Buffett doesn’t care much about market price, especially those panic selling – “would you sell your house to whatever bidder was available at 9:31 on some morning merely because at 9:30 a similar house sold for less than it would have brought on the previous day?”
Two advantages of controlling companies vs buying non-controlling shares are that: 1) capital allocation, 2) additional tax costs; however, stock market can provide additional return by trading at very low prices.
High-level things that people/market celebrates:
1/ more M&A in the US
2/ certainty in taxes: Harris proposed raising corporate income tax, stock buyback tax, unrealized capital gains tax
3/ near-term possibility of ending wars globally
Rates / Treasury yields
bad for long-term bondholders – higher inflation, higher deficits (more supply). but long-term treasury can’t rise too much – it can hurt US domestic mfg etc. if rates are high.
Trump would want Fed to cut rates. Even if Fed cuts, long-term bond yield could be hard to come down.
Thus, we should see a steepened yield curve, which is good for banks! Banks are borrowing current (cheaper cost) and lending long-term (higher yield).
China
1/ less probability of near-term war on TW strait (less idealogical driven; deal maker)
2/ higher tariff, less export – China needs to rely more on domestic consumption
Industries
1/ obviously, IRA could be changed. Then bad for renewables like solar, etc. It’s such an interesting industry.. no real demand if no IRA?
2/ crypto obviously, can boom especially if a new pro-crypto SEC chair comes in power
People sometimes simplify the differences between Waymo autonomous driving and Tesla FSD as Lidar-based solution vs. a vision-based solution, especially as Tesla has been saying it doesn’t use any lidar.
But there are several other important distinctions.
For example, the production & scale is different. Tesla owns the mfg and has been selling cars to consumers, a lot of cars. Meanwhile, Waymo deploys the solution on other carmakers’ cars. As Waymo’s fleet is much smaller than Tesla’s annual delivery, the cost structure can be very different. Tesla can enjoy better economy of scale vs. Waymo, even if the hardware is the same.
Secondly, the responsibility is different, which is a key difference and debating point for robotaxi going forward. Tesla is reluctant to take on responsibility for its FSD solutions as the cars are sold, but Waymo owns the car and operates the ride-hailing service. Waymo takes the responsibility if there is accident due to the autonomous software. On a separate note. if you think about Uber, that’s actually is a very good business model. It can gain from the value creation of autonomous driving potentially, but because it’s just a platform, it’s just matching cars and passengers and take a cut from fares, so it doesn’t need to take responsibility for a autonomous driving software failure. Uber is not a provider of the traveling service but is just providing the matching services.
There is a third element, which I am not hundred percent sure about. It is said that Waymo relies on hard-coded rules and local data vs. Tesla currently more like a blackbox. So the programmers write specific instructions to tell Waymo cars what would do in different (extreme) scenarios. Instead, in Tesla’s current version (end-to-end), it is using a lot of data the train the AI mode without human specifying what to do in each case. Tesla is only feeding data to the AI, and let AI learn from human drivers. This is also why some argue that Waymo is much harder to scale.
However, I do think Waymo is underestimated –
1/ it can actually take a similar approach as Tesla as well, because Waymo also has a lot of data – maybe not as much as Tesla, but Waymo for example has a lot of data in San Francisco. Waymo probably already has the best driver (or at least very good) for San Francisco. If you have the “best driver” in San Francisco and all the related data, you can probably train an AI model with what you have – Waymo can train an AI driver w/o specific rules, but based on data from its current fleet in San Francisco, which is running w/ handwritten rules by human programmers. And from that you are also replicating what Tesla was doing – basically this AI driver for San Francisco is just a learning the best practices of how to drive in San Francisco from the existing Waymo cars. I don’t think Tesla has significant data advantage if we are just talking about San Francisco.
2/ and here comes another bold assumption, which is that if you are the best driver (AI version, not specific-rules based version) in San Francisco (plus Phoenix), you are probably not a bad driver in other cities. Of course you don’t know about the specifics about other cities and other countries, so you are not as good in NYC as you are in SF, but you also won’t be as bad as people expected. And over time maybe in just a few weeks this “San Francisco guy” can do a decent job in New York City as well. If that’s true, and that’s probably a big if, then Waymo’s solution can actually be more scalable than people would have expected.
What I’m trying to say is that, at current stage, I don’t think Tesla’ choice technology has already won this autonomous driving competition with huge data advantages. The jury is still out.
Nio’s sub brand Onvo just announced its price today.
Without battery, price is 150k rmb, or ~$20k.
If doubling the price due to tariff to $40k, that is still competitive in the US.
Model 3, ID.4 is around that price range in the US (excl. credit).
If counting US gov subsidy, that’s $7.5k price advantage for US-made EV. But this subsidy won’t be here forever.
The point is, even with 100% tariff, it’s not entirely unaffordable for Chinese EV brands.
Not to say this is problematic.
But do feel that not doing this is more normal.
Sep 10: finished BlackMyth: Wukong!
Paused a bit longer than originally planned due to this monumental game production.
Quality is impressive especially initially, but feel that the content can be improved if given more time and resources.
Working on personal priorities (think through married life and kids)
Lee Hsien Loong steps down after 20 years (2004-2024) serving as the PM of Singapore. [3rd longest after Turkey and Russia (?); Putin had 8+12 years and started another 6-year term so 26 years at the end of current term]
Singapore had a Lee leader for 45 of its 59 years of nationhood. The new PM Wong won’t have a Lee leader waiting after him.
From my understanding, there is not much political freedom even though Singapore is a democracy.
Hope it may advance / experiment new norm for overseas Chinese.
I recently read a book on Qing dynasty. People’s life sounds a bit pathetic, although from population growth or national wealth perspective it looked very strong.
I don’t believe Chinese society always needs a strictly controlled system, which had been the case for thousands of years.
Eventually, there should be new form of civilization structure that’s very different from now.