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  1. I think Fairfax will take FIH private. If they took their performance fee in shares, FIH would have to issue those shares increasing the float. FFH took cash to buy shares in the open market and reduce the available share count...I suspect they will continue to take cash going forward. At some point, they will offer to take FIH completely private. FFH is generally happier when they own the whole pizza, rather than a few slices. In the meantime, they will bring in outside investors including some of their friends to fund the purchase of IDBI. Let's see where this $1B goes that they just raised. I suspect they will inject it into FIH, increasing their percent ownership dramatically! Fairfax will be one of the largest foreign institutional investors in India in 20 years...outside of nation-state owned entities. Full disclosure: I own zero FIH. I just let FFH handle the investments in India. I don't have the time, expertise or access they do to know the Indian market nearly as well as they do. Cheers!
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  2. I take a more sobering view. I would argue 1-3 are closer to cash return businesses and only 4 can arguably be a reinvestment/growth story. I own tobacco and O&G - the thesis for both is similar: the market is pricing in a faster terminal decline than I am. But there is not really growth, and I would be a seller when they are valued closer to a market multiple. Gambling, I haven't done much research there so I'll reserve comment China - You have compelling valuations and potential for growth with China. I am dipping my toes here (partly based on your posts!). In a future where the current political risks are overblown, it looks like a good bet. I am betting a political status quo is more preferable to open, direct hostilities. But still, difficult to argue against other faster growing areas of the global economy that will probably continue to grow: Technology and healthcare are two that come to mind.
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  3. fine if were gonna hijack the thread into politics at least make it funny
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  4. Part of the benefit would presumably be not having to talk about the share price any more. It's now "out of sight, out of mind" so if it does go fully belly up, it's a non issue. If, by the grace of God, somehow it starts making money, it could be sold eventually not unlike the Pet Insurance business. Improbable, but not impossible. -Crip
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  5. At this point the guys best and highest use would be running charity auctions for the right to be punched in the face by current and former clients whom he's cheated with his antics.
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  6. I still occasionally dream of someone hacking the CPI and releasing a 15 print or something crazy just so we can see these mindless monkey boys who “brace” for these sorts releases have seizures.
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  7. these chaps are definitely NOT buying MicroStrategy hands over fist in their tax-deferred accounts. Old Money vs. nouveux riche
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  8. Every powerful nation with significant regional muscle likes a buffer zone around it (Monroe Doctrine anybody?) - in fact as I've argued the Russian invasion of Ukraine was principally triggered by its slow slide from a kind of ambiguous buffer zone (providing both NATO countries & Russia comfort)......into something much more akin to a US/EU client state....ya know the type of place where the US Vice President's son is on the board of the largest company there.....and where a current US sitting president is so secure in his leverage over a sitting Ukrainian president (due to aid payments) that he can instruct him on a phone call to investigate a domestic political rival. The great tragedy of Ukraine - is that we in the West put it so firmly 'in play' with our hubristic liberal democratic nation building dreams and superior economic resources vs. Russia....to be clear I'm not advocating for some kind of past Ukraine abandonment strategy where we ceded the country to Putin to become a Russian vassal state....I'm advocating for a Kissenger-esque balance of power strategy for Ukraine in the 2000's one where it was neither fully a Russian nor USA vaseel state......a strategic approach that never put it firmly in the Russian column or the West's column......put more crudely....just because you can afford to pump billions more of aid/economic investment into Ukraine than Russia could in the 2000's to buy their allegiance doesn't mean you should have. We failed at this game in Belarus might I add....seems all our love and attention was spent on Ukraine in this period. That's ancient history - the correct strategy moving forward is to give Ukraine exactly what it needs to regain most of the territory lost with the highest priority placed on the economically important regions which allow Ukraine in the longer term to be somewhat self-sustaining economically and militarily. Some landlocked Oblasts in the East are not hugely important economically and due to Ukrainian populations fleeing there are no longer ethnically hybrid regions...they are simply now edge outs of Russia...pragmatism would suggest that these regions form the basis of concessions to Russia in the future.
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  9. As an American I’ve been disgusted by all the warmongering that’s been brought about by the current regime…but it gets to another level when the SOTU headlines are that we’re “determined to avoid sending troops to Ukraine”….huh???? Who TF was ever even talking about sending US troops? It’s bad enough we re wasting billions so a dementia ridden puppet can play stratego….now we need to kill our own over some foreign pissing match? Fuck these people.
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  10. Yeah even when i did it it just went blank but started to work now
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  11. Well finally somebody lays it out in a way I can understand it
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  12. https://www.axios.com/2023/11/03/productivity-growth-us-economy https://www.reuters.com/markets/us/us-productivity-rises-fastest-pace-three-years-third-quarter-2023-11-02/ https://www.ft.com/content/61b8574d-724c-4486-b6b0-21191c22d476 https://www.brookings.edu/articles/machines-of-mind-the-case-for-an-ai-powered-productivity-boom/ https://www.bloomberg.com/opinion/articles/2024-02-23/us-productivity-is-on-upswing-again-ai-could-supercharge-it-for-good-or-ill?leadSource=uverify wall Quite a few hints that US productivity growth is on an upswing and that is even before widespread adoption of AI by businesses. If so it really would be a holy grail as it would result in faster economic growth and lower inflation (and therefore allow lower interest rates). Economic growth and productivity growth was anaemic for much of the post GFC period with most of the EPS growth of the S&P 500 driven by financial engineering, secular growth from Big Tech and tax cuts. So if this isn't a false dawn then this could indeed be the roaring 20s with the S&P 500 already up almost 150% from the pandemic lows and a long bull market can take markets up 300-500%. And that is a prospect that would keep even the most hardened perma-bear up at night.
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  13. What was the change in the value of Fairfax’s equity portfolio to Feb 29, 2024? Fairfax’s equity portfolio (that I track) had a total value of about $18 billion at February 29, 2024. This is an increase of about $496 million (pre-tax) or 2.8% from December 31, 2023. The increase two months into Q1 works out to about $21.45/share. I include holdings like the FFH-TRS position in the mark to market bucket and at its notional value. I also include debentures and warrants in this bucket. My tracker portfolio is not an exact match to Fairfax’s actual holdings. My summary contains no information from Fairfax’s 2023 annual report, as it has not been released yet. As a result, my tracker portfolio is useful only as a tool to understand the likely directional movement in Fairfax’s equity portfolio (and not the precise change). Split of total holdings by accounting treatment About 49% of Fairfax’s equity holdings are mark to market - this includes 'A.) Mark to Market' and 'D.) Other Holdings' - and will fluctuate each quarter with changes in equity markets. The other 51% are Associate and Consolidated holdings. Over the past couple of years the share of the mark to market portfolio has been falling. This means Fairfax's quarterly results will be less impacted by volatility in equity markets. That is an important development. Split of total gains by accounting treatment The total change is an increase of $496 million = $21.55/share The mark to market change is increase of $206 million = $8.94/share. Only changes in this bucket of holdings will show up in ‘net gains (losses) on investments’ (along with changes in the value of the fixed income portfolio) when Fairfax reports results each quarter. What were the big movers in the equity portfolio Q1-YTD? Eurobank was up $351 million and it is now Fairfax’s largest equity holding at $2.5 billion. Eurobank reports results March 7. It will be interesting to see if they initiate a dividend. The FFH-TRS was up $283 million. This position is now Fairfax’s second largest holding. The investment is up a total of $1.356 billion over the last 3 years, which is a gain of 185%. Simply an amazing investment. Thomas Cook India delivered a very strong Q4 to cap off a stellar 2023. Fairfax’s position was up $103 million. People are travelling again in India! Kennedy Wilson was down $48 million. The company has been hit hard by concerns in office real estate segment. The value to Fairfax from this holding is not its equity exposure. The value is the extensive partnership the two companies have established over the past 12 years, most recently in significantly expanding the real estate debt platform. I wonder if Fairfax does not use the current weakness in KW's share price to materially and opportunistically increase its stake in the company in 2024. That was the playbook Fairfax used with a number of holdings that were negatively impacted by Covid in 2020 - and these incremental investments have worked out extremely well for Fairfax a couple of years later. Blackberry continues to shrink in size, down $36 million. Blackberry is now a $130 million position = 0.21% of Fairfax’s $60 billion investment portfolio. In Q1, Fairfax also ended its $150 million debenture investment in Blackberry and Prem resigned from Blackberry’s board. The debenture was a $500 million dollar position in Sept 2020. This is another good example of Fairfax exiting from a poorly performing legacy investment (financially and also in terms of involvement from the management team). Capital at Fairfax continues to shift to better opportunities. The clean-up of poorly performing equity investments looks largely completed – understanding that there will always be a few underperformers. Excess of fair value over carrying value (not captured in book value) Carrying value in this section is understated by quite a bit as it does not capture Q4, 2023. I will update this once the annual report is released. For Associate and Consolidated holdings, the excess of fair value to carrying value is about $1.445 billion or $62/share (pre-tax). Book value at Fairfax is understated by about this amount (less the tax impact). Below is the split. Associates: $1.048 million = $45/share Consolidated: $397 million = $17/share Below is a copy of my Excel spreadsheet (next 2 pages) if you want a closer look. Equity Tracker Spreadsheet explained: The summary below attempts to track all equity holdings at Fairfax. Each quarter the spreadsheet is updated to capture any ‘new news:’ purchases and sales. We have separated holdings by accounting treatment: Mark to market Associates – Equity accounted Consolidated Other Holdings – derivatives (total return swaps), debentures and warrants We come up with the value of each holding by multiplying the share price by the number of shares. Are holdings are tracked in US$, so non-US holdings have their values adjusted for currency. Important: the list is not complete. Some information we only get once per year when Fairfax published their annual report. Fairfax also makes changes to their portfolio each quarter. Fairfax Feb 29 2024.xlsx
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  14. I rarely eat at MCD's but the wife and I were road tripping and stopped for a "quick and cheap meal." Small fry - $3.69 Large fry - $4.95 Quarter Pounder meal - $13.69 McChicken - $3.99 McDouble - $3.19 4-Piece Nugget - $3.69 We kept driving...absurd prices for borderline garbage food. Can go to a local sit down burger joint for those prices.
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  15. @Luca I came across this short article that you might find interesting regarding the value proposition of Bitcoin. Bitcoin's unique value proposition | BitMEX Blog There are a number of technical articles as well here. I downloaded the Block Size Wars - The Battle for Control Over Bitcoin's Protocol Rules by Jonathan Bier. I just started it, but it shed some light behind the scene of its development. You might also find it helpful.
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  16. I was replying to ValueArbs comment of Bezos girlfriend. I referring to breast size of wives or girlfriends as the true measure of wealth but i'm immature, sorry.
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  17. Hi folks. Longtime lurker, first-time poster here. Just wanted to chime in with a few comments, some general, some related to the topic of this thread. First, I want to echo those who have highlighted @gfp's contributions to this board over the years. Thank you for your thoughtful posts—I hang on every word. (I'm grateful to all the members of this forum, I should add!) Re: the topic of this thread, a comment that Seth Klarman made in an old issue of Outstanding Investors Digest (at least, I think that's where I found it) comes to mind. An interviewer asked Klarman about his hurdle rate, clearly expecting his answer to be some crazy nominal figure like 20%/yr. Klarman emphatically replied that he never targets nominal returns, only risk-adjusted returns. I agree that that's the metric to target. I would hazard that Berkshire has pretty much always (and maybe literally always, but I won't go that far) offered at least plausible risk-adjusted returns, including over the past two decades. As gfp mentioned, the key is not to interrupt quality compounding, and the easiest way to avoid interruption is to own low-risk assets that you know intimately. The stock's decent risk-adjusted prospects hold even today. Compare owning (an admittedly slightly pricey) Berkshire now with owning the S&P 500 at a Shiller P/E of 34 and with after-tax corporate profits/GDP near all-time highs, not to mention a degree of concentration that Ben Inker of GMO argues all but ensures underperformance in megacap stocks. So, has Berkshire "killed it" since 2000? On a risk-adjusted basis, yes, and it has a good shot of continuing to do so for the next ten+ years, especially if its dividend policy holds. My 1991 shares have done 14.46% p.a. for 33 years, my 2011 shares have done 15.04% for 12 years, and my 2020 shares have done 25% for four years. If you bought conservatively over the past three decades, you probably killed it in non-risk-adjusted terms, too. Anyway! Nice to meet all of you. Looking forward to many exchanges on this forum.
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