performance for when you recover but if you can, if you provided you're fully invested in the right part of the market. So it's just sort of, it's questions like that around the edge that I'm interested in hearing. But if everybody else says, I don't want a hedge portfolio, then I'm not going to release a hedge portfolio. So Toby, a lot of people in the audience might not even know what you mean by having a hedge portfolio. So describe that to people so that they really kind of understand it. So what we would do is we would use a moving average like the 200 day moving average. And basically all that looks at is the closing price of the last 200,

Starting point is 00:58:04 days of the market. And when the market trends below that price, you put a hedge on. And the way that you do that is by either selling futures on the market or selling, basically you're selling the index. So what you're saying in that is two things. One, we're going to get protection as the market goes down, the short on the index will go up. But you're also saying the portfolio that we're holding will outperform the index. And so we should generate positive returns through a period like that. It's idiosyncratic, doesn't generate positive returns all the time. It can be up and down. So a period like we've just gone through, it would have been down because value itself as a strategy has been down. But in a big drawdown where the market goes down, the short protects the portfolio.

Starting point is 00:58:50 And it offers the opportunity to make positive returns. And Toby, how do you intend to rebalance your portfolio at the end of a 12-month period? So that's a great question. It rebalances on a quarterly basis. And the screen is run. on the end of a quarter. And then the companies are bought and rebalanced back to equal weight. So it holds 30 stocks, each about 3.33% of the portfolio. And then over the course of the quarter, some will go up and they may remain in the screen. And so they'll be trimmed back to 3.4%.

Starting point is 00:59:24 Some will go down and they may even fall out of the screen. And so they'll be eliminated and there'll be others that will be substituted. And the substitutions are done on the same basis that they're, bought in the initial, when the portfolio is first formed, which is to say things that are deeply, deeply undervalued where there's a very good chance of some sort of catalytic event emerging to create returns that aren't necessarily attached to the market. So Toby, I know from reading your book, when you're talking about mean reversion and we had this conversation, I think when we originally had you on the show, I don't even know how long

Starting point is 00:59:58 ago, a year, year and a half or whenever that was, but the conversation really, really, really kind of revolved around. How long does it typically take for a company to mean revert? And I kind of remember the conversation saying around a year. So if you're rebalancing this every quarter, talk to us about that if we're really kind of waiting a full year for things to mean revert. I mean, I think in terms of a business turning around, it's true. It can take even longer than that. I would say three to five years, really. But what this thing is doing is it's saying, the rate of change of the mean reversion is greatest when it's coming out of the bottom, and that's the bit that you really want to capture.

Starting point is 01:00:38 So if you can grab that part, and then you have some sort of possibility of an event, the attractive things to me about event-driven investing is it's not tied to what the market does. An event can cause a company to go up a great deal where the market is falling, and that's the real challenge of creating these things is to create something that doesn't behave like the market does. So these things, it shouldn't behave like the market does. It should be heavily weighted to sort of going up, regardless of what the market does. So to answer your question about hedging, I think for me personally, I don't think I like that dear too much.

Starting point is 01:01:18 But it really depends on which type of strategy you are using. I mean, if I was only going to buy into one ETF, I could see why it would make a lot of sense. say that I would buy into your ETF, Toby, say it would be 10%. Well, for me, I would just really look for the outperformance here, and I would probably allocate something else to do my personal heads that I know how to control. I think that would be my concern, because there's a lot of focus on the expense ratios on ECFs. And I said, for instance, for a part price fund, there were 75 basis points.

Starting point is 01:01:50 But there was a lot of hidden fees and a lot of hidden costs within an ETF, just as any other investment vertical. And if you need to buy or sell for that matter of futures, money can only come from one place and that is me as an investor. So I think that would be a concern I have. I don't know the specific number, so I wouldn't say if it's a very expensive strategy, but I think that would be my concern. So sorry if I'm, if I'm the, if that was something that you were going to launch. I like Stig's point because what he's kind of getting into is as an investor, if you're already trying to hedge or trying to look at things from Where are we at in the credit cycle?

Starting point is 01:02:26 Well, I'm not going to do a deep value strategy at the top of a credit cycle. I'll just kind of wait until this thing matures a little bit and then maybe dive into a fund like that. But if it's already doing it, it'd almost be like double hedging because you're already kind of taking care of some of it. And I think that's a really interesting discussion. And I think it's something that from you, Toby, looking at it from a product that you're obviously wanting more participants in, are most people and most investors going to understand what a hedge strategy even is? And if they don't, is it something that you're too concerned with because are you just kind of looking at what is the best product I can build that will give me the biggest, fattest return over whatever period of time possible? And I think you're kind of leaning towards the latter. And I'm curious to hear your response. I'm probably a little bit more bearish than a lot of people. I think that the market is very expensive. I think that if we can look forward at implied returns for the market and we can see that they are. they're low, they're unusually low to sort of negative over the next period of time.

Starting point is 01:03:31 And there's no way that any sort of long value strategy escapes the gravity of the market when something like that happens because they talk about, say, correlations go to one. What that means is that everything behaves the same way because people become panicked. And it's this sort of selling, anything that can be sold is sold. And so it doesn't really matter if your company is already undervalued. It is something that is already undervalued is sort of irrationally priced, and there's no reason why it can't become more irrationally priced. I never know how big the next drawdown is going to be. We've had two absolute blockbusters since 2000 that have been down sort of 50% plus each.

Starting point is 01:04:11 And I think that the conditions are there for another drawdown, another decline in the same sort of magnitude. The reason that I haven't launched it sooner is because I've been concerned about, a big drawdown. And I think, you know, I would much rather just be the farmer who sort of sits on his property and doesn't do anything until there's sort of blood in the streets. And then he gets in his car and he drives into town to see his broker. And when everybody's in panic, then he buys something. He fills his portfolio up and then he goes back to the farm and he doesn't emerge for seven more years to do it again. But, um, plus you've been kind of, you've been preoccupied writing another book we might mention.

Starting point is 01:04:51 Well, you know, I've got lots of time. I can, you know, I could launch it now. And if the market was cheap, I'd be pushing really hard to get it out right now. But the only opportunity that you get to be that farmer who goes and puts all of his chips on the table is at that time that you're starting. So I've been waiting and I'm sort of inclined to do it as a hedge strategy because then it takes that timing issue away. And it's something that I would put all of my own personal capital. into, all of my family capital into, and just be comfortable holding for here until kingdom come. I think that's our, your last point for me is so important. And when Stig was talking about

Starting point is 01:05:33 Monash, that was what I was thinking in my head is how much of his own personal net worth is going to go into this ETF that he's standing up? Because that's huge. That is absolutely huge. I think it speaks, it speaks more volumes than anything else. It's the same reason why, you know, pretty much all of Warren Buffett's net worth is in Berkshire Hathaway. It's because he stands by his product. Yeah, Toby, I'm curious to hear about your thoughts about the timing because I was thinking, yeah, it would be nice to start the track record when the market is cheap. Relative performance is one thing, but you can't eat it. As value investors, we're looking at the absolute returns. But I'm just thinking, have you thought about, and just be brutally honest here, have you thought about

Starting point is 01:06:20 launching it now where it might be easier to attract capital because everyone is looking for a place to put their capital and it's somewhat easier to raise capital. But at the same time, if when we see the recession, people just storm out and you have all those, say, $150,000 in fixed cost and you might not only be losing, call it 50% when the market drops or if it drops 50% but also people would just withdraw the money at that part of time anyway. So what are your thoughts about the timing of launching it now or a year or a year ago? Those are exactly the considerations that you need to make as a manager. I think I don't want to be responsible for the wholesale destruction of somebody else's capital.

Starting point is 01:07:01 That's the thing that keeps me awake at night. So that's one of the reasons why I haven't launched it because I think that the returns, I can look at the returns to a deep value portfolio, prospective returns based on what historically the market has looked like. And they're just, they're not particularly appetizing at a level like this. Having said that, I would have said exactly the same thing in 2012, and it's been very good since then, over that period of time. But I think that that's sort of largely been a, what had historically been a very expensive multiple pay for undervalued stocks,

Starting point is 01:07:33 has become an even more expensive multiple to pay for undervalued stocks. So I keep on leaning on Jesse Felder, but one of the charts that he put up was this price to sales, ratio of the market is higher now than it has ever been before. It's higher than it was in 2000. It's higher than it was in 2007. That's just one metric gamed by lots of different things. So I always use multiple metrics when I'm trying to make these sort of decisions. But the market is extraordinarily expensive. Deeply undervalued stocks are also expensive, although now that there's been some sort of, they call it dispersion, there is some sort of carnage in a few sectors. So I think that the time to launch is rapidly a price.

Starting point is 01:08:13 But I can't get away from the fact that I'm concerned about the level of the market. We just want to thank the members of our mastermind group, Toby Carlow, Hari Ramachandra, and Colin Yablonski for coming on the show. And we just love talking to you guys. And I know that our audience, having met a lot of them out in Omaha this a couple weeks ago, they thoroughly enjoy these episodes where we get together and just kind of shoot from the hip and really don't have an agenda, but just kind of chat and just talk about each other's business and kind of what we're up to. the stuff that we talked about. Make sure you guys go into the show notes and check it out, especially the questionnaire for Toby. Let's help Toby out to design a product so that we can all

Starting point is 01:08:52 help each other, maybe have something that's really worthwhile here in the long run. So that's all we have for you guys this week. One of the things that I want to throw out there, Stig and I are trying to do live events all over the, all over the world in Seoul, South Korea. We're doing live events in Baltimore, Huntsville. I would really, really like to do one out in California, particularly in Santa Monica where Toby Carlisle lives because I love Santa Monica. It's like the nicest place in the world. So Toby, I need to chat with you about maybe putting something on the calendar for people out in the California area. And I know Hari would probably buzz down from Silicon Valley to kind of hang out and maybe some others. I don't know. But we need to get something like that on the calendar. And if you're in any of

Starting point is 01:09:33 these spots and you want to come out for dinner, have a nice social hour or three or four afterwards and just kind of sit down face to face and hang out for an entire, you know, Saturday evening. That's what we're really getting at with our community. And it works out as a fantastic networking opportunity for folks that participate. If you want to learn more about this, go to our top level page at the Investors podcast where we have our mission statement, one, two, three. Number three says, look for live events in your hometown. And if you click on that, you'll see where we're going and where we might be linking up with people. So be sure to check that out if you want to see about meeting up with us for any kind of live event. But other than that, that's all we have. So we'll see you

Starting point is 01:10:14 guys next week. Thanks for listening to The Investors Podcast. To listen to more shows or access to the tools discussed on the show, be sure to visit www. www.com. Submit your questions or request a guest appearance to The Investors Podcast by going to www.com.com. If your question is answered during the show, you will receive a free autographed copy of the Warren Buffett Accounting Book. This podcast is for entertainment purposes only. This material is copyrighted by the TIP Network and must have written approval before commercial applications.

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