bizaro86

My guess is no Fairfax sub will have gone public by Q2 2021.

I agree low to mid single digits on equities should be easy, but it would have been easy to do a lot better than they did on equities the last 10 years as well. If they changed their approach to buying "easy singles" and just bought the low multiple large caps you mention their returns would almost certainly be fine. Is there evidence they will stop doing their "swing for the fences on structurally distressed" style of investing?

Good question. I'd like her to be nurtured around nice people, but they need to have common sense. There’s two kind of private schools. The catholic ones. And the none catholic ones. The none catholic ones can be a lot more liberal than the public ones. The catholic ones have their problems too, like half of the kids don’t have immunizations. I noticed some schools are called Catholic and some schools are called Christian. I wonder if they are different? Generally speaking a "Catholic" school is operated by Catholics, and a "Christian" school is operated by Protestants. If you have a religious preference between the two presumably you'd go that way. If you don't, I doubt the differences would be meaningful.

I agree with this. I did International Baccalaureate, which is a similar idea. In a big public school, but all my classes were with the same 40-50 kids (out of the 700 person graduating class). And it was a relatively high achieving group. The 20 of us that did the full program are basically all high end professionals now. That's probably true at a good private school as well, but the diversity wouldn't be as good. There were multiple kids of C-suite executives at billion dollar firms, but mostly it was middle class parents. There was also a pretty significant contingent of kids from "immigrant families that strongly value education." My friend whose parents worked janitorial at the same hospital he now works out of as a dermatologist would be an example there. Having a spread of experiences is useful. You don't appreciate the used Toyota if all your friends have new sports cars. But you do when some of them take 1.5 hour bus rides to the other side of town...

I don't live in the US, so maybe this anecdote doesn't apply. But I went to private school for junior high, and a local public high school (magnet school though) for high school. The public high school was better, and it wasn't close. It was also ~10k/year cheaper. Now I have kids, and while I'd be willing to pay for private if I thought it was necessary, the compounded value of 15k/year/kid puts buying them each a condo/house for cash after university in the same cost ballpark. Anyway, I think switching districts or finding a good public program might be an option to consider. My kids are in a specialized (language) program even in elementary, so they have smaller class sizes than average.

I think they would take sports betting reinsurance if there was a market. They did the March Madness bracket contest, which is similar.

For Dillard's specifically I don't know. You might be able to back it out by comparing cash received from selling PP&E from profits from PP&E sales if they report that as a one time gain.

I don't think column C should be the cash received from the sale of PP&E, but rather the undepreciated balance sheet value (ie original cost basis) of the PP&E sold. It isn't likely that they are the same.

The demand to relocate out of expensive cities seems to be high according a survey by Blind, which verifies employees by asking them to provide their company email address. Roughly third are willing to relocate even with a pay cut. In addition, 40-45% will relocate without a paycut, depending on city/company. Here are results broken down by company and by city: https://www.teamblind.com/blog/index.php/2020/09/14/44-of-professionals-are-happy-to-take-a-pay-cut/ https://usblog.teamblind.com/wp-content/uploads/2020/05/PayCut.pdf https://docs.google.com/spreadsheets/d/1zF_jxowBZYkiJIeatZAm3soelVBpoFf1TbjEZVwxBpA/edit#gid=171959972 I don't think that's the demand curve Bizaro was referring to. You appear to be trying to identify the number of people currently living in cities who would move elsewhere if they believed they could. I believe he's asking about the demand from people who would like to live in cities (or different cities) but currently do not because it is not practical for them (cost, location) to do so. Is it possible that widespread WFH actually increases demand for certain cities, because people who historically had to work in say, Omaha, Des Moines, Little Rock or Tulsa can now live in NYC, Boston or LA? Likewise, is it possible that housing in Minneapolis becomes more in demand because WFH frees people from living in, for example, Duluth? Put another way, your comments seem to assume that people are in cities because that's traditionally where good jobs have been. But what if it's the other way around: Goods jobs are traditionally in cities because that's where people want to be? If it's primarily the latter -- and if the desire to live in cities going forward has not changed -- when how would widspread WFH affect demand for urban housing? Applying this framework to the Detroit example, vacancies were high and housing prices low, not just because people left but also because other people did not want to move in. That is exactly what I meant. :D I think places that are desirable for lifestyle reasons will probably remain desirable for those exact same reasons.

How steep the demand curve is matters as well. There are absolutely people who currently either don't live in expensive cities or take long commutes solely because they can't afford to live closer. Small drops in price have the potential to increase demand from people who are priced out of the market. Of course, gateway cities are probably also seeing condo inventory formerly dedicated to airbnb convert to residential usage...

Being well rested makes a huge difference to mental acuity. My decision making is way worse when I'm tired. We recognize this for things like driving, there is no reason to think it would be different for more complex and multi-faceted decision making areas (like investing).

Basically any brokerage should be able to register the shares in your name. There would be a fee.

Yeah, I've been a buyer recently here at $9.xx I think I'd prefer to see them buy some more land vs buy back stock however. If they could get a couple more neighborhoods using their water they'd really speed up the tap fees, which is where the value is. Even if servicing the land was a break even proposition, accelerating the tap fee monetization by a decade or two has a big NPV affect.

It seems possible that it slightly overstates occupancy. My last office job you scanned your pass at a big glass door. If someone else on the floor was on the elevator with you, only one of you scanned. If you're the only person coming in today, that's one scan just for you, but 3 of you on the same elevator would still be 1 scan. Its also possible that scans would understate occupancy. Pre covid-19, I might have gone for a coffee and a lunch outside the building. I bet more people are staying in their buildings now (1 scan per day instead of 3-4)

Fairfax got 9.5 billion rupees ($134 MM) for 11.5% of Anchorage. The 2.7 billion is the implied valuation of BIAL, not the valuation FIH got for Anchorage. So the valuation of anchoeage is $1.165 B. https://www.globenewswire.com/news-release/2019/12/16/1960880/0/en/Fairfax-India-Sells-Minority-Position-of-Anchorage-Infrastructure.html FIH has to take Anchorage public at a 1.3 B valuation, or OMERS gets more shares. The embedded put option OMERS got as part of the deal was in the money when they wrote it. If you assume BIAL is less valuable now (likely) then it is more in the money.

It will also be important to see whether OMERS renegotiates the valuation of the airport or goes ahead with 2.7B. The transaction is supposed to close by the end of Q3 2020. Why would OMERS renegotiate? They get a free look at the upside, and FIH makes them whole with a bigger ownership if the IPO doesn't price out. In many ways, the deal could be spectacular for them as written. If things stay slow for the duration of their option, they will end up with a bigger percentage of an irreplaceable infrastructure asset at a deep cyclical low price.

I am extremely (honestly!) curious how one would hedge an IPO allocation of a stock? How about shorting a basket of public companies in the same industry but are more over valued? I.e CRM? Or maybe they just have some insights that you don’t have? Maybe they have used SNOW’s product and found it’s extremely useful and have huge scalability? What insights you have that others don’t have so you have the confidence to discredit their investment decision? You said you thought it was a short term hedged trade. I like learning new things, so wanted to know how you thought they might have done that. I don't have any insights of any kind, and have no opinion on whether this is a good idea. I'm a bit concerned it is outside their circle of competence, but cloud databases are so far outside my circle of competence I have no idea what valuation is appropriate here. I certainly wasn't trying to discredit their decision, and that's not what the words that I wrote say. Edited to add: I really like market structure/capital structure arbs, and do them often.

I am extremely (honestly!) curious how one would hedge an IPO allocation of a stock?

It looks like he bought at an average cost of $308 USD roughly or about $420-425 CDN per share. It says he bought in the last few days before the press release...I would imagine it was around the 9th, 10th, 11th and 12th, where the stock was around $425 CDN or less and volumes rose. If he is buying there, then I would imagine he is expecting a return of better than 15% annualized or more over the next few years. Cheers! The question then becomes is Prem expecting a 15% return a good predictor of future 15% returns.

I have circle-of-competence concerns about them buying money-losing tech stocks at IPO.

The prospectus says they have a market standoff agreement for 365 days. It isn't totally clear, but it seems they may not be able to sell this right away.

If they said they were going to index the equity portion of their investments the stock would go up materially the next day, imo. The market views their investing as significantly value destructive.

Switched my BRK call leaps (deep ITM) back to shares.

Occam's razor says it was the fee. Why else would he do it? If the IPO was actually imminent, why not just put OMERS in the IPO with a big allocation. Discount them the I-banker fee or something. The only way I can see the deal structure making sense is that it was specifically designed to get OMERS to agree to a higher price than they otherwise would have been willing to pay to get the fees to print. The timing fits that, it was right at the last minute for this years fee calculation. The deal has no downside for OMERS, if the airport ends up being less valuable (for some unknowable reason like a pandemic, for instance) they just get more shares to make them whole. No downside for FFH, they got their fee already. All the downside is at FIH, who could end up giving up a huge chunk of their best asset at a low price, right after paying fees for selling it at a high price. Seems pretty win-lose for minorities to me. I guess the other possible motivation is that Prem just wants to do a favor for his friends at OMERS. Sort of like the Torstar deal, maybe he's doing a favor for a friend with shareholder's money. That seems less likely to me, but even if its true I don't think its any better. Can you think of another motivation for doing the deal? I can't imagine anyone would seriously suggest it was a good deal structure for FIH shareholders...

The airport transfer is a pretty obviously egregious one. They marked it at a high mark to get fees, and only got that high mark by using sub shareholder money to guarantee the buyer their price was money good. They should have had to mark what was effectively a put option on a high volatility illiquid asset separately. After that experience I'd shake hands with FFH management, but would count my rings after.