LC

We got indirectly lucky, were forced to sell a good chuck of the portfolio about 3 weeks ago to fund a house purchase. I am hoping prices decline so I can re-buy over the next 3 months.

Barbarians at the gate

Keynes was the guy turning supply side economics on its head, saying it was increased demand which spurs supply increases. When cars were invented, why didn't the horse-and-buggy industry just ramp up supply to increase demand? Regardless, supply vs. demand driven economies is a different discussion...which economists far smarter than us still argue over. I'm not talking about a slowdown in consumption or "wanting" to work. I'm saying, what happens to all the truckers/drivers when we build self-driving cars. Historically they work elsewhere. Because historically there have always been other opportunities for human labor. My question is what if those opportunities slowly dry up? Furthermore, is there evidence that those opportunities are drying up? I can see the argument for 'yes' to the latter question.

We can argue about that (Keynes would disagree) but my question remains. What happens if we become so productive at 'current' activities, and there are no breakthrough technologies to demand additional resources and force re-allocation? I.e. a situation of long-term idle resources/capital. Why would capital costs remain high?

Output for commoditiy products is determined by the demand curve though. Well, mostly (aside from non-market incentives i.e. gov't subsidies). My question is what happens when those ex-farmers are not able to be re-allocated. What happens when we become so productive? Why would capital costs remain high?

Why would output not change? Technological stagnation. Incremental improvements are not as groundbreaking as previous improvements. Take automobiles or farming for example. Why would resources be left idle? As a result of the above. We get so good at building a car, eventually that activity requires less and less resources. The hope is that idle resources are re-allocated elsewhere. Furthermore why would an increase in productivity lead to a decreasing rate of change in output? Again, just the nature of technological improvements. Eventually the activity reaches a level of production right around the cost curve. Only when something truly disruptive emerges does that change. An increase in productivity leads to both and increase in output and lower rates. To a certain point. The market got really great at churning out horse and buggys at one point

Labor, human capital, call it whatever you want. This is semantics. Interest rates are the cost of money insomuch as money represents earnings. Earnings are the result of productivity. If "money" has no intrinsic value then the cost of money is also intrinsically invaluable. Where do you see a difference between cost of capital and cost of money? Yes an increase in productivity results in lower rates. Less resources needed to produce the same output. This assumes "output" doesnt change. My theory is the rate of change in output has been declining, causing the relative increase of overall productivity, hence lower-than-"average" interest rates.

Interest rates represent the cost to rent capital. And capital here represents all forms: human capital, machines, factoreies, aka anything productive. Interest rates represent the average cost of productivity. So the question is how do you price productivity?

I agree, The real test will be if the people selling out for millions will be buying back in.

Here is a good news website for insurance related items: http://www.artemis.bm/

Hey all, Thought of a good idea for a topic: perhaps we as a board can create a compilation of good quality industry/trade resources (preferably free). Here is one to start if off: https://www.dslreports.com/ This is a great website for anything cable/telco related. I have been a member for probably 15 years now, back when I was a computer nerd in high school. The members there are current of ex- industry workers and intelligent customers and enthusiasts. It is frequented by people working 'in the trenches' (e.g. service repairmen, engineers, etc.) so you get some great commentary. They do an excellent job (mostly) of distilling information from a non-investment perspective, which provides a great counterbalance from an investment-focused perspective.

Why am I not surprised you're a pats fan? ;D ;D ;D

Mentally I focus on the whole entity. Because it starts from revenues and sales are agnostic.

Maybe this topic will 'trickle down' to the politics section. ;D ;D

Teamwork makes the dream work!

Which is essentially paying $18,800/year for 5 years (or about 100k) for your Canadian citizenship. For US healthcare, it's crazy expensive if you're not on an employer-sponsored plan. It's absolutely ridiculous. If I was retired or whatnot, and not wealthy, I would not be living here. I always ask, who is getting rich from all this? Is it the doctors? I don't think so. The government? Doubtful. Insurance/Pharma? Now we're getting warm... Or you could apply to come up here as a regular person under the regular immigration program. That'll only cost you a few grand for processing background checks, etc. The difference is that you wait in line for a couple of years. But once you're here you still get the healthcare. We're nice like that. :) Btw, why wouldn't you live in the US if you were retired? As fat as I know once you hit 65 you go on Medicare and you're on easy street healthcare wise. Well, my personal situation is unique...I had the (pre-birth, haha) foresight of instructing my grandparents to emigrate to Canada from Italy and have my grandmother give birth to my mother during their 10 year 'layover' in Quebec before moving to New York. Come the great age of 17 I applied for and was granted Canadian citizenship based on my mother's citizenship. It was much more palatable for a 17 year old with no money and no idea wtf to do with his life, to pay $4k/yr for tuition vs. the prevailing rate of $30k/year in the US. Citizenship is a valuable option. You can take your skills to whichever country provides the most compensation for those skills, and whichever country provides social services when you need them.

Which is essentially paying $18,800/year for 5 years (or about 100k) for your Canadian citizenship. For US healthcare, it's crazy expensive if you're not on an employer-sponsored plan. It's absolutely ridiculous. If I was retired or whatnot, and not wealthy, I would not be living here. I always ask, who is getting rich from all this? Is it the doctors? I don't think so. The government? Doubtful. Insurance/Pharma? Now we're getting warm...

Interesting to note how WB assessed risk.

The other difficulty is that WB/CM have been evolving with the company. They have been making allocation decisions as the war chest has grown and as the annual CFs have grown.

I don't think that person exists. I think it exists for certain vacuums (insurance, op biz, stock investments). If it were me (ha!), I would institute a dividend or repurchase program. Then, priority of capital goes Jain>Abel>T&T.

The scientific method works! ;D

Probably more profitable to be a perma-bull unless proven otherwise.

Look at this another way: examine what banks were doing in 2005-2007. Were they returning capital or growing their loans?

Hey I think I found it! https://www.dropbox.com/s/haqe3psl29u1scx/October_Quest_2013.pdf?dl=0 I got the name (PG) wrong (well kind of, he does an analysis of PG India vs. PG) but the general point is there. It's essentially about the undervaluation of quality businesses. We think 25x earnings is not undervalued but in many cases that turns out to be exactly the case. I.e. 'good business at fair price'.

Cigarbutt, I have been trying to find the study for years now. I read it about 5 years or so ago. I think it was published by Sanjay Bankshay (spelling?) For your questions 1) If it underperformed the S&P over that timeframe (incl dividends etc etc) then definitely not...so that I guess it the hole in the armor 2) I really don't know for the second question...perhaps? My perspective is skewed because I wasnt alive for that market, so I don't know if investors were more blue-chip hold-forever inspired? I really just don't know. 3) I don't think so ;D ;D