Talking markets and building a SMID-cap fund. Unhedged views on stocks, economics, & crypto + everything else. Top 50 Finance Substack.

Summerland, CA
Joined August 2023
Nick Nemeth (Mispriced Assets) retweeted
Dinner with an exec/friend at a large national property management company tonight. This person oversees ~150k apartments; access to an insane amount of data. Current multifamily market in most of the country is worse than S&L, .com bust, or the GFC. Worst they’ve seen. Class A mostly fine, decent rent growth. However: - credit scores at class A have gone down meaningfully over the past 3 years. - more people are paying rent via credit card. - average bank account balance noticeably lower than even 2 years ago - class A tenants stretched thin, living beyond their means. 20k comes in, 20k goes out every month. - starting to see these renters move down a tier Class B: - simply too many apartments, we built too much new stuff. Ripple effect is enormous. - fewer renters tomorrow than today. Same store foot traffic noticeably down year over year. Some markets down 40-50% - considering dropping rents below $700 a month on some 1beds in major southern markets. Class C: - looking at degrading NOI. Rents aren’t growing for a long time, but expenses keep creeping up - more renters are one missed paycheck away from disaster than they can remember seeing in decades - tenants aren’t paying rent because they simply don’t have it - wage growth has not kept up Lenders: - some major investment funds, household names, haven’t paid their mortgages in 2-3 years. Banks won’t foreclose because “X is a big client.” Mexican standoff. - a roof leak gets ignored, becomes water damage, then mold, then a down building. Buildings are rapidly deteriorating as some owners choose cash preservation over funding losses. - number of pre-foreclosure and REO deals is the highest as a % of total units they can recall. - data providers know it’s bad, but they’re paid to sell optimism to owners/lenders. So every forecast is “it will probably get a little better next year maybe” and that gets regurgitated at investment committees all over. I asked “how do you think this ends?” “Not sure. My gut says slowly then suddenly, and things will get really bad. Been doing this 40 years, you can feel it in the air. But, there’s a chance it’s just a decade of tolerable pain. I’m praying for that.”
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The American Dream is dead.
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What a 99th percentile income gets you, how little home equity you build, how tight the budget is, how stupid the decision is, and how few high earning people can even afford this 2026 upper-middle class, kids-go-to-public-school lifestyle. It’s joever.
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Forced a buyer out me.
Just went to 50% cash. 🤷‍♂️
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This report is outstanding but you can’t make money on it. Going forward, you will see a schedule of short reports that will put Mispriced Assets firmly on the activist short map. With $ALMU $STEP $FISN and $BHF we should already be there, but the next level will do the job. See you soon peers! @muddywatersre @hntrbrkmedia @IcebergResear @Bleecker__St @CapybaraShort @blueorcainvest @FuzzyPandaShort @KerrisdaleCap @CulperResearch @sprucepointcap @viceroyresearch @GothamResearch @ResearchGrizzly @WolfpackReports @ScorpionFund @JehoshaphatRsch @GlassH_Research
On October 8, Clair Health rewrote its website. Thousands of words explaining how its bracelet reads a woman's hormones were replaced with a few lines of FAQ. Four months earlier, @khoslaventures had led its $11.6M seed round. Apparently, nobody learned from Theranos.
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Nick Nemeth (Mispriced Assets) retweeted
"Speculative data center debt is being repackaged and sold to pension and retirement funds, university endowments, and other institutional investors in a manner eerily reminiscent of the subprime bubble." ourfinancialsecurity.org/res…
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On October 8, Clair Health rewrote its website. Thousands of words explaining how its bracelet reads a woman's hormones were replaced with a few lines of FAQ. Four months earlier, @khoslaventures had led its $11.6M seed round. Apparently, nobody learned from Theranos.
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Question for @vkhosla @khoslaventures @genomicsdoc @junwjeon @rabois @speedrun: Which parts of that promise were proven when you wrote the check? If the evidence exists, @clair_health and @jennysduan should publish it. 25,000 women on the waitlist deserve to see it.
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The economy is broken.
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