John Hjorth

You guys should actually be posting in the "What are you selling today" topic in stead ... -Just saying! : - )

This somehow reminds me of Late Jens Otto Kragh, former Danish Premier Minister: "One has a view untill taking a new.". The Shareholder Letter from Mr. Watsa to come in March will be an interesting read from this angle.

Without putting too much into it: The Unilever dilemma: What comes now?.

Duly noted, SharperDingaan, - great post - about cutting it to the bone. Also H/T to especially Vinod and tombgrt in this topic [with regard to the last post from tombgrt, racemize not forgotten here]. I think it's time for me to move on here.

Thanks, NewbieD!, Yes, it's fun to investigate, but somehow also very cumbersome, and time consuming. Somehow, these Swedish tax regulations in this area for investments undertakings - at least to me - seem to be very attractive. For me and my family, as far as I know - so far -, there is no Danish way to circumvent/defer capital gain taxes on realized stock gains, except by doing this kind of investment, if you're not buing to hold forever. What I'm actually thinking about here, is: "If I bought a basket - so to say - "directly" - to "mirror" i.e. Industrivärden AB portfolio, what would the taxes be on such an arrangement, going forward - long term? [Even without the HQ overhead]. My own life expectancy is 23.59 years. The life expectancy of the Lady of the House is 21.53 years. For me, there is no way directly to compete with this tax arrangement - measured after tax - by i.e. Industrivärden AB or Investor AB - doing their investment moves, without incurring the capital gain taxes, unless I think I can do much better by doing the investments directly. I do not live in some kind of delusion, that I'm better at this - long term - than i.e. the Wallenbergs or Fredrik Lundberg. So, it's - for me - all about trying to weed out - and finding the good ones - among the Swedish investment companies subject to these particular rules.

Thanks a lot for sharing this, alwaysinvert.

alwaysinvert, Based on what you wrote earlier in this topic about the 10 per cent treshold I have tried to follow all links in the tax guidance from Skatteverket to see if I could find anything about it. I was without luck. But I did find this in Annual Report 2015 for Industrivärden AB on p. 53: I suppose the written there is correct, despite I can't find it in the tax guidance from Skatteverket. So I suppose there is a difference in the tax treatment of investees with regard to standardized income, based on at least 10 per cent voting power in the investee or not.

globalfinancepartners, The headline of the article is actually to some extent misleading, because it does not indicate, that the proposal was turned down, but that is mentioned in the article. And yes, depending on the structure, this could really move the needle for BRK. I also find the article interesting, because the content of the article gives some indication of, what's passing the desks of Mr. Buffett and Mr. Munger of potential stuff. This is [was?] huge. This could not take place without the involvement of both BRK at top level and the 3G people. Those 3G people are really into the space of huge deals now.

Bloomberg: Kraft Heinz Makes Approach to Unilever on Possible Merger.

I think you are right, rb. BRK is gradually morphing - as it has done in the last 50+ years. :-)

Great read! - Thanks for sharing, bookie71. This is one of those good stories - very impressive - that does not hit the press here. With regard to Mr. Buffetts health: I can't image, that there will ever come a situation, where the BRK board shows him the door, as Mr. Buffett him self called it in a shareholder letter some years ago. It's about generally beeing fit and proper for the job - all included, also health. When your body gradually starts quitting on you because of age, even the most basic acts might start getting cumbersome and time consuming compared to earlier in life. His hearing is in decline, he does not try to keep it a secret. So, likely his ability to communicate orally will be affected going forward. I have noticed that people of high age - perhaps it's just a local phenomen, I don't know - want to spend more time with family in general. Perhaps Mr. Buffett has such considerations - pure speculation from my side.

Thank you for sharing your insights here, alwaysinvert.

Jurgis, I had to look up the US tax concept of a PFIC. It seems hairy to me. For my part, this is not an issue to give attention. For me, these Swedish investment conglomerates - as long as they are corporations - get "ordinary Danish tax treament" [in both taxable and tax deferred acounts]. - - - o 0 o - - - - alwaysinvert, From your post I get the sense that the Swedish tax regime is like here in many respects: Overall rules with a lot of lacking specifics, and the practice actually just materialize over time - by litigation - by court decisions up through the court/complaint system. Certainly not pretty by any measure, and a very expensive way to establish a tax practice, the only parties involved in that getting satisfied are tax lawyers, getting paid dearly. Actually over time getting paid to establish a practice, in a legal battle with the Swedish IRS [called in Swedish: "Skatteverket"]. What's your basis for what you have written about the rule existing about holding at least 10 per cent of the votes on each investee? I can't see that mentioned in what I've linked to prior in this topic. - Perhaps something here just has skipped my attention. - - - o 0 o - - - I'm already invested in Investor AB, L. E. Lundberg Företagen AB & Industrivärden AB - small positions, Investor AB beeing the largest, at about 3%. And yes, ref. alwaysinvert, there are similarities - to some extent, but when you dive into them, they are not - actually, not at all - similar. - - - o 0 o - - - To me mentally, these positions are competing with SCHO.CPH inside the portfolios. - - - o 0 o - - - I expect over time to open separate topics for each in the investment ideas forum, if I choose to invest in the thing on my list [or already invested in it], otherwise I will just post my findings & conclusions - in short - max. 10 - 15 lines - in this topic.

Just don't ever "@" Mr. Pabrai, if you want to be able to read his tweets going forwards. Just saying ; - )

:-) In a few days there will be the 13F-HR to study and talk about on here. Digesting a few Howard Mark's memos and thinking about their contents also helps to get out of some kind of feeling of missery, or boredom while waiting - diversion of the mind, based on placebo... It works for me. I also use the Semper Augustus client letter that way - less placebo, more BRK. Beeing invested in BRK long term actually screews up your hierarchy of needs.

Thanks for the large contribution to my list, alwaysinvert!, - it's very much appreciated. Also thank you for your information and comments including your view on these kinds of investments at the moment. Actually, I'm having trouble valuing some of these companies and comparing them, because of different structures, generating different reporting structures caused by accounting conventions. [wholly owned investments vs. partly owned investments [listed/not listed]. I'm trying to make them comparable on some basic metrics and to decide on position size of each position of them in a basket, build the basket over some time, and then just basically sit on it long term, as a starting point [,meaning, always subject to that I may change my mind going forward, both with regard to basket size and individual position size].

Great question, wachtwoord, After thinking a bit about it: The reasons are several, and the common denominator for them are: Lack of mental flexibility, most likely geriatric based. My tent pegs are just hammered in the Danish soil, so they are stuck. Too lazy, too comfortable. Actually, I haven't moved my butt for more than 32 years now. They also speak so strange over there. It would in one way actually be like moving home. My grandfather on my fathers side was Swedish, and moved to the small Danish island Bornholm in the Baltic Sea from Skåne while young. On Bornholm, they also speak weird, language close to Swedish, more Swedish-like than Danish-like. I get reminded about it every time the old man gets angry, excited or eager. I would like to move south in retirement though - I hate Danish winters. The Lady of the House won't hear talk about all this. I call my self her AUM, when we have disagreements.

Scott, These investment companies are in Sweden taxed, so that the company is basically not taxed, but the shareholders only, and instead, are taxed, to avoid double taxation. The mechanics in the tax computation goes like this: Basis for taxation for the company is a standardized income, which calculation basis is the market value of investments at the beginning of the year minus the value of what by Swedish tax law is defined as "business-related shares". That calculation basis carries a standardized income of 1.5%. To that calculated standardized income the company has to add dividends received from investments, and the investment company can deduct management cost [basically the most of the costs related to running the investment company, net financial expenses etc. [the most of these companies uses leverage to a modest extent], AND dividends paid out to shareholders. The best way to get a feeling of the tax mechanism for such a Swedish company is to study the financials for Industrivärden AB. Just visit the website, switch to "English" by pressing that button on top of front page, grab the 2015 financials for the company, and study the tax note [note 8 on p. 45]. [industrivärden is in this respect "totally clean", because it has no wholly owned investments. The tax mechanism gets "burried" in the tax notes for the investment company, if there are wholly owned investments subject to joint taxation with the investment company, like in Investor AB and L. E. Lundbergföretagen AB.] Industrivärden has made good money in recent years, despite that fact it has a tax loss to carry forward of SEK 7.054 B at the end of 2015. So, in short, such a Swedish company can actually roll in and out of positions without incurring taxes on capital gains [and also not get deductions for losses on positions, if some investments goes south]. Such a Swedish company can actually hoard retained earnings much faster than a company not having this particular tax status, because it is not deferring taxes on unrealized capital gains on stock positions. There are some conditions, that have to be fullfilled for a Swedish company to obtain this tax status: 1. The portfolio has to be fairly diversified. 2. The company has to have "many" shareholders. 3. The companys actual and real activity has to be almost exclusively management of securities. - - - o 0 o - - - If there were such rules in place here in Denmark as part of the Danish tax regime, I would start out monday morning at 8:00 AM building such a damn thing, starting out with my own money, getting the tax status later by taking in OPM.

Within the last few years, this kind of investment has caught my attention. It has caught my attention for tax reasons. In short, it's to me the almost perfect investment, with regard to taxes in Danish tax deferred acounts. Naturally one has to build some kind of conviction about what these conglomerates are actually doing - right now, and going forward - expected. That's hard work and somehow cumbersome & dull. What I have been trying to build lately is a list, containing: The listed Swedish companies, with regard to taxation, subject to the Swedish tax rules of an "Investment företag" In English: "Investment undertaking"[link: here.] The listed entities so far identified by me, subject to those quite special Swedish tax rules, are: Investor AB [iNV A STO or INV B.STO] Link. L. E. Lundbergföretagen AB [Lund B.STO] Link. Industrivärden AB [ INDU A.STO or INDU C.STO] Link. Investment AB Öresund [ORES.STO] Link. Kinnevik AB [KINV A.STO or KINV B.STO] Link. Somewhere, on some Swedish website, a few months ago, I read, that there would be about a docen of companies with this particular status with regard to taxes mentioned above. Which companies are the rest, that I've been so far not able to identify? Any help on this question would be much apreciated - especially from my fellow Swedish board members on here. Thank you in advance for any input.

Thanks, VersaillesinNY! [around the 14:00:00 mark or so: comments about a young school boy going rogue, shorting AT&T stocks, because he's found out most of the teachers pensions funds were invested in AT&T stock!] - This is almost killing me! - lol

Pretty good humor, SharperDingaan! It could actually be a tweet by Mr. Taleb. I saw a bet there, in the category "Trump Specials": "Golden shower footage to appear on RedTube". Odds appeared to be 4/1. Hilarious.

Moderation and truce has to start to start with each of us, before we are asking it from somebody else. The board members here by large should be reasonable, non-violent people, so it should not be hard to have a civil discourse. If not, these threads should be locked. +1 - It's actually that plain simple, as posted by Spekulatius. I post here with my civil name - the name stated in my passport etc. - like Jurgis, Sanjeev and Eric. It's the best way for self moderation, and to stay out of trouble - for my part, at least. Jurgis, Sanjeev and Eric may have other motives, of which I have no knowledge. I respect other board members don't have this opportunity as living the lonely life of managing OPM. Unfortunately, I'm equipped with the worst temper even imaginable from birth - My father is an old school military man, distilled to the extreme -and his genes are in me. It took me many years just to acknowledge that fact, and try to shape my own behavior accordingly, in the meantime causing so many - actually - and uncautionally - selfinduced problems, untill I ended up realizing the facts of from what I'm built, relatively late in life. And life's got a lot easier from then going forward, in general. In short, if something makes you go ballistic on here, - take a break - do something else - positive - on your immediate mind - and get back, when you are cooled down again.

Ref. the question from racemize earlier in this topic, I have to step forward - in embarassment - because I asked my self the same question about 4 - 5 years ago - and ended up stuck on the question. Then, I found This, now even older, Gurufocus article: Lessons From Warren Buffett’s Personal Portfolio [2010.05.25]. The basis and assumptions of the article are false. What does a - former - then younger, and brain washed - Danish CPA do here? Answer: Get a fall back, and start trying to reconcile... it all! - position by position - to test, if the basis is true!... Which it is not. Old news then still apply today. Please just take the F13/HR related to year end 2015 and try to reconcile it to AR 2015 with regard to the number of shares of KO owned by BRK. Since then, I have been stuck, with regard to the understanding of that particular column in the F13/HR. I have tried searching the edgar site, but unfortunately without luck, and ended up giving up in the end, now long time ago.

It's pretty good humor, Williams406! I think I'll start babling to the Lady of the House that we really need some airline stocks now - earlier I have told her, if I ever start babling about buying airlines stocks, she has to stop me! - And to be very persistent with regard to suggestion for alternatives! - Oslo, Stockholm, Paris, Berlin, or perhaps even Hawaii, - here we come! [i call it an "inverted Garfield" - after the Cartoon Cat Garfield] - - o 0 o - - - James, thank you for sharing BAM's remarks on cash. I have read it before a few months ago, but forgot about it. It's certainly worth a print.

I'm with no_free_luch here. To me, [by that phrase I mean: It's not for discussion on this board, how I perceive this topic], it's just [yet another] political board spam topic. Let's all go back to discuss investing.