We Study Billionaires - The Investor’s Podcast Network - TIP188: Mastermind Discussion 2nd Q 2018 w/ Jesse Felder & Tobias Carlisle (Business Podcast)

Starting point is 00:00:00 You're listening to TIP. On today's show, we've assembled our mastermind group for the second quarter of 2018. Some of the major market themes we've seen since the start of the year is a substantial sell-off in short and mid-term duration government bonds, with the 10-year Treasury briefly hitting over 3%. Since global equity markets hit a high on the 25th of January 2018, they've also struggled to sustain that level, and at the end of April 2018, the market is still down negative 6% since those highs. Many people are attributing the slowdown and the equity growth to the inflationary impacts

Starting point is 00:00:34 that are starting to be seen throughout the economy. Although these are the narratives, it'll be interesting to see what the members of the group have to say, and more importantly, how they structure their picks around this environment. The members participating in today's show is Jesse Felder, a former hedge fund manager of over a billion dollar fund, Toby Carlisle from Carbon Beach asset management, and the bestselling author of Deep Value and the Acquires Multiple, and Stiggin myself.

Starting point is 00:00:57 So without further delay, we look forward to bringing you our thoughts and picks for the second quarter of 2018. You are listening to The Investors Podcast, where we study the financial markets and read the books that influence self-made billionaires the most. We keep you informed and prepared for the unexpected. All right, so really excited to have our mastermind group assembled here. Jesse Felder, welcome back to the mastermind. so excited to have you here. Toby, great to have you with us. Who wants to go first? I guess that's the, that's the real question that we always have to debate about. I think I went first last time. So it's not somebody else this time. That's funny because my recollection is I went first last time.

Starting point is 00:01:51 So my pick this time around is AGX, Argan. It's the cheapest stock in the acquires multiple, all investable screener. It's one that I, when I wrote deep value and it came out in 2004, I had to pitch a stock on Bloomberg radio with Carol Massa, and I pitched AGX then. So I've been following it for a very long time. It kind of had a rough year over the next year from 2014 to the end of 2015, and then I had to do a Christmas call, you know, just before Christmas with Carol Massa and James O'Shaughnessy and Pat O'Shaunice,

Starting point is 00:02:27 and it was down like 15% over the course of that year. So they both had a pretty good opportunity to roast my chestnuts again there. But I picked it again. that time and it's had a pretty good run since then up until about three or four months ago and it's sort of it ran from like $15 to about $72 and it's come back off now to I closed at 3845 at the time that we're recording this which means that it's on an acquirers multiple of about one and a half that's slightly misleading because of the way that Argan conduct its business so all of its buildings come in before it then does the work so it's always

Starting point is 00:03:02 carrying more cash and it's actually going to earn. But all else being equal, I would rather my businesses are that way. So Argan is a designer and constructor of power stations. So basically what it does is it takes coal power stations and it refits them to be gas. So to the extent that that's going to continue happening for various reasons, climate change and other things like that, Argan's got plenty of work to do in the future. The reason that it's been so beaten up lately is it has to have. it pretty large book of work to get through.

Starting point is 00:03:36 And it has been doing that work. So its earnings are really good. It's been generating lots of cash. But that book of work has sort of fallen off. So the question is, can it continue to sort of find more work to do? I think that it can. I think that it's sort of sold off too much to where it is now. At 3845, I think the valuation range is somewhere between sort of $50 and $70 on a

Starting point is 00:04:01 DCF basis for a company like Argan. So it's 3845 in this kind of market. I think that that's one of the better opportunities around. But again, I do think that we're sort of in that part of the market where we're all scraping the bottom of the barrel for strong ideas. So I'm happy to take any suggestions from you guys far away. What kind of discount rate are you getting with that price that you quoted? Yes.

Starting point is 00:04:24 I always use discount rate of about 12%. I'm assuming that for sort of the next, five or so years it can grow at about 10%, which is a pretty healthy clip. If you look at the growth rate implied by the current price, sort of suggesting it'll be around 1%, which is basically no growth. That'd be growth under inflation, where if you look at what it has done,

Starting point is 00:04:49 growth rate over the last 10 years has been more than 10%. It's been 12% or so. Over the last five years, it's been 27%. So it's been a particularly good five years on a revenue line. So is 10% sort of achievable? I think that it is five years. Could be a rough five years that we go through. But I think at the end of the five years,

Starting point is 00:05:10 Argen's not a company that goes away. It's been around since 1961, which is one of the things that I always look at. It's carrying the cash. It's got to do the work to actually earn the cash. But that's the kind of business that I like. So Toby, talk to us about the backlog. You already touched upon this.

Starting point is 00:05:26 I mean, if we look at it, it kind of looks like the last projects would be finishing up in 2019. It seems a bit irregular to me in the sense that, you know, I think it was just late April. You saw this big bounce as like 70% or something in a day because they announced like a $250 billion revenue project, which seems to be like the only new thing going on. I know that's partly also priced into the market and you already addressed that, but how and why do you see the demand still come for the products? and will this not be exploited because it's quite visible looking at the company that perhaps they don't have as much negotiation power for people who also knows that they need to make revenue and they need to lend new projects.

Starting point is 00:06:09 The difficulty with a company like this, for one thing, 80% plus of its buildings come from one client and it's always relying on finding new work. The thing that I come back to, and I do agree that it's always hard to see where the next big deal is going to come from for a company like this. But I always return to in an instance like this, the price is so low, really only needs one or two deals for this to be far too cheap where it's trading. So I think that you are sort of rolling the dice a little bit on the work beyond the current backlog, but I think it's a roll of the dice that's worthwhile at this price. So I'm getting very similar numbers to which you got Toby as far as what you're expecting to get on the return.

Starting point is 00:06:52 But I'm kind of curiously here with Jesse, you know, like what kind of concerns are you seeing, Jess? Well, I mean, I looked at this thing and I said one and a half times enterprise value to EBIT, that's crazy cheap. There's nothing close to that cheap that I've been looking at recently. I guess I need to check out Toby's Sital a more frequently. Technically, to me, I mean, it looks like the stock has a really good longer term support at this 3750 level, right, where it kind of is now and downward momentum looks to be waning. So it kind of has like some of the technical stuff that I would look for in addition to being super cheap. The one thing that I do worry about is the valuation has been one and a half times for years now. And it's hard for me

Starting point is 00:07:36 to then argue how much more than that is it worth. And so with a lot of the things I do, I put like a three year time stop on especially really deep value plays where if the market doesn't you know, justify my belief in this thing in three years time, then I'm wrong. And so, and the market's been pricing this thing between one and a half, well, I guess the upper end of the range is closer to four times. And so it's really near the low end of that range. So I, I see a lot to like in this thing. Like Toby says, it's got a crazy good margin of safety built in so that even if they don't find much in the near future, I wouldn't be too worried that, you know, something's going to come along and justify its valuation. But, you know, they're paying a

Starting point is 00:08:20 dividends. So with the low market cap, you're just going to get a fatter dividend yield or if, you know, if they just start banking a lot of that as retained earnings and it's not ever kind of popping in the market price. I just think that you might get it back on the dividends that are being paid maybe. What do you guys think of that? Yield is two and a half percent. It's just gone ex-dividend today, I think. So that's sort of part of the reason. It's off about two and a half percent. So that's probably the reason it's off a little bit today. But, you know, this year at the start of January this year, it was trading at $72. So it's close to 40% plus, I guess, from, it's almost 50% from its peak. I mean,

Starting point is 00:08:59 I didn't think it was a bad stock at the start of the year at three times. But as Jesse pointed out earlier, and Stig, too, it's one of those companies that it's got this concentrated customer base, and it's pretty chunky and you never get very much visibility, which is why trade so cheaply. It's not one of those ones that I like at three times acquire as multiple, which would ordinarily be very cheap for any other kind of business. But at one and a half times, I just think it's hard to ignore. It's one of those things that I don't think that it could be a zero. You can probably, anything can go lower. Anything can go down by 50%. But I like the risk reward at this price. What was the narrative that brought it down so hard? Because when you look

Starting point is 00:09:37 at the top line, the top line's really healthy on the company. So I'm kind of curious what brought it down like that. It's the future work. It's the book of work that it has to do. And that book, they've been working through that book and they're coming to the point where they really need to start finding another power station to convert. I would just say, I love it when the market discounts or starts believing that a company that has, you know, proven that it can find new business for 60 years. The market starts discounting. They're not going to find new business. I love the types of situations. I don't know why I'm actually hesitant. It kind of turns out.

Starting point is 00:10:12 turns out that Toby is usually right. And whenever he pits something, you know, it's not the nice thing to say, but like, Toby typically pitched something that's really, really ugly. And that's kind of like what you see, right? So like, you see, oh, it doesn't have like a backlog. And Toby, as smart as he is, is like, you know, stick, that's why it's cheap. It's really as simple as that and I guess as complicated as that. For me, it's more probably because not as familiar with the stock as Toby.

Starting point is 00:10:38 Like whenever I'm like looking at the cash flows and I can see how receipts, receivables are creeping up. I don't think compared to revenue, it's necessarily a huge concern, but it's probably something that I would monitor. If this was a stock, I would consider investing in. Toby might have done that for a long period of time, but that's whenever you see like backlog issues, whether it's one way or the other, you sometimes see that number going out of control. You know, one thing that I did notice on this, I found a little interesting, Toby, was the cost of revenue for the business five years ago was 65% of their top line. And in this past year, it was 83% of their top line. So it seems like their top line's grown. It's growing really, really well,

Starting point is 00:11:19 but the efficiency of what they're able to bank out of that is really kind of deteriorated quite a bit over the last five years. And it's been pretty consistently deteriorating over that five-year period. That was really kind of one of the only things that I could see that kind of like made me raise an eyebrow when I was looking at it. But I like it. Jesse, you seem to like it. as well, right? Yeah, I do. I think it has a lot to like in terms of just the valuation. One of the things I like to look at is the company's historical valuation. Like I said, it looks to me like over the last five years has traded one and a half to four times. And so buying the bottom of its range looks attractive to me. The one thing, the first thing I do when

Starting point is 00:11:53 I look up any of these stocks, though, is read what kind of business they're in and decide whether that is within my circle of competence. And this one is not really within my circle. So I'd have to do a lot of work about I would have to do that work first and kind of try and expand my circle a little bit first before I would be comfortable buying some. All right. You guys want to do the next one? Anyone else want to go? Yeah, sure. I'll go. All right. Go ahead, Jess. I like Annali mortgage management. This is a mortgage reet. Essentially, they call themselves a yield manufacturer. They borrow short term and lend long term. Essentially, borrowing short means they use repurchase agreements and the very short term, 45 to 60 days.

Starting point is 00:12:35 And then lend long, essentially buying Fannie Mae and Freddie Mac mortgages, and then they use leverage to generate what is now 11.5% dividend yield on the stock. I like to think of it. I mean, there used to be back in the day, you know, thrift institutions, which were always fun to buy when they got cheap, because they had a very simple business model, very similar to this. There really aren't thrifts anymore today. All the banks have gotten into other kinds of stuff. And I really try and avoid banks generally because I can't really understand their balance sheets anymore. But this is a very simple business model for me to understand. I think of it as like the Bailey building and loan.

Starting point is 00:13:15 What is that? It's a wonderful life. You know, Jimmy Stewart, his family's building and loan and they're essentially taking deposits and then lending it to people to buy houses and making the spread. The difference here is that they don't have any credit risk because it's all Fannie and Freddie products that they own. And they don't have any depositor risk because they've raised all the money through the public markets. What's going on with the stock right now? It's been depressed for the last

Starting point is 00:13:38 three or four years because since the yield curve has really started falling. And, you know, when the yield curve compresses, that is typically not good for banks. And it's been better for banks, or at least investors perceive it to be better for banks right now. But annually suffered because people always hate these mortgage rates when the yield curve drops like this and yields compress. So there's a lot of people worried about their ability to make that net interest margin in this environment. But currently trades at about 90% of book value, which is historically pretty cheap. I mean, it's gotten cheaper than this. But when I look at the stock's Cape ratio, it trades seven times its average 10-year earnings over the last 10 years.

Starting point is 00:14:20 There are not a lot of stocks in the market that trade at seven times their last 10-year earnings. To me, that's incredibly cheap, especially in the market, you know, trades closer to 27 times cape ratio or something. The other side of it is that this stock has a 0.5 beta. So if you are worried about volatility in the markets and stuff, this stock does really well when people seek a safe haven and volatility rises. And I really think, you know, I'm really have been bearish on bonds the last 18 months, two years, and I'm worried about interest rates rising even further. That's part of this thesis is it looks to me like we should start seeing a steepening of the curve.

Starting point is 00:14:59 And if that happens, that's really good for the stock. But it's also, you know, for me, I don't know if this curve steepening could happen as a function of short-term rates going down or long-term rates just blowing out on the upside. I think that's a real distinct possibility. And you definitely, so my point is bonds could not be the potentially might not be the diversifier that they were for equity investors during past volatility in bare markets. this to me seems like because they're so good at hedging the portfolio, a really good bond alternative, especially because the yield is four times, you know, what a 10-year bond is. And then over the last three or four years, there's been big time insider buying. These guys have been just loading up on stock.

Starting point is 00:15:43 I think the CEO has bought about $5 million worth of stock over the last six months, which is always a really good confirmation to me that these guys feel comfortable putting themselves in position of the rest of us shareholders. So that's Antony. So, Jesse, it seems like the long tail of the bond yield curve isn't even moving. When you look at the short end or the long end that you were describing there, kind of blowing out, it seems to me like the long end is going to kind of stay put. And I don't see the central banks allowing that to blow out.

Starting point is 00:16:11 Would you agree with that? I think there's a real distinct possibility right now that they are too far behind the curve. We're seeing inflationary signs and wages. I've been talking with my friend Eric Sinamon about this consistently over the last six months. And he's been pointing to companies talking about inflation. So far, the 50 companies or whatever in the SB 500 that have reported have been complaining, wage inflation and then other cost pressures are the number one concern to earnings that they've had, the 50 companies that have reported already.

Starting point is 00:16:41 Bank of America did it show. I mean, it's not showing up in the numbers for a variety of reasons. Bank of America showed in March their direct deposit customers saw an average of a 7.5% increase in their paycheck. in March. So there's a number of reasons why it's not showing up in the data, but wage inflation is here and cost pressures are here. And so, you know, I really do think they could lose the long end because they'd be forced to start fighting inflation rather than trying to support the financial markets. They have to make a decision. 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.

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Starting point is 00:21:05 Sign up for your $1 per month trial today at Shopify.com slash WSB. Go to Shopify.com slash WSB. That's Shopify.com slash WSB. All right. Back to the show. Interesting. Very interesting. Stig.

Starting point is 00:21:25 Basically, the company makes its money based on the spread between the interest earned and assets and the interest payments made on the borrowing, whether that is in debt or, you know, equity, which they have been using plenty. You know, if we look at some of the macroeconomic factors and talk about, I guess, the risk for me would be how significant will it be if they can't renew their funding on favorable terms? I mean, if we look at the credit now, it's out of control. I would argue that we can expect

Starting point is 00:21:52 a huge contraction with QE unwinding. Is that something you're concerned about? And how do you see like the macroeconomic scheme playing into this? Yeah, I mean, I think their funding to me would be a concern if people were worried about the credit quality in their portfolio, which is why banks don't necessarily do well when the old curve steepens because otherwise that's that's a huge profit sign that they're going to make more interest income. But a lot of the times when that spread blows out, that's when they have credit problems. And so I don't like the banks right now, you know, for that reason. Anley has no credit concerns. You look at the, during the financial crisis, they didn't even experience a hiccup. And that's just because they don't have any credit

Starting point is 00:22:34 concerns in the portfolio. And you know, they use repurchase agreements. So basically they're borrowing money for 45 days and that's collateralized with a Fannie loan or a Freddie loan. And so people say, okay, I can get whatever it is, you know, 1% annualized return through a repurchase agreement for 45 days with collateral that is backed by the U.S. government. I don't see that funding drying up any time. And it really hasn't. You look back at the 20 plus year history of this company during the 1998 crisis, 2008 financial crisis, they've really not had any issues. for those reasons. Jesse,

Starting point is 00:23:10 talk to us about the payout ratio, because when I'm looking at their net income and then I'm looking at the dividend that they're paying, it's a buck 37 for the end of last year for their bottom line, and then they're paying a buck 20 of that out on a dividend. So like the payout ratio here is just absolutely huge. Is it sustainable? I think it's absolutely sustainable.

Starting point is 00:23:30 So, you know, with this company, they are the biggest, most powerful mortgage rate on the planet. So, you know, one everybody wants to work with.

Starting point is 00:23:38 They are the Berkshire Hathaway of this market. And the reason I bring that up is because when you look at Berkshire's earnings, you know, Buffett has said in annual reports, when we have capital gains, don't look at that because look at if Buffett were to sell off the whole portfolio today, the earnings would go through the roof, right? But how sustainable is that? That's capital gains. So a lot of the fluctuation in Annalise earnings is capital gains, losses,

Starting point is 00:24:01 it's hedging and it's all that kind of stuff that goes on. So you look at the core earnings of this company, they're super steady, super steady. you know, $1.2 billion, I think the last three years just, you know, boom, boom, boom, in a rising rate environment, in a falling yield curve environment, they're able to generate, you know, consistent profits. Their leverage is really low right now currently. So they're able to kind of try and capitalize on this yield curve, you know, phenomenon right now say, hey, we don't want to put a ton of money to work right now. Wind spreads aren't good, but they could go from six and a half times levered to ten times levered. And this is why, you know, they can really max

Starting point is 00:24:38 that yield curve widening once it starts to happen. So if you're saying normalized earnings for the company look more like around $2 billion, I'm now looking at the cash flow statement. I'm seeing what their cash dividends are and they're around 1.2 to 1.3, which would make it around 60%, not 90%. So you're saying that that's the reason why it's sustainable. Yeah, and they use, I mean, like most REITs do, they use a non-gap metric to kind of help shareholders see what they call it core earnings or normalizing.

Starting point is 00:25:08 earnings, you know, would be aside from all the, you know, different portfolio dynamics that go on. Interesting. All right. Anyone else have anything they want to add on this one? I just wanted to say I think it's a good pick. I think it's undervalued discounted book, probably worth a little bit more than book given its position. And the main concern that I had just briefly looking at the financials was the payout ratio. But I think that Jesse's probably right there that it's got lots of headroom.

Starting point is 00:25:35 I guess my closing remark for the pick will be that if you do share this concern about credit contraction, then you might consider Preston's pick. So I'm just going to throw over to you, Preston, because I know that a lot of people, whenever they think of a stock market top, they're always considering this pick. So please take it away. So normally, inflation, and this is my pitch without saying what my pick is here. And most of this is because I want to seek some guidance from Jesse before I say what my pick is. But normally inflation and gold have this inverse relationship.

Starting point is 00:26:13 However, when inflation is rising more quickly than interest rates, causing the real yields on government bonds to decline or turn negative, gold can actually do quite well. And that's kind of my argument for why I think we might be at a good point for gold. Now, anyone who knows me, they're probably cringing as they hear me say that because they know I'm a hardcore value guy. I'm not an expert at commodities or gold by any shape of the imagination. But I just think we're in this unique environment, kind of similar to what maybe we were in back in 2007 kind of time frame where we're at in the business cycle. And I feel like in the next three to six months, we're going to see gold make a big run. Jesse, you understand the technical side of things. And whenever I sent out to the group that this is what I was thinking about talking about,

Starting point is 00:27:06 you sent me another article back about why silver might even be a better play. But I'm kind of curious to hear some of your arguments, whether you agree or disagree with the idea of gold being a good position for people to be in right now. Yeah, you know, I've been bullish on gold for the last two years, really since like late 2015. I think, you know, Meb Faber did an interesting article. I read around the time where he showed that, you know, when an asset class is down two years in a row, the third year's really good, was down three years in a row.

Starting point is 00:27:38 And, you know, in 2015, gold was down, you know, I think four years in a row. And so there was so much hatred, you know, built up for gold by the end of 2015 that it was just, I mean, a contrarian's dream. I think the Wall Street Journal, you know, had an article, you know, said, Gold is the new pet rock.

Starting point is 00:27:57 Literally, people were just calling it a worthless relic. At me, all those kinds of things just really pique my interest. Since then, I've done a ton more work on it because I have not been interested in gold, you know, until 2015 is really when I started getting interested in, at least during this cycle. And one of the most compelling cases for owning gold, I think, right now is you look at the ratio of financial assets to real assets. and real assets, you know, in relation to financial assets, have never been cheaper in history than they are today. And so financial assets, we're talking stocks, bonds, real assets, we're talking

Starting point is 00:28:34 real estate commodities and gold. Imagine if you back out real estate out of that equation because real estate prices are high, you know, gold and other commodities have never been as cheap relative to financial assets as they are today. You look at what drives those cycles that push financial assets and push real assets. And it gets back to this inflationary thing I was talking about earlier, which is, you know, you look at the last time real assets were really expensive to financial assets was, you know, through the 70s and early 80s before Volcker broke the back of inflation. Since then, we've had a disinflationary period that's been really good for financial assets. And so I think right now gold is extremely attractive over the next five to 10 years because

Starting point is 00:29:17 I think we're transitioning from a disinflationary environment to an inflationary one. And there's a lot of, you know, reasons for that. But I'd probably have to dominate the entire rest of the show to go through them also. No, that's, I'm glad that you said that. Now, I'm curious what your thoughts are buying gold versus silver. Do you think silver is going to give you a better return than gold over the next couple years? It very well could.

Starting point is 00:29:38 I don't own silver. There's more too silver than there is to gold. I mean, there's the industrial uses and things that you have to pay attention to. For silver, gold, I think, is the pure alternative currency and inflation hedge. The reason I think silver is potentially ready to explode is that I was looking at the silver to gold ratio, and it's bumping up along the lows that it's rarely seen in the last 10 years. To me, that's just a sentiment signal towards precious metals.

Starting point is 00:30:06 When people get excited about precious metals, they buy silver because silver just has higher volatility, you know, higher beta than gold does. So the fact that people are abandoning silver is a bullish sign to me, a contrarian sign that the precious metals are still super underowned and hated right now. And then there's also the fact that speculators in the silver market have the largest net short position on record in history. So if these metals start to break out higher, the short squeeze is going to be incredibly powerful. How familiar are you with ABX, the Barracks Gold miner? Yeah, I mean, I look through all of them. You know, the ones that I started buying in 2016 were trading.

Starting point is 00:30:48 I mean, Gold Corp was trading at literally 50 cents on the dollar, half of its tangible book value. And so those are the kind of ones that I lean to. Barrick and Newmont are, you know, the big boys. And they usually don't get quite as, you know, cheap as some of these other ones. Gold Corp's not a small company. I don't like to really speculate in the smaller miners. That's that I don't own any barrack. but, well, my question is this, because we've watched gold, right when you started talking about it is when it really bought them. Then it bottomed it around, let's call it 1040, 1050 in price. And now it's at 1342. So it's easily up 30% since when you first started talking about it. But you go and you look at barracks gold mining. And I mean, it's really had a rough time in the last year. I mean, the thing has been punished. And it hasn't been tracking the price of gold. I can't figure out why that.

Starting point is 00:31:40 That's the case. But when you put a gold position on, I'm kind of curious because back in when you first started talking about this, I read an article where George Soros put a call option on Barracks. He absolutely crushed it because he did it like the price of gold went up 30% within that first six months of that period of time. He sold the call. But it really kind of caught my interest as maybe a really smart way to approach this because you get all these arguments, people saying that the gold market's manipulated, the,

Starting point is 00:32:10 argument about paper gold versus hard tangible gold. And then you see a guy like Soros go out there and do a long-term call option on a gold mining company and he just brushes it 200, 300% in six months. So I'm curious, do you think that that's the way to play this into the next two years, call it? Or do you think you just go out and buy like, you know, some gold ETF? Yeah, no, I'm very comfortable recommending to people that everyone should allocate a portion of gold to their portfolio. Ray Dalio said, you know, if you don't own gold, you don't understand history. So, I mean, everybody should have some, you know, portion of their portfolio allocated to gold. And I think my favorite way to do it right now for most investors is the Central Fund of Canada,

Starting point is 00:32:54 which has just changed to the Sprott something. I don't know, Sprott bottom out. And this is a closed end fund that just owns gold and silver in storage. And it still trades today at a 3% discount to the assets. that it has in storage. So it's crazy, but this is another sentiment signal. There's no reason why it should trade it a discount because since Sprott bought this fund, they've made the shares convertible into bullion. So you can say, I want to convert my shares of the Central Fund of Canada into bullion, please send me my gold coins. And they'll do that. So there's literally no liquidity risk. There's no, I mean, any type of risk in this thing, Sprott is the biggest name in the industry.

Starting point is 00:33:36 but that's just owning the metals. And I think that's a really easy way to own the metals. The stocks, the mining stocks are much more volatile. And there's a lot that goes into it. I mean, I've talked with my friend Bill Fleckenstein a lot about this because he's really kind of an expert in the area. And one thing he taught me was to look at where the mines are because a lot of these companies have mines in iffy government, you know, countries where, you know,

Starting point is 00:34:00 the assets could be taken over by the government. So you really want to own things, you know, in Canada and other places. places where you don't have to worry about geopolitical risk and that sort of stuff. So I do have to plug Toby again. I saw back in February and March or something, he wrote something about Tahoe. And I said, this is one that hasn't hit my radar. I bought it back in February, March or something of things up like 50%. So thank you, Toby.

Starting point is 00:34:27 His Humana pick was on the front page of the Wall Street Journal as well. I guess Walmart's trying to buy it. Yeah. That was a good one. I'm glad we're not talking about the last time Jesse was on, which was AGO and he had CF, I think in that horse race, I think my horse is still running. That's AGO, which I still think is really cheap, by the way. It's way too cheap, but it's going to take a little while for it to work through its problems.

Starting point is 00:34:49 I really like gold, I think about early last year at the start of last year. I'm going to make both people who are gold bugs vomit and people who hate gold vomit. So I think this is the perfect position. The gold bugs hate it when you buy the paper gold, like GLD. I kind of like, I'm not going to go and store gold in my house just in case there's anybody out there who's thinking about robbing me. There's nothing here of any value at all. Or burglling the house, there's nothing here. All my gold is paper gold.

Starting point is 00:35:18 And because gold's been so beaten up and so quiet for so long, there's absolutely no vol. So I was buying the leaps at the start of last year in GLD. So I don't mind that as a way to do it. And I looked at the way that GLD and gold performed the last time we went through 2007, 2009 the last time market got beaten up like that. the gold miners index got really beaten up. It didn't kind of stand up. So it trades a little bit more like equity than it does like gold. Gold sold off a little bit too, but it wasn't as bad or GLD sold off as well.

Starting point is 00:35:48 So that's just a different way of doing it. I don't mind the leap. So that's the very long term call options. You find the longest dated call. You find, you know, one that's pretty liquid and that as close to the money as you can get it. Because if you're directional, you want to get close to the money. And so that's what I have been doing. every time it rolls one more year, I buy one more.

Starting point is 00:36:08 So we're about, I think there's 18 months to the backmark a call option right now. So that's the 2020, I think, is the longest one you can get. So it calls out the money on GLD or a similar sort of gold trust. My opinion is if the price of gold kind of punches through this really hard resistance level that we're seeing at like 1370, 1360-ish, if it decisively pushes. through there. To me, that seems like it's just going to go off like a rocket. Would you agree with that? Yeah, I mean, there's a long-term head and shoulders bottom, just from a purely technical standpoint, that like you said, goes from about 1050 to 1350. And so traditionally, you would measure that head to the top of the head or the bottom of the head in this case, because it's inverted to that neckline.

Starting point is 00:36:54 It's $300. So that would project $300 to the upside once it completes the pattern. So break through 1350, technicians are going to be looking for $16.50 next. So, Jesse, and I'm really sorry if this pitch here from Preston really turned into an interview of you about but I think this is something that the listeners would find really interesting because we're talking about real assets. We're talking about gold and we know that you're giving to have so many hard, cold, Warren Buffett listeners out there. A lot of them do not believe so much in gold, but they're still believed in real asset. So how do you see that as an asset class going through the cycles? Like, how do you allocate and what's your thought process about that?

Starting point is 00:37:38 Yeah, you know, for me, I would show people who don't believe gold is a good alternative currency, because that's really how I look at it. It's an alternative currency. And you look at the long-term trend in the dollar. You know, essentially gold is, to a large extent, the inverse of the dollar. So you look at what drives the dollar. Well, the biggest thing that I can find over the long term is federal deficits. You look at, you know, when was the last time gold extremely cheap was when we had a federal surplus, you know, during the dot com mania, all the capital gains created all the nice taxes, and we had a nice federal surplus and nobody wanted to own gold.

Starting point is 00:38:15 But there's a really tight correlation between the federal deficit and the gold price. And this is the first time, I think, in history right now where we're seeing federal deficits widen during an economic expansion. If you're worried about that, then you need to buy gold, period. And so I'm seeing these deficits widened, and you look at the projections of where these federal deficits are going, and they're only going to get wider. And the projections don't include a recession. So, you know, when we get a recession, the deficits are going to blow out. And this is the catalyst for gold, you know, breaking out to the upside is just widening

Starting point is 00:38:53 deficits in my view. I have this deja vu of being on this show in the United States. the last few years and having this discussion about Buffett and Gold. And I think I pulled up this quote at the time. I just think it's worthwhile sharing it again. I wrote this in 2009 on Greenbacked. Buffett was being interviewed by Becky Quick. And she asked him a question about gold. And he said, blah, blah, blah, blah, just sits there and looks at you. And he didn't really like it. But then I remembered that he wrote in his 1979 letter to shareholders that someone had pointed out to him that in 1964, one share of Berkshire bought one half ounce of gold, and then 15 years later

Starting point is 00:39:29 after ploughing back all of the earnings plus blood, sweat and tears from the greatest investor alive today, that Berkshire Hathaway share bought the same half ounce of gold. So it's just worth thinking about that there are periods of time where you can invest as well as Warren Buffett without any of the effort over sort of very long periods of time. I think that gold is getting close to being in one of those positions again. With a rock. Yeah, and I would just add that, you know, well, Buffett might not like it. And Buffett is plugged into the financial system as anybody.

Starting point is 00:40:03 Alan Greenspan, over the last couple years, has been telling people to buy gold. And so, you know, when you have the, you know, Sir Alan Greenspan, I should call him, because I believe he was knighted, to him who's been responsible for this boom-buzz cycle that we've seen in the last 15 years, to see the situation, the fiscal situation that we're in and saying, you know, people just need to start buying gold. To me is the only endorsement of it from a major public financial figurehead that you need. All right, Stig. Yes. So my pick is United Therapeutics Corporation. And before you guys bring up the bat, I would just say that this is a very ugly company, as always. In the sense that it might be similar to what Toby talked about,

Starting point is 00:40:46 except that Toby's stockpics typically perform a lot better. After, we have to recall, this is from Silco Stock or this is a biotech company. And the biotech company, they're developing and selling drugs to patients with chronic and life-threatening conditions. And it's primarily to treat pulmonary arterial hypertension, PAH, which is a condition of increased blood pressure with the arteries of the lungs. and this is as much as 94% of the revenue. Really, in this market, there are like three main drugs and they're the market leader in two of them.

Starting point is 00:41:21 And then, like, have a very, very small portion of the revenue around 4% that comes from the treatment of a neuropostoma, which is like a rare cancer that forms from immature nerve cells. So that's primarily with kids. If we look at the industry as such, it's a $6 billion market, growing 5% a year. And really lifestyle is the main reason for this. So smoking, alcohol, the way we eat, it's all huge contributors. Mine contribution is HIV, and as with many other diseases, a lot of the causes are simply unknown. Really, the driver for the growth of the industry is the presence of the large population, above 60.

Starting point is 00:41:57 So lower immunity levels, and they're prone to get this disorder from that. Now, if we look at the competition, the numbers look great. There are definitely some challenges in the future. but, you know, we are looking at the second highest operating margin among its peers. Again, it's for various products, but in the industry. And it's up there with the Gilead, which was Toby's pick from episode 166. And I just do want to point out, despite like healthcare not necessarily doing well since Gilead has really held his own.

Starting point is 00:42:29 So that's been interesting to follow. If you look into the future and one of the reasons why it's selling a discount, well, for one reason, like the industry as such has just been punished, but more generic drugs are entering now, which is going to take its toll on their revenue, especially in 2018, not necessarily from 2019, because I do want to point out that this is not the active ingredients being patented. This is also what is around that treatment. So it's really like dependent on where the patient's health is. There are the five different groups.

Starting point is 00:43:04 So depending on how developed this disease is, they'll get different kind of treatments, and there are a lot of new patterns around those type of progressed diseases that is not running out. So without sounding like a doctor or anything like that at all, that was the first part of my pitch. And I'm very excited to hear what you guys had to say. 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.

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Starting point is 00:46:32 material before investing, including objectives, risks, charges, and expenses. This and other information can be found in the income funds prospectus at fundrise.com slash income. This is a paid advertisement. All right. Back to the show. So I want to go first because I absolutely love this pick, and this was actually going to be my pick until Stig cut in first and picked it. I'll tell you why. It's the second cheapest thing in the Acquireers Multiple Large Cap Screener. I got it in the screen at four. It's four or five, something like that on an Acquireas multiple basis.

Starting point is 00:47:07 I think this is a spectacular stock on just about every metric, massive return on invested capital, like 13% free cash for a yield. I like everything about this stock. I think it's a really good pick. So I just wanted to get that out front and center. I think it's a really good one. That's so boring. Like you usually beat me up, Toby. It's very confusing for me to experience this.

Starting point is 00:47:29 I just, I'm so dark that you got in first stick. Well, I would just add to that that this is actually a stock that I owned back in 2012 when I saw Martine Rothblatt buying a ton of stock. she is a fascinating person. She invented serious XM satellite radio. And then one of her kids got sick with this and she created this company to basically address this illness. Fascinatingly brilliant person. Not to mention she had the courage to transition from living as a man to living as a woman now back in the 1990s before it became a more accepted like it is today.

Starting point is 00:48:11 So, I mean, really, there's an interesting TED talk with her where she discusses a lot of these things, too. I got interested in the stock 2011, 2012 when I saw her buying, you know, millions and millions of dollars of stock. And then I sold it way too early, as I always have a habit of doing. But I'm looking at just the insider activity now. And the one thing that just concerns me is, yes, it's very cheap. But there's zero insider buying. And Martine is actually, it looks like she just has kind of a consistent. you know, sell program going.

Starting point is 00:48:44 And she does have the discretion to put that on hold. And so that I would at least like to see, you know, some type of confidence there where she said, I'm not going to sell any more stock for a little while. It's just too cheap. Or at least, you know, some insider buying by somebody at the company to kind of justify my idea that is cheap. It does trade, you know, five times enterprise value of EBIT, which to me is extremely cheap. The only thing I worry about is that, you know, is it justifiably cheap?

Starting point is 00:49:10 I come back to the second level thinking, Howard Marks, you know, you have to have a non-consensus idea, you have to be right, you know, for second level thinking. So the non-consensus idea here would be generics are not going to hurt them and the pipeline is better than people expect. That was actually what was hurting the stock back in 2012 is people worried about generic competition. And it turned out the company overcame that and did really well. Today, I wouldn't have the same kind of confidence to take that kind of a non-consensus view. But that's just me. really to respond to some of this. And first of all, I just want to point out that this story about the CEO, it's incredible.

Starting point is 00:49:45 And she talks about how she traveled across the U.S. to find a scientist who can fabricate like one gram of this active ingredient to cure her daughter. I mean, it's been amazing, like offering $100,000 to like almost sounds like random people at different universities because it was really dangerous at the time to develop because things exploded and it's a very, very fascinating story. And she itself, it's a very interesting person with everything is going on with. I think she also flies helicopters and wants to build a solar plex around growing organs, which is a very fascinating and almost like a separate conversation, too. In terms of what you say, Jesse, about the inside training, that's a huge issue and something

Starting point is 00:50:31 that I really don't like. So she's the founder and CEO, but she currently owns 0.12% of the company. and she's been selling off for quite some time. Now, I do want to say that her base pay is relatively small. I know that whenever we talk about CEO, base pays relatively small. But still, whenever you look at the data and you're like, stick, that's not like a small salary. It's a high salary. A lot of that at the time was tied up into stocks and stock options.

Starting point is 00:50:59 And that has later been cut back back in 2015. They also got rid of Jeff, the co-CEO. I really don't know why they would have a co-CEO. The way that the management said back then was that it was also to reward him and reflection of the contribution he did for the company, which to me is like a huge red flag if you have that kind of culture where you're just patting each other on the back. I see, Prest, you're dying to say something here. I'm just curious if Jesse would consider all the share buybacks in the same light as maybe an insider buy him, because it looks like they've been buying back at $250 million to $500 million a year and share buybacks.

Starting point is 00:51:38 I'm very skeptical of buybacks especially these days. I think, you know, insiders need somebody to sell to. And it's very easy to, when you run the company to, you know, we're going to buy back stock and provide that. I will say that there really isn't any other selling going on, which should be more, you know, confidence building. That said, you know, when I was buying the stock, Martine owned 700,000 shares today according to, you know, what I'm looking at, she owns 8,000 shares. So it's essentially divested almost all of her holdings. So Stig, when I'm looking at the fundamentals, so I'm going to talk to the fundamentals and the momentum on it. So from a fundamental standpoint, I'm kind of like you and Toby, it looks really great, you know, based on the discount cash flow that I'm looking at and all the numbers. I think at the price, you could even get a 7.5% return if it could continue to pump out the numbers that they have been producing. My concern and why I wouldn't buy this right now today is just because the momentum's kind of really bad on it. I don't see anything that kind of has given you the

Starting point is 00:52:44 indicator that you're seeing any type of statistical change in the price action. It's very flat and somewhat just going down. So I think if you'd see something that changed, I think this would be something that I would continue to monitor me personally. And then if I saw a nice change in the price action, then I might, you know, start buying. But I'm kind of with Jesse on this. I'm a little suspect as to what's going on. I'm not looking at it, possibly the way Jesse might look at it, which might be on a single stock name, you know, point to point. I'm not particularly familiar with that at all, but I wouldn't use momentum to assess this kind of stock. And I wouldn't know how to do that. That's probably me trying to

Starting point is 00:53:21 make myself sound a little bit smarter than I actually am in relation to that. That's where I am. Well, I would just say, you know, from a technical standpoint, it looks like the last four years or so, it's had a nice range between 100 and 150, 60 bucks. It does have, you know, lower highs. So that's, you know, potentially a sign of a longer term downtrend. But to me, it looks like, you know, what I would be looking for here is in terms of momentum, like you were saying Preston is potentially another breakdown below 100, you know, 100 bucks. That's going to freak people out. get it below 100 bucks and then you could probably buy it at least for a trade to see it pop back maybe even up to 120, 130, 140 bucks, you know, just from a longer term technical perspective. Yeah, so just to should go back to what Toby said and before I really put him on the spot of the momentum thing, I have started to look more and more at momentum. It was, I already know it was really interesting to hear like how Bill Miller, like one of the old school value investors is also using momentum whenever he is valiant.

Starting point is 00:54:24 validated the fundamentals. And so that was very inspiring. I do want to say, like, just looking at the momentum for this, especially called something 100-day average, 200-day moving average, once you're probably not buy into this. I do want to point out, like, the importance of inside trading. I think it was like a year ago or something like that, when we have the exact same group assembled. And I pithed Beth Beth Beyond. And the group was like, that's the stupidest thing I ever heard anyone say or something like that. I might not be accurate, but they might say have something worse than that. And then Jesse said, have you looked at the inside of buying? And I was like, yeah, yeah, no, it doesn't look good, but it's like really cheap. And we talked about,

Starting point is 00:55:10 yeah, you know, if they just sustain the current cash flows, it was still like whatever 14% return or 18, whatever it was at the time. And it has just been crushed. So, after, you know, after After that experience, actually, I did end up not buying the stock. And I should probably buy you guys beer like in Berkshire, whatever, for that just in itself. But whenever I think back at that, because I was definitely like emotionally attached to that stock. I've been following it for years. And it's just like, yes, now's the time to buy. I started to pay a lot more attention to insider trading.

Starting point is 00:55:43 So why am I still pitching this stock? I mean, it doesn't look good in terms of the insider trading. Martin Goldblatt, she definitely still has a hatch in terms of her stock. So if the stock performs well, it's very, very important for her compensation. I think just a few years ago, when she was on the old agreement, she was like the highest female paid CEO or something like that in the States. So there's definitely a heads there for her, but no, it's obviously not a good sign if the CEO and founder does not want to own what she created. I think that says for herself. About what you said about the driver, Preston, really to address that, I think it's true that, especially in the

Starting point is 00:56:20 short run is primarily like the value in itself. If you believe that or not, that will be the driver. Like I don't necessarily see 2018 to be a great year. I think it's going to be a hard year with revenue and net income picking up in 2019 with the new patents coming out. I do want to say that one thing that might seem completely off, but it's a very, I think it's still a significant out-on-the-money option is all the work that they're doing with growing organs. And what the company actually did was already back in 2011, they bought the spin-off company of, I think it was an English or Irish company who cloned the sheep dolly. And they continued doing that research. And already in 2023, they look for FDA approval for part of manufacturing organs.

Starting point is 00:57:10 So this is not like this cool scenario where you just like necessarily prints a kidney or a lung. They're primarily in lungs. It does not work like that, at least not in the first five or seven years. They can fabricate or manufacture a part of that. This is actually something that they heavily invest in, and obviously don't see any kind of revenue from that at all. But if you look at transplants of organs, which itself is like hundreds of billions of dollar market, it's a huge, huge market.

Starting point is 00:57:41 The way this typically works is that you would have an unfortunate incident, and then that organ would be transplanted into that patient that really needs it. Now, the problem with lungs is that the rejection rate is really, really high. So it matters 80%. So 80% of the lungs that's being tested for transplant because it has to go really, really fast, they're rejected. Now, so what's happening is that they have an agreement where they take the rejected lungs and then they see if they can get them back to life. And the success rate already at the end of 2017, is 50%. And this is something that was already rejected. I mean, this is not just like empty talk. I mean, they're doing some amazing progress in this field. So yes, it's out there in terms

Starting point is 00:58:29 of timeline. I know that the CEO might sound ridiculous whenever she was on Yahoo and she talked about, you know, doing 100x, whatever she was doing on the current mind cap. But this is like a very, very significant, but they're the market leader as far as I can see with the research that's done. So to me, that's very interesting. But if it's going to do 100x and she's making statements like that, and then you look at the position that she used to have in the company to what she has now, I mean, I guess I don't buy any of it if that's how much she's offloaded her position, you know? If anything, it makes me even more concerned.

Starting point is 00:59:03 The only thing to say to that, though, is the people sell for lots of different reasons. I just looked at her on Wikipedia when Jesse was raising that then. She's 63, 64. or traditionally that's been getting closer to retirement. You might not want to be fully exposed to the market or to a business at that kind of age. People sell for lots and lots of different reasons. People typically only buy for one, and that's because they think it's undervalued. So the existence of selling, I think, is less significant than the absence of buying,

Starting point is 00:59:31 which to Jesse's point, there may be some information. Another way of approaching it is the way that I do it on the acquirers multiple side. I screen out stocks that are too heavily shorted. you can look at the short interest ratio and I just screen out the ones that are too heavily shorted. So that's one of the reasons why I didn't like Bed Bath and Beyond last year when Stig raised it. And now when it's down a lot, I still think that it's still a very heavily shorted stock. So you won't see it in the Acquire as multiple even though you might expect to see it in that list because it's acquire as multiple is low enough that it should be in that list. That's not the case with United Therapeutics.

Starting point is 01:00:06 The shorts just aren't in it because shorting is a tough business. You've got the borrower. You've got to be right on the timing. You've got the unlimited downside, all those sort of things. So shorts tend to do a lot of work. I like it when the shorts aren't in a stock. And it's typically a red flag when they are. So the stock price has been so strong.

Starting point is 01:00:23 You're sort of standing in front of a moving train trying to short those things. UTHR, it's not the case. They're not there. So Toby, you know, on the show, we talk a lot about how you should be able to argue both sides, and which is why, say, if you're really like Bitcoin, like what's the best, argument why it's going to fail and vice versa. So I'm very curious about why you think that this pick is a bad pick because clearly this is something that's very exciting to you and you have your own bull case.

Starting point is 01:00:52 So what is your bear case? What is the biggest red flag for you? It's the one that Jesse identified that the stock is currently priced as if earnings are going to continue dropping a few percent every year. And it's entirely possible that generic competition causes that to happen. And I think that there's also, there's a very large popular groundswell against the enormous markups that everybody who touches the health industry has been able to get for a very long period of time based on patents or various other legislative. I saw some statistic today that it costs a dollar to produce a bag of saline and then hospitals sell it for $800. And I think that a lot of that stuff that is, the markups are enormous.

Starting point is 01:01:35 And that's been a good reason to buy these stocks. If you're a Buffett-style investor, you know, they have enormous profit margins, massive returns on invested capital. They don't really require a great deal of capital to grow their businesses so they're able to reinvest, throw off lots of cash, they're fantastic businesses. But, you know, society allow them to continue to do that. Very strong arguments on the other side. So the way that I resolve that is I think that it's just too cheap and I'm willing to take

Starting point is 01:02:01 the bet at this price, but it's by no means clear. Yeah, and I would just value. your point, Toby, about the insider selling. To me, insider buying is much more valuable, especially when it's on the part of executives, especially the CFO. When I see directors buying that, you know, it doesn't really excite me too much. And when I see selling, it really doesn't bother me too much either. It looks like she's been divesting for a long period of time. I have seen examples. I remember seeing Bernie Ebers sell every share of stock in Worldcom in a literally couple weeks before the fraud was discovered.

Starting point is 01:02:36 Jeff Skilling sold every share of Enron that he owned a few weeks before the fraud was discovered. When you see guys go from having, you know, $50 million, $100 million worth of stock to zero in a week or two, that to me is the only type of selling that's very compelling and makes me dig deeper and look for problems usually in the cash flow statement. So I definitely don't see that here. Just to your point, Toby, about the backlash from the public and then turned from the politicians in terms of regulations. But I would still like to challenge that.

Starting point is 01:03:07 Like right now we're talking about, especially with Facebook, but also the huge tech giants general. We even had Jesse Follards coming on the show to talk about Fangstock. So I just got to slide that in there. So it's a very fascinating interview. But really, I think there is a tendency to have this focus fallacy where what we see right now, especially in terms of regulations, It just seems something that we emphasize too much.

Starting point is 01:03:34 I mean, yes, it has been more public or, like, criticism of the healthcare sector than it has been. But I just think, like, historically, not just looking at this sector, but also also sectors, whenever, like, you have this suspected backlash, you don't necessarily see that materialize into the earnings of the corporations in the time to come. You know, if you look at the banks, you know, it happens through so much criticism so many years. And what does happen? Like, every time they're bailed out, they're still making a ton of money and they're still, that's just how the political system works with lobbyism. So I wouldn't say that it's not a concern. It's definitely it is.

Starting point is 01:04:10 I just think that shouldn't be overemphasized. I'm curious to hear your thoughts about this, Toby. I know you're doing a lot of backtest and on a bunch of things. So do you have any thoughts on this? No, I agree with you. I think that the system is broken. And I've never spoken to anybody in the States who's said, I don't know, it's a wonderful system. I love the way it works. I think everybody thinks that there's an issue, but I think

Starting point is 01:04:33 everybody's thought that there's an issue for a long time. And it's sort of, you know, I think that the regulatory response is often, it can be a little bit arbitrary. You don't know how it's going to land. It could have an enormous impact. But, you know, in relation to UTIHR, specifically, I don't see any specific legislation or anything that's going to impact it. I was sort of speaking, like, what is the bare case for UTHR? What potential risks are there? And I think that that's one. some stage, there's some reining in of the cost. And I don't know how that's achieved or how it happens, but it's worth watching. So I'm around like a 10% return with the current price. And just as a disclaimer, because I actually think I forgot saying that I bought the stock at 109 here,

Starting point is 01:05:14 months or two months ago, something like that. So I am long as I'm saying all of this with the bull case. What kind of return do you come up with implied discount rate for your valuation of the stock? I think it has a wide range. I think fair value, it could be half price or fair value could be roughly where it is. So that sort of means that I don't think that it has a great deal of downside. I think that the risk reward is right. I wouldn't ordinarily give a fair value range as wide as that. And I wouldn't necessarily be as excited about something with a range like that.

Starting point is 01:05:50 But I do think that the upside is it's potentially half price. And that's really hard to find in this market. So I think that it is a worthwhile position to put on. All right. So that concludes our mastermind discussion. Jesse, if the audience wants to learn more about you, where can they find you? Yeah, I'm at real active on Twitter. It's just at Jesse Felder.

Starting point is 01:06:09 I share just a ton of stuff for the reading research that I do on a daily basis. And then I try and put up a weekly blog post at thefelder report.com. Awesome. We'll have links to that in the show notes. And how about you, Toby? The website is Acquireasmultable.com. And if you want to learn about the process I published a book six months ago, The Acquire is Multiple.

Starting point is 01:06:31 And that's available on Amazon, Kindles, 999. And I think the paperbacks 14 or 1599. And I'm on Twitter all day long to Jesse's one of the best tweeters out there. My handle is Greenback, G-R-E-N-B-A-C-K-D. I like every single one of Jesse's tweets. So like I'm stalking him. I'm going to show if it's fun. You know, it's, I honestly, I can't recommend your book highly enough.

Starting point is 01:06:59 I think that probably might be the best investment anyone can make in the, in the current environment is read up on that stuff so that you can take advantage of opportunities that are coming in the future. Well, guys, seriously, thank you so much for always coming back and having these discussions with us. I know I learn a ton when I get a chance to talk to you guys. I see Stignaud in his head as well. and I'm sure our audience learning a lot from your participation here. So just thanks so much for coming back on the show. All right, guys. That was all that Preston and I had for this week's episode of The Investors Podcast.

Starting point is 01:07:35 We see each other again next week. Thanks for listening to TIP. To access the show notes, courses, or forums, go to theinvestorspodcast.com. To get your questions played on the show, go to AsktheInvesters.com and win a free subscription to any of our courses on TiVeevastors. This show is for entertainment purposes only. Before making investment decisions, consult a professional. This show is copyrighted by the TIP network.

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We Study Billionaires - The Investor’s Podcast Network - TIP188: Mastermind Discussion 2nd Q 2018 w/ Jesse Felder & Tobias Carlisle (Business Podcast)

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