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@Viking and @Maverick47 have provided great responses. From my perspective, I have FFH at over 50% of my net assets and I’m adding my own leverage (via margin) to own it so I worry about leverage in terms of the real risk of impairment and about price volatility which could cause problems for me given my variable source of capital (the margin loans) forcing me to liquidate at the worst time. I don’t recommend anyone do this but I don’t lose sleep with respect to Fairfax based on the structure of the balance sheet, the conservatism of the valuations and the low starting valuation. The sources of Fairfax’s leverage are the float and long term non-callable debt with no near term maturities. @djokovic1 succinctly explained how Buffett thinks about insurance float for a high quality insurance company. I don’t see this leverage to be anywhere as risky as bank debt as for a well run insurance company it’s always growing. No near term maturities and long duration of issued bonds along with large revolving unused debt capacity also makes it unlikely the debt at the holdco becomes a problem. The balance sheet is conservative with respect to valuations on both sides as @Maverick47pointed out. Carrying value for the equity portfolio is well below fair value for not just what we know about (Eurobank, Poseidon etc..) but also for the positions where there is no reference price. It’s not hard to get $8b in fair value over carrying value which is 2x what we know about. The liabilities are also over stated due to the conservative reserving during hard market’s as was highlighted above. The normal interest rate environment also means holes are filled in very fast for negative surprises that show up in the equity portfolio or due to unusually large cat losses beyond reserve releases. Despite the low starting valuation for Fairfax, it’s still a stock. So bad things can happen. I have my leverage at 25% of assets so I can take a large drawdown before I need to start selling. Fairfax would have to trade below 0.95x BV. It was there a few years ago so of course we could go back but I’m making the bet that we won’t. It’s a risk I’m willing to take. What helps is that BV is growing 3-6% a quarter for the most part so my risk goes lower every day. The higher leverage should be why Fairfax trades at a big premium to MKL and BRK but the market structure keeps it at a discount. That’s the opportunity.

Maybe he will issue a "Taco" executive order.. Meanwhile, listen carefully to your buddy, Schumer:

This pretty much sums up 2026 for me!

Sold my FPE.DE (Fuchs Petrolub SE), KNOS.L (Kainos Group PLC) and the remaining half of my RBB positions

Sanjeev [ @Parsad ] Honestly I think understand good enough its's not any real importance to you [I may be wrong, btw.!] If it's bothering one, there is the solution to 'plant new trees' [like Elon Musk!]. Does it even matter to anyone? To me, it doesen't matter at all! - As long as you behave here as the person you are!

I hope trump pardons him. Game gotta recognize game.

You mean this happens regularly? Geez! Cheers!

Tracking Buybacks of a select few companies here (https://mananainvesting.substack.com/s/buyback-tracker-series). Below is Fairfax Financial.

LOL! Hey I need one of those...does it come in rosemary or thyme...I have straighter hair! Cheers!

I don't have enough hair for a combover. I flip up the front a tiny bit to make it look like more, but there is still a bald forehead in front. Cheers!

https://www.telegraph.co.uk/us/news/2026/07/16/explosive-diarrhoea-outbreak-sweeping-america-donald-trump/ DOGE dopes strike again! Hopefully none here are reading this from the porcelain throne!

maga dating.mp4

Yeah @CassiusKing1, All good.

Greg seems to be more inclined to do buybacks. Hope they continue, plenty of excess cash coming into Omaha.

Wow. Disgrace is right. Another bad apple in the White House. Maybe he can get a job with Paul Pelosi !

I am so bad at timing these things, used up a lot of cash at initial drop, didn’t average down much after.

Agree, I do love the impact of the Euro players on the league. Their footwork and ball handling skills are amazing.

The Hill [July 16th 2026] : White House suspends teleprompter operator accused of placing bets on speeches: ‘Disgrace’ - - - o 0 o - - - So much for betting on insider knowledge as a maybe poor man working on POTUS' telepromter, with perhaps really not so much means - 'disgrace' - It's almost killing me!

looks like buybacks have started up again!

I agree on the NBA enjoyment, was just highlighting the game is played different today and requires different types of players. You don’t see Shaq like players anymore and instead have more athletic leaner more dynamic players Wemby….all started with Dirk and Durant pushing limits.

Correct - and that is precisely why you can keep a franchise quarterback healthy these days. IF those rule changes had not been enacted - you would go through quarterbacks like diapers - and the NFL would be destroyed. Today's defensive players are far stronger, faster and bigger. Different strokes I guess. I still enjoy the game, but those 80/90's Knicks/Celtics battles, Bulls/Pistons battles were so fun and so physical. Players like Rodman, Ewing, Malone, Oakley, Mahorn, Mason - they would foul out every game. Those were really fun games for fans. More like Canadian Hockey!

Not to mentioned the degradation of the core FANG/MAG whatever stocks as they shift from net cash, high margin, asset lite companies to more debt burdened, asset heavy, capex beholden ones.

@djokovic1, thanks for sharing your presentation. I thought it laid out the thesis very well. At a high level, the story is very straight forward. Well done!

Always good to challenge assumptions, ask questions, consider the downside risk of any investment @RRR! When I think about this in regards to Fairfax, I consider a number of factors. AM Best is an insurance company rating agency that considers how secure and financially stable an insurer is. They have been granting upgrades to Fairfax over the years, with the last major upgrade in 2025. Take this with a bit of a grain of salt though, because before the GFC, AM Best had assigned their highest ratings to both Berkshire Hathaway and AIG. They missed the danger lurking in AIG Financial Products, which would have taken the company down absent a government bailout… One insurance tail risk is if the loss reserves are set at an inadequate level. Fairfax’s history indicates that their general approach to setting reserves is for them to be much more likely to be redundant than inadequate. Another is future likelihood of weather catastrophes. Tough to know for sure, but based on computer modeling, Fairfax has been reducing their tail weather catastrophe risk over time as a percent of supporting equity. My guess is they have a billion or two of redundant loss reserves which means their equity is understated by that same amount. Similarly, they have about $4 billion of fair market value excess of assets compared to where those assets are carried in terms of book value. They are prudently managing their exposure to catastrophe losses relative to their equity base. Over time, the increased allocation of investments to common stocks may well result in a Berkshire type situation where the market value of their common stocks regularly grows faster than the natural growth in the underlying insurance premiums, making the company even more safe and secure relative to claims obligations over time than it is now. But if there is a period of volatility with the equity investments, and a seriously large negative market value move, how might the company respond? I think we’ve already seen this in the early 2000’s when they chose to sell minority stakes of their crown jewels, Odyssey and Northbridge, buying the minority interests back once the company had recovered. I think the good thing about Fairfax to me is that they are a learning organization. They faced an existential crisis during the early 2000’s and the short seller attacks. They learned from the lost decade of hedges and shorts after the GFC. They are building a margin of safety into their shareholder equity book value, and have developed solid partnerships with organizations such as OMERS who can help provide capital if needed in the future.

@RRR, welcome. Good question. Here are some thoughts: The key to your question is how you define risk. Is it: Volatility? Chance of permanent loss of capital? This also ties in to time-frame: short term (less than three years) or medium term (more than three years)? Another key is type of equity: Mark to market Associate Consolidated More than 50% of Fairfax’s equity holdings are associated and consolidated… meaning a big decline in the market averages will have a more muted impact on reported results. Another key is opportunity. Fairfax often makes their best investments when volatility is at extreme levels.