Spekulatius

Nuclear power <> fusion. Nuclear power is solved from a technical POV since the 1950's. I agree on autonomous driving and I think we will see that before the majority of the cars will be electric. I am not sure, if the ownership model will change. Some things change much slower than I think they would. When online banking came out in the late 90's, I really thought that this would make bank branches obsolete, but here we are 20 years later and we still have more branches l than back then ( I think). And that is just with a fungible asset ( money) that can easily be virtualized and moved around online.

I bet the presentations about nuclear power in the 50's looked the same. Some changes occur faster than anyone expects, and some slower. Sheba has cherry picked examples. I also think that his cost estimates for electric vehicles (repair costs etc) as well as for current vehicles are way off, just to pick some details.

Mentioned in an earlier post that she's trying to pay for tuition. Can't see how this ends poorly ::) . Either college is all paid for or no college. Assume I have $7.50 in one preferred share. I sell and buy 3 common shares instead. In few weeks, the pfds jumps to $14.00 and common jumps to only $7.50. I sell my common shares for $22.50. Is $22.50 better or $14.00? Even today if I had any preferred left, I would convert to commons at these prices. I thought you all were smarter than me. ok., assume common only goes up to 4.00 and pfds to $9.00. I still have $12.00 rather than $9.00. Let’s poke holes in my analysis and if I made a stupid decision. I want the money now to pay for education and not wait 10 years. why are you not ready to convert to commons ? The folks here are probabły smarter than you. You made a scenario with made up numbers where common made up better than preferred, but that does not tell us anything. Preferred are senior in the capital structure to common, so there is a possibility that preferred get made up whole and common could get nothing. FWIW, I have not met many people in my life that won money gambling just when they needed it.

Aren't these cryptocurrencies inflationary? As I understand that it, mining these cryptocurrencies does not create any real value, so basically, a fan cryptocurrency has a value, this means that the value of the currency we currently own is devalued. Right now, the total value of the crypto currency creates an s probably still too small to matter, but if it becomes significant, there should be an inflationary impact on the economies. I also think that the government eventually will crack down on this for above reason and the ease to use it for money laundry. Sure, the government mayn't be able to control who owns it or who uses it, but if they make the use of he cryptocurrency unlawful, then the cryptocurrency would become a Mafia currency of some sort and be worth far less for most of us. I think it is just a matter of time when this get regulated to some extend. This is now like the "Wild West", but eventually, the Wild West was ruled by law as well.

Yes, it created wealth *at the top end* but it also meant a big chunk of the population were disincentivised and unproductive. If it was such a good system for creating wealth, there's a decent chance the south would have been wealthy enough to beat the north. In fact, the north's economy dramatically outperformed the south's and was a major factor in winning the war. Similarly if slavery was an effective economic system great wealth would have been created in feudal Europe; in fact, wealth creation exploded as we moved away from the feudal system. Slavery is a great system for moving wealth from the poor to the rich; it is not a great system for creating wealth, not compared to free trade. Ha! Fair. Although everything is relative: what I meant was that America didn't start with a feudal system and have to waste centuries persuading the lords to give up their serfs. +1 The problem with slavery is that so much human capital get's underutilized. Since sales have no prospects, their productivity is low and you lose the human capital of smart and ingenious people's with a lot of skill just working the cotton fields. The main reason the south lost was because the North had the numbers and the industrial capacity that the south could never build, partly because of slavery

I would drop FB first without hesitation, AMZN would be next. Ironically, the hardest one for me to drop would be MSFT, mostly because I use Excel a lot for work.

Scotty is probably getting stoned as I write this.

UPS

That would be my recommendation. I don't know why people feel compelled to discuss politics here - this is and investment board. Granted, politics and investment mix to some extend, but much less than generally presumed. Even Munger said, that politics don't matter much for BRK's business, I don't know why it should matter for us here.

DISCK - I think my thesis is broken after the earnings report. Cordcutting increasingly seems to become a strong headwind.

EEQ

Maybe, these guys with good looking track records were not that good to begin with, just lucky. Since there are so many entering and exiting the field, some ought to get lucky. With investing, it is hard to distinguish luck from skill with investing, a track record of a lucky, but unskilled manager, might look the same this thread track record of is skilled investment manager. I probably takes a along time (> 10 years for sure) to distinguish skill from luck, just based on track records. Another possibility is that some of those with skill over time get fat and lazy and are just not that good any more.

Oh, I agree it's not a fad. It makes long-term sense. But you have a congregation of capital of enormous size going into them. When a correction happens it will be bigger and faster. The recovery will also be quicker. Cheers! Many things begun by smart people and end up being done by fools in the end.

It's going to pop. the reason may not be known and it does not really matter. These bubbles are reflexve, due to positive feedback mechanisms. Prices rise, because prices rise and the inverse logic applies as well. Interest rate rises or government interventions may do it. Once prices stop to rise, the marginal buyers (Flippers etc.) will be gone, the natural buyers won't feel buying pressure any more and hold out, and prices start to fall. It will take a while to show up in numbers, but a change in buyers perception can change in a month or two all of a sudden. I have seen this happen several times in different markets. Real estate is one of these things that feels like a better buy to most people, when it's expensive and getting more expensive.

Money is fungible, how would you determine where the Dollars for a specific expense is coming from? The whole idea makes no sense to me, unless you talk about money laundry.

No wonder, he likes 3G, he provides some funding and his reputation, and they do all the work. It's a great arrangement for the old fool, who would not like such a deal and the folks that make it possible?

Are your prices adjusted for inflation? As you can see from the graph I posted earlier, after the smaller late-80s bubble burst in TO, it took over 20 years to get back to the same point inflation-adjusted. The prices are not adjusted for inflation. Even more astounding - my first 30 year fixed loan had an interest rate close to 7%, if I recall correctly, my last refinance around 2011 (for a 15 fixed then) and interest rate of 2,5%. it just shows him disconnected home prices can become from fundamentals.

Well you never know. I bought a house in CA in 2002 for $320k. The value of my house peaked around late 2005/early 2006 at ~$500k. The the prices started to go down and value of the house bottomed around 2010 @$280-300k. I for sure would have been able to buy a nicer place for the same money around 2011 or 9 years after I purchased my house. I sold it in early 2015 for $465k because I moved elsewhere. So, even though I did not buy at the peak, I could have purchased my house about 9 years later for the same price after the correction caused by the Great Recession. Strange things happen, when people go collectively nuts.

Not sure I agree with either of these statements. An unemployed surgeon is more valuable than an unemployed ditch digger. Price does not equal value. Free education does not devalue the education. The price is just a transaction price. Look at the Chinese cities built upon free IP, they are in fact more valuable because they have removed the transaction cost. Most education and information is already out there to learn freely. Heck, I can download a med school's worth of textbooks and watch all the lectures online. That is not the reason we don't have a civilization filled with doctors, engineers, etc. I grew up in Germany where education is free. You can go to an university and basically study what you want, if you pass the Abitur (except some restricted subjects like Medicine). However starting at a University does not mean you will be able to get a degree. There is not that much guidance, it is sink or swim. Half the students were gone after 2 semesters because they figure they wouldn't make it. I like meritocracy based in skill and hard work.

+10 or so 8) I liked "Fooled by randomness". The rest of his books are just repetitions of the same idea, written with pompous prose.

Financials are different in the sense that treating the owners fairly is not the main concern of the regulators. Since most of the capital that financial are working with is debt of some sorts, the main concern is that the creditors and are made whole as much as possible, because the trust that you get paid back is what keeps the financial system functioning. If the owners lose, well that is their problem, but as long as the financial system works, it is not a major concern for the regulators . I always felt that bowing to the regulators is the price to pay for getting access to other people's money at favorable terms.

Chinese love of old, wise and rich men! WEB is sort of the 21st century Buddha.

It is amazing how Buffet has this public persona where if you went to work for him, you had a job till you die. But in reality, if you made mistake, you get the boot or as they say "retire". Despite this, I think Berkshire has some of the best executive/employee retention track record. Does anyone here know how Berkshire pays its managers and what are the tools to keep them on? It seems to me he has this low risk culture for subsidiary executives. If they just dividend the money back to him they get paid more; if they risk some money: they better get it right; if they do get it right, then they get to manage a bigger subsidiary and get paid even more; if they get it wrong, they'd have been better off not taking unnecessary risks and letting Buffett manage the money... In other words: they are allowed to shoot fishes inside a dry barrel; if there is still water then they shouldn't risk it. This kind of low risk culture is the exact opposite we see in public companies CEOs and seems to me is a big advantage for Berkshire wealth maintenance objective. I suspect the acquired business weren't that great and t wasn't just the decline in the price of crude that impaired the,. WFT for example appears to run their business very poorly, or they become poor business while they own them. The executive probably was canned, because that was an unforced error - WEB encourages bold on acquisitions, but does so, because they are supposedly low risk. I think he sees the acquisition price and probably was Ok will what they paid, but if the business owners twelfth is crap, it's on the executive and in my opinion should be dealt with, From my perspective, the due diligence that a lot is of executives do on these acquisitions is laughable. I have experienced a few as an engineer where I thought that sending a few good engineers and operations people into the to be acquire company for some due diligence would have uncovered issues very quickly, the came later back to haunt. in public companies, failure with acquisitions are rarely acknowledged an much less leads firings, at least not at the executives ve level. It can lead to consequences at a mid r upper management levels, when they can't get a handle on fixing something that supposedly did not need to get fixed to begin with. My favorite quote from the Sopranos applies to the business wowners world as well, maybe even more so than for the Mafia: "Money flows up, shit flows down"

Looks like WEB really dislikes DOW and hedges his exposure. I think he is onto something,because DOW was snreally to a large extend a commodity chemical company that claims to be a specialty checmical company and that will at some point see a Dramatic reduction in margin. I think it will be a great short at some point. Besides that, even specialty chemicals see large variations in margins, that tend to expand early in the economic cycle and contract in the mature state. There is a lot of petrochemical capacity being build in NA, which I think can lead to oversupply issues.

"An investor should ordinarily hold a small piece of an outstanding business with the same tenacity that an owner would exhibit if he owned all of that business.” And another one... To make money in stocks you must have “the vision to see them, the courage to buy them and the patience to hold them.” And another one... You've gotta know when to hold them and gotta know when to fold them....