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I’m sure many of you have read Stanley Druckemillers speech at the lost tree club years ago. If not its a must read. There are perhaps 2 key takeaways. https://www.dropbox.com/s/294et8igxsnufe2/Stanley_Druckenmiller_Lost_Tree_Club_1.18.15_1_.pdf?dl=0
1. Invest in the future not the present. All these people salivating over tech are investing in the past decade’s deflationary theme- as inflation reasserts itself the assets that suffered- commodities (nat gas/uranium/oil etc) will do far better than the ones that thrived this
Decade as rates went lower. Tech is nothing but a play on lax anti trust laws (allowing bigger cos), lower tax rates & passive etf flows & lower discount rates. All of these trends are going to reverse esp with baby boomers retiring & selling assets . Commodities which trade
At a 100 year low to S&P, and in most assets prodn cost >current price implies those commodity prices will need to go up (& in some cases like uranium quite substantially).
The second big take away is don’t diversify. Stan made most of his $ on concentrated bets. I keep getting asked about this stock or that. Those that follow me know i dont own 100 uranium names. I own 1 and one only $PDN which i think has the best risk adjusted return (& nice to
Know that the gods of uranium (segra and sachem cove agree). In nat gas i think $ar and $am have superior upside esp post the disastrous $rrc transaction i detailed a few days ago & I think iraq has superior upside & the best bank in iraq at 0.3x pbr, 13% dividend yield is a no
Brainer. It’s nice to see that you dont need 100 different bets to follow and cloud your mind. I find if you know what you own you can take stomach sickening swings against you & not get perturbed (like when $ar went to 65c this spring). We all know that the S&P has compounded
At 9-10% over the past many decades- most retail would be lucky to have compounded at 1/2 that. So the lesson is know what you know and monitor it religiously.
