Banking and Private Credit

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Bloomberg Television

Күн бұрын

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@hangender Жыл бұрын

shadow banks ftw

@TechnikMeister2 Жыл бұрын

Call me nostalgic, but there was a time when businesses funded expansion through their own positive cash flow, not borrowings. New businesses grew that way and their founders or owners stuck around for the long term. Now the shit has hit the fan for those who relied too much on debt and wanted to take their money and run via an IPO. When Warren Buffett bought an old haberdashery in Omaha in the early 1960s, he built it from profits and good management to the behemoth Berkshire Hathaway is today. He will probably die at his desk. That's what's called sticking with it for the long term. And he invests mainly in other businesses who do the same. 95% of the time he makes the right call so it's worth revisiting his golden rules of what makes a business great and profitable through all the cycles of markets: 1. The owners are the managers and they are there for keeps. They know what works. 2. They generate free cash flow in excess of 10% of revenue. 3. They have products or services that are insensitive to market fluctuations. 4. They sell to everyone, not to a narrow market. 5. They use their cash to expand, not buy back stock. If you apply these criteria in investing in stocks, you cannot go wrong.

@yorkoxmaul66 Жыл бұрын

Berkshire Hathaway was an overvalued stock and a failed business, he then gained control of blue chip stamps and used float to cover the loss. Buffet used insurance float later on, which is the same thing. If you think about it, Insurance deposit are loans from insurance clients, he used the loans to invest, similar to private credit buying CLOs, they are both risky. If it is a good business, he wouldn’t have to shut the sewing machines down.

@yorkoxmaul66 Жыл бұрын

Buying back stock when it is undervalued and selling when it is overvalued is a no brainer, warren buffet did that too. You got F in finance?

@evanmastermind 6 ай бұрын

Excessively low rates for too long will do that. The Fed messed up big time and the poor will sadly pay for it as usual.

@LivingWithGout Жыл бұрын

Unfair competition, these financial companies need to be regulated like a bank too if they’re going to lend money like a bank regardless of the funds coming from depositors or investors.