Agreed - you have been able to grab Lyft & Uber from SFO airport easily for a long time. I guess the difference here is they have a license from the airport.
434 karma · joined August 11, 2011
"That’s no surprise since about 30 percent of PayPal’s business is still on eBay, although that is down from 50 percent only a few years ago. Donahoe said eBay projected it would get to 15 percent quickly." http://recode.net/2014/09/30/ebay-to-spin-off-paypal-with-ne...
I'd suggest going on nerdwallet or a personal finance blog to get an idea of all your options as I would definitely not include Simple in the upper tier of online options (at least in current state).
"They get paid to sell your orders to Knight Capital, Lava and Credit Suisse.."
"Pay it friendly. Treat your friends" [imagery of two friends eating popsicles]
Compare this to Square "Start selling today. Take care of your business anywhere with Square" [picture of a square ipad reader]
I think it's clear which company illustrates better what the actual product is.
The key problem I see with the investing world is that 1) most Americans lack a basic understanding of how financial instruments works 2) the media & investing culture encourages a speculative investing mindset that makes most people act like gamblers rather than rational thinkers 3) the incentives are misaligned - financial institutions are not incentivized or built to encourage people to invest smartly.
None of these problems are solved from zero trading commission structure. To be honest, this seems like a feature that day & algorithmic traders would care about rather than a normal investor. You could even argue that zero commission trades will exacerbate the issue by pushing the investing mindset to be even more short term focused; this mindset is what causes most investors to lose performance.
This seems more like a clever PR angle for Robinhood ("we are helping real Americans") rather than something impactful. I doubt their aim & monetization strategy is geared towards the everyday investor.
If the trend continues, this could mean a massive shift in the US's labor force from salaried jobs to independent contractors. A lot of folks in the Valley view this as a positive innovation, but I think this is a clear case where the free market is not going to work out what's best for our society.
Imagine a future world where companies like Uber are the norm. A majority of the workforce will face issues like: * No regulation on working hours (i.e. the industrial revolution v2) * Massive healthcare costs born on the taxpayer due to lack of employer provided healthcare (i.e. going past what we already see with corporations like Walmart) * Lack of retirement benefits for the workforce as they age (401k, pension, social security). People may argue that the government shouldn't force people to save, but what is likely to happen is that the taxpayer will bear the burden of supporting a lot of this population. * Lack of unemployment insurance which means that our labor force will largely be unprepared for the normal boom & bust cycle of our economy * Lack of worker's comp which means that employee's won't be shield from low probability high risk events
The scenario feels like a deja vu; during the Industrial revolution, we hit a point where technology progress was leading to inhumane working conditions for manufacturing workers. Eventually regulation caught up, but this was definitely not something that the free market sorted out on its own.
Are we really prepared to live in a society where independent contractors are the majority of our workforce and lack basic labor protections?
The issue is that: 1) Road design - many/most cities do not have adequate road engineering to deal with bikes 2) Driver training - Road drivers in the US aren't trained to deal with non-car traffic 3) Weak Bike traffic law enforcement - I don't think that bike negligence is a key cause of accidents but I do agree that police enforcement of traffic laws on cyclists is lax.
So I disagree with the notion that bike traffic needs to have a separate roadway from urban traffic. I think there are plenty of good examples where a sharing system works.
However the rise of Lyft and other competitors essentially pushed Uber to go into a price gauging war. They went into a big price cut with UberX that essentially made them cheaper than both Lyft & taxis, and had a lot of advertising campaigns talking about their price advantage. This happened late last year (I believe) and since then both Lyft & Uber have been going through a series of price cuts & driver promotions to compete on both side of the table.
So yes, Uber users are definitely price conscious. This has happened largely because Uber has shifted its model more towards UberX. Slashing fares was a pretty bold move (companies rarely cannibalize cash cows with high margins).
The new focus, I think is to consolidate their position by growing aggressively, competing with Lyft on pricing & driver promotions, and ultimately, drive the cost of service so low that they expand the market past on-demand limos (Uber before X), cabs (Uber now), to a service cheaper than owning a car (Uber in the future).
To a VC yes. That's the business model of their fund. I think if Everpix had attracted a different class of investors they might have been more successful fundraising.
I also think #2-#4 would result in the diversity of topics & sources on my front page to erode.
Regardless, let's suppose the mantra is "invest all your money in index funds until it breaks 50% after which bad things may happen". Do you think that if we manage to hit that 50% in the future, anyone will actually actively try to stop people from investing in index funds? Effectively there would be a lot of money very rich index fund managers who will be pushing to increase their fund sizes even further.
So it's possible for extreme irrational exuberance to cause even index funds to harm the market.
The the truth is, you can't be lazy - it's simply not an option. It's the burden of having savings. You need to research your investment decisions and understand your financial goals even if you decide you want a passive investment strategy. Why? Here are a few scenarios where investing the majority of your savings in index funds probably won't make sense:
i) You are approaching retirement age and will be living off your savings in the next few years. You have saved just enough to live out your expected lifetime. ii) You are a young hacker and will be bootstrapping with your friends in a few years (sounds familiar?). You are close to saving enough to pay for your personal burn & even server costs for a year.
i) & ii) are clear cases where the users need liquidity and are unable to handle index fund volatility.
No one lazy would realize this. The truth is those who decide they don't want to actively manage a portfolio still need to understand a lot of things (savings accounts, CDs, annuities, bonds, treasuries, etc.) before they decide to jump into index funds.
Essentially, I think investing is a part time job regardless of your strategy. It's the burden of having savings.
If you want to know this group of high performing value investors, c2 is referring to Buffet's article called "The Superinvestors of Graham-and-Doddsville". It's a pretty fascinating read. You'll have a hard time investing in most of these folks as they are all early proteges of Ben Graham (father of value investing) and as such many are dead or retired.
Regardless, I highly recommend reading those as they give you an idea of why some think a strong value investor can beat EMT & the market.
This quote neatly summarizes what I fundamentally don't accept about this viewpoint. Specifically, most of the article's arguments are those you encounter from Efficient Market Theory which has pervaded our financial education to the point of being accepted as blindly as faith and has lead to a lot of pain & suffering by investors. Here are some key messages from the article which I find incredibly dangerous and damaging:
1) UNLESS YOU ARE "SPECIAL", INVEST IN INDEX FUNDS
Index investing has become a sexy mantra in the era of EMH and passive investing. If you can't beat the market - why not just follow it? At first glance it does seem like a great option as it cuts out middlemen fund managers who seem to invest on chance. However, it's a mantra that is self defeating as more investors adopt it. Although indexing is predicated on efficient markets, the higher the percentage of all investors who index, the more inefficient the markets become as fewer and fewer investors would be performing research and fundamental analysis of equities. At the very extreme, if everyone practiced index investing, stock prices would actually never change relative to each other since everyone would be "all in" [I've loosely paraphrased Seth Klarman's arguments from Margin of Safety but for a much more exhaustive treatise please dive into the novel]
I think a golden rule of investing is you should reject any absolute assessment of a investment vehicles ("gold always goes up", "invest in index funds", "junk bond funds have lower risk at higher return"). Wall Street loves to peddle their latest, shiny investment creations; don't rely on their faith - no matter what you invest in, you better do some damn research on it (even an index fund).
2) STOCK PRICES REFLECT THE CONSENSUS AND GOING AGAINST THE CONSENSUS IS BAD (worded as aggressive in the article)
This is in it's heart is the essence of the efficient market hypothesis - prices are rational and reflect underlying public information. I'm not going to into a huge essay against pricing being rational but history has shown time and again that prices reach irrational exuberance; tulip mania and trading sardines are not merely historical phenomenon. Intelligent Investor by Ben Graham details out some clear cases where stock prices did not reflect anything remotely close to underlying public information. Off the top of my head, there are many examples where passively managed closed end mutual funds traded significantly from their NAV value (which makes little sense). Historical records shows that supply and demand factors (rather than underlying information and rational actors) drive stock market prices.
As a nice hypothetical example, let's think of a change in the S&P 500 where the new stock AWSM pushed out OLDFTHFUL from the S&P 500. Let's assume the changing of the index happened during a lull period in both companies where no material information about the companies was given out (i.e. their economic forecasts were stable during the S&P shuffling). Since everyone was following the "invest in index funds" argument of the author, this triggers billions of purchase orders for AWSM and lots of sell orders for OLDFTHFUL. Naturally one stock rises while the other stock falls even though there has been absolutely no change in the forecast for either company.
3) YOU ARE COMPLETELY BEHIND THE CURVE WHEN INVESTING - DON'T BOTHER UNLESS YOU KNOW INSIDE INFORMATION
Nothing could be the further from the truth. Frankly, it's probably one of the best times to do rigorous stock analysis since 1) we are in a time when most investors embrace the EMT and thus don't bother doing even basic fundamental analysis 2) financial info and SEC filings can be easily acquired through the internet & hacking and financial modeling can be easily done with Excel & programming 3) many of the institutional actors that drive the market are not incentivized to conduct fundamental analysis. Specifically, mutual funds have specific characteristics that prevent them from acting rationally (requirements on diversification, inability to short equities, large fund size, low cash reserves, etc.). Hedge funds have similar issues (20% fee structures which incentivize short term thinking).
Things might not be as rosy as during Ben Graham's time, but don't fool yourself into thinking that doing research into your investments is a waste of time. Any natural scientist will never accept that further research will yield nothing, but for some reason we accept this in the investing world.
4) YOU ARE TRADING AGAINST GOLDMAN SACHS. DO YOU REALLY WANT TO BET AGAINST GOLDMAN?
I hate this perception; Wall Street's business model is largely driven by volume rather than investment acumen. I.e. they make money as long as the market moves, regardless of the direction. Goldman is a giant because they manage the machinery of markets, not because they are expert stock pickers.
Overall, I think the world would do a lot better with this advice: "A stock is a small percentage share of a company. Treat investing your money in an equity exactly as you would treat investing in a business." I think most of the investing mistakes alluded to this article would be prevented by heeding this advice.
Nevertheless here's where I think we disagree:
* Inventory will have some liquidation value. Let's discount inventory by 75% which is pretty conservative; you will still get $200M here
* IP - Main disagreement for me is here. Most analysts who have pegged the IP at $2 - $3 bn. Let's put it at $2bn, the lower end of the spectrum [1][2]
6.2 + 2.2 - 3.7 + 2 = $6.7B (~40% above purchase price)
As we can see the main question is the value of the IP (and PPE to a lesser extent). I have absolutely no experience valuing patents, I'm not a patent lawyer, and definitely won't be evaluating their 9K+ patent applications. So unfortunately there's a pretty big unknown in the valuation.
Regardless we have a $4.7B - $6.7B range based on a very quick 15 minute analysis of their balance sheet with an upside of earnings of any profitable lines of business that can be operated independently (if they exist).
My guess is tha Prem Watsa, as former chairman of BBRY, has done a much more rigorous evaluation of their IP and found profitable business lines he wants to keep / spin-off to reach a comfortable margin of safety.
[1] http://money.cnn.com/2013/09/24/technology/enterprise/blackb...
[2] http://blogs.wsj.com/corporate-intelligence/2013/08/26/the-n...
All I did was take the balance sheet and pull out intangible assets: https://www.google.com/finance?q=NASDAQ%3ABBRY&fstype=ii&ei=.... I did NOT consider the value of earnings from any of the business (i.e. income sheet) as the investment thesis I made was for shutting down the business, and I don't want to divine profitability from each of the business lines.
They really need to require finance coursework in college so this kind of fake financial journalism gets stamped out.
The balance sheet numbers per share: 1) +$13.50 - Net current assets (i.e liquid assets) 2) +$2.50 - Real estate holding (less liquid) 3) +$6.50 - Book value of IP 4) -$7.00 - TOTAL Liabilities
Meaning if you shut down the company you could realize a value of around $16 per share. Even if you discount current assets & IP since they might be over-valued in the books you can realistically get to a $11-$14 range for the value of the stock.
Essentially this means that any smart owner could realize a significant profit at $9/share just tearing down the company smartly (i.e. not a fire sale). As such, I expect Fairfax: 1) Maintain the businesses that are profitable TODAY 2) Shut down the unprofitable parts of the business that are destroying earnings (and thus slowly eating into asset value and the investment thesis) 3) Shop out ownership / licensing of the IP given it's significant value
I don't think this means that Fairfax is trying to turn around the company and restore Blackberry to its earlier glory; that would be a bit irresponsible and reckless for a value investor. Don't expect Blackberry to be the same company it was before, although I expect parts of business to continue.
If was already on your phone I could see users adopting it for things like contacts & photo exchange.
Although they are private businesses, in the eyes of the law — specifically the Civil Rights Act of 1964 — bars and nightclubs are "public accommodations" like hotels, restaurants and movie theaters, and thus forbidden to discriminate on the basis of race, color, religion or national origin. Private clubs, institutions such as country clubs that are selective in membership and only open to members, are generally exempt.
However, "Even if you have a doorman, a bar is more like a restaurant than a country club," says Dale Ho, Assistant Counsel for the NAACP Legal Defense Fund in New York City. "So, generally speaking, a bar that treats patrons differently on the basis of race is in violation of federal law."
Disclaimer: I was born and raised in Houston.