vishmitt

For people tracking Pabrai - http://economictimes.indiatimes.com/et-now/experts/aware-of-the-intrinsic-value-of-all-invsts-made/videoshow/45686622.cms 1. 55% of Assets in 3 stocks - Fiat/ Chrysler, GM Shares and Warrants, Horsehead Holdings 2. 13% of Assets in Indian Equities (coming from India, all 3 are average business at cheap prices) Cheers

I am from India too and use whatsapp extensively. Like earlier used yahoo messanger, msn messanger, sms, bbm etc :) Now just a thought - what if someone like Google launches a clone of whatsapp, with the promotion that they will pay 100 most prolific users over a year 10 million dollar each or 1000 users a million dollar each (total cost 1 billion only:) ), whats gonna happen to whatsapp base - i think it will be a mass shift, right ? Doesn't seem to meet 'Buffett test of competitor with a billion dollar to burn' test....

I sometimes face similar problems. The following could help: 1. Go for good, simple businesses with honorable management (when at right price) where you don't have strange accounting. More Peter Lynch approach of looking at businesses we come across in daily lives. 2. More orientation towards larger and better governed businesses in every sector rather than the cheapest one. 3. Checklist is a great idea - too many red flags could mean just skip the stock - no need to spend time on detailed analysis 4. If idea seems great but calls for too much accounting/ too much intricate analysis, i talk to couple of friends who are much more blessed in this. Ofcourse final decision is mine, with normal than higher MoS and lower portfolio allocation. I think it all boils down to 2 principles : Circle of competence + trying to cross one foot hurdles than seven foot ones.

I am an Indian investor based in New Delhi, India. As usual, the truth is in shades of grey, rather than white or black. India has lots of problems, but lot of these reports are biased/ short sighted/ desk research. Let me talk from other extreme. India is not an open country: Each country has to decide its own pace of openness. US is all for openness for product mobility but has serious problems about services and manpower mobility. Doesn’t US has a president who talks about outsourcing rhetorics to win elections? Why does US keeps increasing Visa fees (http://timesofindia.indiatimes.com/business/india-business/India-proposes-to-take-US-to-WTO-on-visa-fee-hike/articleshow/12497455.cms)? Corporate Governance is poor: Enron/ Worldcom?!! There are 6000 listed companies, out of which around 1300 are of some size (Mkt Cap > USD 20 m), as on date. With my limited knowledge, I can talk about atleast 150 companies which are decent businesses + run by above average management. This is a sufficient universe for most investors. In this, there are sizable companies which are likely to grow by 20% over next 5-6 years, there are deep value small companies. Growth investors have a play here, deep value investors have a play here. BTW, some of the worst corporate governance practices has been by many MNCs in India. It ranges from capital misallocation, showing poor results just before delisting decisions, poor dividend to lower stock price, shifting product line to unlisted wholly owned subsidiaries, merger with wholly owned subsidiaries at unfair ratios, delisting just before past investments were to bear higher profits etc. I am not talking about Chinese companies. I am talking about P&G ( http://www.capitalideasonline.com/articles/index.php?id=2885), Cadbury’s (now owned by Kraft - http://www.dnaindia.com/money/report_cadbury-dashes-minority-hopes-again_1570878), HP (http://www.equitymaster.com/detail.asp?data-ipsquote-timestamp=03/08/2011&story=4&title=MphasiS--Unfair-deal-to-minority-shareholders), Akzo Nobel (http://www.thehindubusinessline.com/markets/article2872545.ece), OTIS (now owned by United Technologies) etc. Business Ethics: Nobody calls their clients as muppets at Indian banks. Indian banking system is still mostly run on simple banking principles. Yes, there is political interference in public sector banking, but any analyst worth his salt can analyse this in a matter of days. Can’t say the same for toxic derivatives in US financial system. Taxes: I as a resident individual resident pay 15% on short term, and 0% on long term capital gains. I don’t understand why FIIs have a problem in paying taxes? Why do they have to come through tax havens? What is so saintly about stock market investments that it should be tax free? I understand tax regime should be stable and prospective, but why this obsession to evade taxes? I am not saying everything is hunky dory in India and bad in US. But these news reports need to be taken with truck full of salt. There are problems everywhere, difference is in terms of degree depending on population, poverty levels, age since independence, education levels.

Snowball had some new packets of info, but I generally didn't find it quite upto the mark. Anyways, it was a total waste of a great opportunity to understand the nuances of his investments. Buffet is a man of habits, and she just kept repeating that again and again (motherly women, money obsession, showman). I read about buffet to learn about investments, business and values, not his quirks !! I would have personally liked if she just took 20-30 of investments he made and didnt make, and the detailed rationale for the same from his own mouth. What were the alternate scenarios he saw, how did he evaluate the management, how did he look at risk from individual stock as well as portfolio approach? Why Coke and not Pepsi? Also, he has made great market calls (1969, 1974, 1979, 1999, 2008) - what all parameters he looked at.

Hi, Just saw Fairfax's investment in Indian Equities - though small bets. Renuka Sugars - USD 15 m at CMP - position created in last 1 year Sundaram Finance - USD 11 m at CMP - position created from 2004, have pared down the position by 30% since then. Cheers Vishal

Pls. mail the 2003 letter to vishmitt@yahoo.co.in I have part of 2005 letter...

One key learning for me is to try to know when to be in the market, and when not to be - not exactly, but approximately. Buffet does this - 1969, 2007 (in personal portfolio). He cant in BRK because of size, so he can do only incrementally by hoarding cash, which he did. Also, distressed investing is better in industrials rather than financials. Financials have too much leverage on smaller equity, and only real asset is trust - which is more easy to loose than hard assets. Buffet checked this in case of Amex by personally seeing that people were still using Amex cards even after the scandal. I agree with the comments on 10x10, which is a good startegy but only for high quality companies. I also have 10% positions but only long-term high quality companies, rest are 3%-6%. Cheers