Who I Read and Why: Focused Investing Newsletter #14
A member requested a list of people I find thoughtful and insightful. Here is shared those who came to mind this week, not without some trepidation.
One thing is that, regarding economics and philosophy, I’m not fond of reading people I agree with. I really like to read authors who have changed their position as they learned about some subject, which is evidence of independent thought.
For investments I like to read authors who teach me things — providing fresh data or fresh ideas. Except about sports, I am deliberately anti-tribal, resisting the urgings of evolution to find a tribe for everything.
A corollary of that is this: I do not believe in gurus or oracles. So whoever I recommend, including me, will at times publish some things that on reflection don’t make sense to me.
The third thing is that I almost hate podcasts. I get the use case for listening while, say, driving. But overall the data rate is too slow and besides I want to pay attention to what I’m doing, especially when outside in nature.
When you read an author, you should ask yourself: What does this author want from me? That can help you know how much salt to pour on what they feed you.
Some further comments about this:
Mainstream media authors (and their employers) want your clicks. The accuracy of what they write is irrelevant to that goal.
Authors on web systems such as Substack and Seeking Alpha have more diverse goals. Some write solely to express their views and interact with readers. Some provide a lot of low-quality marketing material seeking to attract you to their paid services. And there are many things in between.
Many authors are looking toward some sort of monetization. It is up to you to assess the impact of their approach on their reliability.
Having said all that, here is an incomplete list with some comments:
Lyn Alden: (Seeking Alpha, her website) By far the most accurate and comprehensive understanding of monetary systems and how they interact with inflation of anyone I’ve read, and the ability to explain it.
Arjun Murti (Substack) Perspective on the oil and gas industry from a very long term industry analyst.
Robert Bryce (Substack) Definitely on the anti-alarmist side of climate. Provides lots of nice explanatory graphics focused on energy.
Roger Pielke (Substack) By far the most objective observer, in my view, of the climate science debates and battles.
Philips O’Brien (Substack) Best coverage I’ve found of the war in Ukraine.
Greg Easterbrook (Substack now) I have admired his independent thinking for decades.
Recent News (that caught my attention)
With earnings season having wound down, news will be more sparse for a few weeks.
Economic News:
The CPI and PPI came in a bit cooler than anticipated. But lagged housing costs are not doing what I had expected, illustrated by the red arrow here:
It takes growth of M2 (broad money) to drive significant price inflation, so we are in a pause for now.
Midstreams:
Phillips 66 will sell its 25% stake in Rockies Express Pipeline for $685M to Tallgrass Energy. REX is perhaps the major east-west natural gas pipeline across the US.
REITs:
I had an interesting chat this week with Joey Agree of Agree Realty (ADC). It seems like some of their regulars are getting back to the business of making real estate work rather than just doing nothing while waiting for the Fed. There will be a deep dive on ADC in a few weeks.
Dividend Increases:
Realty Income (O) raised its monthly dividend by 0.2% (6.0% dividend yield)
Cannabis REIT NewLake Capital (OTCQX:NLCP) hiked its quarterly dividend by 5% (8.9% dividend yield).
WP Carey (WPC) hiked its quarterly dividend by 1% (6.9% dividend yield)
Credit Ratings:
Moody’s affirmed the credit ratings of Essential Properties (EPRT) at “Baa3” and revised its outlook to positive from stable.
Fitch Ratings affirmed the credit ratings of Stag Industrial (STAG) at “BBB” with a stable outlook.
Fitch Ratings affirmed the Long-Term Issuer Default Rating for Tanger Outlets (SKT) at “BBB” with a stable outlook.
Ground lease REIT Safehold, Inc. (SAFE) has closed on a ground lease reportedly valued at $9M to support a 166-unit senior affordable community in CA. It is nice to see some action but that is tiny for a REIT that aspires to exceed $1B per year in new deals.
Crown Castle (CCI) announced plans to narrow its investment focus. They will concentrate on a higher mix of collocations and network-adjacent anchor nodes, with fewer greenfield locations.
Member News
This week featured
items that went to all members:
A discussion of investing at negative spreads, something both often said to be unprofitable and actively being done.
Items that went to paid members:
A Brief Note on property values.
Changes to the Google Sheets (for annual members):
I have moved the REIT assessment sheet to a tab on my portfolio sheet. The old one will disappear soon.
An initial version of a Midstreams assessment sheet has been added as well
Also:
A lot of ongoing random discussions occur on the Focused Investing chat. One can also post items of interest, which I do often. Check it out and post your own items, please.
Annual paid members should have access to the live, real-time portfolio showing all my stock-market investments, and to the Sheet showing my assessments of selected REITs. (If you don’t have that access, contact me). Comments and questions are welcome.
This is cool.. Thank you
Thanks for the reading list, Paul