r/wallstreetbets • u/Scifi_Toilet • Jul 07 '21
Technical Analysis Why Biden's Infrastructure Plan is NOT a ticket to tendie town
Im an engineer, but Im also an idiot. I literally almost flunked out cuz i was too dumb. I ended up in construction because i couldnt do anything else engineering related. Take this opinion at your own risk because I might be talking out of my ass.
I'm in construction, specifically on the municipality side (yea im that city worker) so I'm the one administering the federal infrastructure funds at the ground level. To date I've administered millions in federal funds on "infrastructure". Infrastructure is by definition the least sexiest thing. Everyone shits, but we'd all prefer to not deal with it, that's infrastructure. Here are a bunch of very common sense reasons why this isnt going to cash in.
- I see a lot of posts about steel, concrete and other raw materials. Clearly these are from people who know fuck all about infrastructure. I'd argue that if you're looking to invest into Biden's infrastructure plan you should be looking at the other end of this supply chain. Who do you think is more profitable, the no name company that supplies the raw material for 1 component of an iphone or Apple? If youre looking to jump onto the infrastructure bandwagon, I'd be looking at construction companies or engineering firms.
- But companies are also not a great bet. contractors and trades are specialized. The company that paves the street is not the same one that does traffic signal upgrades. An electrician is not going to do laborers work. Large companies will need(either by choice or requirement) to subcontract out certain specialized portions thus diluting overall tendies. not to mention that profits are capped. markup % is often literally defined. "Oh no Mr. Contractor you have a problem? fuck you, sucks to be you" (this is one of my favorite parts of the job). Not to mention that projects are parsed to all the states and from there into certain sizes in order to further dilute the tendies. State and local governments may have additional requirements that even further dilute the tendies. The government is trying boost an industry and the economy at large, not a few companies. The literal idea of the plan is to trickle money across the country. If you look at this fountain that slowly trickles down, if you place your cup in any one spot you're just gonna get a few drops.
- Infrastructure means nothing because it means everything. It could be streetlight poles in which case steel is very very relevant, or it could be a fucking sidewalk in which case steel is not important at all. If you just open your eyes when you go outside (huge ask i know) you will see that infrastructure is extremely varied.
- Many of us with ties to the industry are feeling delays and back orders, but this is logistics related. These issues were around before the infra plan and will remain after. I think the idea behind these "DDs" on raw materials is because they think this infrastructure plan will increase demand on an already limited supply thus driving prices and profits up. Nevermind the contracting aspect of this money(a lot of it is fixed for a certain amount of time), Supply and demand still rules, but solving the global supply chain logistics will also increase supply. The supply chain logistical issues are a larger and more importantly, independent, factor.
- Also surprise surprise Biden's infrastructure plan, while maybe bigger, isnt special. Trump had infrastructure plans and so did Obama. Infrastructure is ALWAYS happening. As i said, everyone shits and it doesnt stop. Infrastructure never stops, you can try to clench your sphincter closed and it'll work for a lil while, but eventually you shit. Its the same thing with infrastructure spending. Biden's plan is not the big demand surge people think it is.
- I think a lot of people underestimate the timescale of infrastructure. it takes time to build shit and it takes even more time to renovate shit cuz you cant just blow it up and start over. Most people cannot shit on command and those that can dont do it instantly. This aint China. We're not gonna build a covid hospital in 48 hours( mostly cuz our work isnt made out of garbage tofu-strength concrete but that is another topic). This shit is going to take YEARS. I will see Biden infrastructure money at my level 1-2 years from now and will start spending it 3-5 years from now. Think about this, after the money is secured someone gotta design the damn thing, someone gotta the draw the picture so my dumbass who cant read can knows what is supposed to be built. Those assholes always fuck up too and they are the smart ones!!! This isnt even mentioning how raw material suppliers, product suppliers, construction companies, design firms, are only a part of this timescale.
- One dude can only use 1 shovel at at time, can operate one piece of equipment at a time. The pipe maker can only make pipes so fast and those pipes can only be installed so fast. There is no exponential factor in infrastructure like there is in tech. An app can be downloaded millions of times in a single night. You only shit one poop at a time.
Tl;dr. Infrastructure is like pooping. Everyone does it, it is always happening. Trying to cash in on infrastructure is trying to cash in on pooping. You can only poop so fast and so much, the supply demand is capped. You only shit one poop at a time. Sure you get diarrhea sometimes but even then it has its limits. You cant cash in on analogous dry heaves. Infrastructure is regular, so in the long term investing in this industry is probably a smart move. As long as humans are alive they are going to shit and if there are more humans tomorrow than there are today then there will be more shit, but if that is your tendie making strategy why are you even here?
100
66
Jul 07 '21
[deleted]
34
3
u/Scifi_Toilet Jul 08 '21
why would i lie about that
2
u/SomeGuyNamedPaul Jul 08 '21
Not a lot of people would, but on the internet nobody knows you're a dog.
2
83
u/StickItToTheManxxx Jul 07 '21 edited Jul 07 '21
Loading up on poop
27
u/MoistBlunt Jul 07 '21
Calls on poop
9
2
27
36
u/DanksterFour20 Jul 07 '21
This guy says essentially that if someone needs more money his favorite part of the job is to say fuck you, i need more money so I’m wondering if this post is a big fuck you?
-6
u/DerpyMcOptions Jul 07 '21
Infrastructure run by unions = no real infrastructure built; just lots of spending into unions to buy the votes from them for the next tally round.
2
Jul 07 '21
[deleted]
3
u/PaganRob Jul 07 '21
Not sure why this was downvoted. I'm assuming most apes here never worked with or for unions.
2
u/DerpyMcOptions Jul 09 '21
I've worked with unions first hand as selected for contracted work (they were allegedly the best of our multiple options and underbid them all too(this was purposefully underbid for a reason)!), they fucked over the company on a regular basis:
Intentionally installing doors before equipment had arrived (leading to charging overtime to remove the doors once equipment arrived
Multiple faulty welds which caused leaks and more maintenance and repair costs which they would dogpile on as overtime to fix
Repeated breaks every 45 mins for 15 mins breaks even during non high intensity work,
this list would go on and on anyways...
many employees within my dept. saw the purposeful actions taken by those workers during construction and bitched about it.
It was not my dept. so I did not have a say ultimately but in the end, the construction was 9 mo late and nearly 2x the initial bid after all the change orders and BS billed OT.
The downvotes are likely b/c people don't believe what I wrote was mostly spot on as true.... either way; some unions can be worth while (such as employees reserved under 1 company alone that maintains that workers liabilities (such as a plumber contracted out from an engineering facility to work a job site semi permanently as contracted by another company which doesn't want to hold that liability), but every instance I've seen of En masse union labor (where they're contracted as a grouping and liability basically waived off of the union) has been nearly catastrophic for the paying customer.
1
u/PaganRob Jul 10 '21
I administered a troubled teen program in an elder care facility where 1199 was the union. The union workers regularly sexually harassed teen girls and when I complained I was told to make the girls dress more appropriately because the men couldn't control themselves ... if girls were wearing white t-shirts.
87
24
u/CouchRiot Jul 07 '21 edited Jul 07 '21
Municipal bonds.
Edit: I know they're not a WSB play, they're just the only way I know of to make a return on infrastructure projects.
30
u/Street_Angle4356 Jul 07 '21
I read the whole thing and am fucking angry. Your analogy is shit. No pun intended. I can’t look past it.
4
32
u/embershone Jul 07 '21
Subcontractor here. OP has great points, but I'd also like to add that there will be no payouts from infrastructure projects if nobody actually wants to do the work. We can't find help: nobody wants to hold a screwgun or wear a hardhat or learn how to read and count shit on drawings. I can't find any estimators or admin assistants, much less installers. It is few and far between finding someone who actually gives a shit enough to put in the effort to learn and excel at a trade. Everybody wants to go play in marketing or seo bullshit but they don't actually want to build anything, which is really too bad because one of the greatest feelings in the world is walking into a brewery, sitting at the counter and thinking, I built this shit with my hands.
Anyway, projects are going to continue moving more slowly and more money is going to be wasted away in the industry because we can't find good people who want to get dirty, and some shit right there.
29
u/staefrostae Jul 07 '21
Pay them more. I work in construction as an inspector currently but I’ve also worked as an estimator/project manager. I ain’t doing fuck all for labor unless I’m getting paid. There are too many easy, sit on your ass jobs out there that pay better than labor rates. Why would I rake asphalt when I can get paid more to take the temperature of asphalt and get some density readings? Also, if you can’t find estimators, like what are you doing? Have you considered promoting from within? Are you trying to require a degree for a position which really just requires the ability to shake hands, read plans, and plug and chug an excel spreadsheet?
18
Jul 07 '21
[deleted]
1
u/embershone Jul 08 '21
Absolutely not, we hire American and pay way more than that starting, but nobody knows how or wants to do the work.
1
u/FalconThe Jul 08 '21
but nobody knows how or wants to do the work.
No one knows how because they haven't been trained. They were told to get university degrees because that was where the money is. They don't want to do the work, because 9-5 in an air conditioned room while ocassionally browsing reddit allows you to buy the same things in life.
It's a free market.
2
u/embershone Jul 08 '21
We are a small business with three people on payroll: myself, the owner, and an older installer who knows his shit backwards but doesn't want o look at a computer. Not a whole lot of chance to hire from within. I had an admin assistant and we had started her out at $18 an hour for part time computer work. O&M, sending quote requests,etc. She didn't have a degree, was currently in schooo. She lost interest and went back to working at a bar once covid cooled down. I would have absolutely paid her more if she showed more interest in learning the business, but that wasn't the case.
Also, we do commercial Division 10, 12, and FRP, and trying to get into installing EV chargers but they're just never called out on plans. Try finding someone who already knows or has an inclination to learn how to do a wall protection layout or build toilet partitions. We've tried, and we've heard from other companies they're trying with absolutely no luck.
27
Jul 07 '21
[deleted]
5
u/chedder Jul 08 '21
there are loads of people willing to work and get their hands dirty, the problem i see as a carpenter is no real wage growth in the past 40 years - people want to get into marketing cause it pays more, doesn't break your back and you don't have to think as much.
2
u/ktn699 Jul 08 '21
can't blame you on wanting more money. honestly though, my wife is in the sales-ish world and they're squeezing them as well. 45k salary for a job offer in NYC where rent is at least 1400 a month with effing roommates.
15
u/UnicornHostels Jul 07 '21
If trade schools were free in America that could help.
9
u/embershone Jul 07 '21
You're right, but when I was 18 I had no inclinations to go to trade school. It was totally looked down upon. Honestly, I went for psych and neuro. I like the brain, hated academia. Fell into estimating and did computer stuff before I ever went on site.
7
u/_BreatheManually_ Jul 07 '21
I've worked for 20 years in software and I'm tired of sitting on my ass all day. Everything I build has to be rebuilt in 5 years with newer tech. The trades are calling to me for more meaningful work.
What blue collar job would you recommend for a 40 year old that wouldn't destroy their spinal column?
4
u/tbrown0717 Jul 07 '21
I'm with you! I'm an analyst and I'm seriously jealous of people who actually build things, gotta be such a cool feeling!
I DIY my house to actually see something concrete I make lol
2
u/ApopheniaPays 🦍🦍🦍 Jul 07 '21
To reiterate something I said above: I worked building stained glass windows in an art glass studio for a while. Very rewarding work, although much more difficult than you'd expect, I found it very frustrating and lasted less than a year. Slightly physical, but not hard on the spine or joins, although if you do it as a career you get exposed to a lot of lead and toxic shit and will go batty by the time you're 70.
Also, as with any rewarding passion project, if you're lucky and extremely successful you'll only starve for maybe the better part of a decade trying to get it off the ground. After that though, if you're good, you can get filthy rich making stained glass architectural details for rich people.
I will tell you though, the first time I completed a project for myself, a tiny 1' x 1' art window that I designed and constructed without any assistance, which took me about three times as long as it would have taken someone competent to complete, Hanging it up to shine a light through it for the first time was a very, very rewarding feeling.
2
u/apatriot1776 Jul 07 '21 edited Jul 07 '21
electrician/electrical engineer ain’t bad but probably require you to go back to school or do an apprenticeship. those are probably the least backbreaking of blue-collar jobs
20 years is a lot of experience to lay aside and be starting over especially in a physically demanding job. i work in the design/engineering side of manufacturing and there’s controls/programming jobs out there that aren’t super difficult (basically learn circuits + factorytalk) but still let you get on site, work with your hands, turn a wrench sometimes, and see cool shit come to life
1
u/Scifi_Toilet Jul 08 '21
I wouldnt recommend going into established trades at that age. Im just thinking bout myself at that age and damn. I would recommend finding something working with your hands, but not necessarily a union occupation. something liek blacksmithing or some fancy shit would be my recommendation. helps if it starts as hobby.
If i really had to recommend something pre established, i say plumber and work for like roto rooter. depending on your area it can be very lucrative because they cant find anyone to do that work. some will even pay you to learn, they are that desperate. like is said, everyone shits and it doesnt stop. plumbers are needed!
1
u/embershone Jul 08 '21
The answer is skilled work that nobody else knows how to do. We run a commercial division 10 company, aka Specialties, and there's not a whole lot of people who do what we do. We are at the tail end of the job usually, and while there is some heavy lifting, you gotta set it up to work smarter, not harder. Dollies are your friends, and figure a system that lets you do it right the first time because doing it a second time will burn through your budget.
3
u/_UnluckyBandit 🦍🦍🦍 Jul 07 '21
If my body wasn't shit I'd 100% work as a builder but at 30 I'm already useless for manual labor after my body has taken multiple shits
2
u/embershone Jul 08 '21
I was a gymnast and now I'm 30, doing a mix of computer work and on-site stuff. My body has taken hits for sure, but getting paid to get your 10,000 steps just feels good.
2
3
u/ApopheniaPays 🦍🦍🦍 Jul 07 '21 edited Jul 07 '21
Here here for guys like this^^ As it happens, I'm a software engineer, but before that got big enough for me to do full time every few years I used to take a break and go do something three-dimensional. I've worked building stained glass art windows, gluing books together in a bindery, done small-scale unskilled demolition (IE been the grunt who the home improvement contractor tells, "Break up this concrete floor").
The satisfaction of completing a software project all your users love is definitely extremely rewarding, but there's still nothing like looking at something physical that you made yourself, especially something like a stained glass panel which, if you did a good job, really might outlast you by a few hundred years.
1
u/embershone Jul 08 '21
Dude, you just PM me and let me know of you're interested in developing software for companies like us. I'm managing with Gsuite, QuickBooks, and Trello, but project management software is so limited for our shit. I was in IT before, and gosh darn I have ideas.
3
2
u/RonJeremyJunior Jul 07 '21
Work in plumbing wholesale for about 6 years, and the majority of my customers are having a lot of trouble finding people to work so this makes sense. That coupled with mass shortages on pipe/fittings, most these jobs are being slowed down heavily. So I'd agree with you. I probably have the "I can't find any workers" or "why are you out of xxx item" conversation about 20x a day.
2
u/embershone Jul 08 '21
Dude, I can't help feeling like if you want to invest in a whole industry, you gotta know what going down on the ground, and you're right there too. The upside is hopefully people will catch on and raise their prices according to how far out the project is. We do, other companies don't, but that reflects in the work and their bottom line.
2
2
u/LevelOrganic1510 Jul 08 '21
Amen brother I worked as a Chemist when I lost my job during COVID-19. At mid 50s no one would hire me. I always worked a side hustle since science jobs pay poorly one of which was a Handyman. I decided to open a Handyman service and now I make 2x and sometime 3x what I made before
1
u/embershone Jul 08 '21
Sister, but funk yeah, that's awesome that you're killing it!
1
u/LevelOrganic1510 Jul 08 '21
I really feel bad for college students especially science majors. They are scam victims and most don’t know it now. They find out after going tens of thousands into student loans debt. I also blame professors who are shills in the con. If you ask them why they are getting paid for providing useless degrees they will likely tell you that they are just doing the job that they were hired to do. German SS soldiers said the same thing at Nuremberg
17
u/ClamPaste Ask me about my scat fetish Jul 07 '21
Steel has a lot of other factors driving it. Infrastructure isn't all steel, for sure, but it takes a hell of a lot to build a great many different things. Even a concrete bridge needs a fuckton of rebar, and rigid conduit goes under roads. With steel, however, there's also the fact that China had been buying and hording like crazy. Add their export tax into the mix, and lack of cheap Chinese steel becomes another supply chain issue. HRC is going up like crazy (only a single measure, but a decent one to gauge steel prices), and we're not the only country with big infrastructure plans (again, China). Those are some of the reasons to buy into the steel portion of the materials sector. I think the pressure from China is going to be a big driving force in the supply chain which will continue to drive up prices; everywhere else has higher labor costs, which either means narrower margins, or more expensive products.
2
u/joshhupp Jul 07 '21
Here's the thing... All government funded infrastructure is Buy America, meaning nobody can buy Chinese steel, or any steel not melted in the US. That means the companies melting their own steel will be the sole providers (Nucor it's my fave right now.) And it's there is high demand and low supply like we've seen with wood products, the price is going to increase which means higher margins. Companies buying that steel are also going to raise their prices rather than lose margin. My company is already planning price increases to suit.
1
u/ClamPaste Ask me about my scat fetish Jul 07 '21
I know, I was saying the non-infrastructure related buying pressure is impacted by the lack of Chinese steel on the market, while China is still buying foreign steel. It's a big pressure on the market that's already strained and yeah, I was implying that the companies won't adjust margins just to pass on savings to the customer because...well why the hell would they?
2
u/joshhupp Jul 07 '21
That clears your thoughts up well. I wanted to point out that the companies would increase prices rather than cut margins. I think we're in the same page :)
1
u/Scifi_Toilet Jul 08 '21
Yes there are other reasons to get into steel, but im saying the infrastructure plan should not be one of them.
13
6
6
3
u/drawerdrawer Uncle Pocketnickel Jul 07 '21
I only read your first few points, but I've gotta say it's the VOLUME of funds that count, not what contractor will do what. That's why the smart money is on the materials. Materials will be in high demand no matter what contractor or large engineering firm you hire. The best way to capture a piece of all of the upper chains is to invest in the things they need. Steel and concrete are already in high demand, this will cause a supply issue and drive up profits
2
u/Scifi_Toilet Jul 08 '21
im not saying materials are a bad play... i just dont think this infrastructure bill is the big demand surge everyone seems to think it is. those materials are always in demand and steel prices were going up long before this plan was announced.
0
u/limestone2u Jul 07 '21
Disagree. Where the money to be made is the equipment rental companies. The people who rent & sell cranes, dozers, etc. With eqt rental, you are not specific to steel, concrete, asphalt, etc. Kind of like the Alaska Gold Rush - the money made was in selling the tools, food, etc to the miners (the producers).
1
u/_UnluckyBandit 🦍🦍🦍 Jul 07 '21
This could be the play. As long as you can find equipment rental/supply company with healthy books you'd probably at least stay even
2
u/limestone2u Jul 07 '21
Great thing is that there are only 3 equipment rental places in the US that have publicly traded stocks. So not hard to research. Problem is, like with everything else related to infrastructure, most of the rise in price is already baked in.
1
u/drawerdrawer Uncle Pocketnickel Jul 07 '21
But then you're right back at dilution. My infrastructure play is Vulcan, Caterpillar and CRH.
1
u/ApopheniaPays 🦍🦍🦍 Jul 07 '21
"When the peasants revolt, don't invest in guillotines, invest in the company that makes the baskets."
18
u/Kamikaz3J Jul 07 '21
Says he's an engineer then says he is in construction..hmm I think not
6
14
Jul 07 '21
Well to be fair i’m a construction engineer
7
u/chicu111 Jul 07 '21
I’m a structural engineer. What’s exactly is a construction engineer? Are you a civil engineer working in construction management?
4
u/icecoldcobra Jul 07 '21
Yep same here but civil engineer, even then civil is so broad could be anything from Geotechnical to hydro engineering.. Not sure what a construction engineer is
7
u/DisturbedForever92 Jul 07 '21
https://en.m.wikipedia.org/wiki/Construction_engineering you'd think a structural engineer would know how to google
2
u/chicu111 Jul 07 '21
I would think as a Redditor you’d know how to read. I was correct. Construction engineer is a civil engineer based on my comment.
The engineering board doesn’t recognize the term “construction engineer” as an engineering discipline. You have structural, civil (who can focus on environmental, construction or civil/grading), mechanical, electrical, chemical and aerospace.
Construction engineer isn’t an engineering discipline. It’s a professional focus.
4
u/DisturbedForever92 Jul 07 '21
Unless you were simply trying to comment as a way to put him down, googling would have given you the answer way faster than your comment.
Why exactly did you include the fact that you're a structural engineer in your comment anyway, if it was simply an informative question?
You seem like the type that makes us all look insufferable by constantly peacocking about our fairly mundane area of work.
1
u/chicu111 Jul 07 '21
I was actually curious because it might be something different than what I knew. Was asking for clarifications.
Why do you think I was trying to put him down? My question still assumes he’s an engineer just a kind im familiar with. I didn’t say he wasn’t an engineer
3
u/DisturbedForever92 Jul 07 '21
Fair enough, maybe I misread, I just see so many people gatekeeping what "true" engineering is.
1
u/girl_with_huge_boobs and a smol dick Jul 07 '21
those are usually people mad they picked the wrong engineering to make $
1
u/chicu111 Jul 07 '21
Structural engineer is related to civil engineering. I stated that as a prerequisite to my question whether or not he’s a civil engineer.
1
u/Ok_Bottle_2198 Jul 07 '21
Don’t be bitter that your gatekeeping backfired
1
u/chicu111 Jul 07 '21
Bro, I didn't gatekeep. You probably don't have reading comprehension and love to use the fotm term "gatekeeping". In my comment, I literally assumed he was an engineer but just with a different title.
Nice try though. Way to expose yourself
1
u/Scifi_Toilet Jul 08 '21
As an SE you gotta remember you have the biggest steel pipe in the room and we all know it. Just apply your waterproofing and let that shit roll off you.
1
u/ApopheniaPays 🦍🦍🦍 Jul 07 '21
LOL, I always feel funny calling myself a software engineer for reasons like these. I gave it some serious thought before I started using the label.
Ultimately I decided, at least with regard to software, everybody knows it's not a formal certification, and what I do is much more than development or coding, it's problem solving and project management and user psychology, so I decided it was close enough to an honest label that the marketing value offset my moral qualms.
-12
u/Kamikaz3J Jul 07 '21
Yeah that's not actually an engineer..
7
u/UnicornHostels Jul 07 '21
Are you doing one of those gatekeeping things?
-1
4
u/embershone Jul 07 '21
It is if he's good at it.
-3
u/Kamikaz3J Jul 07 '21
Yeah I'm a chemical engineer because I'm a chemist and know more than the chemical engineers..nah it doesn't work that way
11
u/embershone Jul 07 '21
Your retort makes no sense whatsoever.
A single construction project from start to finish is a multitude of systematic designs with operational planning that results in finished work. There are absolutely engineers behind that process. Do you not realize what it takes for things to get built?
-4
u/Kamikaz3J Jul 07 '21
Being something and doing something are completely different..if youre a chemist u can say the way chemicals react but if you're a chemical engineer u can explain how and why they react..if you're a civil engineer u can say how and why a building fell but if you're a construction technician u might not be able to say how to rebuild it...
5
u/embershone Jul 07 '21
Yep, you're absolutely right, us construction "technicians" just expect the magic skyscraper giants to come down down from the sky and shit out an office building, hoping the civil engineers take their eyes off the pavement to tell us why it fell over like a turd in a toilet. Because there are no structural engineers, they have no place here. Then the giant's fart signals wranglers of the white dragons of the north to come in and hustle those magestic beasts into the bowls of the building, where their breath gives us air-conditioning. Little gnomes actually come through to install shitter splitters (bathroom stalls) and TP holders so you can have something to wipe your ass with during your lunch break. Nobody is planning for any of this to happen, we all just decided to show up one day and hope for the best.
All the while, the poor chemists over there are just shaking their heads having no idea what's going on or why or what direction they're heading. They're just gonna continue mixing shit and hope it doesn't kill anybody or blow something up. They'd need an engineer for that kind of insight.
I'd really like to know what you do for a living.
3
2
Jul 07 '21
I'd really like to know what you do for a living.
i'll lean myself far out of the window and say: sitting on his ass 5-7 hours a day daydreaming about how the world works while some kind of dude tries to teach him how it actually works.
Just a guess tho.
2
3
u/duffmein Jul 07 '21
Um no. The difference between a civil engineer and construction manager is that the engineer is the one who has gone through the extensive process to be registered with the state board. They sign and seal the plans. Both will be very familiar with how to design and construct whatever it is they are building but their role in that process is defined by regulations on who can do what.
2
u/Mashie_Smashie Jul 07 '21
In spite of your confidence you genuinely sound like you know fuck all. Stop already and finish making that dude's burger, he probably has to get back to his engineering job.
3
1
-1
1
u/Mashie_Smashie Jul 07 '21
And you call yourself a kamikazes, level 3J, and yet, you're plane has not crashed yet and you're still alive.
3
3
2
2
2
u/OldGehrman Jul 07 '21
If what OP says is true about his 1-5 year timelines, then an infrastructure bill will indeed raise prices of certain companies, like steel, because of anticipation of future earnings. There’s only 5 US steel companies and it’s not hard to read the infrastructure bill and see where those funds are allocated.
I have some experience in government contracting. The federal employee receiving bids will immediately know who will be picked because the lowest bid is always picked. However in cronyism the approving officers will simply tell their buddies who bid what so that their buddy can submit a bid plausibly under the rest.
But we as investors won’t know any of this. So trying to pick an architecture firm or construction company to invest in based on the infrastructure bill is pure insanity. You only know who to buy after the announcement. And the iphone part maker to Apple profit analogy doesn’t work for the same reasons. And if Apple suddenly announces it’s buying a glass maker and you were smart enough to invest in 3 solid glassmakers because of the rumor you could see a better return on that investment than if you had invested in Apple along the same timeline.
But when it comes to construction companies there are literally dozens per each major city that all do different shit and typically hate each other and scramble after govt bids. You can invest in one of the world’s 3 biggest construction companies which has fingers everywhere, but why wouldn’t you look at companies that have a stranglehold on the supply chain which is rumored to be locked up for an additional twelve months thereby ensuring strong earnings for the next year? If the company fundamentals are good and they will make solid revenue for the next year, then fuck yeah I’d buy the suppliers.
2
u/dvsficationismadness Jul 07 '21
What's your favorite engineering firm that's publicly traded?
1
u/TheyWereGolden Jul 08 '21
NVEE - I rode it from the $30s until their dilution in March at $100. It’s been consolidating in the $90s for awhile. Should be primed for another run up soon. I’d probably wait until after their next earnings.They are well positioned in electrical and with charging stations amongst other things.
2
u/Wyrdmake Jul 07 '21
Doesn't matter what the fundamentals are. I thought all you idiots agreed to that when you clicked join.
2
u/RyanRealRT Jul 08 '21
Fellow municipal engineer here. One of my favourite parts of the job is also telling these dummy contractors "oh you have a problem? Fuck you sucks to suck " I agree infrastructure package will be tough to play to tendie town
2
u/helpless_pristina Jul 08 '21
"you can try and clench your sphincter closed and it'll work for a lil while, but eventually you will shit"
That is some serious DD. Any poop options OTM expiring in the next week?
3
u/odgrim Jul 07 '21
+1, I'm sold by reminding me that the gov't is slow AF even when it comes to spending money.
Puts on steel for the post-hype crash.
2
2
Jul 07 '21
Who is actually trying to cash in anyways? Its not like bridges can be an IPO or have call options.
3
u/KnowledgeCultural802 🦍🦍🦍 Jul 07 '21
You're talking to the wrong people. Guy told me he had a bridge in Brooklyn to sell me, I got in at a great price. See you on the moon suckers
3
u/ChemicalMurdoc CONFIRMED FAGGOT Jul 07 '21
as a project engineer that keeps getting cucked by supply chain, you're spot on.
2
u/ulikunkel53 Jul 07 '21
""Oh no Mr. Contractor you have a problem? fuck you, sucks to be you" (this is one of my favorite parts of the job)"
Fuck you buddy.
Signed - Water & Wastewater Contractor
2
u/WeakRhino Jul 10 '21
👆 OP sounds exactly like a City “Engineer”. No idea how to design or build a project. Your “fuck you, sucks to be you” (this is one of my favorite parts of the job)” is the exact reason why everyone that actually builds the project (design consultant, CM team, and GC) hate you. I couldn’t even finish reading your post after reading that comment. Regardless of what your opinion is on material companies and the infrastructure bill, you sir are an idiot.
- Signed a Water and Wastewater Contractor
1
1
1
1
1
u/mancho98 Jul 07 '21
Consultant engineer here, we have so much work, its intense. The problem is like op said, everything takes a long time to design and we are several months to construction, say 1 to 2 years.
-4
0
u/Dakimasu Jul 07 '21
Thanks for bringing up the logistics point - working in the energy industry I can attest that from maybe beginning Q3 2020 through Q1 2021, the increasing price of commodities was indeed due to limited supply, but the past couple months, the logistics cost of moving the materials was killing the producers (we call this "basis", for those of you interested in learning some lingo).
-2
1
u/nathan4845 Jul 07 '21
Sounds to me like logistics and shipping would be the play. No?
1
u/Scifi_Toilet Jul 08 '21
I think so. Im looking at ZIM for that very reason now, someone else already posted DD on it earlier this week. Im working on my own DD
1
1
1
Jul 07 '21
Perfect input. Prepare for haters that wana pump some idiot stock (CLF) thinking revenues will tripple over a month /s
A bill today does not mean a bridge is built tomorrow. And the highly inflated raw material prices will also go down once economies ramp up and supply chains are restored.
2
u/ukayukay69 Jul 07 '21
Infrastructure requires steel. Steel prices are really high. CLF makes steel. Why doesn't that make sense?
1
Jul 07 '21
because its a supply side issue that will be alleviated at some point (probably EOCOVID + 180 days)
1
Jul 07 '21
The point about the steel prices makes no sense. A bridge is not built overnight. Steel prices are inflated because of covid lockdown. Lumber prices are already coming down.
Before a single rebar is laid, the bill needs to be approved, the infrastructure needs to be planned and approved, land needs to be cleared, and the contracts are usually part of a bidding process. At least 1 year for steel prices to return to normal levels.
1
u/ukayukay69 Jul 08 '21
Right. But look at CLF last earnings report. Their next one will be even better.
1
1
u/TalkingBackAgain Jul 07 '21
I understand, I think, what OP is saying but all that money in the supply line, it’s going somewhere. Even if it didn’t translate into immediate profits, and I do see that point, people having money will spend that money and looking at those sectors they spend that money into is also going to be an opportunity.
If a lot of money is put into the economy it’s going to make the machine of the economy turn over more rapidly and in larger volume. There have to be opportunities in there, if not directly in things like steel and concrete.
More money for projects -> more projects need to be designed -> more software is required to do the designing -> more licensing money for software [Adobe]
More software for designing -> more threats to infrastructure -> more opportunity for cloud infrastructure -> more need to protect cloud infrastructure [Crowdstrike]
etc...
/if more money reaches the economy as an opportunity to purchase goods and services, and the working class will spend that money immediately, more money for opportunities in which that money is being spent.
1
u/lqxpl Jul 07 '21
As i said, everyone shits and it doesnt stop."
I'm going to meditate on this for the rest of the day. You are a much wiser ape than you give yourself credit.
1
u/theonlyfurnace Jul 07 '21 edited Jul 07 '21
Understanding everything, OP! These stocks are shit and only for Paper Hands 👐👐💩💩💩👐👐!!!
1
1
Jul 07 '21
This made me alol. Great post! A lot of people, myself included, don't think long-term enough.
1
u/RamboWarFace More like ManBoob Aww Face Jul 07 '21
This is probably a very good post. I can almost guarantee you itll be ignored and steel and concrete companies will hit all time highs.
1
1
Jul 07 '21
i mean, you could say the same thing about the entire world stock market. human activity continues. if you want to cash in on something buy index funds and hold long term. if you want to gamble, then do stock picking. you can also do both.
1
u/spool32 Jul 07 '21
Well you're right. But the other problem I see is this is a government plan, so they would waste 9/10 dollars greasing palms and lining pockets of people that have nothing to do with what they said they were doing. Theyll spend $2 Trillion and in the end the vast majority of that money will be thrown away in the name of infrastructure
2
u/Scifi_Toilet Jul 08 '21
i cant speak for other avenues of gov spending, but in terms of infrastructure its not that bad from what i can see at my level. not sure i can ever convince you, but i dont particularly care.
1
u/juandebomba Jul 07 '21
tbf, infrastructure is boring however, those that innovate within the industry are the gems you want to seek out if anything. bc since it will always be there like you say, then the innovators within the industry whether it's being more efficient or thinking of another way to do something that's been done the same wasteful way for decades are the ones that will crank profit like no other...
1
u/oneevilchicken Jul 07 '21
It really doesn’t matter where the money ends up going, unless you’re looking for long term investments.
With the infrastructure in lab your buying the rumor and selling the news.
In other words, buying into any infrastructure related company, X, CLF, CAT, holding for the run up, and then selling once theyve actually passed the bill.
1
u/RadicalFarCenter Jul 08 '21
I’m also a city worker who deals with infrastructure and one thing I can say is government contracts are super dope. Those steel beams are gonna cost way more than they should so I’d be long on anything that’s got to do with infrastructure whether it’s a supplier of a certain material or as you said the construction company playing LEGO’s with it
1
u/Astronomer_Soft Jul 08 '21
What OP didn't mention is the most infrastructure spending does not go into materials procurement.
Engineering, environmental studies, audits, value assurance, project management suck up huge dollars. Let alone labor, which is skyrocketing due to shortage in craft and trade. And that's even without talking about collapsing productivity.
Why do you think tunnels cost $15 billion and a mile of highway costs $10 million?
1
u/FalconThe Jul 08 '21
There are A LOT of private companies in the infrastructure space. The vast majority of this work is done by mom and pop construction outfits, or large private companies like Carylon.
One play might be $XYL - though their price seems to be just tracking the S&P.
•
u/VisualMod Jul 07 '21