Category : Weblog

While Our Five Year Numbers Are Pretty Good…They Won’t Always Be.

From a New York Times interview with Davis Swenson, head of Yale endowment: Mr. Swensen likes teaming up to invest with his former analysts. For one thing, it can reduce the risk of panicky withdrawals. “We were talking to a […]

No Matter How Bad You Think it is in Washington…It’s Worse Than You Think

From Fortune: Senators Call the Wrong Time Warner CEO to Testify about the AT&T Merger You may have heard about the controversial $85.4 billion merger between cable provider Time Warner twx and telecom giant AT&T. U.S. lawmakers have heard about […]

Larry Summers: Eat This!

This is simply a devastatingly effective argument that has never been read in Washington DC and is what we fear in the middle of the night. It also has a non-zero probability of being right.

Nothing Further, Sir

Check out this video on YouTube: Garrett Rips Secretary Lew For Not Playing by the Same Rules as the Rest of Us

CSC Strategy Letter | Number 26 | Dow 36,000…and the Grumbling Hive

Download Cove Street Capital’s September 2016 Strategy Letter Number 26, “Dow 36,000…and the Grumbling Hive”

Headline Versus Reality

Now, one would think that statements like “More small caps reducing shares, paying dividends” would seem to the investor at large to be a good thing. After all, how can more people thinking about how to allocate capital in a […]

Another Demerit for Corporate Governance and A-B Share Classes (Formerly “Why Doesn’t the CSC PM Learn His Lesson?”)

Press Release Cove Street Capital, LLC and Other Shareholders Resoundingly Rebuke Westell Technologies, Inc. Board of Directors and Strategic Direction EL SEGUNDO, CA, September 22, 2016 – At the annual shareholders meeting of Westell Technologies, Inc. on September 13th, 2016, […]

Wash, Rinse, Repeat

From the 2016 Liberty Media Annual Report Dear Fellow Shareholders, The past twelve months have seen the continued structural evolution of Liberty Media. Most notably, in April of this year, we recapitalized Liberty Media Corporation into three tracking stock groups, […]

And the Vending Machine Selling Cheetos is Completely Empty

From the Quanex Building Products Presentation on June 9th, 2016 Question (Unknown analyst): So for a number of the manufacturers, particularly in the window side, it seems that the surge in housing activity in ’13 and then the subsequent drop-off […]

This Is Not How You Would Like A Day With Investors To Go

At Cove Street we are constantly weighing three key variables: business, value, and people. In the case of Belmond Ltd., we are confident in the company’s value and the underlying hotel business. However—and it’s a big however—there is a problem […]

The Old “Sluggish First Half—but We Will Make it Up in the 2nd Half” Trick Bites the Dust…Again

The following is a pretty accurate assessment of what is going in the US economy – we think. “—MSC Industrial Direct Q3 Earnings Call — July 6, 2016— I’ll get started with current market conditions and our fiscal third quarter […]

Investment Managers Worry About This

This Is Painful But Try THIS Pain on for Size – 14 Years in a Row of Net Outflows Which Leaves 15,000 to Go Under Current Consensus Thinking

CSC Strategy Letter | Number 25 | T.I.N.A. Will Be a Cruel Mistress

Download Cove Street Capital’s July 2016 Strategy Letter Number 25, “T.I.N.A. Will Be a Cruel Mistress”

The Only Relevant Color or Gender Here is Non-Depreciating Green. The Alternative Color is Gold.

This was a letter recently released by U.S. Senator Elizabeth Warren (D-MA) and U.S. Representative John Conyers (D-MI) and was signed by 116 Members of the House of Representatives and 11 senators. Doing counterproductive things to destabilize global economics and […]

Reflections from Omaha: A Case of Cognitive Dissonance

by Ben Claremon | Principal, Research Analyst After taking a year off from partaking in the annual trek to Omaha, I returned to the home of The Oracle looking to be re-invigorated. There is so much noise and nonsense that […]

CSC Strategy Letter | Number 24 | Living in an Economics-Free Zone

Download Cove Street Capital’s April 2016 Strategy Letter Number 24, “Living in an Economics-Free Zone”

This Just Smells Really Wrong

From a recent interview with Bill Gross, manager of the Janus Global Unconstrained Bond fund: Years of easing by central banks mean that interest rates in most of the developed world will fluctuate narrowly. That offers an opportunity to sell […]

The Next Time You Get Harassed About an Underperforming Year—Bring Out the Singer

From the March 2, 2016 Wall Street Journal: Some traders go short. Others go long. Paul Singer went really, really long. His trade, which is transfixing Wall Street this week, has been one of the most drawn-out and contentious bond-market […]

Buffett’s Annual Report

One of the reasons why Buffett remains important to us is the increasing frequency at which he echoes our own thoughts: I suggest that you ignore a portion of GAAP amortization costs. But it is with some trepidation that I […]

Oh Yes, We Will Own This Some Day

Our man, Dean Pagonis, visited Sun Hydraulics last week under the heading of “How Does This Really Work?” Here is what they told us about “what [they] don’t do.” We like it, but we like it at a lower price. […]

The Five Experiments

While parts of this wander from what we do day to day, I think it can be argued that it is difficult to divorce these issues from investing in today’s world.

Someone Else Thinking Like Us

We ran across Hodak Value as we were reading a proxy that detailed managers not getting paid a bonus because they didn’t hit a target that looked to us as very cleverly designed. You rarely see either—bonuses not being earned […]

Why You Should Give Us Money Right Now

Properly speaking, there are only three reasons why someone should allocate capital to a money manager: 1. New funding or capital inflows. 2. An existing partner whose strategy makes intellectual sense has developed legitimate “people problems”—as in defection, death or […]

A Note From The Portfolio Manager

We have habitually re-counseled clients (and ourselves) that financial markets go down as well as up and that is actually a good thing as we get to “replenish the well” in periods of distress. Thus we generally do not think […]

Supporting Charts – 1st Quarter 2016

CLICK HERE to download our supporting charts for going forward in 2016.

CSC Strategy Letter | Number 23 | Waves in an Ocean of Guesses

Download Cove Street Capital’s January 2016 Strategy Letter Number 23, “Waves in an Ocean of Guesses”