Episode 81: Boundary Conditions
Jax’s Parent’s House, California
How’s the hunt for value going? His father asks Jax over the dinner table. I’ve got some ideas that I want to run by Lana, Jax says. Why don’t you try me? Do you consider Altria uninvestable? Yes. What is Altria? His mother asks. Phillip Morris. Oh. Why? Jax asks. I won’t own cigarettes or guns. But casinos are okay? Jax questions. Shades of gray; my mandate isn’t unconstrained. Now pitch me on Altria. It’s got a great dividend yield, Jax says. What’s the payout ratio? 80%. What else makes it compelling, son? It just took a huge writedown on its stake in Juul. The vaping company? Jax’s mother questions. Jax nods. That is getting to be an epidemic among teenagers, she says, frowning her disapproval. The stock is trading at a huge P/E discount to the S&P, Jax continues. My thesis is that I get paid to own it while the share price appreciates. His father nods, an OUCH play. Ouch? His wife asks. Out-of-favor, ugly, cheap, hated. Jax responds, grinning at his father. I don’t want you to own it, his mother tells him. Jax sighs. Mother, have you ever heard of the eleventh commandment? No. It goes like this: thou shalt not do good with other people’s money. Milton Friedman, his father announces. Mother, my sole job as fund manager is to maximize the return on the capital that my investors have entrusted to me. That way, seventeen months from now, the most enlightened of them may donate a part of the substantial increase in their portfolio to a worthy cause – like Truth, the teen anti-smoking campaign. I still don’t want you to own it, his mother repeats. Fine, Jax concedes with a sigh. What other ideas to run by Lana? his father asks. That was my big one. And I just wanted to hear how she’s doing.
You can read how she’s doing on that girl’s blog, Jax’s mother says. She’s using this Lindsey as her mouthpiece. I enjoy reading about Lana, Jax’s father admits. I can see why you like her. She’s obviously very intelligent. And manipulative, Jax’s mother says. Notice she didn’t go through the sub rosa exercise with her this time. If it didn’t take the first time, why would it sink in the second? Jax’s father replies.
I wish that Lindsey would have chosen to ride with Bettina. She’s such a lovely person, who I’d like to get to know better. This stays kept, Jax tells his parents. Simon bought a diamond when we were over in Israel. How much? Jax’s father asks. Twelve grand. Show me the smallest most spectacular diamond you got, he told this old Hasidic guy. And he bought it on the spot and took it with us. He’s going to get it set in a ring over here. Have you talked to her lately? His mother asks. We talked when Simon and I got back. She insisted that I take on four more investors. What’s her take on this Levi? She told me not to worry about him. That Judaism and Christianity are completely different belief systems. They were talking marriage, his mother responds. The material point is that Lana said that they are not seeing each other. They’re just coworkers. That’s not going to last, Jax’s father says.
The Tesla
Do you like tennis? Levi asks Lana. Well, if I had to rate my interest in tennis on a scale of 1-10, I’m a zero, Lana says giggling. The others laugh with her. I have tickets to the US Open in New York. Court level. Please don’t waste them on me, Levi, Lana says softly. Men’s or women’s, Lindsey asks. Men’s. She groans and puts her head in her hands. You’ve never played tennis? Levi asks her. Lana shakes her head no. I wasn’t allowed to play any sports. Not even in PE? Lindsey asks. Homeschooled. Do you play? She asks Lindsey. Yes, and I’m good. I’m sure I can beat him. Levi looks over at Lana and sees her Mona Lisa smile. Raj, you like tennis? Levi asks. Would I be allowed to film? I don’t see why not. You’re not getting out of going with me, Lindsey protests. Levi drops his head. He looks over at Lana. Help. I need more information. Are these seats just for one tennis match, or are they good for the whole tournament? Quarterfinals, center court. Hmmm. How about an Ebay auction – watch the US Open with Lindsey, proceeds go to the campaign. You cannot do that, Lindsey protests, and Levi grins at Lana. What if no one bids? US Open. Quarterfinals. Court level. Raj repeats. What if it’s some creepy pervert who wins the auction? She responds. What if it’s one of Samantha’s movie star friends? Levi responds.
It’s next Friday, correct? Lindsey asks. Yes. Why won’t you go with me? The logistics. Yet that wasn’t a problem for taking Lana? Lana is Samantha’s friend, and has stayed at her family getaway before. It’s not like Samantha and I are strangers, Lindsey says. She’s not going to be there. Just her uncle. Well, I can do an Airbnb in the City, and meet you there.
What are you doing on Friday? He asks Lana, ignoring Lindsey. I’ll have to check with Bettina to see what she has planned, Lana defers. What’s something that you like to do? Levi asks. I’m free Sunday morning, if you want to take me to church. Levi grunts, and doesn’t say anything for a minute. Just the two of us? Levi asks. Yes. What time do you want me to pick you up? 10:20 @ the apartment. Lindsey clears her throat. Levi sighs. The tickets are yours, Lindsey. Do what you want with them.
Wednesday noon blog post: The Bait and Switch.
I don’t think anything phases Lana. Levi asked her out this morning as we all rode to the event. Does she like tennis? Instead of yes or no, she told him that on a scale of one to ten, her interest in tennis is zero. And we all laughed. But he kept on going, unable to make a midcourse correction. He’s got court level tickets to the US Open. Please don’t waste them on me, Lana said softly. And of course, I’m all over it. You’ve never played? Finally, something I’m better at than her. She told us that she wasn’t allowed to play sports, that she was home schooled. Then like I hoped, she asked me if I played? And instead of telling them about being on the women’s tennis team at Sarah Lawrence, I laid down the gauntlet, I’m sure I can beat him. Levi didn't take the bait, and asked Raj if he likes tennis. Raji, of course, wanted to know if he can film the event. I don’t see why not. And I protested that he’s not getting out of going with me. He dropped his head and looked over at Lana and pleaded “help”. And she asked him for more information and revealed her complete ignorance about tennis by asking if the seats are for the whole tournament or just one match. Like there is only one court. So funny. Men’s Quarter-finals, center court. She thought about this. How about an Ebay auction? Proceeds go to the campaign. Watch the US Open with Lindsey. Of course, I protested. Why won’t you go with me? Logistics. But that’s not a problem with Lana? Apparently she has an open invite to stay at Samantha’s family compound in the Hamptons. Well I can stay at an Airbnb in the City and meet you there. And he ignored me, and asked Lana what she is doing that Friday.
She deferred and said that she’d need to check to see what Bettina has planned. What’s something that you like to do? He asked, giving her carte blanche. And he fell into her trap. I’m free Sunday morning. You can take me to church. He grunted at this, knowing that he’s got to put up or shut up. Just the two of us? Yes. He finally said, what time do you want me to pick you up? 10:20 at the apartment. I cleared my throat. And he told me that the tickets were mine to do what I want with.
I talked to Bettina about it, and she loved the idea of an Ebay benefit auction. That sounds like so much fun! Am I allowed to bid? She is such a sweetheart. If it was with her, I’m sure bidding would be in the stratosphere.
Wednesday evening blog post: US Open Men’s Quarterfinals
Senator Johns asked me to ride with him after lunch, so we could talk tennis, which he loves. Turns out there is a serious doubles league in DC during the winter months. He used to partner with Tom Daeschle, the former Democrat House Majority leader. Eventually our talk got around to the auction and where to start the bidding. Tim said to start it at $1,000, because that is what he is willing to pay to watch the match with me. Sold, I told him. Not so fast, Bettina said. This is for PJ; we can do a lot better than that. I’m going to have to sell my truck to go any higher, Tim protested. Don’t you dare hang a for sale sign on that! Simon wants it, Bettina told him. What kind of truck do you have? I asked him. A 79 Ford F150. He completely restored it, Bettina told me. Then she told him, you can always buy another truck. He thought about this for a long time and finally said: "You know what - you’re right".
I love Louis Lamour Westerns.