Episodes
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Murray Stahl Episode 31: The croupier does not bet
A December 15, 2008 Stahl commentary reviews and updates his croupier business model. From A Review & Update of The Croupier Business Model (Horizon Asset Management, Interim Market Commentary): croupiers facilitate financial transactions without putting their own capital at risk. Stahl argues…
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Murray Stahl Episode 30: Four misfits in November 2008
A November 2008 Contrarian Research Report compendium rejects the comparison with the Great Depression. From Contrarian Research Report Compendium, November 2008 (Horizon Research Group): in Murray’s Musings, Stahl starts from Benjamin Graham’s 67% loss in the Depression and argues that a...
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Murray Stahl Episode 29: Funds, cars, and a market that has already broken
A November 2008 Devil’s Advocate compendium puts credit default swaps at the heart of the crisis. From The Devil’s Advocate Report Compendium, November 2008 (Horizon Research Group): Stahl argues that collateral calls on credit default swaps drove forced selling and froze credit lines, and that…
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Murray Stahl Episode 28: Four consumer names in a breaking market
An August 2008 Scratch Report compendium argues that the housing decline couldn’t repeat, and that the market’s forecasts didn’t add up. From The Scratch Report Compendium, August 2008 (Horizon Research Group): in Murray’s Musings, Stahl notes that new home sales near 500,000 a year roughly…
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Murray Stahl Episode 27: Industry analysis, taught with a paradox
A May 2008 Murray Stahl lecture teaches industry analysis through comic books. From Industry Analysis via Comic Books (Devil's Advocate Report Compendium supplement): Stahl argues that deduction is dangerous in social science, using the Unexpected Hanging and Bottled Genie paradoxes, and prefers…
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Murray Stahl Episode 26: Further basic principles of the croupier
An April 27, 2006 Stahl essay lays out further principles of croupier investing: the exchanges, brokers and custodians that earn their living from other people's trading. From Studies in Absurdity: Further Basic Principles of Croupier Investing (Contrarian Research Report, later collected in...
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Murray Stahl Episode 25: Utilities then and now
An October 28, 2005 Contrarian Research Report from Horizon Research Group (research staff including Murray Stahl). From Utilities Then and Now (Studies in Absurdity): after utility shares fell 12.07% in 17 days on inflation fears, the report goes back to the 1970s. Seven utilities from Florida...
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Murray Stahl Episode 24: Exchanges versus indices
A June 22, 2005 Contrarian Research Report from Horizon Research Group (research staff including Murray Stahl). From Exchanges Versus Indices: as indexing spreads, the report asks whether owning stock exchanges is a superior form of indexation. Using NYSE seat prices back to 1868, it shows that...
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Murray Stahl Episode 23: High yield, without the yield
A December 2004 essay by Murray Stahl on a high yield market without high yields. From High Yield Investing In the Absence of High Yield (Studies in Absurdity): with single-B bonds yielding only 7.64% against 5.12% on 20-year Treasuries, Stahl argues that double-digit returns from high yield as a...
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Murray Stahl Episode 22: Gold stocks versus a gold trust
A November 2004 essay by Murray Stahl comparing gold shares with the new gold ETF. From Gold Related Stocks Versus Gold Indexed Exchange Traded Funds: An Exercise in Comparative Valuation (Studies in Absurdity): the Street Tracks Gold Trust began trading on November 18, 2004, and within days the...
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Murray Stahl Episode 21: Zipf's law as a tool for investors
A November 2004 essay by Murray Stahl on Zipf's law, with brief remarks on Bradford's law. From Zipf's Law as a Tool for Investors (Studies in Absurdity): a value multiplied by its rank tends to give a similar number down a list. Stahl shows how Zipf values expose oddities in military-personnel...
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Murray Stahl Episode 20: Benford's law as a tool for investors
A November 2004 essay by Murray Stahl on Benford's law. From Benford's Law As A Tool For Investors (Studies in Absurdity): in tables of statistics the digit 1 leads 30.6% of the time, not the 11.1% equal odds would suggest. Stahl explains why compounding produces the pattern, why departures may...
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Murray Stahl Episode 19: Gresham's law in corporate finance
A November 3, 2004 essay by Murray Stahl on Calpine's convertible and the shares that don't exist. From Gresham's Law in Corporate Finance (Studies in Absurdity): on September 30, 2004, Calpine, a CCC credit, priced a $736 million convertible yielding only 197 basis points over ten-year…
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Murray Stahl Episode 18: Google and Yahoo as toll roads
An October 19, 2004 essay by Murray Stahl, Part III of his Yahoo, eBay and Google trilogy. From Google and Yahoo as Toll Roads (Studies in Absurdity): Stahl pictures entrepreneurs who build tollgates in front of the world's stores and charge retailers for steering shoppers to them. These are...
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Murray Stahl Episode 17: eBay and the problems of consensus
An October 13, 2004 essay by Murray Stahl on what eBay's share price assumed. From eBay: The Problems Created by Consensus (Studies in Absurdity): in finance, problems generally occur when people agree, because agreement lowers the rate at which future earnings are discounted. Stahl tests the...
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Murray Stahl Episode 16: The other housing markets
A September 2, 2004 essay by Murray Stahl on the parts of the housing market the homebuilder optimists left out. From The Other Housing Markets (Studies in Absurdity): the optimists' case for the homebuilder shares was clever. Quality-adjusted new home prices rose only about 2.55% a year since...
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Murray Stahl Episode 15: A reader answers back on Stalin
An August 25, 2004 exchange: a reader challenges the history in "Joseph Stalin's Hedge Fund," and Murray Stahl replies point by point. From A Reader Responds to "Joseph Stalin's Hedge Fund" (Studies in Absurdity): the reader accepted the point about growth, value and income investors crowding…
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Murray Stahl Episode 14: Utilities from a buyout perspective
An August 23, 2004 essay by Murray Stahl on the utility buyouts that public investors ignored. From Utilities From A Buyout Perspective (Studies in Absurdity): in eight months, eight utility buyout transactions, from Kohlberg Kravis Roberts buying Unisource to a Blackstone-led group buying...
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Murray Stahl Episode 13: Distressed utilities from the short side
An August 10, 2004 essay by Murray Stahl on why distressed utilities carried such heavy short interest. From Distressed Utilities from the Short Seller Perspective (Studies in Absurdity): hedge funds bought the high-yield bonds of debt-laden utilities and hedged the default risk with credit…
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Murray Stahl Episode 12: Joseph Stalin's hedge fund
A July 20, 2004 essay by Murray Stahl on self-reinforcing cycles, from Soviet grain to Value Line screens. From Joseph Stalin's Hedge Fund (Studies in Absurdity): in 1930, collectivization starved Soviet farms while American farmers, burdened by fixed costs, produced more as prices fell. The...
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Murray Stahl Episode 11: Twenty thousand leagues is a distance
Two days after his Yahoo report, Murray Stahl printed a reader's correction and his reply (July 1, 2004). From Erratum: The Logical Consequences of Yahoo! (Studies in Absurdity): a reader pointed out that the 20,000 leagues of Jules Verne's novel is the distance the Nautilus travels, not a depth....
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Murray Stahl Episode 10: The logical consequences of Yahoo
A June 29, 2004 report by Murray Stahl on Yahoo, fear of error, and how to bet against a bubble stock. From *The Logical Consequences of Yahoo!* (Studies in Absurdity): believers, short sellers and index-hugging "agnostics" all fear being seen to be wrong, so the agnostics own Yahoo at its index...
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Murray Stahl Episode 9: Reflections on Dell Computer
A May 20, 2004 essay by Murray Stahl takes apart Dell's buyback arithmetic. From *Reflections on Dell Computer and Other Matters* (Studies in Absurdity, Book VI): Dell did not invent direct selling of electronics; Hugo Gernsback's Electro Importing Company sold radios by mail order in 1905. Over...
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Murray Stahl Episode 8: Two car companies that needed a bull market
A May 27, 2003 Scratch Report looks at Ford and General Motors through their pension funds. From General Motors and Ford Viewed From the Perspective of Their Pension Funds (The Scratch Report, Edition 8; analyst Murray Stahl): with a weak auto business, the two companies' earnings had come to...
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Murray Stahl Episode 7: The ultimate ultra contrarian
A May 30, 2002 report tours the Nasdaq 100 by way of Lebanon. From The Ultimate ULTRA Contrarian (Contrarian Research Report): Banque du Liban et d'Outre-Mer, Lebanon's largest bank, at 3.8 times earnings. Give its recovery only a 20% chance, and the expected return is 17.5% a year. The 51 Nasdaq...
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Murray Stahl Episode 6: The language of the modern investment profession
A February 20, 2002 report studies a dialect: Modern Investment English. From The Language of the Modern Investment Profession (Contrarian Research Report): the dialect relies on the conditional tense, and the report shows it by translating Churchill's Dunkirk speech ("We have no intention of...
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Murray Stahl Episode 5: A solution to an unfair question
A June 1998 essay answers an unfair question: where would U.S. stocks and gold be if Russia thrived? From A Solution to an Unfair Question (The Skeptic's Almanac): the obvious answer, worldwide inflation, carries the seeds of its own destruction. Instead the essay invents a fictional General...
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Murray Stahl Episode 4: Three ways to lose on the same business
A March 1998 chapter on a company that failed as a public stock, as a leveraged buyout, and as a corporate division. From Chapter 7 of The Worst Investments in History, The Various Incarnations of Research Cottrell: in 1973 the scrubber maker sold at 54 times earnings and was essentially debt…
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Murray Stahl Episode 3: A bad manager can beat the market by doing less
An August 1997 one-pager answers a question with a decidedly affirmative yes: can a bad portfolio manager beat the S&P 500? From Can a Bad Portfolio Manager Beat the S&P 500? (Contrarian Views and Ideas): the manager's picks average 8.8% against the market's assumed 10%. Eighty percent earn 6%…
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Murray Stahl Episode 2: If you knew the future, you still might miss the past
A one-page April 1997 essay on why knowing the future still wouldn't have helped a 1925 London advisor. From Time Travel, Socialism, and Equity Market Returns (Contrarian Views and Ideas): handed the General Strike, the Depression, the Second World War, the end of the Empire, socialist policy,...
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Murray Stahl Episode 1: How to buy a million acres for twenty dollars
A May 8, 1995 report on a trust that was slowly buying itself out of public ownership. From the Contrarian Research Report on Texas Pacific Land Trust: at $20 a share the trust was worth $62 million, with no debt, and it owned the surface of over 1.1 million acres in west Texas plus royalties....
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Murray Stahl Episode 6: The language of the modern investment profession
In a February 20, 2002 essay, Murray Stahl studies the dialect of professional investing and finds a habit: no plain statement is allowed to stand without a hedge attached. He asks whether a language built on "might" and "could" ends up corrupting the thinking of the people who use it. When every...
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Murray Stahl Episode 5: A solution to an unfair question
Murray Stahl answers a deliberately unfair question: what would a strong Russian economy mean for U.S. stocks and gold? From the June 1998 issue of The Skeptic’s Almanac: instead of the obvious worldwide-inflation story, Stahl invents a fictional coup and a military government that offers Western...
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Murray Stahl Episode 4: Three ways to lose on the same business
Murray Stahl on Research Cottrell — three ways the same business could lose, without bad debt or bad character. From his March 1998 piece in *The Worst Investments in History*: a scrubber maker for coal plants that traded around 54 times earnings in 1973 with almost no debt. The energy crisis,...
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Murray Stahl Episode 3: A bad manager can beat the market by doing less
Murray Stahl on how a mediocre stock-picker can still beat the S&P 500 — by doing less. From his August 1997 one-pager *Can a Bad Portfolio Manager Beat the S&P 500?*: a manager whose picks average 8.8% while the market earns 10% loses on a one-year scorecard. But if eighty percent of the book...
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Murray Stahl Episode 2: If you knew the future, you still might miss the past
Murray Stahl on why knowing the future still would not have helped a 1925 London advisor predict seventy years of British equity returns. From his April 1997 one-pager Time Travel, Socialism, and Equity Market Returns: Fabian “permeation,” Shaw’s socialist program, and the disasters that followed…
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Murray Stahl Episode 1: How to buy a million acres for twenty dollars
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The Link Between Evolution and Investing
This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit investingodyssey.substack.com
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