Picture Credit: David Merkel, with an assist from the YouImagine AI image generator || Chibi Gautam Adani surrounded by Twitter birds

Adani Group

• “Foreign investors are clearly watching.” Billionaire Gautam Adani is battling the worst crisis of his corporate life and that’s raising big questions about India’s credibility as a destination for global investors https://t.co/zkvzRS87R6  Indian cronyism affects foreign investors Feb 04, 2023
• S&P Global slashes the outlooks on Adani Group’s credit scores to negative as investors grow concerned about potential governance risks and funding challenges https://t.co/Z2FSJfUxyB  Not so big, just neg outlook, not neg watch Feb 03, 2023
• In six trading days, Gautam Adani has lost more than Sam Bankman-Fried and had his wealth wiped out almost as fast as Elon Musk https://t.co/WXJ7aMZhPC  Easy come, easy go. Wealth does not grow that fast, unless there’s too much leverage employed. Feb 02, 2023
• Gautam Adani recently had a $147B fortune. Now, he’s facing billions of dollars in losses, a short seller’s accusations of fraud and a canceled $2.5 billion stock sale. https://t.co/7VxW1TRVgV  He never had a $147B fortune. The float is small, and the debts are high. Price<>Value Feb 02, 2023
• Adani says his ports-to-power conglomerate would examine its capital market strategy after pulling his flagship firm’s $2.5B stock offering following fraud allegations made by Hindenburg https://t.co/uUIaQfzKnm  If you think you can grow without free cash flow you are nuts Feb 02, 2023
• The flagship company of beleaguered Indian tycoon Gautam Adani pulls a record $2.4 billion share sale https://t.co/iJMW4nnV4F  Time for the financing methods of last resort https://t.co/3rqY8GgZ6e  Feb 01, 2023
• The crisis plaguing Gautam Adani takes a sudden turn for the worse, with a record 28% plunge in his flagship company’s stock raising questions over the collateral he needs to cover loans https://t.co/4b2HYe4IDc  When the is no free cash flow, you can’t fight back against shorts Feb 01, 2023
• Adani Group put up $300 million worth of its shares on Friday to maintain its collateral cover on a $1 billion loan, sources say https://t.co/au2vrOHbt7  This looks risky, or at least dilutive. Why not borrow directly? Jan 31, 2023
• Abu Dhabi-based IHC says it will invest $400 million in the $2.5 billion follow-on share sale floated by Indian billionaire Gautam Adani’s flagship https://t.co/oyEscsd9yy  They are as shady as Adani Group, and are using many of their techniques. Jan 31, 2023
• A plunge in dollar bonds of Adani Group companies quickened on Monday after a rebuttal by the Indian conglomerate failed to ease concerns following a scathing report by short seller Hindenburg https://t.co/RjJU0HJcSO  If I were speculating on the bonds, I average in slowly Jan 30, 2023
• RT @AlephBlog: Billionaire Adani Says India Will Add $1 Trillion to GDP Every 12-18 Months https://t.co/FAbMGwkyV5  Not likely. When this ov… Jan 30, 2023
• Adani Group fired back at an American short seller, but the group’s 413-page response didn’t stop a slide in the shares and bonds of its companies https://t.co/72zaxIzoDE  Maybe some margin calls? Also IHC of Abu Dhabi has similar issues. Debt, complexity, fast stock price rise… Jan 30, 2023
• These are the guys who bought $400 million of stock in an Adani Group subsidiary. Birds of a feather flock together. https://t.co/HOgpd9E0sX  Jan 30, 2023
• For more on International Holding Company, look here: https://t.co/QUAfU9B2PR  https://t.co/fz6Y0WzVMv  Jan 30, 2023
• Adani says Hindenburg’s conduct “is nothing short of a calculated securities fraud” https://t.co/OskrHOfmQj  As we say near DC, “Never believe anything until it is officially denied.” Also, saying, “Same as above” many times does not answer the question. Same as *what* above? Jan 30, 2023
• Also, cheaters often label accusers they way they themselves should be labeled. Calling Hindenburg “Madoff” increases the likelihood that Adani is engaged in fraudulent activity. https://t.co/weWJnxUD9w  Jan 30, 2023
• Adani responds to Hindenburg report, but stocks continue descent https://t.co/HhxMJ4RJGn  Fascinating that Adani Group for all of its size, needs to get a measly $2B secondary IPO done. They don’t want to give up control, but they probably need liquidity https://t.co/IIDr73q2hH  Jan 30, 2023

Portfolio Management

• Cathie Wood is having a scorching start to the year and she wants investors to know it https://t.co/unUdiVze8B  Humility is not her strong suit. Feb 03, 2023
• How many stocks should a portfolio hold? https://t.co/AsYvvxPmoo  Usually, I think 20-35, but it depends on what types of stocks, and what other assets you own, and your time horizon. Feb 03, 2023
• Legendary ‘Big Short’ investor Michael Burry issues an ominous warning after the latest stock market rally: ‘Sell.’ https://t.co/fY3XdLg8IX  We are in the 97th percentile of valuations as the equity share model goes. But I don’t see weakness in financials. Analogy 2000-2002? Feb 03, 2023
• Michael Platt built an $11 billion fortune by turning his back on outsiders’ money to focus on tending his own — with some perilous losses along the way https://t.co/UQZnbki7tO  Odds of flaming-out are nonzero. Feb 02, 2023
• After the Darkest Hour Comes the Dawn https://t.co/RbSkvVGTo3  European Value looks promising Jan 31, 2023
• European de-equitisation comes of age https://t.co/d8KHqn7eR9  Interesting, probably positive for European stocks. Jan 31, 2023
• The Forgotten Lessons of 2008: Seth Klarman https://t.co/BwtgKTbq21  Worth reviewing. Valuations are still stretched, and debt levels are high, though not at the banks. Jan 31, 2023
• Heard on the Street: After an epic 15-year run, hedge fund Universa’s Mark Spitznagel says the financial system is poised for a crisis—eventually https://t.co/YobK8GMFHH  Has anyone gotten a look at what Spitznagel uses for hedging? I assume credit default swaps, but am I right? Jan 31, 2023
• How Do Active Managers Invest Their Own Money? @ritholtz https://t.co/OrOH6x4j1F  Many active managers invest passively. I invest over 90% of my liquid assets in my active strategies. It would be dishonest for me not to have significant skin in the game as an active value manager. Jan 31, 2023
• Pension-fund investment in private-market loans reached an eight-year high in 2022, even as banks pulled back on lending and default rates inched upward https://t.co/Ke7N42SMx9  If CALPERS has shown up, the bull cycle is near its peak. Jan 30, 2023

Companies

• British companies are starting to pay a premium for staff who work five days a week in the office, according to recruitment giant Reed https://t.co/S1TAegZiZC  This shouldn’t be a surprise. Being able to interact more freely is valuable. Feb 02, 2023
• A startup that sells $555,000 flying motorbikes will soon start trading on Nasdaq, making it the rare Japanese company to trade on the American bourse https://t.co/X7hU6RFRYk  Not useful in its present form, but with improvements who knows what this could bring? Feb 02, 2023
• Industrial companies like Caterpillar, UPS and Dover appear to be moving full steam ahead on investments amid chatter about a downturn https://t.co/icbGmSukui  I would be skeptical for this to persist Feb 01, 2023
• Blackstone’s $69 billion real estate trust hit a monthly redemption limit in January, ramping up the pressure on the massive vehicle for wealthy individuals https://t.co/UINfs7x4Le  Get out if you can. Feb 01, 2023
• AIG Terminates Interim Finance Chief Mark Lyons https://t.co/j5r5pNwWhy  Odd. $AIG Jan 31, 2023
• Why Does It Feel Like Amazon Is Making Itself Worse? https://t.co/18JZI92WOm  Interesting thought. As a facilitator of third party sellers, $AMZN works less well than as a first party seller. But maybe they just want to be a middleman. Jan 31, 2023
• Lawler: D.R. Horton (DHI) Net Order Price Declined “Roughly” 10% from Peak https://t.co/AofAP4Hh8C  Housing prices continue to sag Jan 30, 2023

Non-US

• Ghana plans to convert an estimated $3.3 billion of loans owed to its central bank into bonds, making it the single biggest holder of domestic government securities and exposing it to an ongoing debt restructuring, sources say https://t.co/eHkTOgg9bB  No free lunch Feb 03, 2023
• Maybe sending tanks and escalating in Ukraine is the only way to end the war. But Western leaders haven’t earned the benefit of the doubt https://t.co/3YG0EfLg4M  This does need to be talked about more as the EU & the US are depleting stockpiles of armaments… is this worth it? Jan 30, 2023
• Parts of Johannesburg are being subjected to renewed water-supply cuts as ongoing electricity shortages disrupt pumping operations https://t.co/HpuzaIrv3j  Theivery & corruption plague Eskom. When will S. Africa’s leaders focus on the good of the nation and clean up Eskom? Jan 30, 2023
• Will accusations of dirty governance tactics in India spur global investors to change course? @shuli_ren https://t.co/HqEmEeOSFX  Given the complex holding company structure, how much debt might not be disclosed because of joint ventures, etc? Jan 30, 2023
• For Russian gas to reach India, it will have to build pipelines through Afghanistan and Pakistan, writes @JLeeEnergy. Good luck with that. https://t.co/ZQuFDe6PN6  Putin does not care for his own people. He has semi-permanently damaged his own economy. Jan 30, 2023

Central Banking

• Understanding the FOMC through the eyes of a child https://t.co/yV3G6wDvV8  Avoiding bravery and panic — be humble. https://t.co/OrNU6vBsyS  Feb 01, 2023
• ‘Colossal’ central bank buying drives gold demand to decade high https://t.co/enUPd28Dad  Gold is a nice neutral asset to hold, particularly during wars and trade wars Jan 31, 2023
• Banks tighten lending standards in an uncertain economy https://t.co/qF6FEzgBQ6  Credit deteriorating on the low end Jan 31, 2023
• The Goose That Stopped Laying Golden Eggs https://t.co/8P3aOUZE4g  Central Banks should keep their assets short, and not play around with the yield curve. Jan 31, 2023
• The Fed Is Asleep At The Wheel And Americans Are Feeling The Consequences https://t.co/qRWqSx032A  Falling M2 and ODL, inverted yield curve, weakness in housing and autos. Time to cut rates. Drive through the windshield, not the rearview mirror Jan 31, 2023

Legal

• A former Allianz fund manager says the lawyers who were engaged to represent him in a fraud investigation switched sides to become government informants https://t.co/YA8HSihKdn  Maybe we are getting to the point where employees need to purchase their own E&O policies. Feb 03, 2023
• A derivative lawsuit in Delaware seeks to hold McDonald’s directors and officers liable for failing to sufficiently intervene in a sexual-harassment scandal. https://t.co/9vAJDklSRo  If appealed, it will likely be reversed. In other news: D&O insurance premiums rise again. Feb 03, 2023
• A court ruled that Johnson & Johnson can’t use the bankruptcy system to administer tens of thousands of talc claims because the fund the company created to pay claimants had too much money. https://t.co/ZLQ19Ldgrh  To me it seems like a form of fraudulent conveyance of a liability Feb 03, 2023
• Johnson & Johnson will probably face years of litigation in courts around the US before it can resolve baby-powder lawsuits https://t.co/utpZ8D5wyq  Until now, it has been difficult to deny a bankruptcy petition, even from solvent entities Feb 03, 2023

Crypto

• New York Digital Investment Group, one of the largest crypto lenders, is repossessing 27,403 mining machines from bankrupt miner Core Scientific https://t.co/J44Dyp7kW8  If selling the machine isn’t profitable, why should running them be profitable? Feb 03, 2023
• A trader faces criminal charges for allegedly manipulating the decentralized exchange Mango Markets and draining more than $110 million of cryptocurrency https://t.co/Lv4MUKJAoE  Some may think “code is law,” but there are more general laws that exist outside computer code Feb 03, 2023
• When a one-time TV and film producer’s company bought Farmington State Bank, it got a name change and a new shareholder: Sam Bankman-Fried’s Alameda Research https://t.co/3iqIKi0PVl  Could be wrong, but crypto can’t be a reserve asset at a bank. Maybe it could be held as surplus Feb 03, 2023
• Crypto’s Tax Shelter Problem https://t.co/V6X2S0G0Mo  Secrecy on the part of tax havens compounds the difficulty of getting money back Feb 01, 2023

Financial Plumbing

• The glitch at the New York Stock Exchange has become a pawn in the ongoing battle over a rewrite of stock-trading rules proposed by US regulators https://t.co/JsCnvxwy2x  One central order book would be nice Feb 02, 2023
• “We are at the beginning of a reckoning.” Scott Peng, one of the first people to call out Libor, is now sounding the alarm over its successor https://t.co/3ot0DVxfzm  “Corporate borrowers… can’t enter into paid term SOFR swaps, given the ARRC’s recommendations” #liborwasbetter Feb 01, 2023
• Smart money is betting on insurance money to fund fast growth https://t.co/zJyogt1VbS  The bad old days for life insurers returns. Insurers/reinsurers are taking too much asset risk. Some regulators should disallow reserve credits for insuring asset performance by weak reinsurers Jan 31, 2023
• if I wanted to talk to an institutional expert on deep out-of-the-money put options, who should I talk to? Feb 01, 2023

Politics

• Biden administration proposed an end to an exemption allowing health plans to exclude coverage of no-cost birth control on moral grounds, part of work to protect access to contraception since Roe v. Wade was overturned https://t.co/yPPi43RP3n  Supreme Court already ruled on this Feb 03, 2023
• How Biden Officials Bungled a Better Vaccine https://t.co/xgUujkehiy  Argues that C19 isn’t merely seasonal, & that the J&J vaccine offers more durable immunity FD: + $JNJ Jan 30, 2023
• Missouri Camping Ban Squeezes Rural Homeless Population https://t.co/ENuahUJzJX  This fits my ruralization of poverty theme, and now rural areas fight back. Jan 30, 2023

Personal Finance

• Most Americans stayed the course with their retirement savings in 2022, even as the stock market fell and inflation rose https://t.co/1kmr4sqigB  Retail investor driving through the rear-view mirror, which is temporarily self-reinforcing Feb 03, 2023
• Penalties on early 401(k) withdrawals stop some workers from putting money away because they fear they won’t be able to access it https://t.co/wpMqKLcr68  This is the price of getting tax deferral. Sorry, this is fair. Feb 02, 2023
• In the event of an emergency, you can crack your nest egg, but financial advisers say it should be a last resort. https://t.co/keHuFmuUWF  Think hard before doing this. It might be better to do a home equity loan, or borrow from the 401(k). But sometimes the present trumps future Feb 02, 2023

Energy

• Models of collapsing oil demand look increasingly at odds with short-term trends https://t.co/YDN6mmjV4c  If the end of 2022 didn’t teach us that the transition will be slow, what will? Feb 02, 2023
• Diesel prices have receded from record highs, but pressures on supply signal that gains at the pump may have run out. https://t.co/IoGwx0s6yD  Diesel supplies are tight, especially on the east coast, which spills into jet fuel pricing https://t.co/n7X7Me2SGi  Feb 02, 2023

Credit

• Another company could be pulling a J. Crew https://t.co/IGsDlbtsYa  What you get for lending without significant protection from covenants Jan 30, 2023
• Worries loom for used-car market https://t.co/rK8o23mFYT  More downward pressure on prices Jan 30, 2023

Odds & Ends

• 17 Most Dangerous Toys of All Time – Banned Kids Toys https://t.co/l1tbGC3HCP  I remember catching a Jart in my hand after an errant throw had it flying at my face. That hurt a lot, but healed well. That said, it was a fun game, and played it many times without accident. Feb 03, 2023
• The 31 Most Hard-to-Pronounce Words https://t.co/NozETlULPg  Aside from 2 ridiculous words that I never heard of, I think most well-educated people pronounce these correctly Feb 03, 2023
• 26 Ridiculously Hard Jeopardy! Questions to Stump Your Brain https://t.co/Evqk8kqQ28  I got 5 right, 3 wrong, and 18 I had no idea Feb 03, 2023
• This ‘airliner of the future’ has a radical new wing design https://t.co/L3NZBQvFrs  Looks flimsy. Feb 03, 2023
• “The more you put in the store, the more bandwidth it requires,” said Ahold Delhaize USA CIO Rom Kosla https://t.co/dYXVUeYEgs  Tech equipment is inexpensive for what it can do & there are many alternatives for how to do it. This shouldn’t be so tough. Feb 02, 2023
• U.S. home prices declined in November from the prior month as higher mortgage-interest rates made home purchases less affordable for home buyers https://t.co/Kaufh1fxEW  Absent economic weakness, mortgage rates are at their lowest level in 5 months. Price declines should slow Feb 02, 2023
• “Miracle Mineral Solution,” or MMS, is easy to find on Amazon despite FDA warnings on how toxic and dangerous the potion can be https://t.co/R3khPhWkz2  Astounding that people would drink bleach. Feb 01, 2023
• It’s the new chicken-and-egg question: Should I just buy some birds? Some shoppers thought that was the answer to record egg prices. It’s often not so simple. https://t.co/ILUzbLmmSk  There are simpler ways to save money. Jan 31, 2023
• Medical Schools Bail on Academic Merit and Intellectual Rigor https://t.co/Lzp8C3xNMU  This is a place where you should value competence over ideology. Jan 30, 2023