Hawks

Bought some at $359 and change. This is about the fourth time I have been in and out of FFH over the years. Hoping to hear news in 2011 re purchase of whole companies as has been discussed on this board recently. My picks on TSE would be GVC and BIN.

I am somewhat surprised re some of the posts here which seem to be suggesting it is time to be a little more defensive (at least that is my interpretation). Even Myth said he might take some off the table. It is almost like a turnaround in thinking may (or may not) be occurring on this Board compared to only 7-10 days ago. I normally don't post much at all (prefer to be like a sponge and take in all the insightful info that members post here). But last week under the post "Too much risk, lessons not learned", I commented that I had decided to go to a mostly cash position. Some replies to that decision were: "overly dramatic", "fighting the last war", "aren't investing", "return on cash is low". You know what? After reading a number of the postings here "Re: Seth Klarman", maybe I wasn't too far off base after all (or at least I felt a little more comfortable). Could be dead wrong, but interesting how thinking ebbs and flows. And also, really depends upon each person's circumstances and objectives. Mine may be very different from those who were somewhat skeptical of my decision. And that's ok with me. Because everyone here has to sort it out for themselves and feel comfortable with all that. What a great Board this is.

SD I'm thinking along the same line which you just expressed. And you can add the terrible mess that Ireland and Greece are in with Portugal and Spain not far behind. Ordinary families in those countries are feeling a lot of pain which is not going to get better for a long time to come. To add further to your comment re "goods may well be on sale within 3-6 months", here is a recent quote (paraphrased) from Buffett and the CNBC transcript. He was talking about how to value equities and he said this: "And the real test of whether you would like it (a given stock) as an investment is whether you would be happy if it never got quoted again and just in terms of what the asset did for you" ie "the asset is going to keep delivering over time". Something to think about for all of us, inmo. How many equities do each of us own that meet this test? I think it really narrows the field and the landscape when you think about stocks that way.

Zippy1 I too prefer to hold undervalued securities as you said. I'm just having far more difficulty finding them in 2011. When I look at the 5 and 10 year charts of hundreds of companies which I research, most are at or very near their highs. If I were a "momentum" guy, I guess the thing to do would be to keep riding the wave as long as it wants go. But I'm averse to that way of thinking, unless of course I have found a "dog that can hunt" before the market does, and then I will ride it up for sure. Thanks for your reply.

Have enjoyed reading your responses to my post. To reply to some comments: Partner24: you quoted "Be fearful when others are greedy, etc etc.". I agree. And that is exactly what I said a few years ago on this Board when I posted "Why is everyone so negative?" And I followed my own advice at the time and was able to buy some wonderful, cheap equities such that I climbed back from my losses during the "crash" and am now well ahead of where I was during the peak of 2007-2008. So, by going to cash now, all I am saying is that it really concerns me that so many (like the media, govts, fund managers, etc) are now so enthusiastic and giddy and bidding prices up as if all problems have been solved. I am simply trying to be prudent, take my profits (and willing to leave some on the table if that is what happens) and protect what I have. But I can still dabble here and there, and that is what I will do, but cautiously now. FFHWatcher: you said "How can anybody be that sure about anything?". Hey, I am not all that sure that I am right. And I am certainly not preaching or teaching or calling a "market top" or anything like that. I am a simple man, content with what I have achieved with my retirement portfolio (when others were "throwing in the towel" and they are still now wondering how they will ever recover their lost savings). I've been retired some 5 years now, and there are times to be prudent and more cautious. The "stock market rocketship" took off some 12-18 months ago and I have enjoyed the ride. I don't mind getting out early if that is what the future holds. But I sure don't want to be the "last man in" still trying to catch that rocket. And with all that money flowing out of bonds and into equities, mutual funds, commodites, etc., it sure looks like everyone wants in! And you know, I can still dabble here and there; I haven't tied my hands behind my back so that I can't punch the "buy" button! Re: "the 1-2% equity stake" which I currently have. I have a small position in BIN on TSX (I'm Canadian, eh?). They are a waste and garbage collector in North America. And for sure, there's a lot of garbage out there in our society ready to be collected! I like their growth story so far, seems like smart management, and doing "tuck ins" here and there. Have a little of Radio Shack as has been discussed on this Board recently. It gets my attention when so many hate a stock and don't want to touch it. So I do some research and if it doesn't smell too bad, I load up my small peashooter (thanks Myth for that analogy) and shoot it. Also have some U on TSX. It is pure uranium (not mining stocks). Demand is growing for this fuel due to current nuclear plants but more so due to the large number of new plants coming on stream these next few years. And uranium has a long way to go to get even close to its high some years ago. Zippy1: you said in #2 in your list that "I can't time the decline". I agree with you. Is there anybody out there who can?? But I'm not trying to time anything. As I said earlier, I am getting more and more cautious with all the gains I have made. I will still buy here and there, but I'm not going in 90-100% again for some time (when: who knows?). You know, all those big problems out there have not gone away. There is the European debt problem, the state and municipal deficits and debts, the spiralling food prices causing revolts and hardship and starvation, etc. I want to have plenty of cash around when and if the market stumbles for whatever reason. Beerbaron: you wrote "invest with caution". I totally agree, as previously stated. "Blood is not running in the streets" like in 2008/2009 (unless you happen to be in the Middle East). Heck, even Buffett has been sitting on billions for the last 6 months or so, and not doing much buying as the "rocketship" goes higher and higher. And yes, I know, "he has loaded his elephant gun and his trigger finger is getting itchy". But there is only one Buffett. Myth465: you said "I suggest devoting energy to finding cheap companies". Absolutely agree. I love to do that. But I am finding it more and more difficult to find those these days. It was "like shooting fish in a barrel" in 2008/2009 but it took guts to buy when everyone was selling. Look what Parsad said about Wells Fargo back then, and a lot of people were skeptical but he was right on. So if any of you are finding those "cheap companies", be sure to post them. I will be your most avid reader. And I have cash to put to work! Cheers.

I don't post much, but this Board has so many astute, insightful members that it is enlightening to read all the postings many times each day. I could name "my favourite", but I will not go there because this Board is made up of ALL that post, with their agree/disagree comments but they are always respectively. Thanks to Parsad for all that he has done to create and inspire such an informative, insightful group of individuals willing to share in an intelligent, thoughtful manner. And to be respectful of one another. One post some time ago I did was "Why is everyone so negative?" Some of you long time members may remember that. It brought a tremendous number of responses, which truly amazed me, and kept me waiting for the next response and then the next. I learned a great deal from those responses such that my retirement investments/savings are in excellent shape and better than ever before 2008/2009. I know there are many people in this world who cannot say the same, but I am truly thankful for the member postings here. So, here is my question this time. Has anyone learned the lessons of 2008/2009? Right now, commodities are all the rage (as Buffett said,you are hoping the next guy will pay more than you just did (paraphrased), individuals are trying to chase the markets having missed the greatest run-up in the NYSE and TSE in decades, risk is back big time, and Klarman is warning us all as well. But Buffett seems ok with America recovering, but slowly which does sound good. But I am not sure that this is "we have seen this before" and that this is a normal, but slower recovery. And that America and the world is OK. I was invested 90-95% in stocks up until 2 weeks ago, and fighting back from terrible losses in 2008/2009 (when I lost 30-40%). But, back then, I did go back into the market at the depth of the markets, with all the great values that were being offered (I remembered what Templeton did when he bought hundreds of stocks during the Depression, which sent him on his way to becoming an all-time great investor which he carried over for the rest of his life), and so now, I am in the "green" and wanting to stay there. And as of today, I am now 98-99% cash. So, again my question: Have we learned the lessons of 2008/2009 and the Crash?

Bronco I have been here before, but not as active and resourceful and insightful as some of you (so I probably benefit the Board that way). But that's why I love this Board because of the thought process and analysis that goes on. I did post recently about oil stocks and European stocks, but got no replies. And awhile back, I posted about "why is everyone so negative"; huge response to that thread which was extremely interesting and rewarding. So, since you asked, I think some of my best ideas right now (buyer beware here; my opinions only) are companies like Bank of New York Mellon (fees give them their value), Cdn Natural Resources (oil sands negativity is high but too important to the U.S. to right off), Diageo (good play on emerging markets and great brands), Fortress Paper (Cdn company in Switzerland and Canada; banknote printing and specialty cellulose producer which will be used to manufacture rayon, a substitute for cotton), Petrobank Energy (mid sized Cdn oil producer; doing spinoff of international operations), Qualcomm (collects fees on hand held devices, but this part is undervalued by the market imo), Seaspan (mentioned on this Board before, and have met every ship target they set out all thru 2008-2010; dividend should be restored in 2011/2012), and Vodafone (divesting non-core assets, cash rich, great dividend). Again, these are my opinions only; I will live with the results.

Gentlemen Could we get back to why this Board is so insightful and worthy of reading every day. And that is, in additon to commenting on Fairfax and Berkshire, trying to find companies which are undervalued, with good margin of safety, and are shareholder friendly just like Fairfax, Berkshire, Chou, Baupost, Longleaf, etc. do all the time. Too much bickering and "noise" going on here right now for me. Just my opinion.

FFH is 8.2% of my portfolio.

Which American companies with a large per centage of sales and profits from worldwide markets (vs domestic) do you think will benefit from the weaker U.S. dollar?

In the last year, I have been reading more and more articles about crude oil. And as the world very slowly comes out of a severe downturn, and with the Asian economies continuing to expand and grow, oil stocks would seem to be the place where some good money could be made. I normally don't go to commodities due to their very cyclical nature. But given that crude oil stayed in the 70-85 U.S. dollar range thru these tough times of 2008-2010, I am beginning to think that it would be a good idea to overweight oil stocks in my portfolio for the next few years. Have already bought small amounts of Canadian Natural Resources, Daylight Energy, Total, ATP Oil and Gas, Penn West and Petrobank. Would like to know from more knowledgeable investors than me on this site, what are your thoughts? Are you putting funds to work here? staying away? What is the counter-argument to where I am leaning?

FFH is 5.4% (BRK.B is 6.5% fyi). Will buy more FFH if today's drop continues.

Smazz I live in Guelph. Raised in Waterloo. I was in business, then taught in University/College towns in Canada and Europe. The thought process is so vibrant in those environments. How is your golf game? (I know, a slight distraction comment from all the serious, insightful comments on this board). But what a wonderful forum it is.

Just got back from golfing with my gal in Niagara Falls these past few days. Didn't think about the market, and the market didn't worry about my golf game! so we are even on that count. When I first posted "all the negative news", I was pretty sure that some of the individuals on this board would respond with their insights and opinions. Never, in my wildest imagination, did I ever expect to see and hear so, so many intelligent, factual, contradictory (a good thing I believe), sincere and convincing arguments and points in response to my post. I want to thank each one of you for your responses; you have provided so much in the way of "food for thought" on how to proceed in this investing environment. And Parsad, I want to especially thank you, not only for the insights you have provided re your investing prowess, but especially for starting this board and providing a forum for intelligent conversation with so many "savy" and "wanna be savy" individuals (like myself). I know my mind is richer today because of what you have provided to all of us here. One further point. When I mentioned "blood running in the streets", "maximum pessimism", etc., I wasn't suggesting that today is comparable to the Great Depression or late 2008/early 2009. Those periods in my opinion were far, far worse and unsettling than today. My late Dad, who lived thru the Depresson, would certainly testify to that. What I was trying to say is that right now, all we seem to hear most of the time is negative, bad news; and that at times like this, it is better to commit to some very solid, enduring companies which offer "good value" than to sit only in cash. Yes, their stock prices may go down from here, but I believe the value of their operations is increasing as their weakest competitors fare far worse, and especially if things get worse. So, I will continue to "prune my weeds and try to help the healthy flowers grow". With some luck too, and contrarian thinking, this hopefully will happen. I will "eat my own cooking", and time will tell. Thank you so much to all board members for taking the time to share your insights and perspectives. You are the best.

Munger The market is "up 50% plus from its lows". But, how do you know that these lows will probably never again be seen in our lifetime, if you are 30 years or older. Why do you think 2008/2009 lows will come back? Is the end of the world at hand? Sounds way too pessimistic to me. IMO. Europe is way behind the U.S. in addessing its problems, the PIGS aren't even close, and China is trying to find a way to reasonably contain growth. But the US is at least working its way out of all this; not as fast as everyone would like. Especailly the midia and all the "talking heads". Thus there are opportunities for those who like to look down the road a few years. Do you think that Templeton bought his boatload full of stocks in the depth of the Depression because he thought he would be wealthy and right in 3 months? one year??? or never??

Sharper You said that Graham "would have done better by either buying less or waiting longer before buying". In hindsight, decades later, you are probably right. But, how does your record match up against his, given your criticism of what he did? How do you match up versus Graham in the last couple of decades? All I am saying is that there seems to be way, way too much negative news out there today, and that is not the time to retreat and sell eveything. That is what "lemmings to the sea" do. I really admire Templeton, not for his religious views, but for the fact that when everyone got emotional and negative, and all the bad news kept flowing out, he kept buying. Easy to say, "sell when stocks up, more difficult to buy lwhen they are low and going down". Time will tell.

Myth I agree with you; not a huge number of "no brainers". Not like 2008/2009. But good values are there, imo. I think Parsad commented on this as well a few weeks ago; and he put some cash to work as well. You are better at numbers than I am (I have followed your posts in the past) but would suggest you check out je.un (Toronto) cash flow and "moat" grows larger each month; day (Toronto) a growing mid-cap oil play in Canada but stock price down due to crude lows in last 5 weeks, tup (love their emerging markets penetration) and visa (huge moat, despite negatives in media re credit card companies and new legislation). In Canada, check out Goodwood funds and Irwin Michael (value guys for sure; buy $1 value for .50-60 cents; they like these 2 Cdn stocks).

To all board Members With the utmost respect for all members on this board which is without a doubt the most insightful and intelligent collection of insights and opinions I have ever come across in my investing research (thanks to Parsad for making all this happen), there is something I truly do not understand right now. So many of you respect Buffett, Watsa, Parsad, Templeton, Graham, etc. as I do, but what I don't understand is why so many of you are now so negative about the values that now exist in the market. It was Rothschild (maybe Baruch) who said "buy when blood is running in the streets". It was Templeton who said "buy when there is maximum pessimism" And Buffett said " buy when others are fearful". When I read all the headlines on CNN, Bloomberg, Yahoo and Google Finance, business television, etc., all I hear and see is gloom and doom. And yet, so many board members are going to cash, getting out of most equities, and waiting for the next 15-25% drop in the markets. You may be right, only time will tell. But I have been trying to remember when in 2008/2009 when my RRSP (yes, I am Canadian) took a huge plunge despite what I viewed as good "margin of safety" companies. And when the days were darkest and it looked like the world would come to an end, I remembered Templeton's words of "maximum pessimism" and how he bought a boatload of stocks during the Depression and in the end, turned out to be one of the wealthiest and most insightful investors of his generation. And now, I have come back from those depths of 2008/2009 and am close to pre-market crash (within 5%). That feels good, but the media keeps spitting out more and more negative news. So I decided about a month or so ago, to start using my large cash postion to buy some good value large caps in the U.S., mixed with some small cap Cdn companies. I have lucked out in that the Cdn dollar has depreciated vs the US and that has been a "margin of safety" so far. I could be totally wrong here, but it looks to me that the market offers good value right now (for example, huge discrepancy between Treasury yields and company earnings yields; Americans are finally building their savings again; historic low interest rates; huge cash positions and lower and lower debt levels for the best companies in America, etc.). Are the values as good as at the bottom of 2008/2009 when all of America was on sale and as Parsad said, "we may never see prices/values like this again in our lifetime" . I agree with Parsad on that one. But the values are good; pessimism is rampant, the "blood is running", the little guys are bailing out of equities. So, here is my question: why do so many board members (whom I respect so much for their comments and insights over the years), feel that now is not the time to buy? how do you reconcile your value investing style with your position of "selling now", "sitting on cash", "waiting for 25% fall", etc. with what the greatest investors of all time have been telling us all these years which is to buy when all the news is negative? I may be very naive about all this, and I may be too early re building my positions (someone once said that it is best to "buy too soon, and sell too soon", because no one knows the bottom) but I will "eat my own cooking" as some will say. Time will tell. Really, sincerely interested in what all of you think about all this. Thank you in advance for your time and comments.

As a Canadian, I own the following: adp ata.to bax brk.b cpb dell deo xom ffh fbk.to ftp.to gvc.to hf.to jnj je.un.to mdt msft pep pm qcom ssw tre.to teva tup v wag wfc wed.to day.to Largest holdings are ata.to, brk.b, deo, ffh, ftp.to, gvc.to, jnj, je.un.to, v. They comprise about 52% of my portfolio, in about equal amounts. When Cdn dollar weakens, my U.S. stocks benefit, and vice versa re stronger Cdn.

Parsad How about Glacier Media? Right in your geographical area too. And McElvaine also own lots. One of my favourites for a long time.

Sanjeev I cannot thank you enough for the quality board you have created and the many, many hours you have dedicated to make this site a "must read" all day and every day. The insights and comments from dedicated members on this board is like a "breath of fresh air" compared to so many other sources of information and news on the markets or "what to buy now" stocks. Wishing you a wonderful and safe Holiday Season.

Is anyone on this board following or has invested in Canadian Hydro Developers? Transalta has made a takeover offer at $4.55. KHD management is telling shareholders to reject this hostile, low-ball offer, and is soliciting offers from a "white knight". I have heard that some analysts think the value in this business is more like $6-7.00. Huge volume today, and yesterday which may indicate that another company is accumulating shares for a counter-bid. I've owned KHD for sometime and believe management is correct is saying the current takeover price underestimates the KHD future revenues and profits. Would like other opinions from members if you are knowlegeable of KHD.

Other than FFH, anyone finding cash rich Canadian companies benefitting from the weak Cdn $ relative to the U.S.$?

Also bought some ORH Preferreds in last 2 days. Question: any other Preferreds out there, in Canada or U.S., that present real value and opportunity in this environment?