bargainman
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Posts posted by bargainman
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A few things:
This devaluation is a joke because the Bolivar traded on the black market at a devalued price for a long time and always has. (that's not to say it's a noop, but it's just 'officially' moving closer, although not exactly to, its 'real market' ahem, 'black market' value)
What is not a joke is that the bolivar has been currency controlled/pegged to the dollar for a number of years. It has also been "limited". By that I mean, people could give the Venezuelan gov Dollars, and they'd happily hand over Bolivares, but you couldn't give them Bolivares and get dollars. Citizens of Venezuela were allowed to exchange a certain amount out as dolllars if they travelled out of the country via their credit cards, but this was limited to a small amount.
There was at some stage a way of exchanging by buying bonds in Bolivares, then selling them in Dollars, but Chavez and his buddies cracked down on that and closed all the trading houses that were doing this.
With regards to the left vs right debate, I'll say this. Comparing Chavez to 'Obama and the democrats' is borderline ridiculous. If you took everything Obama wanted to do (remember he's a moderate democrat) and implemented it, you'd get nowhere near the madness that is Venezuela. Heck, if you took everything these 'ultra left' democrats you're referring want to do, you'd get nowhere near. Take a look at these charts:
http://en.wikipedia.org/wiki/File:Chart_of_US_Top_1%25_Income_Share_(1913-2008).svg
http://en.wikipedia.org/wiki/File:US_high-income_effective_tax_rates.png
We are nowhere near the highs for taxation in this country, and as the last chart shows we are near an all time low for tax rates for top income earners. The problem is that the conversation always tends to be relative to today, not to history. So people react to raising taxes on highest earners today as if they were raising them to some new high, when in reality they'd be raised to a historic low, just not quite as historically low as today.
Chavez is/was reportedly manic depressive and on medication. He was a paratrooper in his previous life, he led an attempted coup. He had a show where every week he would speak on radio for an uninterrupted 4 hours straight! Obama is an ex harvard law professor. The gap between the two countries and the two men is as massive as the grand canyon.
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can someone explain to me what the motivation is to invest in fairholme before its lockup? they will still disclose their holdings publicly...any investor could copy-cat them on particular holdings...its not as though one would miss out.
I can understand the motivation for someone uninformed in finance, or without desire to monitor the portfolio, but for some capable/willing of monitoring/understanding what Fairholme is investing in, why worry about getting in before lockout when copy-cat strategy is always an option?
For me personally the original question was whether I should shift to the smaller fund given the deadline. But I'll echo what another said, which is that I'm happy paying Bruce 1% to manage this money for me. You could copy cat, but you'd never get it perfectly correct. Not sure if that matters, you'd probably get a reasonably closely correlated return. Correct me if I'm wrong but MFs only have to make quarterly filings right? I'm pretty sure they also have to file right away if they own a significant portion of a company (>5%?) but not otherwise. So there would be a delay.
Plus there is just the plain psychological friction. Every decision you need to make and act on takes energy and time, and represents room for error and deviation. I really wonder if someone has successfully implemented a copycat strategy while maintaining a full life and a job not in finance. Somehow I doubt it. I bet the failure rate for people trying copy cat strategies is about as high as the failure rate for startups. That's why Greenblatt opened up mutual funds for this strategy. Even he found it hard and tedious to run his own mechanical strategy in his kids' accounts.
The one additional consideration for me personally is SHLD. It's too hard for me, and I haven't been happy with the spinoffs and the tax consequences of those spinoffs, so I sold the shares I have. I'm happy to hand the reins of that investment to BB.
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Everyone seems to be making the assumption that BB will never open the fund back up to new investors. There are other funds that have stopped accepting new money when there is a lack of opportunities and then opened things back up when the circumstances warrant.
I don't think anyone is making this assumption.
What is to stop them from doing this?
nothing.
But here's the thing. All we know is he is definitely closing the fund this month. We do not know whether he will reopen at all, ever. So we have a 100% known vs a complete unknown. As such you use what you know you know, and what you know you don't know to make the most rational decision possible. In this case, if you like BB and are comfortable with the allocation, it's 'open a minimum position so you can invest in the future as you like'.
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I got into FAAFX. Get ready everyone, that means MBI will be crashing soon! along with BAC and AIG! You can thank me later when you get them at a lower price ;-) I sold some positions here and there that were approaching fair value or had other issues to lessen the impact. However I kept FAIRX for now. I do still like the stocks in FAIRX and plus I had acquired my FAIRX position over about 15+ transactions and didn't want to deal with figuring out the cost basis or fifo for them when I had other stuff I could sell which wouldn't give me a headache come tax time :-).
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Another book added to my ever growing to-read list. I seem to add 3 books to the list for every one I am able to read and take off the list. Thank you for posting this, though, if the rest of the book is nearly as good as that snippet it should prove a fascinating read.
It's going to get worse. The rate of data generation keeps increasing and increasing at a massive rate. Terabytes of data, big data. Here's a fun stat:
72 hours of video are uploaded to YouTube every minute
So it's basically impossible to watch all the video on youtube :-)
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did see this posted yet, but maybe I just missed it:
"Berkowitz is raising money for a partnership that takes minimum investments of $1 million, according to a January regulatory filing. He declined to elaborate when asked whether the new entity was meant to attract more patient capital."
kind of sucks for smaller investors but I guess he has the mutual funds for that..
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Some interesting screens:
http://www.grahaminvestor.com/screens/
http://www.magicformulainvesting.com/
you might want to check out aaii too.
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28.5% FFH
48.5% Owner-operators
13% Short positions
6.5% Gold
3.5% Silver
All equity, no use of leverage. And I expect to receive a 10% fcf from my operating businesses through this year.
Actually, not much changed from last year. I clearly don’t understand all the small nuances of the markets, so I guess I will have to wait for some “big change”. When that happens (and it will happen, as it always does), I think I will have the wherewithal to take advantage of it.
giofranchi
“As time goes on I get more and more convinced that the right method in investment is to put fairly large sums into enterprises which one thinks one knows something about and in the management of which one thoroughly believes. It is a mistake to think that one limits one’s risk by spreading too much between enterprises about which one knows little and has no reason for special confidence.” - John Maynard Keynes
Just curious, would you mind breaking down your "48.5% Owner-operators" a bit?
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Hmm I realized I kind of put the cart in front of the horse.. Let's back up a bit...
to use google spreadsheet's built-in finance commands, here is what you need to know:
http://support.google.com/drive/bin/answer.py?hl=en&answer=155178
Click on the "View a list of common attributes" link and you're all set to go.
In my spreadsheet cells I have:
for example:
=GoogleFinance($A3,B$1)
The column header "B$1", has "price", "high52", "low52", etc.
The row 'header' "$A3", has the ticker, so "LUK" or JEF etc.
In case you're not aware, the $ means it's absolute, not relative. So if you fill the cells from that cell, then that value will stay the same on an absolute basis..
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After a great post by meiroy here:
I thought I'd start a thread to aggregate some info on google spreadsheet since I use it to track my investments too. First a copy and paste from meiroy's excellent post:
BTW I just figured out how to get correct closing values for options and warrants from Yahoo Finance into Google Docs for anyone who needs it.Here are two examples.
For AIG-WT:
=Substitute(importXML("http://finance.yahoo.com/q?s=aig-wt&ql=1","//span[@class=time_rtq_ticker]"),"*","")
And as an example for AIG Jan 2015 40.000 call:
=Substitute(importXML("http://finance.yahoo.com/q?s=AIG150117C00040000","//span[@class=time_rtq_ticker]"),"*","")
It works for other warrants and options as well, just put in the correct URL.
Now just one substitution of my own.. I find you only need this in the case of options. In the case of warrants you can use the following:
=ImportData("http://finance.yahoo.com/d/quotes.csv?s="&A19&"&f=l1")
Where the cell A19 would contain:
AIG-WT
BAC-WTA
BAC-WTB
ROICW
etc.
I've also found a great resource for google spreadsheet imports from yahoo finance here:
http://dubd.wordpress.com/2010/05/10/google-docs-stoxpage/
It gives the list of all values you can import into google. The one I probably use the most is "y" which is the dividend yield, which for some reason google finance does not give you.
so an example is:
=ImportData("http://finance.yahoo.com/d/quotes.csv?s="&A6&"&f=y")
where A6 contains the ticker like say: ROIC
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Thanks for all the good replies. I pretty much agree with what's been said. Agree that if they stay around, FAAFX is going to be better long term, but that the current mix is probably better for FAIRX short term. That said I've been buying up more aig warrants (wish I had loaded up more when they were down at 7 where I got my first set), and will probably buy some more BAC's too, so I think I'll get most of what fairx would give me short term. I'm thinking I'll sell at least half my fairx holdings and maybe move some other money around to get into faafx before the close. The fact that it's so much smaller should really give it an edge.. I mean we're talking 3.5% the assets! That's a very large difference.. Assuming he keeps the small fund going forward... I also think that it's true that this is closer to how Bruce would manage his money on his own. That said, I do share the concern that he will get rid of or roll over FAAFX into some other vehicle.. We shall see...
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Given the recent news of Fairholme's soft closure, I'm considering if I should shift most of my FAIRX into FAAFX. Wondering what people here think..
FAAFX: (# is %)
Holdings:
http://portfolios.morningstar.com/fund/holdings?t=FAAFX®ion=USA&culture=en-us
Mostly: MBI(30), AIG(15), SHLD(9), BAC & WFC wts (6.6,6.5).
Expense ratio: 0.75%
assets: 267 million
http://quote.morningstar.com/fund/f.aspx?t=faafx
minimum initial purchase of 25k!!!
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FAIRX: (# is %)
Holdings:
http://portfolios.morningstar.com/fund/holdings?t=FAIRX®ion=USA&culture=en-us
Mostly: AIG(37), SHLD(10), BAC(8.8), GGP(7.6), JOE(5.8), CIT (5), AIG WTS (3.78)
Expense ratio: 1.01%
assets: 7.6 billion
http://quote.morningstar.com/fund/f.aspx?t=FAIRX
minimum initial purchase of 10k
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I'm kind of surprised that FAAFX is cheaper than FAIRX given the size difference! I have almost enough of FAIRX where if I redeemed most of it, or all of it I could get into FAAFX without too much more of an investment. but the question is.. should I? Clock is ticking to make a decision....
thoughts?
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In the video, he also says that he had a standard mutual fund but people want to pay him more. I really hope he's not gonna leave the little guy behind and manage hedge funds (around 29:25). :(
At this point, I don't think the hedge fund route would provide him any more comfort than running the mutual fund. A 2-year lockup would not have made a whole lot of difference to him, but it probably would have saved some fools from selling out before the rebound. I suspect he is going the permanent capital route, and it very well may be through St. Joe. Cheers!
Oh goodness, that would be awful if he turned his back on the mf.... I really hope he doesn't even if people do want to pay him more... But the way he said that did seem worrisome...
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might be his first step in his transition to permanent capital!
Yes, I think this is what is happening. He learned a very tough lesson with the amount of redemptions he had to deal with. I think he may have been at the point where "how do even my long-term investors lose faith in me? Time to reduce that risk." Cheers!
As a shareholder who was with him for the whole ride down as his assets ballooned up, all I have to say is it's about time! He shouldn't have had to learn the tough lesson, he should have closed it the first time to prevent the fiasco.. 20/20 I guess... Sorry, if that's harsh, but I was not impressed with his allowing it the balloon up the first time...
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Maybe this is what Sanjeev meant by the insurance funds, but 'guaranteed return of capital' funds have been around for a while now. At least 10 years I think. It's simple really. Just put x% in a bond that matures at the final date, then use the rest to buy long call options over the time period.. The $ value is guaranteed as long as your bond doesn't default. That said that's just the $ amount. You lose to inflation. Of course this just guarantees that you'll get your money back, not that you'll make a certain return...
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it's worth watching/reading Greenblatt's take on this last book and funds:
http://www.forbes.com/sites/steveforbes/2011/07/05/joel-greenblatt-interview-transcript/
Definitely get his funds in a tax advantaged account. He walks through the value indexes and the equally weighted funds/etfs and their faults in his book.
I would agree with index, and maybe even some vanguard target retirement date funds. Wellington is a good boring balanced fund. If you want some growth, go with the Primecap funds which you can get directly from Primecap since vanguard's Primecap is closed. Dodge and Cox tends to be ok but they are so big I doubt they'll perform that well going forward. I'll second Kinetics Paradigm. Tilson Dividend (Not run by Tilson but by Zeke Ashton) is quite good and uses both value and options to enhance returns (but fees are high). Another that's been mentioned is Wintergreen, he can short too, but he's expensive.
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Right now the ones I know of are
for university level courses:
coursera, udacity, edx, udemy
for slightly younger crowds there's also
Khan Academy
and for professional stuff there's
Lynda.com, teamtreehouse, codeacademy
There are many others. It's a wild world out there. Access to educational material is becoming ubiquitous. I really wonder how things will be for higher education in 10-15 years..
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I would have guessed that politicians would be #1 on the list. There is a professor at University of British Columbia that has developed a brain scan which detects psychopaths. Company boards should consider hiring the professor in CEO reviews to avoid potential shareholder pain.
Now if I could figure out how voters could have an opportunity to screen politicians before voting...
My guess is that "Civil servants" == "Politicians" on the list.
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That's a silly article. That's a pretty long list of professions already. It seems as though more recent and prolific psychopaths have been video-game playing, Nazi-sympathizing, white males. And where do psychopaths like Willie Pickton from Vancouver fit in...Pickton was a pig-farmer who killed over 50 vulnerable women, and even fed some to his pigs?
I don't think there is any clear cut way to define what makes a psychopath. We're animals born of specific genetic material, mutated by the environment we live in, shaped by the experiences we endure. It's far to complex for any idiot to generalize in an article! Cheers!
Well the article is not the source, as others have pointed to. The source is the book/research:
http://www.amazon.com/The-Wisdom-Psychopaths-Killers-ebook/dp/B007NKN9U8
by "the renowned psychologist Kevin Dutton"
And believe it or not there is probably a definition of a 'psychopath' in the annals of clinical psychology somewhere. That definition may not be what we think of as laymen, or the extreme cases we think of as the one you pointed out, but I'm sure there are plenty of studies and clinical cases supporting said definition.
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Not unsurprising, but certainly not that encouraging either:
http://www.sfgate.com/jobs/article/Jobs-fit-for-a-psychopath-4172506.php
The following jobs have the highest rate of psychopaths, according to Dutton's research:
1. Chief Executive Officer
2. Lawyer
3. Media (Television/Radio)
4. Salesperson
5. Surgeon
6. Journalist
7. Police officer
8. Clergy person
9. Chef
10. Civil servant
The list is scattered across several fields, but Huffington Post blogger Eric Barker notes each of these professions "require an ability to make objective, clinical decisions divorced from feelings." In a more straightforward way, the traits that define psychopaths are also the skills that can make people successful in the workforce.
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Talk by Seigel addressing the 'death of equities'
http://new.livestream.com/livecfa/Siegel/videos/7432965
slides
Choice quote regarding Bill Gross: "I should invite Bill Gross to my econ 101 class".
Ouch!
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It may be worth asking the broker if they'll buy it off of you... see this article here:
http://www.kiplinger.com/columns/ask/archive/2008/q1222.htm
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I preferred the way he addressed the shareholder meeting. Tough contrast.
http://www.youtube.com/watch?feature=player_embedded&v=p7rvupKipmY#!
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The Nexus 10 has 300 ppi (2560 x 1600) resolution compared to the ipad retina display of 264 ppi (2048 x 1536). That's impressive !
https://www.google.com/nexus/10/
So all the bugs with Android will be more visible and the pixelated apps designed for phones will look better? :P
well I suspect that's part of the point. Google is hoping that with their version of the retina display that will incent developers to develop apps for that resolution.. It will be interesting to see if they follow suit or not..
Wow! Venezuela currency devalued by 46,5%
in General Discussion
Posted
I think we agree in principle on many things, especially what you wrote, even though it may not seem so (I can't write everything I think and neither can you), so I think we write about what we disagree on. The question you're getting at is how to best address accountability. I don't think that government is completely useless in that regard, but clearly their record in many areas is dismal. I guess it's partially like that old quote: "Democracy is the worst form of government, except for every other one"? If there was no government who would keep corporations in check? Do you think the health insurance industry would cover people with pre existing conditions if it weren't mandated by law?
The foundation of the US is the checks and balances the founding fathers wrote into the constitution. I don't have a solution, but while there are many good things about the US healthcare system there are also many awful things. Look at the cost per capita vs amount of coverage vs outcomes. It's less of a meritocracy and more of a plutocracy.
I wonder if there is a way to drive more transparency and drive out the inefficiencies. When I lived in Canada I couldn't believe the number of times people went on strike complaining about the conditions or this benefit or that one! I also can't believe the sense of entitlement some people have and the massive pensions some government workers get. It's unsustainable. I remember reading an article by John Mauldin on Sweden, where the Swedish people were pissed off that they were held up as the nanny state. Apparently their equivalent of social security is tied to a percentage of GDP! what a novel idea! People get in payouts what can be afforded by the size of the economy that year!! Imagine if they tried to implement that here!? I think most of these programs should be capped by some % of the GDP. That would help address the sustainability issue.
With regards to abuse of the programs, that's a really tough one. There will always be those who figure out how to game the system. The question is how do you make the system so that those who need it can access the help without so much pain... it's a tough problem, I don't have a solution. IMO recently some of the ones who have gamed the system more so than not are the top 1% with their tax rates.. I'm sure there are plenty of others in the 99% who have gamed the system too.
I've seen all sorts of things that don't make sense. One guy used to be a teacher for 30+ years, now he can't find a job cause no district wants to pay him his 30 year experience salary, so he just gets Social Security instead of finding a job! wtf? Another person who's 2 degrees away worked for the gov for 20 years, got a 50k pension, then took another gov job and got another 50k pension! wtf?
Anyway, my post was in reaction to the implicit comparison of Obama and Chavez which I've seen too many times to not say something about. One is a moderate democrat, the other is basically a medically certified mad man.
And here is another tidbit. Apparently 2 years ago the black market Bolivares rate was 11!! Now it looks like it's closer to 20... So that move from 4 to 6, not so close to reality...