Incredible article, again. Agree 100% on increasing ICE efficiency, this should be a no brainer. Being from Canada also a huge fan of #FreeCanadaFromMis-GuidedClimateNDCAccountingIsanity. LOL
Dec 10, 2022·edited Dec 10, 2022Liked by Arjun Murti
Thanks for this Substack and the podcast. Just discovered it after hearing you on George Noble's podcast. The SuperVol framework is a great paradigm. The capex cycle analysis is also very helpful. So my takeaway is long term-good investment for the next decade or more, but because of SuperVol, we can see big price swings, so use the demand destruction downswings to build a long term position (possibly next year as Fed induced recession comes to fruition in the U.S. and general global economic slowdown continues).
Good on you for calling the low energy capex for what it was. As for ICE bans, they won’t go ahead if EVs haven’t come down in price enough for the average buyer. Fully agree on more stringent mileage standards. Another cool policy is EV subsidies specifically for “gasoline superusers”.
Thanks for your sharing your work. Have you in the past written about 'why' ROCEs were lower in the period ending in '19?
Incredible article, again. Agree 100% on increasing ICE efficiency, this should be a no brainer. Being from Canada also a huge fan of #FreeCanadaFromMis-GuidedClimateNDCAccountingIsanity. LOL
Thanks for this Substack and the podcast. Just discovered it after hearing you on George Noble's podcast. The SuperVol framework is a great paradigm. The capex cycle analysis is also very helpful. So my takeaway is long term-good investment for the next decade or more, but because of SuperVol, we can see big price swings, so use the demand destruction downswings to build a long term position (possibly next year as Fed induced recession comes to fruition in the U.S. and general global economic slowdown continues).
Do you find CAPEX/FCF to be a leading indicator of ROCE at the firm level?
If not, what do you look for at the firm level to predict ROCE?
Good on you for calling the low energy capex for what it was. As for ICE bans, they won’t go ahead if EVs haven’t come down in price enough for the average buyer. Fully agree on more stringent mileage standards. Another cool policy is EV subsidies specifically for “gasoline superusers”.
https://www.coltura.org/gasoline-superusers