If Regular People Did That Sh!t
Carlos Ghosn – The previous
CEO of Nissan must have been watching the movie “Catch Me If You Can”. For
those of you not paying attention, he had been jailed on charges related to
misusing company funds – a charge alleged by Nissan. Mr. Ghosn orchestrated an escape out of Japan
that truly only rich people can get away with. So regular people if you ever
get jammed up, follow what rich people do, not what they say:
First he was not required
to wear any electronic monitoring device (smh).
Then Carlos evaded detection and took a high speed train to Japan's Osaka
airport to board a private jet. How do you board a plane when you been accused of damaging Japan's iconic Nissan company - well by jumping into a large speaker box used for concert equipment
(remember to poke holes in it like he did or it might not turn out good). From
there, the plane went to Turkey and his team got him onto a plane to Lebanon. Why Lebanon – because Carlos’s game is tight
he is a citizen of Brazil, France, and Lebanon. And Lebanon DOES NOT have an
extradition treaty with Japan so for now he’s untouchable. To plot and possibly
test run this escape, it took months and supposedly hundreds of thousands
dollars. So next time you think you’ve made
it, ask yourself is your get outta jail card as good as Carlos Ghosn??
No Photoshop – A Real Look Back
I continually assess my
performance to ensure I am reaching my goals and targets. Here is a look back at 2019 and when personally reflecting you have to be real about what worked and did not work. But I always caution patience, look at my list from the previous year end and surprisingly the areas where I decided to push forward paid off. Here is a quick summary of Items that Did Not
Work (in Red) and Nice Surprises (in Green):
·
Colony (CLNY) – Due to
poor performance at this company, some investors have called for CEO Tom
Barrack to step down. Investor(s) rationale: being a close personal buddy to Donald
Trump has caused reputation risk to the company and has been and operational
distraction for Tom. Who is the agitator: Blackwells Capital. Outcome: Unclear
if it’s a coincidence, Mr. Barrack has named, Marc Ganzi, as his successor and
the CEO transition will take place in 2021.
·
AMC Entertainment (AMC) – AMC is a good example of poor risk management on my
part. I had successfully traded this position multiple times for small gains.
Using options, I was in a position that allowed me to finally own the stock even though I profess to hardly going to the movies because of the costs and now due to the ease of streaming. All was temporarily well after the most recent earnings call – revenue was up
however earnings missed the mark. At first glance I was good, the stock rose
and I had a profitable position. Bur the EPS miss may have been signaling a more significant problem - AMC is spending significant mounds of money to fuel the monthly subscription service called Stubs-A-List which
is supposed to draw people back into the theatres. Long story short, I should have done a proper
risk assessment. It would have led me to a 5 second conclusion:
I think movies are slowly declining business as streaming is the new trend. I
think once AMC stops burning cash this stock will do well…but they’ve burned
bridges with me. I’ll reevaluate after the next few earnings but this won’t be
a long-term position.
·
Retail
– This sector will continue to be difficult to trade as retail companies
are reeling from too many headwinds: 1) Amazon, 2) China Trade Issues, 3)
Changing trends (like working from home and athleisure wear), and 4) decline of malls.
So yes my investments into Foot Locker, Kohls, and Stitch Fix were misguided
because I thought I could dip my toe into the deep end of a pool for a quick buck and hop out. However, every time Amazon flexed its muscles or supply chain disruptions were
identified in China (from the Trump admin – China trade war in 2019) it was
more like jumping in the deep end and remembering you’re not a great swimmer. The positive is jumping in with Foot Locker,
Kohls, and Stitch Fix is like jumping in with 2 experienced swimmers and one
newbie who poised for breakout, respectively. At current prices, these stock
have likely bottomed and but the rebound will take time. Business and Life Lesson: Always set limits for short term positions and goals and don't be afraid to adjust or admit failure. If NOT, be prepared for the long-haul.
·
Moore’s Law –
If you’re not familiar with this law you should be. This law theorizes that computer processing
doubling every year and I believe that semi-conductor chip makers are sitting
in the middle of a revolution – Computer’s are more powerful fueling the Cloud,
5G phones, autonomous cars, gaming, streaming, televisions and the COSTS are
coming down across most of these product segments. You’ve seen me dabble in chipmakers:
Qualcomm and Qorvo but there are many more like AMD I need to evaluate. I believe it’s fueling the
investment trends of the future listed above and impacts all corners of life. See these examples below:
o Sports - I joke other areas of our lives are impacted by Moore's law and are
racing to reach a most optimal efficient state. Take sports – the games have
gotten faster, the players bigger and smarter, the hits – harder, and the focus is now all about DATA analytics. When I used to play Sony Playstation's Madden NFL football game years ago, I always picked a team
with a mobile quarterback. Fantasy football – same trend I foresaw years ago the path to racking up passing and rushing yards is through mobile quarterback. The rationale – Football is simple à keep the ball moving forward, limit the sacks and
incomplete plays and good things will happen. Well we’ve come along way from Randall
Cunningham, Michael Vick, Donvan McNabb and others being an outlier. Look who’s
in the playoffs this year: Russell Wilson, Lamar Jackson, Patrick Mahomes,
Deshaun Watson, Josh Allen, Ryan Tannehill. They took a theme I knew back in
the early 2000s when I would pick Donovan McNabb or Michael Vick in Madden…which was "OPTIONALITY". Just like in life on every
play I wanted options - in football it was the option to Run/Pass/QB run to always gain positive yards. Funny
it took the league over 15 years to catch up to the obvious or wait maybe there was something more holding back the inevitable? Live your life like water - find the most efficient path and then always give yourself OPTIONS.
o AfroBeats – I don’t love the name for this music genre but hey I
guess if Lil Nas X is not country music who am I to judge. The mix of musical
influences is nothing new to life, however; I belive the only thing that holds the flow of music is labels
and the radio stations. Moore’s Law to me is like water, life will find its
most efficient path and that is happening in music. Everything is FLOWING to
streaming, the cloud and to blending sounds. The only people that didn’t
get the memo are Country Music execs in their denial of Old Town Road, but strangely I hear there are country rappers now. 👂 But back
to the message: Amazing artists have blazed a path just like artists did in in Electronic/EDM when they infused the electronic sound with pop artists (unless you were tripped out...who wanted to listen to music with no words). But now African artists are getting their
shine. Not sure what took so long because the music has been so good and so
rich for so long (clearly when I would attend African parties or watch music
videos during my trips to London). So now I’m happy to see really good artists
blowing up mainstream:
§
Davido - Fall
§
Burna Boy – Ye
§
Koffee – Toast
§
AfroBeats – Drogba (Joanna)
§
Wizkid – Come Closer
§
Rotimi – Love Riddim
Props to Akon (Senegal), P
Square (Nigeria), Rihanna (Barbados), Nicki Minaj (Trinidad and Tobago), and French
Montana (Morocco) for continuing to blaze the trail. Even more than ever, we have African and Carribean infused music
being played all across the world. Thanks to the streaming outlets for giving
the people what they want. So prepare to be disrupted in your life - it's inevitable. Take Moore’s law and the music industry - disrupted Radio music execs and stations who always want to rinse and
repeat music about cash, drugs, and sex now have to compete with the endless amounts of music on YouTube, Streaming outlets and Satellite Radio. This is a good disruption because allowing music to easily get out into public brings variety (and a many bad viral one-hit wonders) but I wouldn't have it any other way. Our society and culture… are so much
more that power being in the hands of few trying to curate our lives one song at a time.
Stay tuned - I'll post soon about the fear of World War III and the impact to your portfolio in case you haven't been watching Oil + Gold prices and stocks skyrocketing
