Our company understands how frustrating and illogical the stock market can be. We have been involved in stock markets for 40 years and had success despite these shortcomings. Through our missives, quarterly newsletters and appearances in the media, we provide advice on how to avoid stock market failure.
[...] Ideological thinking has run amok in the allocation of capital. This has transpired from government edicts and will, a typical creator of a bubble. It is promoted by the promoters, who are another element of bubbles. Their love child is what we now refer to in the investment business as ESG. [...]⟶ Keep Reading
We are getting questioned constantly on how long this bear market in U.S. stocks will continue. It’s a reasonable question, and as we always do, we look back at the most similar situations and view the depth and length of the most analogous bear markets of the last 60 years. [...]⟶ Keep Reading
Corona’s 1995 classic “The Rhythm of the Night” rings in our ears as we stare at the circumstances that are likely to expose the darkness of the 2020’s. We saw the light in the 2010’s and will see the night in the 2020’s. Our aim for this letter is to give an understanding to investors of the rhythm of what we are likely to see in the road ahead. [...]⟶ Keep Reading
As we’ve hit the halftime mark for the investment year 2022, we are faced with a daunting two-headed monster. One head is the first full year of unwinding what Charlie Munger called, “the biggest financial euphoria episode in his career, because of the totality of it.” The second head is what we call “wolverine inflation,” which is mean and leaves a stench. This combination is powerful and, in many ways, unprecedented. How do we navigate a stock market which is dealing with a two-headed monster? [...]⟶ Keep Reading
[...] Chairman and largest shareholder, Harold Hamm, is trying to own our shares of Continental Resources (CLR US) at a price of $70. We’ve seen it trade above there in the open market in the last month. How strange? Warren Buffett is bidding on a regular basis to buy shares of Occidental Petroleum (OXY) from other existing shareholders. The stock isn’t sprinting higher on this news. How strange? These are historically control investors who don’t mind playing for keeps. [...]⟶ Keep Reading
Someone once said, “Better than being smart is knowing who is!” Over the last few weeks, three of the richest and most successful businessmen in the U.S. have let us know what they think about being in the oil and gas business. Warren Buffett, Jerry Jones and Harold Hamm are instructing us in a special way and we at Smead Capital Management are happy to be instructed. It is a trifecta that any good handicapper couldn’t pass up. [...]⟶ Keep Reading
Over the last four years, we have argued that the glamour monopoly technology companies have a low multiplier effect in the U.S. economy. At the same time, home ownership and the creation of new homes has historically been a powerful driver of economic activity. With interest rates normalizing and the stock market punishing the prior financial euphoria, how can we invest to succeed in the coming five to ten years? What does the chart below tell us about how much the stock market will impact the economy going forward? [...]⟶ Keep Reading
We are approximately six to twelve months into a bear market in stocks and bonds. This bear market is the natural consequence of the financial euphoria episode which preceded it. How do wise long-term investors handle these cold stretches in the stock market? Why is it worth fighting through these stock market corrections? How should we as investors behave in a process which takes time, courage and patience? [...]⟶ Keep Reading
Corona’s 1995 classic “The Rhythm of the Night” rings in our ears as we stare at the circumstances that are likely to expose the darkness of the 2020’s. We saw the light in...⟶ Keep Reading
As we’ve hit the halftime mark for the investment year 2022, we are faced with a daunting two-headed monster. One head is the first full year of unwinding what Charlie Munger called, “the...⟶ Keep Reading
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