muscleman

Your answer is too vague. I asked a couple of questions. Which one are you referring to?

Since there is a general accounting question thread, I think it also makes sense to have a general tax questions thread. :) Let me start with this question: Liberty Interactive acquired TRIP at a very low cost basis, let's assume it is $10 per share for this question's sake. They later wrapped the stocks into LTRPA and spun it off. Some people say after two years, if LTRPA is acquired as a stock for stock swap, there will be no taxes. 1. Does this restrict it to acquisition by any company or just TRIP? 2. If LTRPA is acquired by, say AT&T and swapped for AT&T stocks, what's the tax basis for LTRPA shareholders? I think it should be ONLY related to the cost basis when each shareholder bought the LTRPA stock, right? 3. In that case, what's the cost basis of TRIP inside AT&T after it acquires LTRPA? Is it $10 a share? 4. What if LTRPA is acquired by TRIP for a full stock deal? In that case, what's the cost basis of TRIP for the original LTRPA shareholders? What's the cost basis of the TRIP stocks that TRIP just acquired from LTRPA?

You should start a thread for OnDeck. My take after looking through over 200 bank statements is that whenever the provision ratio goes down, it doesn't smell good. The reserve can remain high merely because they haven't charged off the losses from the reserves. It doesn't mean anything. Another problem is that when a bank is growing too fast, the growth can hide the delinquency problems. For example if your bank is growing loans at 20% a year, and if the loans usually perform for two years before they default, then you can look really good for the first 3-4 years. The growth of the new loans in year 3 will hide the delinquency problems for loans made in year 1. And if they find this problem, they can lower the underwriting standards to accelerate loan growth, so the problem will be hidden for even longer. Eventually it will be a grand bust. I am not saying OnDeck is sentenced to this game. But I have concerns that I don't know how to dig further to fully understand.

You have to be careful. OnDeck reduced its loan loss provision/revenue ratio substantially after the IPO. All the net income growth comes entirely from that. :)

Might be a typical politician exodus during an administration's final year. Nothing too exciting. He may be heading toward Wall Street I guess. :)

Please excuse my ignorance. But my understanding is that they are trying to consolidate the four cases into one in DC's district court, but that does not include consolidating the Perry Appeal. http://gselinks.com/Court_Filings/Jacobs_Hindes/15-00708-0039-A.pdf ===================== The Federal Housing Finance Agency (“FHFA” or the “Conservator”) respectfully moves the Judicial Panel on Multidistrict Litigation (the “Panel”) for an order, pursuant to 28 U.S.C. § 1407, transferring four pending actions concerning the Conservator’s and the U.S. Department of the Treasury’s (“Treasury”) entry into the Third Amendment to the Senior Preferred Stock Agreements, as well as any subsequent actions, to the U.S. District Court for the District of Columbia for coordinated or consolidated pretrial proceedings. ===================== However, if Perry Appeal turns out in favor of us, I am sure it will impact the District Court's review of the consolidated four cases, should that be granted by MDL.

Isn't that part of the "point". He's able to see and understand things different than us? That's true, but I wish someone could walk me through the numbers and get to Allen's conclusion. Well I bet I had better discuss the numbers in the CMPR thread.

Good question. I start to think we need a CoBF bar raiser program to improve the quality of the threads here. :) The quality of the threads are getting lower and more posts filled with "Oh Bruce added 100000 shares today". Or "Oh Prem Watsa said he expected a huge upside"

Anybody looked at the government's filing today in MDL? Please share with me your brilliant thoughts! :) http://gselinks.com/Court_Filings/Judicial_Panel/MDL-2713-0008.pdf The government said this: "Actions may be transferred to any district for coordinated or consolidated pretrial proceedings where civil actions pending in different districts involve “one or more common questions of fact” " Well, this is outright wrong. I googled and found this: http://www.pretzel-stouffer.com/profiles/pdf/Multidistrict%20Litigation%20to%20authors.pdf "if only one question of fact is common to two or three cases pending in different districts there probably will be no order for transfer, since it is doubtful that transfer would enhance the convenience of the parties and witnesses, or promote judicial efficiency"

Thank you for starting this thread. The mistakes I made: 1. Foray into the Oil and gas industry. I lost money on SD and ATPG. It is really hard to value this sector. Better to avoid. 2. SHLD. I bought merely because Lampert and Berkowitz bought. Later I realized well if the EBITDA is negative, then the situation is really serious. Then I sold in a short squeeze and fortunately didn't lose money. 3. Chinese reverse merger frauds in 2011. I lost quite a bit of money there. I didn't listen when there were so many obvious signs of wrong doing. 4. BBRY. I didn't lose money here but I felt like this is a serious mistake to buy. Could still be controversial to members here. I bought early last year and then thought, well, the business is declining faster than I expected. I thought their passport phone and a few others will be a killer but that didn't happen. I shouldn't have bought in the first place. 5. Municipal bonds in Puerto Rico. I bought a medium sized position of Highway bonds in 2014 summer at 36-39 cents. I significantly underestimated the will to protect pensions. I might come out without losing money but I got my capital stuck in this illiquid situation for over a year now. I think the biggest mistakes I made are blindly following super investors into various situations. It is obvious that even the best and brightest sometimes make mistakes that's so obvious. Nowadays I only stick to one type of investment: Asset light companies with fundamentals vastly improving. This principal applies to both growth stocks and turnaround stocks. Screw deep value. Screw bargains based on asset valuation. :( I think it will also be helpful to talk about traps that I avoided. I apologize if the following made anyone here feel offensed. 1. VRX. Financials made no sense to me. When the stock was $150, EV/EBITDA = 20x. Why would I buy something so expensive? 2. MBI. I compared MBI with AGO in 2011-2013. AGO is obviously better. At least it is making money. Most people on the board weren't interested in AGO but a lot of them interested in MBI. Why? Merely because Berkowitz and a few other supers own MBI. That's not rational. 3. Eurobank. A few people got burned on this name last year. When I compare Eurobank with Bank of Cyprus. BoC is clearly the winner. Vastly improving Macro in Cyprus vs Hell in Greece. Similar valuations. Why did people buy Eurobank? Merely because Prem Watsa + Wilbur Ross were into it. I think herd behaviors can be observed on the value investing community as well. Momo "investors" herd into FANG stocks while value investors herd into BBRY, MBI, Eurobank and VRX. It is very important to avoid herd like behaviors.

Does anyone understand AVM's investment philosophy? I examined the historical trades in dataroma and found most of his positions as high P/E businesses. CHEF, TRIP, CMPR etc. I haven't seen any value investors buying such high P/E stocks. Can anyone help me understand his approach?

thanks! Thanks a lot! Do you have his earlier year letters, from 1999 to 2005?

It looks like FHFA is still filing motion to dismiss in the Saxton court. I thought they would file the motion to transfer in this court and ask for a hault, and still the same old argument without regard to the recent Delaware 9th circuit court's ruling. http://gselinks.com/Court_Filings/Saxton/15-00047-0076.pdf

if govt loses in dc cir ct in fromt of this merits panel, then scotus can either agree or not agree to hear appeal...appeal not of right. throw of dice appointing judges, it can always seek to have case reargued in front of all 17 judges, en banc. see http://www.law.du.edu/documents/denver-university-law-review/v86-3/Berkus.pdf for more on this. Well, if delay is the primary defense strategy for the government, then it seems almost granted that the government will seek to have case reargued in front of all 17 judges right?

I wonder if anyone has any thoughts on Patricia? She got appointed by Obama into this court of Appeals. https://www.washingtonpost.com/politics/senate-gop-filibusters-two-obama-nominees/2013/10/31/c232a6d4-424a-11e3-8b74-d89d714ca4dd_story.html In addition, I wonder if anyone knows about Supreme judges? I am sure if we win in the Appeals court, FHFA will appeal in the Supreme court.

Thanks a lot! It is very interesting to read his thoughts over these years. If there is an interview opportunity next time, I would ask him about his commentary on SD in the 2011 letter. He quickly sold out SD in 2012 and luckily avoided catastrophic losses. What was his thinking process on this whole saga?

Come on. We got Lamberth last time. We deserve someone better this time! :D

Well that depends on whether the judges are randomly chosen or the plaintiffs and defendants can appoint them. If not randomly chosen, the probability is very hard to calculate. i have read that it is random, using a process that court wont disclose EDIT: found the link: http://www.law.du.edu/images/uploads/neutral-assignment/Neutral_assignment_links.pdf (15 years old so process might have changed) In this case the chance is 1 out of 289. However I assume there are other judges that will also believe in law. :) And I still have hope in the US and believe Lamberth is a rare beast in the US judicial system. In other countries like Russia and China, most judges are like Lamberth. The government is always right, no matter what it does.

Well that depends on whether the judges are randomly chosen or the plaintiffs and defendants can appoint them. If not randomly chosen, the probability is very hard to calculate.

From GSELinks: The Panel directed today that: -- Appearances are due on or before Mar. 30, 2016; -- Corporate disclosure statements must be filed on or before Mar. 30, 2016; and -- Responses to FHFA's Motion to Transfer must be filed on or before Apr. 6, 2016. If the parties move quickly, the Panel may be able to consider FHFA's Motion to Transfer at its hearing scheduled for May 26, 2016, in Chicago. If that date doesn't work, the Panel's next bi-monthly hearing will be held on July 28, 2016, in Seattle." I bet after the hearing, there will be all other kinds of arguments, so the delay is at least 5-6 months.

I think it is only the four cases below that FHFA is asking to transfer. Did I interpret it incorrectly? Saxton v. FHFA, No. 1:15-cv-00047, was filed on May 28, 2015 in the U.S. District Court for the Northern District of Iowa and is pending before Chief Judge Linda R. Reade. The Saxton plaintiffs filed an Amended Complaint under seal on February 9, 2016. (Docket Sheet attached hereto; Amended Complaint filed under seal.)  Jacobs v. FHFA, No. 1:15-cv-00708, was filed on August 17, 2015 in the U.S. District Court for the District of Delaware and is pending before Judge Gregory M. Sleet. (Docket Sheet and Complaint attached hereto.)  Robinson v. FHFA, No. 7:15-cv-00109, was filed on October 23, 2015 in the U.S. District Court for the Eastern District of Kentucky and is pending before Judge Amul R. Thapar. The Robinson plaintiff filed an Amended Complaint under seal on December 29, 2015. (Docket Sheet attached hereto; Amended Complaint filed under seal.)  Roberts v. FHFA, No. 1:16-CV-02107, was filed on February 10, 2016 in the U.S. District Court for the Northern District of Illinois and is pending before Judge Edmond E. Chang. (Docket Sheet and Complaint attached hereto.) Please see paragraph 1 of this link http://gselinks.com/Court_Filings/Judicial_Panel/28-0001-01.pdf The Federal Housing Finance Agency (“FHFA” or the “Conservator”), as Conservator of Fannie Mae and Freddie Mac (the “Enterprises”), respectfully requests that the Judicial Panel on Multidistrict Litigation (the “Panel”) transfer four Enterprise-shareholder actions pending in four district courts (the “Related Cases”) to the U.S. District Court for the District of Columbia for coordinated pretrial proceedings. Each case—and more that FHFA expects may soon be filed— involves plaintiffs with the same interests asserting the same claims arising out of the same transaction against the same defendants.

The MDL thing is beyond my depth. I'll have to ask around, but I think you usually consolidate into an existing court rather than move to a completely new court. Moreover, they're trying to move to DC so they can use Lamberth as precedent -- doesn't matter if they get Lamberth assigned or not. I've been researching and thinking about this since last night. I think the best strategy right now is to ask the other 3 cases' plantiffs to withdraw their case without prejudice. In this case, the MDL motion to transfer instantly becomes invalid.

https://apps.americanbar.org/litigation/committees/classactions/articles/081810-101-MDL.html ============================= How does the MDL Panel decide where to transfer the cases? While the MDL Panel has the authority to transfer the case to any district, it often selects a district with a currently pending case. The MDL Panel will usually select the most convenient forum for most of the parties and witnesses involved. Do I have any say in whether my case is moved into an MDL? Yes, but you have to act quickly. You have 20 days to file a brief—limited to 20 pages—in response to a motion to transfer. The matter will then be set on the MDL hearing docket. If the MDL Panel has already established an MDL for a particular set of cases, your case can be transferred by means of a “tag-along” notice with no hearing, unless you object within 15 days. ============================= I expect plantiffs to move quickly on this. Unfortunately it didn't say how long does it take for MDL to make the decision and whether FHFA's motion to transfer automatically pauses the current cases.

http://www.classactionlitigation.com/mdl/faq.html#q2 There are a number of interesting text here. ========================= Q. How Does a lawyer avoid having a case consolidated under multidistrict litigation rules? Only federal cases may be sent to one judge under the federal multidistrict litigation statute and rules. If a lawyer wants to have a case heard in a state court, he must carefully draft the lawsuit to avoid "federal question" claims and to avoid what is known as federal "diversity jurisdiction." Under certain circumstances, a case filed in state court may be removed to federal court by a defendant. After a case is removed to federal court it is then subject to being transferred to one judge as any other federal case. The MDL rules provide that when a consolidation occurs all cases of a similar nature then filed as well as all later cases that may be filed are to be sent to one judge. These later cases are call "tag-a-long" cases. Therefore, what sometimes occurs is a lawyer will file a case in a state court, have it removed to the federal court in the state where it was filed, and then, have the case subsequently transferred to a distant state. To avoid this scenario, the complaint filed in state court must assert claims over which a federal court does not have jurisdiction. ========================= The Jacobs case's jurisdiction should be the state, but I am sure FHFA would argue that the jurisdiction is not in the Delaware state.

http://www.jpml.uscourts.gov/sites/jpml/files/Pending_MDL_Dockets_By_Type-March-15-2016.pdf http://www.jpml.uscourts.gov/sites/jpml/files/Recently_Terminated%20MDLs-1-1-2016_to_3-15-2016.pdf It seems like MDL needs many many years to decide a case? OMG. Am I looking at the right document? :o