John Hjorth

That's a great topic, Pete, because I think it's NEW!, As investors [at least, the long term of us], we certainly need both a good company and a good management to create good investment outcomes. So to me personally, it's somehow a twisted, outdated phrase. Personally, - and somewhat related to the topic - I also question the existence in real life today of "the company, that could be run by any idiot, because, eventually, it will". [i hope I'm not clogging up the topic here.]

Graham, Thank you for your latest edit of your last post. Please remember that there is no right of withdrawal of your original post, as it ends up in many CoBF members' inboxes via notifications.

I'm just kicking in a footnote here. I looked up the FFH portfolio at Dataroma, using the "activity" button for Fairfax. [it would be like searching for a needle in a haystack that perhaps not was there to walk through the filings directly.] There is no sign of VRX for the FFH portfolio on Dataroma. So I think it's safe to say that FFH has not been long VRX in the last few years [after 2013 - VRX tanked in 2016]. Thank you for a great discussion in this forum [not only in this topic] about FFH lately, especially to Pete.

Today, I've had an exchange on Twitter with Gísly [CoBF member: Sportsgamma], that I consider worth repeating here : Gísly: <Please put in here some kind of amusement expressed by me> After which I got from Gísly.

Thank you for a mutual mind provoking statement. Time will tell.

aws, Yes, very provoking statement from me in my last post, I'll give you that. But - at least to me - that's just a part of being a Berkshire investor - a positive one, may I add. [Mr. Buffett operating in the fat [read: [almost] unthinkable] tails. He is [historically proven] extremely good at this. Again, please look at the data, that I've provided in my last attachment in this topic. Berkshire AAPL position EOP 2018Q3 [ex. NEAM] : 252,478,779. Average daily volume according to Yahoo Finance : 42,876,784. So, why shouldn't Mr. Buffett trade it, if he felt inclined to? -He is not constrained by liquidity in the stock here and can do the trade without any kind of flagging. My above statement was not some sort of prediction.

Parslaars, That's really bad to read. My best wishes for the health & future of your child!

Thanks Hjorth. I'd missed that. I'm getting the low 160's as the basis through Q3. You're welcome Libs, Today I've been thinking more about how to proceed with this reverse engineering of the AAPL position. I've come an interim conclusion so far, that I'm on a wild goose chase here, contemplating to do Sisyphus work. This is about what's been going on with Berkshire's AAPL position i 2018Q3 [not so much for the two quarters prior in 2018]. The point here is, that Mr. Buffett may have trimmed the AAPL position on it's way up in the run-up to the top near EOP 2018Q3, and may have have trimmed it further down on the slide on the other side of the top, perhaps even without buying near yearend and its recent lows as of now. There is no legal way to find out, until we see the next Berkshire portfolio report on EDGAR mid February. There is nothing to triangulate on, nor even to intercept on - because we have only two dots hanging up in the sky [on EDGAR] - Berkshire's EOP 2018Q2 & EOP 2018Q3 AAPL positions. So please stay open minded towards that Berkshire's AAPL position at YE2018 [with regard to number of shares] may be lower than at EOP 2018Q3.

I suppose your point of measurement here is EOP 2018Q3, - which in this market development since then is ages ago.

Viking, Thank you very much for keeping us in loop with regard to updates on relevant US macro stuff [macro stuff, that matters, by the way!]. I have now put it [the Gundlach presentation] in my calendar, so that I don't miss it, and I'm looking forward to that. [ : - ) ]

StubbleJumper, I know for a fact that won't happen as long as Mr. Buffett is alive - perhaps not even before his estate is finally settled. The reason is that it hoses some dividend taxes into the coffers of the US IRS, generates cash for Mr. Buffet that he does not want or need, and thereby also dilutes his gift promises. So you know it, too. The wonders of having a controlling shareholder ... I think it's called so.

Libs, It's in my last attachment in this topic. [The last known one, that is, ref. globalfinancepartners.]

Exactly - what globalfinancepartners just said. So from here: High hopes for continued scrambling around below 200 for the B, combined with high daily volumes!

StubbleJumper & alwaysinvert, How do you feel and think about the whole thing today Monday? - In a time context, your posts was just after the Berkshire 10-Q was released. Now we have had ongoing discussion during the weekend and analysis of the 10-Q, and it has come up that about ~USD 15B has been allocated to financials during 2018Q3 [- of the ~USD 15 B ~USD 6 B allocated to BAC -], on top of the share buyback of ~USD 1 B in the quarter. Furthermore considerations/speculations [ time will tell ] that more capital has been allocated to perhaps BK, USB & GS, perhaps even new positions in financials. Personally, I was a bit disappointed just after the release of the 10-Q, too. After a couple of nights sleep on it, I have a good feeling about this here Monday morning. The upward trend in liquidity surplus has been turned, and Berkshire is still the Rock of Gibraltar. All in all, not that bad, because it's actually able to generate good earnings and cash flow as it is. John, Since the beginning, I have been skeptical of the Apple position because it struck me as outside of WEBs circle of competence and it has always struck me as a desperate move to deploy a large amount of cash. The catalyst for that move has never quite been obvious to me -- what has Apple done in the past 12 or 18 months that suddenly merited such a large chunk of shareholders' capital? The price didn't plunge rapidly to make it a 50 cent dollar. Nope it was bought on fundamentals and operating results. But, after racking up $110B± of cash it looks like brk is grasping for reasons to not initiate a healthy sized dividend or to not buy back a large slug of shares. Turning to the purchase of large US financial companies (banks), nearly everybody on this board took a high conviction position about 5 or 6 years ago and we have made out like bandits. The banks are still a buy, IMO, but are not as cheap as when we were all pounding on the table about BAC or JPM back in '11 or '12. So why is brk suddenly taking a high(er) conviction position in the banks right at this moment? A what point during the past five or so years were the US banks not an obvious purchase? To be blunt, it was value in plain sight. How did brk accumulate $110B± of cash when the banks have been an obvious outlet to deploy cash for the past 20 or so quarters? The actions of the past year or so have struck me as a desperate effort to deploy cash and deny a basic reality. That reality is that cash from ops is basically $40b per year. Take off something for maintenance capex, new plant and equipment, and opportunistic acquisitions and you're looking at reasonably reliable cash surplus of about $20b per year. The opportunities to deploy that much capital on an ongoing basis are not available in sufficient quality and high enough expected return to continue retaining 100 percent of earnings. SJ I'm sorry for the dense quotation above - Here I'm going back to this particular post by StubbleJumper from about two months ago, which was a direct reply to me, which I somehow managed to miss to thank you for StubbleJumper. So, thank you StubbleJumper, & please accept my apology for a very late reply here. - - - o 0 o - - - Here, this is particularly for me about Berkshire's position in Apple. Yes, it's in a way "controversial" to me, too. I've been thinking a lot about it lately, and have also felt forced to do some work on the company to get a better understanding, simply because of the size of the position for Berkshire. -And yes, then comes in the recent events with Apple... I'm in my early innings with Apple, still, but I like it. What has happened while Mr. Buffett has built the position - now to the largest one - is so far to me like a page intentionally left blank. So I have tried to do something about that, by just looking at some data, in a structured way, yet without getting into some real tinkering with data. So the file contains right now just a pile of data, but on the tab "Interim overall assessment" I have structured them to give a visual overview for the first three quarters of 2018. [Data for building the position for 2016 & 2017 I just consider history - but important data for understanding Berkshire's cost of the AAPL position]. Just by looking at the structured data for the three quarters, I feel quite confident, that Mr. Buffett hasen't been buying at wrong prices in 2018Q4, because he hasen't bought much in 2018Q3 on its way up. At least that feels comforting. [Personally, I'm totally indifferent towards the wild gyrations in the stock lately - but the cost of the position matters to me long term]. Some time ago I posted here in this topic some calculations of what Mr. Buffett max. could pour into AAPL, based on EOP 2018Q3 market prices [uSD ~50 B], which I ref. above feel confident hasen't taken place in 2018Q4. - - - o 0 o - - - The liquidity of the AAPL stock is much better than BRK.A/BRK.B - So how do you think Mr. Buffett has instructed the broker to buy AAPL during the first three quarters of 2018? - Let me hear you, and I'll start tinkering the data. - - - o 0 o - - - File attached. BRK_-_Reverse_engineering_of_AAPL_position_-_2018Q1_-_2018Q4_-_Beta1_-_20190104.xlsx

Surely you know about his giving program? He is actively trying to make his wealth go to zero. This exchange is actually a bit funny! [ : - ) ] - Serious mistake in those original gift letters, giving away 5 percent each year, while Berkshire grows ~10 percent each year. So he fails miserably! [ : - ) ] -Mr. Munger would call Mr. Buffett a young, failing overachiever, still collecting more nudgets than he gives away!

Good one, Jurgis! [ : - ) ]

You're welcome, globalfinancepartners, And yes, you interpret the output correctly. I have uploaded it here, with a "default setup" as the reverse engineered result [best fit from using the tool on 2018Q3 data "marked with the red cells". [buyback threshold for the B share = 209, combined with 10 percent of daily volume.] If you have alternative / other expectations for the buyback threshold for 2018Q4, they are available for you in the spreadsheet, right there too, assuming 10 percent of daily volume while buying back. I've chosen that particular default setup for the sheet, based on that I've been absolutely amazed - almost spooked - about that your in advance prediction for 2018Q3 was totally spot on. - - - o 0 o - - - I'll update the sheet with the last trading day data [that won't change much, though] and also put in there some "bling" [charts and diagrams]. - - - o 0 o - - - And I agree with you : Over time - if the share price stays low for prolonged periods - it could get meaningful for earnings per share going forward. Berkshire is running at a clip now at about USD ~3 B per month in cash generation [mind provoking to think about, actually], so perhaps in the area of USD 4 B in buybacks in a quarter isn't that bad. Naturally, what really matters the most - as also mentioned by compoundsnowly & longinvestor today - is what has happened in 2018Q4 with that available capital of USD 111 B EOP 2018Q3 - how much of it is put to work, and in what?

compoundsnowly, The tool calculates buybacks measured in USD as a function of buyback threshold and percentage of daily volume, based on actual market data. [it can't think! [ : - ) ]] - - - o 0 o - - - PS : I like your board handle!

clutch, There is so much to it. I've had the same thoughts about 1 - 2 years ago. I ended up leaving that line of thinking, - for good. In short, you'll have a better existence & life as an - perhaps - underperforming & stockpicking investor, than being an index investor. Where there sure is material positions in the index of your choice, that you do not like. [Which can actually be much more stressing for you [as a CoBF member] than the average investor.].

rolling & flesh, You are mentally faithful to yourselves [never forget that!] - I certainly hope it stays that way! -I feel confident, that you'll do great going forward!

I just added the poll. -Please take it! [ : - ) ] - - - o 0 o - - - Maximum votes per user: 1, Run the poll for : 90 days, Allow users to change vote: Yes, Result visibility : Show the poll's results to anyone. - - - o 0 o - - - I hope I haven't screwed up anything here.

Cigarbutt, Your posts here on CoBF to me do not contain negativism, but healthy skepticism, based on facts, observations & documentation. And always polite posts & to the point. Personally, I hold a list, where I'm in overdue with qualified replies to your posts. The replies from me will eventually come up, after I have done my own home work, to get better. [NVO comes to mind here.] Please keep them coming, Cigarbutt!

Later today, my local time, I'll add a poll to this topic, so that we can see how the CoBF people have fared during 2018, at least for those who'll take the poll.

Meh [<- sorry, typo!] Me: Minus 3.1 percent, measured in my local obscure currency DKK, pegged to EUR. [My worst year so far.]

Happy New Year to all my fellow CoBF members! - And may your God be with you in 2019, with the best wishes for lots of [<- earned? [ ;- ) ]] tailwinds for your portfolios & stock endeavours in 2019!