Insights on markets, emergent trends, history, innovation, risk management, global economics, strategy, policy, and other topics that catch our attention. Inspired by ongoing research, conversations and events. Written and edited by Osbon Capital Management and published every Thursday morning.
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Too much time is spent talking about price. Fundamentals are ultimately what drive equity prices higher over time. To say this another way, a company’s stock price can’t continue to rise unless it continues to be successful. The famous quote by Warren Buffett is, “In the short run, the market is a voting machine, but in the long run (...)
Investment Trends That Supersede Politics
While we are all focused on election changes, let’s take a moment here to step back and check in on some of the long term trends. An election date is a punctuation mark in time, and there is always broader context that one can look to for insight. Here are some thoughts on the big picture and other major recent…
A Short Comment on the Bull Case
We have been stuck in a range-bound territory for broader market indices since the beginning of September. The election is imminent and the virus activity in many parts of the world is returning. The lack of the stimulus plan and potential monopoly regulation adds to anxiety, understandably so. Despite all of this, we see a positive road ahead for investors…
The Burden of Regulation
We’re at a crossroads for large technology monopolies and their platform business models. If we regulate them and slow their growth, they could stall and lose out on new opportunities. If we don’t regulate them, they could increasingly grow more dominant while crowding out new entrants and resting on their laurels. Competition is what keeps companies fit, lean and hungry….
Investing in the Next Fiscal Stimulus
We all know there is a great deal of uncertainty about the next election, who will win, who will have control and who the new players will be. By design, the US experiences a major reshuffling every four years in our political structure. Despite the unpredictable changes, one thing is clear: there will be more fiscal stimulus going forward. There…
The Cloud Computing Age
The rise of public cloud computing was an inevitable next step following the development of the internet. Cloud computing allows companies to access sophisticated connected servers without the hassle of designing, constructing and maintaining complex data centers. With its ability to enable new business models, unlock exponential rates of growth and increase access, the public cloud transformation has a lot to offer.
Antidotes To Permabear Narratives
Perma-bear is a term used to describe an investor with a perpetually negative view of the future. Perma-bears are worth listening to because they can help us gauge where the worst of the worst risks could be lurking. In aggregate, they attract headlines but their track record has not been positive as they are far more often wrong. Let’s take…
The Triumph Of Intangible Assets
Over the past 20 years, intangible assets have become the dominant factor in company valuations. Today approximately 85% of the valuation of the S&P 500 is defined by intangibles, while in 1975, that percentage was just 17%. Intangibles are notoriously difficult to value. Given their slippery nature and their power to generate returns, it’s worth paying attention to the qualities…
Population Growth Is Cooling Off
Population trends are often absent from investment research reports. Population growth rates are best when measured in decades and centuries, which is perhaps too slow to be considered new information. Since 1900, the world population has exploded from 1.6 billion to 6.1 billion in 2000 and 7.8 billion today. However, population growth passed an inflection point nearly 50 years ago…
Deferring Capital Gains With Qualified Opportunity Zones (QOZs)
The U.S. Department of the Treasury Opportunity Zones, created by the Tax Cuts and Jobs Act in 2017, offers unique and creative tax opportunities for high net worth investors with capital gains. In exchange for investing in economically distressed areas, the IRS provides investors with substantial benefits that reduce, delay and avoid taxation. The right partner, the right location and…