Investing Beyond AI: Why Traditional Businesses Could Still Thrive

During their recent episode of the Value Options Podcast, Travis and Carlisle discussed Investing Beyond AI: Why Traditional Businesses Could Still Thrive. Here's an excerpt from the episode:

We’re still going to need enormous amounts of energy and power. I mean, there are no rich, low energy nations. Every nation that gets richer on basically the fit to it is like one for one.

They need more and more power. And clearly the more technologically advanced, we’re going to need more power. We’re going to need oil and gas to get us to that point probably.

We need land, like all of these things that, all of these businesses that have existed for hundreds of years are going to continue to exist after the singularity or if we’re right in it now, or if we’re post-singularity now, all of that stuff is still going to exist. So it is possible to invest in the things that don’t change, which is always Buffett’s thesis, like what doesn’t change? And so I think that we’ve discussed some of those kind of ideas.

Like I had Tim Melvin on the podcast yesterday and one of the stocks that he likes is Vichy Properties, which I know is one that you looked at before.

[Tim] Yeah. Yeah. I mean, exactly.

I mean, people are still going to gamble and I mean, when you’re the landlord and your tenants are strong, viable businesses, I mean, it’s not like Caesars doesn’t have the greatest balance sheet in the world, but the casinos are profitable and they cash flow well. The regional casinos, which are the ones that people are a little more worried about, they actually outdid Vegas in terms of growth last quarter. So yeah, I mean, look, there’s such a dichotomy between commercial real estate valuations and what’s going on in the residential housing market.

If you’re a long-term bull on real estate, I think that you can find buys right now that, I mean, can make you a tonne of money over the next 10, 15, 20 years. But on a day when rates go up, like today, last time I checked, the Fed held steady, but two officials wanted to raise rates and yields were up a little bit, the REITs sell off. So you have to be willing to take some short-term pain, look stupid in the short term for the long-term benefits.

But absolutely, like that’s something that is going to be there.

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