Yesterday I waxed enthusiastic about Nvidia.
Today it’s up 6%. I am a genius, except I don’t own enough NVDA.
Yesterday I told everyone to watch this video. Please do. I know it’s long.
I’ve been in technology since 1969. This is the best presentation I have ever seen. This man’s company has increased computing power by a million times in the last 10 years. He promises to do better in the next ten years. He’s revolutionizing/improving every industry and every company you own shares in, or work for. Please watch the video.
Amazon is my second bargain
Here’s an excerpt from a really good review of Amazon on Seeking Alpha today:
Amazon is poised to grow over the coming years and we believe that margin will significantly improve as well due to a business-mix shift and lower investments. We believe that revenue can grow north of 10% per year over the coming years and EBIT margin could reach >10% on a normalized basis (maybe a mid-teen operating margin).
Our quick analysis of operating margin suggests that margin on a normalized basis will significantly improve over the coming years. Note that this rough estimate does not consider the impact of business mix: the higher-margin businesses will outgrow the rest of the business.
We believe that the share price will compound at least at 8% CAGR over the coming years with the opportunity to compound at a much faster pace if Amazon delivers much faster growth, better margin improvement, or trade at a higher valuation multiple that we used in our valuation framework.
It is also interesting to note that current management initiatives are more shareholder-friendly.
Yu can read the rest of the Amazon friendly review here.
Apple is my third bargain
It’s my biggest dollar gainer and I think it will continue to be. Owning oodles of Apple is a no-brainer.
Russia
Average annual income in Russia last year was $6,000. That’s in U.S. dollars. It’s much less now because of the sanctions and the collapse of the ruble.
Madeline Albright was our first woman Secretary of State. She was awesome. She immigrated with her family to the United States in 1948 from Czechoslovakia. Her father, Josef Korbel, settled the family in Denver, Colorado, and she became a U.S. citizen in 1957. She just died.
In her last essay for the New York Times, she wrote:
In the 20-odd years since we met, Mr. Putin has charted his course by ditching democratic development for Stalin’s playbook. He has collected political and economic power for himself — co-opting or crushing potential competition — while pushing to re-establish a sphere of Russian dominance through parts of the former Soviet Union. Like other authoritarians, he equates his own well-being with that of the nation and opposition with treason. He is sure that Americans mirror both his cynicism and his lust for power and that in a world where everyone lies, he is under no obligation to tell the truth. Because he believes that the United States dominates its own region by force, he thinks Russia has the same right.
Mr. Putin has for years sought to burnish his country’s international reputation, expand Russia’s military and economic might, weaken NATO and divide Europe (while driving a wedge between it and the United States). Ukraine features in all of that.
Instead of paving Russia’s path to greatness, invading Ukraine would ensure Mr. Putin’s infamy by leaving his country diplomatically isolated, economically crippled and strategically vulnerable in the face of a stronger, more united Western alliance.
For her full February 23, 2022 essay titled Putin Is Making a Historic Mistake, click here.
How will Russia pay for the war in Ukraine?
If it wins, it will loot whatever it can. It will sell the prime real estate (government buildings, etc.) to oligarchs and sundry crooks.
If it loses, or if the war drags on and on, the Kremlin won’t be able to sell savings bonds, or ramp up more oil and gas sales. It will have to print money. I want a trillion Ruble bank note, so I can exhibit it in my bathroom next to this one:
Today the Ruble is worth basically nothing. I don’t see anyone offering a Marshall Plan to Russia if she loses the war, which I pray she will.
