CapitalWorks
CapitalWorks Private Equity
Insight for those who want to include private equity or direct investment in privately-held businesses in their portfolios. The opinions expressed in the PE4Fams blog are those of Rob McCreary and not necessarily those of CapitalWorks or its employees.
I have never been good at betting on NFL football. Invariably, I am on the wrong side of picking the over/under or the winner, especially Superbowl games. I always thought it was my lack of information. So this season I entered two NFL football pools sponsored by a friend,
There is always a large dose of wonder and a small amount of dread about travel to developing parts of the world. The electrical grid and connecting your devices usually mean at least 5 different connector models, none of which really work when you actually get to your destination.
Every year The World Series of Poker hosts the finals of the Texas hold ’em competition where the best poker players in the world compete for a multi-million-dollar purse. Unlike most other poker hands, the players in Texas hold ’em get 2 down cards which they alone can see,
In the movie “Terminator” machines with artificial intelligence provoke a nuclear holocaust with the objective of eliminating humanity. While they almost succeed, the future reveals a small, but determined, human resistance led by John Connor. In that future Connor is on the verge of eliminating the machines when they
There are only a few financial occurrences in my lifetime as confusing as negative interest rates. In September 2015, I wrote a blog about living in a Bizarro World where everything is reversed ( https://capitalworks.net/i-am-living-in-a-bizarro-world/). Negative interest rates are just the latest Bizarro example where you have to pay more
I did not appreciate Elon Musk until I read Ashlee Vance’s biography entitled “Elon Musk: Tesla, SpaceX and the Quest for a Fantastic Future”. The author is clearly a Musk advocate and he looks past Elon’s shenanigans to find a once in a century mind working from what he
If the US Bond Market is the Eighth Wonder of the World, the Depositary Trust & Clearing Corporation (DTCC) is certainly the Ninth. Most people have never heard of DTCC but in 2012 it and two of its subsidiaries were named Systemically Important Financial Market Utilities (SIFMU’s”). SIFMUs are
Mark Zuckerberg would be one of the last people on the planet I would trust with my financial information, but obviously his Board of Directors must see it differently. Facebook announced that it would introduce its own cryptocurrency called Libra tied to a market basket of world currencies and
A recent article in the weekend edition of the Wall Street Journal “News Industry, a Stark Divide Between Haves and Have-Nots” highlights the demise of the newspaper industry in the United States. Even though digital is taking over print, the speed of the death spiral is nonetheless surprising. What
In the Game Show “Who Wants To Be A Millionaire” when they were unsure of their final answer contestants had three lifelines. My favorite was Phone A Friend because the interaction was often hilarious, usually unexpected and often wrong. Who Wants To Be A Trillionaire? I could not stop
Business and sports understand the importance of a scorecard. But what if CEOs only got the final earnings number, or if Jordan Speith’s only input for improving his game was his 18-hole score instead of fairways hit, greens in regulation, sand saves and putts? Similarly, what if Mookie Betts
I guess I am just a sucker for contrarian thinkers, but when I first read Stephanie Pomboy’s investment guidance in an article by Barron’s Leslie Norton on March 22, 2018, I was a little skeptical about her thesis. In the face of a new Fed chairman’s committed interest rate
When pitchers and catchers report for spring training the winter of my mind officially ends. My seasonal affective disorder of endless nights fades to a new dawn of clarity and understanding. I begin to see baseball as a metaphor for business. There is a significant problem in baseball right
Barron’s recently invited 10 leading financial minds to look into their crystal balls and predict how capital markets may fare in 2019. This round table is always interesting, but you have to remember panelists’ perspectives are usually tied to the industry that pays their salary. Abby Joseph Cohen is
A little-known provision of the Trump Tax Reform Act of 2017 was bipartisan support for an interesting tax incentive around investments in Opportunity Zones. This is the hottest tax dodge since tax shelters in the 1980’s, but whether it will serve its purpose of distressed community development is uncertain.
The zombie motif was popularized by the horror movie “Night of the Living Dead” where zombies and vampires morphed into aggressive and deadly undead preying on humans. The zombie concept moved into finance with the advent of Zombie Banks in Japan in the “lost decade” of the 1990s. Those
Remember when a Japanese investment group bought Pebble Beach Golf Blub September 1990? It seemed like every important asset was being gobbled up by an ascendant Japanese economy. Soon thereafter in 1992 the Japanese real estate market crashed and then, in a great imitation of a kamikaze, the Nikeii
Investors all have sure signs for market tops. Lately, the equity crowd is watching an inverted yield curve as a harbinger of recession and the inevitable market correction. Other savants point to the disconnection between the market movements of Facebook, Amazon, Apple, Netflix and Google and the rest of
Five years ago, when a private equity firm sold a business the buyer would require the seller to establish a funded escrow account (5-10% of the purchase price) with an independent bank as a convenient source of indemnification for representations and warranties. Until recently, in the lower middle market,
In the lower middle market our management teams are the biggest contributors to investment returns. When you are lucky enough to inherit a great management team you can usually count on sustained growth and sequential profitability. Good managers immediately understand the vital few objectives and are typically honest about
The last time I went for a physical examination the nurse who was taking blood samples and updating my medical record was shocked when I reported I was not taking any prescription medications other than an oral inhaler for seasonal asthma. Aside from being a medical freak, I got
This blog represents the views of Rob McCreary and do not reflect those of CapitalWorks or its employees. This blog is not intended as investment advice. Any discussion of a specific security is for illustrative purposes only and should not be relied upon as indicative of such security’s current or future value. Readers should consult with their own financial advisors before making an investment decision.