During their recent episode, Taylor, Carlisle, and Doug Ott discussed The Case Against Investing in Metal-Based Industries. Here’s an excerpt from the episode:
Jake: Toby, do you remember who was– I forget who it was, but they wouldn’t invest in any company that produced anything out of metal, because that could always be delayed in a CapEx cycle. That metal is not going to go anywhere.
Tobias: Mm.
Jake: It’s too non-perishable [chuckles] to be relied upon.
Doug: That’s interesting. You don’t remember who said that? It was a fund or a person?
Jake: No. I want to say like Terry Smith sticks in my head, but I don’t think that’s right. It’s like, for some reason, that’s where my head– [crosstalk]
Doug: That’s a unique way of putting it, I guess.
Tobias: Does that rule out Nvidia?
Doug: For Me?
[laughter]Jake: Are you saying [crosstalk] are cyclical? What? No.
Doug: Well, there’s a lot of things I wish I could have done in hindsight. Very early life as a young kid into video games, I’ve known Nvidia for a long, long time. Not from an investor’s standpoint, but as a consumer’s standpoint. I don’t think it was originally called Nvidia or something else. And then, they acquired 3D effects and it’s building out there.
Jake: I remember buying my own first GeForce and building a computer probably 25 years ago. That was an expensive part. You really spent a lot of time thinking about like, “Oh, what graphics card should I get?” It’s like, “Which [crosstalk] games?”
Doug: It’s amazing.
Jake: Only for playing Counter-Strike.
Doug: Yeah, exactly. [Jake laughs] So, that’s originally how I know Nvidia. Maybe I should have been more open to the idea of identifying a cyclical bottom for the company. I knew the product well. I knew why people liked it, bought their products.
Jake: What’s the inverse of signing a [unintelligible [00:30:56], because that would be the bottom, if you kind of– [laughs]
Doug: Who know?
Jake: If it’s been invert.
Tobias: It would be the Berkshire annual meeting, wouldn’t it? [Doug laughs] That would be the inverse.
Jake: Yeah, exactly. [chuckles]
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