Now Is Not The Time To Sell

In their latest episode of the VALUE: After Hours Podcast, Brewster, Taylor, and Carlisle discuss Now Is Not The Time To Sell. Here’s an excerpt from the episode:

Tobias: It’s not like there’s much you can do anyway. The time to sell out was, I don’t know, there’s been no good indicator to sell out.

Jake: Now, you tell us.

Tobias: It’s definitely not now. Now is the best opportunity that we’ve seen in a long time. Now’s the wrong time to be doing it. Forward returns– [crosstalk]

Bill: it could go a lot lower.

Tobias: It could, but I’m just saying that forward returns, when you get to these levels start looking pretty good.

Jake: To start getting to adequate, right? [laughs]

Tobias: Well, I guess, it depends on what part of the market you’re hunting in. If you’re looking at the market, if you look at the index, and then again, the index is made up of, like, we just discussed Amazon. But we could have said the same thing for Microsoft or Google. That’s a big part of the index. These are unusual businesses. We’ve already discussed that. It’s possibly index does all right in defiance of Cape. Probably, it’s a better bunch of businesses. It’s not like you’ve got Exxon as the number one stock in there, which is selling a commodity. Then again, Verdad says it doesn’t matter. It’s a hard game, right?

Jake: Yeah. Exxon was a pretty good business for a long time too.

Tobias: It is a good business. They are just taking prices, though. That’s the only problem. I guess Amazon’s taking prices in some sense too. Google’s probably setting their prices.

Bill: Well, the auction does, right?

Jake: Oh, yeah. They’re capturing a big chunk of the consumer surplus versus producer surplus there in their auctions for sure.

Bill: Not enough. Help them get more.

Jake: [laughs]

Bill: Same with Microsoft. Microsoft needs more money too. Jeez.

Jake: Raise the price.

Bill: That’s right. I’m still waiting to get a percentage of every transaction on the desktop.

Jake: Make all these capitalists richer.

Bill: That’s right.

Jake: [laughs]

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