Being in bed following a minor medical procedure yesterday brought me full frontal to the shenanigans playing out on the ‘news’ shows. Edited clips framed to curry favor depending on the audience is the rule. No longer can we – the consumer – decide whether a story is right or wrong without blatant editorializing. As Sammy Davis, Jr. aptly stated in reference to The Huntley–Brinkley Report, “My only contact with reality. Whatever I’m doing, I stop to watch these guys.” (Life magazine, 1964). Or as Warren Buffett writes in his recent letter, “… media reports sometimes highlight figures that unnecessarily frighten or encourage many readers or viewers.”
My contact with reality was found in the (probably edited) recitation by our president of the lyrics to a song in his speech to CPAC members.
“Oh shut up, silly woman,” said the reptile with a grin
You knew damn well I was a snake before you took me in
The Snake by Oscar Brown, Jr., 1963
Applause erupted, a pregnant pause ensued, before he mentioned the words “immigration”. I really thought he was referring to himself for a minute. But it does provide a decent lead into this weeks’ post.
Snake –1. A scamming backstabber. Someone who does something just to get something out of it.
I generally like to tie my musings into an investment (rather than political) theme and this one will be no different. The last couple of weeks have certainly uncovered a few snakes hiding in the grass, particularly with the 13F filings. I – based a on a looser definition – could very well be one of those snakes too.
Let’s begin with the beloved practitioner of buy and hold investing. Ol’ Warren previously increased his Apple and decreased his IBM positions stating at the time he preferred consumer over technology holdings. Perhaps, but I’m thinking more that it’s a protégé decision. Then we have the Phillips 66 reduction. Not mentioned in the annual letter (you could say it was a timing issue) but the reason provided in the press release was regulatory issues. Yet he’s poised to increase his stake in Pilot Flying J (similar issues). Perhaps a preference for retail versus downstream operators? Another curiosity two airlines in his top holdings. Although Delta is interesting as it bought their own refinery from none other than Phillips 66 in 2012. At the time, it was reported that JP Morgan was involved as well. Probably not snakelike, but is there a tangled web that’s being woven?
Most snakelike by far are the antics of Carl Icahn (once again). First he postures Xerox (successfully) for a spin (Conduent). Then he agitates for a sale of the remaining Xerox shell. When this too is successful, he sells a portion of his holdings. He then initiates a proxy battle and files suit to block the deal. You have to wonder where the SEC is hiding on this one. Did I mention Icahn was a part of the current administration in the early days?
Update 4 Mar 2018 – It has been reported that Icahn sold some of his steel centric holdings recently. Although telegraphed well in advance by the administration, one has to wonder if a leak occurred regarding timing …
Proving that little guys are equally capable of gamesmanship are my escapades in the Qualcomm saga. The bruising battle between the two CEOs makes a cage fight look tame. Sure Broadcom wants to underpay and Qualcomm wants a significant premium. Taking this fight to the media only produces losers. Therefore, last week I voted the blue proxy (Broadcom’s) while simultaneously adding to my QCOM stake. If AVGO is successful at the current offer, I profit. If the offer is increased, I win even more. If AVGO walks – at least I reduced my QCOM cost basis. Yes, I admit it. Snakelike.