John Hjorth

Gents, please note that it's still only some hours ago, that alwaysinvert posted here on CoBF today: It just so striking. This - today - is his [Mr. Buffett's] favorite playground.

alwaysinvert, I have already omitted/excluded Mr. Buffett's conversion on July 1st ref. : These conversions being charity related - like Buffett's - seems highly likely.

Thank you for a convincing explanation, gfp, That said, personally I would have brought the buyback specification to tie with the cash flow statement for 2019Q1 by adding the USD 106 M to "Treasury stock acquired" in the cash flow statement and accruing the same amount in top of the cash flow statement in the adjustments to earnings in the line "Changes in operating assets - Other liabilities" [Consolidation adjustment, or just enter the actual settlement debt in the general ledger for the parent before firing up the consolidation system]. And well, it doesn't really matter - it's peanuts for Berkshire. - - - o 0 o - - - On another note more related to this topic - the possibility of a stock tender from Berkshire - and after spending a lot of time on Berkshire in the weekend - I did the same calculation that aws did to find out if shares were bought back in 2019Q3 till July 25th, and reached the same conclusion as aws. What caught my eye was the extent of conversions of A-shares - 5,919 converted in 2019H1 and 772 non-Buffett shares converted in the business days of the first 25 days of 2019Q3. Isn't that a lot? Anyone have any idea of what that activity is a token of? - It could be "the opposite" of a tender, i.e. Berkshire refusing to buy stocks from A-holders, who - for one reason or another - are in need for cash [Estate settlements or partly sales to cover inheritance taxes under transfer of shares within generations.]

scorpioncapital, I appears to me you have been looking at the movements in share counts for A & B in note 20 on p. 21. Those movements are half-year figures. You find the exact figures for the quarter on p. 47. The easiest way to get the capital spent in the quarter on buybacks is to look up treasury stock acquired in the cash flow statement and calculate the difference to last quarter [in casu : USD 2,133 M - USD 1,585 M = USD 548 M]. If you calculate directly based on the buyback specification, you get USD 442 M. The cash flow statement for 2019H1 ties with the buyback specifications for 2019Q1 and 2019Q2 on a total level, while there for 2019Q1 is an inconsistency between the cash flow statement and the buyback specification amounting USD 106 M. Because the numbers fits on a total level for 2019H1, I dare to posture that there is an error in the cash flow statement in the Berkshire 2019Q1 10-Q [0_0]+[*holding my head low* & *arms up in front of my head* for incoming rotten tomatoes, rotten eggs, Scud missiles and the like!]. - - - o 0 o - - - File with calculations attached. BRK_-_Analysis_af_share_buybacks_2019H1_-_v1_-_20190803.xlsx

bizaro, +1.

Nicke, coc's way to approach this is [on a technical/calculation level] exactly the way to go. [This post took me tremendous force to post, [after coc not so long ago ridiculed me here on CoBF for being a Danish CPA] [<- [ ; - ) ]]]. - - - o 0 o - - - Just the question implies that you're a thinker. A few years back here on CoBF I was by SharperDigaan introduced the concept of time weighted rate of return. [You'll have to lookup the posts by yourself.] Honestly, it was ringing for my ears. [Why wasn't I taught about this at the university?] More food for thought : Joel Stevens [CoBF member: racemize], Austin Value Capital: "Measuring Returns" [January 5th 2017].

nicke, Do you use M$ Excell? -If so, perhaps I can help you out here.

orion, To me personally, this is a great move, and you aren't really missing anything. Gísli [CoBF member Sportgamma] posted not so long ago in the EXOR topic here on CoBF a link to Gísli's website containing a spreadsheet containing a real time SOTP valuation of EXOR. [ Link ][Website post of December 8th 2018]. - - - o 0 o - - - It's just so great to have fellow CoBF members, who share wonderful stuff like this. - - - o 0 o - - - Edit: Somehow TwoCitiesCapital beat me to it.

Is that safe to do? - Wouldn't it be more safe buying some 30 years negative yielding German Bund? [<- J/K] - - - o 0 o - - - My addition to SCHO.CPH today was basically reinvestment of some dividends received in tax deferred accounts, where I'm maxed out on Berkshire [i can't in such accounts buy more than 20 percent in one stock ... -if just Berkshire B was liquid dual listed like BAM!]

Added to SCHO.CPH today.

$1.73b pretax in the first 6 months...I know....no one cares. Cheers, Dazel I do, & I hear you, Dazel! [ : - ) ]

Buffett has been preparing shareholders for the modest, if any, edge in the future. He has also consistently said that he’d rather prefer Berkshire shares to sell (slightly) below IV. If your long term prediction comes true, it’ll be good for the next CEO. He won’t disappoint new shareholders that way. This is an important part of the coming transition because Berkshire’s shareholders will be an important piece of the culture remaining intact. This is something that current management has not had to deal with. So far. But, boy, there’re some pi$$ed off folks right now, who may be more p’ed off come Saturday Thank you for sharing your thoughts, gents, Not so long ago, longinvestor posted something about Berkshire hasn't moved one whit within the last year with regard to market price. Now please make that the last 18 months - so or so. I suppose, quite some "socalled long term investors" [three months, six months, one year, or so], have lost all patience, and have sold. [Duly noting, that among money managers, "long term" orientation is used as an excuse for lack of performance.] - - - o 0 o - - - To me, the real "dark horse" here [with regard to stock buybacks] is what's going on with the Berkshire positions of the early Berkshire investors over time. [That could move the needle, at least somewhat.]

A bit rude, no? :-[ I wanted to discuss the factors causing firms to drastically increase buybacks. Now of course we know where the cash comes from, as mentioned a lot of this excess cash comes from tax reform and the fact that many SP500 juggernauts are late-stage cash cows. But firms still have a choice how to spend this exesss cash, i.e. return to shareholders vs. invest in the company. Rate of capital investment does not appear to have changed trajectory over the past 5 years or so. Wouldn't one therefore conclude that internal investment opportunities have been essentially exhausted, hence the decision to return the majority of this excess cash to shareholders? So where are the best marginal opportunities for reinvestment, if not in the SP500 companies which have dominated the past decade? Financials, Real Estate, Consumer Staple/Discretionary, Autos...all seem "tapped out". Even tech appears closer to this end of the spectrum. One poster suggested infrastructure, this seems reasonable. But I think this is a real question that the US economy will have to face over the coming years. That is the question I wanted to underline. LC, Personally, I appreciate much that you have taken the initiative to this discussion. Also, personally, I think you that you may have - severely - misread the emphasized above. [Please note I'm not Cigarbutt, and naturally Cigarbutt can reply for himself.] My personal angle is as follows : Both Cigarbutt and I are not US citizens, so, we are observers of what's going on in the US - as investors. Maybe Cigarbutt may disagree with me here, so this is written on personal behalf : Seldom have I experienced and perceived USA so divided than as of now. [Ref.: Cigarbutt's use of "mature", that I personally think was in no way addressed at you personally.] - - - o 0 o - - - In short : For long term investments [i.e. infrastructure investments] to take place in the US for USA to become a better place for all, a political stability with a long term horizon for decisions is absolutely imperative. To me, the political system in the US simply just hasn't been able to provide that recently. No fingers pointed. It requires two parts to collaborate & cooperate, as well as it requires two parts to get into endless arguments. So I also speculate that Cigarbutt's "mature"-comment is about taking real responsibility. -Period.

Finans.dk [July 31st 2019] : Here business customers avoid paying negative interest rates - and here they pay at cash register one.

Thank you for sharing, alwaysinvert, Yes, it appears quite striking. Let's see Saturday, how the last quarter has played out.

gfp, The BAC 2019Q2 10-Q got filed with SEC just after market closing yesterday.

Yeah, tell me about it - have you ever studied something more recent, - something like the doings of Elvira Nabiullina. To me, naturally, you haven't, and thereby you don't have a clue about what you're talking about. Please prove me wrong here.

Geez, I must have been asleep while reading the Berkshire 2018 10-K. It's right there - on p. 12 - BAC shares held 918,919,000 at YE2018. The addition is even visible on Dataroma for 2018Q4, so not NEAM-related. Great find, Dynamic.

I'm a bit surprised to observe today this move by Mr. Buffett, honestly. How about the three days reporting rule? Does that also apply for the initial Form 3? -If it does, the purchase must be in July, right? Well, at least, 50 M shares at ~ USD 30, that's USD 1.5 B allocated. Edit : I just reread gfp's last post. If I think about it from the perspective : "What is going on - so to say - "behind the curtains" at Berkshire?" on this matter, I come up with that Mr. Buffett have already filed for permission to go above 10 % for both WFC and BAC, and perhaps based on signals in the ongoing positive dialogue with the FED [why wouldn't it be that, with the existing proposal for change of regulation?], he decided already now to buy more BAC.

Thank you for sharing, gfp, I have to agree OracleofCarolina here - it's so weird. Well, now we at least got a tiny dose of Chinese culture & politics out of it.

nicke, Please feel free just to call me John. [ : - ) ] I still remember hitting the bull's eye [at least pretty much, I think] on reverse engineering the Berkshire buybacks for 2018Q3 and posting actively about it here on CoBF, after which everything collapsed calculation-wise for the following quarter for me. [-lol!] is a link to a visualization of Mr. Buffett & Mr. Munger, if they had read my posts back then.

nicke, I have been through the whole emotional spectrum with regard to Berkshire share buybacks, too. Personally & today, I think of my personal ideal/theoretical share of the Berkshire cash & T-bills as capital, on which patience is outsourced. So, it allows me to take more risk on other positions. [Naturally, this line of thinking is not really applicable, if one is really heavily invested in Berkshire.] Berkshire provides good staying power in investing. That also matters a lot to me. - - - o 0 o - - - Personally, I expect, that Mr. Buffett has added in a meaningful way to JPM in 2019Q2. Time will tell.

This makes a lot of sense - at least me, personally, longinvestor. It’s also possible that the guy paying millions figured out that he has exactly zero chance of convincing Buffett and thereby winning some credence for bitcoin. What if someone asks (again) Buffett or Munger about this topic the day after lunch? It’ll probably be rat poison still. $4M down the drain. You got to pick the right medium to market your product. Please feel free to mentally bent it the way you want, longinvestor, I personally still think that this dinner/charitable activity was never from Mr. Buffet's side meant to become a "clash between "religions"". Oh-well - here we are.

This makes a lot of sense - at least me, personally, longinvestor.

I certainly agree with you here, SHDL, Personally, I think this capital inflow of institutional money from Europe to the US bond market must be a temporary phenomena, that eventually will dry up. That money is also regulated money, so one can't go totally haywire/heavy in US [uSD denominated] bonds assuming large amounts currency risk on a low yield asset. Hedging costs will create an equlibrium, I think.