wknecht

Don't mind if I do...

Am I missing some news here?

To put the numbers out there: On 9/30/12, The Brick was on Fairfax's balance sheet at $109.7 mm (with a "Fair Value" of $152.8 mm). Fairfax's 34% share of the sale price is $225.9 mm ($11.10 a share) for a pre-tax gain of $73.1 mm ($3.60 a share). (Not sure if they also own warrants, but that's a much smaller part of the deal). I like the fact that after taxes, the sale occurred at a 31% premium to the reported Fair Value (and 83% above carrying value). But the numbers are too small to move the dial much.

Curious, it seems Charlie Munger Jr. decided to weigh in on the subject writ large... http://www.businessinsider.com/jerry-brown-and-the-mungers-2012-10 Quote from the article: "Charlie Munger Jr.'s measure aims to ban all corporate and union donations to political candidates."

Regardless of the legality, I find this highly irritating...strikes me as horrible judgement, and a waste of money. "Business reasons"...they sure make it sound like a euphemism for something else.

I was a little confused about the contracts also. I had thought they were options because the financial reports mention option pricing models and volatility pricing inputs. But on the conference call yesterday Prem mentioned "inflation swaps" which makes me wonder if they have a mix of swaps and options. Hopefully this was just a slip because to me the obvious preference would be for (cheap) options so additional losses don't accrue in the case of inflation.