The Ledger
Every statement that passed quotation and attribution checks. Mix any filter with any other: certainty 1/5, debate potential 5/5, or both at once.
why aren't all 39 resolved? a statement only gets an assessment when the public record can support or contradict it. opinions and what-ifs never can, and 1 checkable ones are still open, waiting for their date. predictions held up or didn't; assertions are supported or contradicted. on every card: ▮▮▮▮▮ certainty · ▮▮▮▮▮ debate potential. speakers are clickable
Sosin: Fund managers are 'deeply arrogant' to apply personal ethical frameworks
“I think that if you manage money for other people, you're deeply arrogant if you are going to apply your ethical framework onto
The way that you invest.”
Sosin: Someday people will compare Jeff Bezos to Carvana's Ernie Garcia
“Someday people will compare Jeff Bezos to Ernie Garcia, not the other way around.”
Sosin: Carvana's 2023 debt exchange did not save the business
“And that whole exchange happened in the summer of 23, and a lot of, sort of, the retelling of the story is, and by virtue of that exchange, they, like, saved the business. By that point, the data I was looking at said that everything was great. That was just k…”
Sosin: Every competitor attempting to copy Carvana's vertically integrated model failed
“Everyone who's tried to build this business besides Carvana has failed, and that's why It's taken Carvana, you know, over 10 years and ten billion dollars to get, you know, where it is.”
Sosin: Carvana will probably reach 13% to 14% EBITDA margins
“And they'll probably get to the 13, fourteen-ish percent range based on what they've said, and there's no reason to doubt it.”
Sosin: Carvana sells vehicles $500 to $600 cheaper than CarMax
“And we track every car that they sell and we compare it to similar cars sold by CarMax. We also compare it to other market indices. And we believe that they sell cars of the order of sort of five, 600 dollars cheaper doing that.”
Sosin: The institutional investing business prioritizes marketability over performance
“One might naively think that, that the investing business is about maximizing performance, which, but it's not, it's about maximizing marketability and performance is a component of marketability, but really what you're trying to do is signal talent and the wa…”
Sosin: Investing is the premier intellectual pursuit due to public accountability
“But in investing, you know, it is wildly accountable. You, you're making predictions about which businesses are going to win and which are going to lose which, you know, to understand businesses are sort of complex social structures embedded in our society, wh…”
Sosin: Software tooling businesses are built on sand due to tech shifts
“I, you know, who knows how, how people are going to write software in 10 years, like for what, for quantum computers, for You know, and it's just like you might have a business today. It's like building a castle on sand, right? Like it's just very, very hard t…”
Sosin: Investors can profit from moral panics like economic panics
“I've also noticed there's sort of moral panics that have happened and you know, you can buy into moral panics much the way you can buy into economic panics and you can do well.”
Sosin: Investor divestment mandates do not necessarily make assets super cheap
“I don't think that like,
Groups of investors deciding to forego certain asset classes like oil companies necessarily cause them to be like super cheap.”
Sosin: Carvana operates at lower cost than traditional dealership system
“Also what I described of Carvana system is a lower cost to operate system than the traditional dealership system.”
Sosin: Carvana's ADESA acquisition was a huge home run
“It's been, in retrospect, it's been a huge home run. But, you know, they bought it with all debt. They bought it in February of 22”
Fundraising success depends heavily on the sequence of annual returns
“If you changed the order of the years, get to the same place, but I definitely wouldn't have raised any money. So there's also a meaningful component of luck.”
CAS Investment Partners holds four to eight positions and trades annually
“Over time, We've sort of had kind of between like, we'll call it four and eight. I may, might have been as many as 10 at one point, but that's kind of the number of investments. We tend to, over the course of time I've been investing, I think on average I've s…”
Sosin: Economic profits are anomalies where competitive forces fail to reach zero
“If you think about it, in most markets, you shouldn't have a lot of profits, right? Like profits are kind of a fluke of some sort of something about the setup that makes it so that some reason why, you know, competitive forces can't drive, you know, economic p…”
Rental cars, airlines, and cruise lines operate as Cournot oligopolies
“It turns out that like a lot of travel businesses are, you know, Cornell oligopolies you know, rental cars air, air, air travel cruises.”
Sosin: Carvana Has Recovered and Is Now More Profitable
“The company's fine. It's right back. It's a little behind where I sort of thought it would be, but it's actually more profitable and it's back on track and the stock's mostly recovered and all the rest.”
Sosin: No competitor has replicated Carvana's real-time, penny-accurate financing stack
“To this day, as far as I'm aware, no one's like replicated this capability. In order to do it, you need to be vertically integrated into prime lending, subprime lending. It just turns out that like no one else is.”
Used cars are likely the hardest retail e-commerce category for fulfillment
“In the sort of fulfillment sense of it I think, you know, used vehicles are probably the hardest thing to build in but the analogy to Amazon actually, I think is is apt.”
Sosin evaluates management quality by assessing former long-tenured employees
“The really good way to do it, I find, is I talk, talk to former employees... The human capital exhaust is kind of indicative of what's inside.”
Carvana holds more vehicle inventory than all Connecticut dealerships combined
“There are more cars available on Carvana's website right now than there are for us right now sitting here in the entire state of Connecticut from all the other dealerships.”
Sosin: In-person car auction business is decaying over time
“The in-person auction business will have a long tail to it, but it's eventually a decaying business over time.”
Navy Federal Credit Union offered auto loans below comparable Treasury yields
“There was a long period of time where, like, Navy Federal was offering car loans at a discount to Fed, to the Treasury of the comparable duration”
Sosin: Auto loan spreads reached pre-2008 lows by late 2022
“Industry-wide auto loan spreads by late twenty-twenty-twenty-two were at the lowest levels in the whole time series I have, going back to before the crisis, before the financial crisis in 2008.”
Sosin: Turning unprofitable businesses profitable is far harder than modeled on paper
“Another is that in general, I have a new and deeper appreciation for how much harder it is In reality to go from profitable, from unprofitable to profitable than it is on paper.”
Sosin: Carvana would not have survived with 5% target margins instead of 13-14%
“If this business all grown up and super great was a five percent margin business and not a, like a 13 or 14% margin business, I'm not sure they'd have had the wherewithal to make it.”
Sosin: AI disproportionately advantages independent investors over large research teams
“I think that in the playing field of life, it advantages someone like me who works you know, fairly independently. I don't have like a giant team in investing”
Sosin: AI cannot deeply analyze companies like Carvana without proprietary offline data
“Right now, an enormous amount of information is not in the internet, right? So if I were to grill an AI about all things like Medicare, Medicaid, managed care, it knows a lot. If I grilled about Carvana, we pretty quickly run out of stuff. Like this interview …”
Sosin: 'My great-grandchildren will marvel at my poverty'
“I am fully confident that my great-grandchildren will marvel at my poverty.”
Sosin: Investing outside your home country is hindered by hard-to-overcome naivete
“There's just an enormous amount that you learn about a place by being there. And so it's not that I could never invest outside the U S it's just that like, I'm keenly aware that like overcoming a certain degree of naivete is very, very hard, even for some plac…”
Sosin: CAS Investment Partners manages between $1.5B and $2B across 100-200 LPs
“It's sort of between one and 200 across a few different vehicles. And the firm's moves around every day, but sort of between a billion and a half too.”
Sosin exits portfolio positions only for upgrades or broken mental models
“And so there's two ways out of the portfolio. One is that the gap between what I think, you know, I find something better so I can upgrade. Or the other one is that I have some view as to what makes a business successful. You can think about like a mental mode…”
Sosin hired a Stanford professor to teach him all economics models
“I hired a Stanford professor to assemble all of the economics models in all of the courses in Stanford, and then just like walk me through all of them to make sure I hadn't missed any.”
Sosin: Capital One saw auto originations drop 50% after pricing to reality
“Capital One also priced to reality because they're smart. They saw their auto originations fall 55 zero percent.”
Sosin: 70% of Carvana customers rely on word-of-mouth recommendations
“And we found that 70% of people said that it was either somewhat or very important in their choice to buy from Carvana. Therefore only a third of people were buying from Carvana without the recommendation of a friend or family member.”
Sosin: Carvana was by far CAS Investment Partners' largest portfolio position
“By far it's my biggest position, and you know, it didn't help that nothing else seemed to be doing well at the time either.”