No. of Recommendations: 72
Sort of On Topic

Charles Schwab Inc recently sent me a copy of Charles Schwab’s autobiography “Invested”, which was just published. I thought, boy this is going to be dull, but I started reading it. Wow, was I wrong! This guy, writing in the first person, described upending the security industry just as many of our companies are upending their own industries. It’s like reading about Alteryx, or Okta, or Coupa, or any one of them. It’s damn exciting. All the big established companies hated him because he was cutting commissions on trades and they had invested years in establishing their high-cost, high salesman-commission models. It was Zscaler and Palo Alto all over again.

There had been fixed commissions where everyone charged the same outrageous commissions and then the government finally decided to deregulate commissions. That’s when he was starting Schwab, with lower commissions. However, he was worried that Merrill Lynch could afford to cut even lower and crush his new company. He couldn’t believe it on the day of deregulation when Merrill announced they were RAISING commissions on small investors and cutting on big institutions. Charles Schwab was saved! 😀

He wasn’t worried about making a profit in the early days, just growing as fast as he could before anyone else caught on. But the hyper-growth meant that they were always broke, having to raise money or sell stock, because growing that fast meant that they were having to hire more staff, more order takers, etc. And they discovered that opening an office in a new city would mean almost immediately an increase of ten to fifteen times more customers from that city, but the office wouldn’t pay for itself for nine months or a year (I think he said), but after that it would be all profit, so they built them out as fast as they could afford it, and they were always plowing back every cent of potential profit into growth. I thought I was reading about one of our companies!!! When they’d hit a correction and volume fell off, they risked going broke, but didn’t stop investing in growth.

He also computerized the process five to ten years before everyone else, using the most up-to-date technology of the time, which gave his company a huge head-start. Again, like our companies.

He was looking for clients who wanted to make their own decisions while the Merrill Lynch’s of the time had customers who were willing to pay high commissions in exchange for imaginary brilliant tips from their broker’s salesmen. Reminds me of us as opposed to others, as well.

He writes “I’ve always believed in growth over earnings. A colleague once asked me if I’d rather have a fast-growing company with modest earnings or a slow-growing company with higher earnings. I didn’t hesitate. I’d much rather see fast growth. In my experience, earnings follow growth and stock prices follow earnings. My philosophy is that with growth everyone wins: clients get better service, investors get a better return, employees get jobs and rising pay, the community gets support, and of course, the government gets taxes. As far as I’m concerned, growth is the key to creating wealth.”


Is that our kind of guy, or is that our kind of guy? I urge you to at least read the first 100 pages to see what all of our companies are currently going through, and you won’t be able to stop anyway with the excitement of one crisis after another.

Hope this will brighten your weekend, after a tough week.

Saul

PS - By the way, most of those full commission brokerage houses went out of business or were acquired.
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Saul:

Thanks for the tip on Charles Schwab's book "Invested". Thanks also for your attention to this board. You are educating a lot of us.
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Merrill Lynch could not cut commissions. Their whole business was based on charging for all of that research that they did. If they offered lower rates without that service they'd risk their entire customer base switching over to this low cost no frills commission rate and they'd lose a significant amount of revenue and that research cost would be spread across fewer and fewer accounts.

This is exactly the dilemma panw, Fortinet and all the other security appliance manufacturers face with cloud based security firms such as zs and net.

It's why I have given zs extra leeway during these short term issues I may not have given many other companies that didn't have such a powerful business model.

If ZS pulls a DOCU and says billings are way up next quarter because some of those big deals that were in the works closed, I want to be on board.
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Great feedback Saul, thanks. I listened to the interview on Bloomberg in the car yesterday, and I made a mental note that I need to get a copy of this book. With your endorsement I think I'll rush out and get it.
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I opened my Schwab account in Houston Tx. in 1981. Have never had a bad experience in all the years following. Just terrific customer service. Charles and I were both young men back then, now not so much.
Mike
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According to this morning's WSJ, Mr. Schwab is currently focusing on expanding access to investing, particularly to younger clients, by introducing the buying and selling of fractions of shares. He didn't specify when the program would launch.
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I also have been with Schwab since 1981 (actually I started with Letterman Transaction Services which I believe was acquired by Schwab in the 80s sometime). This thread made me look at Schwab's SCHW stock chart over the last 5 years. Great growth till last year. Seems like it hit a high April 2018 $55 and has been on a slight downward trend since then now at $40.


-zane
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And some words of wisdom about what’s happening right now!


Later in the book, Schwab is talking about 1988 and 1989, right after the 25% one-day crash of October 1987.


“The good news was that the stock market was rising again, restoring to wholeness those who stayed put, and greatly rewarding those brave enough to have jumped in at the trough… We know now with the benefit of hindsight that the longest bull market in history was already off and running. In fact, the late 1980’s, right after the crash was probably the best opportunity my generation was ever presented to dive into the market. It was the chance of a lifetime to make enormous long-term investing gains. But few recognized it at the time. Having just been burned, many watched warily from the sidelines.

I have now seen nine market crashes in my life
, and it still troubles me that investors react this way, because it always ends the same. The market roars back and leaves too many investors sitting on the sideline missing out.


Saul: I still see many people burned from the 2008 crash who are still gun-shy and afraid to invest. As Charles says here, each crash damages some people like that.

Best,

Saul
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No. of Recommendations: 47
And some words of wisdom about what’s happening right now!


Later in the book, Schwab is talking about 1988 and 1989, right after the 25% one-day crash of October 1987.


But the market (i.e. S&P500) is just 1% below its all-time high. Yes, the S&P500 has not seen the huge gains that the SaaS stocks have over the past 2 years, but to say that we just had a crash/selloff is not accurate. So what what will happen going forward? No one knows, especially in the short term. 1) SaaS stocks could continue to decline in the short term. 2) SaaS stocks could stabilize around their current valuations. 3) SaaS multiples could reinflate.

While reading the recent Morgan Stanley analysis by Mr. Weiss, I have continued to think about valuation of the SaaS stocks. I've concluded a few things and have some pending unanswered questions which I plan on exploring further:

1) valuation ranges for the Cloud SW stocks has fluctuated with falls and rises over the years

2) I think (for me) it's better to think of valuation in a range of values within the historical, bigger range

3) the valuation multiple ranges (in my opinion) should be examined very carefully and in a nuanced way rather than a single number for the whole category. Weiss referred to a EV/Sales multiple number which I think is too broad. He did further divide it into 3 subcategories which I think is an improvement but I still think it can be done better (I will work on something over the next week or so).

4) I also think going back only 5 years as Weiss did is not far enough back especially since we saw multiple expansion over the past 2.5 years. Salesforce (CRM) has been in business for more than 20 years and has been public since 2004 (15 years). It is one company to study the history of as it is a pure play cloud company. I will see about which other older, more mature cloud companies I should study to gain more insight into how the market has valued the category over a longer time period.

5) Weiss included some SaaS companies (e.g. NEWR, MSFT, AMZN) that I would not invest in because I either don't like their business/financials or I think they are already too mature.

I have other thoughts that will require me to do more work to validate or toss out. But before doing an extensive analysis, my current bias/presumption/hypothesis is still that the SaaS companies got too overvalued and have pulled back from the highs. I also still think that the businesses are great and that in the long run most of these companies will grow at a rapid pace. I've said in August that I think we might see our SaaS companies (assuming their businesses continue to perform which I think most will) reach their former all-time high stock prices in about 18 months as I wrote a month ago on 9/15/2019:

Another question is when will our companies recover now that have now dropped between 20% and almost 50% (ESTC being an exception: only down 10%) from their July all-time highs. I don't know. I tend to think that it could be a while (and they may not have bottomed yet). This is just my opinion, but I would be surprised if these stocks go back to their all-time highs before the end of 2019. It will really depend on 2 things: how the businesses perform (and we're only getting 1 more cycle of earnings results before the end of 2019) in the coming quarters and when will the companies come back into favor. If the businesses perform then they should also come back into favor but at what multiples. No one can know, but my personal guess is that the highs on most of the companies might be matched in 18 months with a range of 6-24 months. If it's 6 months then the multiples will need to go back up. If it's 24 months then the growth of most of the businesses should be able to support the previously high stock prices with a lower multiple; and this is what's keeping me in the stocks. Again, this is just my personal opinion and I could be wrong.

https://boards.fool.com/you-wrote-that-by-july-of-2015-you-w...

So here we are a month later. The decline has continued as you all know. My portfolio peaked on July 26, 2019 at +100.05% YTD. Currently, I am still up +30.2% YTD with enough cash on hand to pay all of my 2019 income taxes and enough to cover my living expenses for about 2 years. Interestingly, this week my portfolio's value dropped below the 2018 peak in early September 2018. Bummer. I also deleveraged as much as I needed to ensure that I can ride this out for 2 years without any forced selling or any severe cutback in my lifestyle. Other than that I am not adding or selling and plan on staying concentrated in the companies that to me appear to be the clearest, sustainable winners in their categories.

Chris
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No. of Recommendations: 7
Seems to me this time is different. How many times have we been taunted by this statement and yet when it applies to historical market recoveries where are these same brilliant people to also tell us this time it is different.

Stocks go up, they go down, they rumble along, and in the end more and more wealth is created. Even two world wars, Cold War, passenger planes crushing into buildings did not make things different this time.

Bottom? Duration of malaise? Not a clue. Things are different this time...highly unlikely.

As Saul says, enjoy your weekend. Investing in the end is about perseverance and the cliche that is not because most people don’t believe it anyways when it actually happens, investing most during times of panic.

The Roman Empire did eventually fall and then things really were different. If America goes socialist - then yeah things really will be different, but otherwise the derogatory comment things are different this time has the same veracity as it has in its other context.

Each to their own.

Tinker
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Gauchochris,

I find this “valuation” argument extremely short sighted. Again, I will use Zscaler simply because I know it’s numbers (not because of any other reason).

This could be wrong. It could disintegrate, the world rebel against cloud security, etc. assuming this won’t happen and Zscaler will continue as a successful growth investment, what will it be worth if it does $450 million this year, $630 million next year, another 35% growth the year after, all with high margin, extremely low churn, recurring revenue, and still growing?

I posture at this point whatever multiple the market deigns is irrelevant. The stock is getting so cheap for its fundamentals that someone will buy it out or the market will do what it always does and increase the share price based on nothing more than pure fundamentals.

Run the numbers yourself. Zscaler fails as a business then sur rah sur rah, but if it does not the Weiss report is complete and utter worthless jargon in the context of investment opportunity beyond a few quarters.

Each to their own I suppose. Charles Schwab’s experience be damned as this time it is different!

Tinker
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I find this “valuation” argument extremely short sighted. Again, I will use Zscaler simply because I know it’s numbers (not because of any other reason).

I might agree with you here, Tinker, but it would depend on what time frame "short sighted" means. Yes, of course, in the long run (several years) our companies will be a lot more valuable than they are today assuming that their business fundamentals continue to perform so well. And I assume that if one is invested in these companies, he/she currently believes that the companies becoming much more valuable in the long-run is the probable outcome. I am still mostly invested in SaaS stocks and will benefit when they recover.

I tend to care about the short term (in addition to the long term) because if I can convince myself that we might be near a bottom (valuation range...and I do think that Weiss's analysis has some flaws), I might be inclined to take some extra risk with some small amount of leverage. I am biased because over the past 2.5 years I have made a lot of extra money by making sequential short term/long term bets (sell near dated in the money puts to buy leap calls) that continued to work out as the short term targets were met and the short in-the money puts expired worthless. I took some losses recently but on balance I did extremely well with this approach over the past 30 months. Now, perhaps I got just lucky. This latest downturn in our SaaS stocks led me to close most of my leverage positions, realize most of my profits, and stop placing these sequential bets. I exited the options positions and ceased entering new ones mainly because the SaaS specific drop (with the overall market going up) didn't make sense or rather it didn't follow the pattern of the previous 2.5 years (it was also risk management to not keep/add leverage). What I mean is that in the past the SaaS stocks would drop primarily only when the market also dropped. My hypothesis is that SaaS valuations got too high in the near-term (which I agree would lead you to call short sighted if you are a long term investor).

I think some long historical data in stocks of the same category might give me some insight or perhaps this is just a fool's errand. But I like to know how much I am paying for something particularly when I intend to someday sell that thing to someone else. In the long run I don't care if we are near a bottom or not even if it might give me some additional peace of mind for now.

Chris
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Chris, valuation is a horrible indicator of short term direction of the markets. I think you've seen enough evidence of that yourself over the past few years.

And leverage is a driver for short term thinking. It's why I don't do it. It overcomplicates things. And probably closer to a break even in the long run. Beta does not lead to outsized long term returns in and of itself.

Yes, the last few years have been exceptional for growth investors.
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Chris, Saul, All,
I took a hard look at my portfolio due to three factors on August 5. First, I should only invest in growth stocks what I intend to keep for the long hall. Second, my company is imploding due to gross mismanagement. My group, new technology R&D, is being shuttered. Third, the trade war looks to be longer than I envisioned.

I evaluated what I need for retirement today, and pulled that money. I take a slightly different tack than selling what I need from a growth portfolio for day to day expenses, but I put what I need into a REIT portfolio for my retirement income stream. I am periodically rebalancing REIT/Growth to provide fuel to the growth portion in down years and fuel to the REIT to keep my income growth solid.

The key point is stay in these excellent companies as much as you can, but not more. If your allocation is correct for your life circumstances, then you should sleep well. That balance should be found before the storms hit.

Best,

bulwnkl

PS YTD RoR = 34%
PPS My retirement ended before it started. Sometimes things that look dark ain't so bad after all.
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To Gaucho's subsequent point, people need to not confuse investing in the market as a whole (especially large caps) with investing in a basket of aggressive growth companies, which are subject to this extreme volatility that has been seen.
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No. of Recommendations: 21
Weiss referred to a EV/Sales multiple number which I think is too broad.

Interesting to see Chris mention this, as I just happened to attend a presentation by a Morgan Stanley managing director last week, in which he, too, used EV/S to compare companies on several of his slides, a copy of which wasn't available to us afterwards, unfortunately.

The presentation was geared more toward privately held tech companies that are contemplating an IPO in the near future, so there wasn't as much discussion of existing public companies and their merits as an investment going forward, but the MD from Morgan Stanley was from NY and had helped to take both MDB and DDOG public, so he had lots of good information.

One of the more interesting slides showed the large tech companies (Amazon, Google, etc) plotted on a graph alongside traditional non-tech powerhouse brands like coca cola. At least according to Morgan's calculation of EV/S, the tech companies have similar valuations to Coke and some of the others, on an EV/S basis, despite still growing at much higher rates (noting that these were AMZN, GOOG and not our smaller SaaS companies growing at 80%+). He only stayed on this slide for a minute but he suggested that the fear of the government breaking up large tech was one of the biggest things keeping their multiples from expanding more.

A while back, I had posted some links to a study (might have been on another board) that showed that many companies that were broken up by the U.S. government in the past, e.g. AT&T to the baby bells, actually proved to be great investments post-breakup if you held onto your shares of all of the pieces for a few years afterwards. This is one of the reasons I don't lose any sleep over my, still large, AMZN holdings being broken up.

More pertinent to this forum, one of the things that the Morgan Stanley guy emphasized is that he expects much much more M&A activity in the tech space over the next year or two. As we know, Salesforce has had some large acquisitions with Mulesoft and Tableau, but one company in particular that he specified is likely to make some large purchases is Shopify.

I would imagine, as the new dominant market leaders start to fall out in cloud security, databases, etc, I assume the big winners will want to stay public and not sell, while the less successful ones will be more likely to be acquisition candidates especially if they have really good tech but just not the operational success, perhaps due to management not getting them to that next level.

In my mind, this provides a bit of a floor for companies with great tech even if they don’t execute as good as we expect, shareholders could get support from potential M&A. Not that I would buy a stock hoping for an acquisition, but it may mean that a basket of 8 to 10 SaaS companies with 2 or 3 being huge winner market leaders, and 2 or 3 that do well, but not spectacular, the last few that may not be as successful, are probably less at risk of going to zero than in traditional industries given that they will almost certainly have some very valuable tech, IP, and data. Regardless, I expect that the big winners in that basket are going to be so successful that they will make for a market-beating portfolio even if some of the others went kaput.

In typing this post, I did a few searches online hoping to find the slides from last week. Although I didn't find them, I found several lists that Morgan Stanley seems to release every few months of tech companies that they deem most likely to be acquired over the next 12 months.

In April 2018, they put out this list, which included Twilio and Nuance

https://www.insider.com/tech-companies-most-likely-to-get-ac...

A few months later in July 2018, they put out this list, which included OKTA and PURE

https://www.businessinsider.in/miscellaneous/morgan-stanley-...

and more recently in August 2019, this list was released with DOCU

https://websfavourites.com/science-and-technology/morgan-sta...

Interesting that there is very little overlap in the lists. They may just be throwing a bunch of darts and hoping some stick. Of course, M&A is a huge source of revenue and profits for Morgan, so it doesn't surpise me that they probably post lots of things like this on a regular basis.

Like many of you, I am not losing any sleep over the past week's market gyrations. While MDB, TTD, and AYX are still my three largest holdings (along with AMZN which is largely comprised of unrealized capital gains in a taxable account), I did use the proceeds from my successful SFIX options (thanks again wouter!) this week to buy my first shares of ZM and DDOG. They still feel pricey to me, but I think a small stake in both is worth the risk. I also added a little more SMAR given what appears to me to be a nice discounted price. I would have liked to add some more ESTC too, but just couldn't find anything else that feel is worth selling to reallocate more funds there at the moment.

-mekong
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I have now seen nine market crashes in my life, and it still troubles me that investors react this way, because it always ends the same. The market roars back and leaves too many investors sitting on the sideline missing out. ”
but so far this is not a market crash , it is the crash of a smallish sized sector. The word "crash" is OK because the decline for most of our stocks has now passed the -20% definition of a bear market. And 9 examples may not be enough to use the term "Always", especially since the Japanese stock market is still way below its 1990 peak. People who bought in 1990 will likely be dead before it reaches old peaks ."Almost Always"??

I went to higher cash levels months ago, and at these prices will gradually start to deploy it. Though I have no hard data, my sense is that waterfall declines in a group of stocks initiated by FUD is more likely toward the end of the fall, something usually not true of individual stocks which are usually moved by specific bad events at the company involved so the biggest decline tends to come early.

https://www.marketwatch.com/story/cloud-software-stock-slamm... SaaS valuations are still at risk to further market volatility and we expect the group to remain choppy until we get through C3Q estimates and there is some greater comfort that the demand backdrop has not materially worsened as we head into 2020,” Evercore ISI analysts wrote in a midday note on the decline in cloud-software stocks. Workday Inc.’s analyst day sent fears through the sector and a Morgan Stanley analyst suggested that a recent pullback in the hot sector was not enough to dive in wholeheartedly.

https://www.cnbc.com/2019/09/10/investors-dump-winners-and-b... Momentum names, software, cloud stocks and a whole slew of higher priced stocks have been getting slammed, while investors are snapping up industrials and cheap stocks, with low price to earnings ratios. A CNBC study shows that of the 50 highest P/E stocks, 64% were lower Tuesday afternoon, while 90% of the lowest P/E stocks were higher.
this link gives a laundry list of reasons analysts are giving for this sector rotation. Thus well worth reading. All or none of these explanations may be true but what we need to know now is how long it will last (My WAG not much past 10/31) , how much further it will go,( my WAG not much more than another -10%) and how long will it take the sector to go back into favor (not enough info for me to make even a WAG) If our supposition the the underlying business of these Saul companies is good, eventually the price should respond to the magic of compounding revenues and one hopes, earnings .. Even during a run of the mill recession. One might note that severe recessions are associated with banking failures, massive over-lending, and except for governments that have the big advantage that they can can print money, this is not in evidence today.

Another wild card here is the possibility of a generalized recession based decline in stocks prices , which presumably will carry our stocks along with it. But it is hard for me to see how a mild GDP decline for a few quarters( which will be met by the Fed flooding the economy with liquidity)will make much difference in corporate needs to move to the Cloud and to improve cyber security. But it will give time for more competitors to develop. And then there is the politics of the election coming in a year.

Under this scenario I have been searching for the best buys among Saul type stocks, and for the weakest to sell to raise cash. I decided on ESTC for the latter and TWLO for the former. But the TWLO decision was partly based on the fact that I did not want any further increases in AYX or ZS which are already overweight.
One way to work back into stocks is just to keep the total dollars invested in stocks the same as prices fall.
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I hear you Chris. Although I usually advise just making monthly contributions each month I don't always do that and do market time when I sense panic. Usually I get near the very bottom, but this time this is a more substantial and probably longer lasting crash. Funny that though, this crash has not been called historic, but last year's October and December crashes were called "historic".

From 2015 through mid 2018 I was making monthly contributions, and occasionally jump on big ones like when the Tableau FUD event hit last year. But I stopped doing that in mid-2018 and when the October and December crashes came I put everything plus the neighbors kitchen sink into the market as the "historic" crash ended the world for all of us.

Since then I had not put any money into the market until 2 weeks ago (a bit early but in the ballpark). Some of this is because I took money that I would have contributed in 2019 into late 2018. Some of it is paying taxes. Some of it is some home improvements. But most of it was I just didn't find buying all that compelling (holding yes, buying no). That is until 2 weeks ago. I am sure I will be buying more over the coming days and weeks. Buying what I perceive as quality.

So yes, I market time as well. Use to almost make a show of it in days of yore buying exact bottoms just before 30, 50, 70% bounces within days or a few weeks. That is a game for younger folk. But I was very good at it, so I guess it is not surprising I buy during real panics (but only if I am scared to buy as well. If no fear, then it is too easy and something is wrong).

But my point, at this point in time of the market, is that valuations are getting so low (and yet, fortunately, still "overvalued" {never, ever, ever, ever, buy a stock that is not considered "overvalued" by the powers that be - hey, take it or leave it}, that if the businesses continue to function admirably, in 12-18 months the multiples become absurd and either they are bought out for a materially higher price, or the market will do what it does and start to buy again and bid the share price back up.

In a slow drip crash like this I cannot call a bottom. What I can do though is see risk/reward and therefore don't have to worry too much about the exact bottom - the valuation risks are almost completely removed and it is all fundamental risk). It may be back to just buying each month again for me (and probably accelerating such buys, taking from next year's contributions to this year if such opportunities are perceived by me).

There is a lot to panic the market right now. Too much for me to digest. Even Chile had riots today. Income inequality appears to be the theme here and everywhere (except China...but that is a different discussion). So I won't even try to.

What I can do is look at specific companies, at specific buy points (eliminate those that became text book cheap) and see what else there is because, as you state, the likelihood of recovery at higher prices at this point is very high. Just a matter of temporal uncertainty.

And with that, the similarity between Einsteinian physics and Buffett words of wisdom come to a close.

No, until SHOP or Zoom, show that their businesses really are not going to grow anymore or are not special, they will never get as "cheap" as you want. Just like ISRG, back in the 2009 crash, never got cheap enough so it was not scary to buy it. Those who did are still doing great. Those who did not, because it just never got cheap enough, lesson learned when quality crashes on panics that won't affect the fundamentals.

Tinker
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Tinker,
Just a quick correction. Income inequality in China is not a theme in America. The story is quite different in China. Most all my wife's friends are middle class to upper middle class Chinese. They are acutely aware of the "uber" rich in China and it is infrequently a topic of discussion. However, when it comes up, the universal opinion seems to be that there is a reasonable but undefined upper limit to one's wealth. Dynastic wealth is deemed to be a negative for society in general.

At least this is the feeling according to an unscientific, very small slice of the Chinese. However, I have reason to believe that it is more widely held as my wife occasionally brings to my attention an article in the Chinese press related to the ill-effects of income inequality. Virtually all the press releases in China have some level of official government approval.
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"Under this scenario I have been searching for the best buys among Saul type stocks, and for the weakest to sell to raise cash. I decided on ESTC for the latter and TWLO for the former. But the TWLO decision was partly based on the fact that I did not want any further increases in AYX or ZS which are already overweight."

Hi mauser, wondering if you meant the opposite? That you are selling TWLO to raise cash and adding to ESTC?

Thanks!
Dominic
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No. of Recommendations: 3
Dominic I did not make it clear but by "weakest" I did not mean price but my conviction level. And that in part is baed on how much I understand the underlying company's offerings. TWLO is pretty simple
In a generalized decline like this the babies are being thrown out with the bath water and price percentage declines of individual stocks may just be random. So a few percentage points one way or the other may be meaningless.

Actually ,so far buying anything in this decline has been a mistake since there is no evidence of a bottom. Yet. Typically prices fall too far due to momentum, and then stage a quick partial rebound . But nobody knows when that point will be reached. At this rate of price decline of 4% to 7% a day we are probably close time wise to a bottom. Unless we are going to have a nasty recession and companies are going to ignore the cloud and/or security upgrades.
It will be interesting to see how these stocks respond to earnings report. During the boom they were often down after anything but a huge beat, showing very high expectations. Has that changed?
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