rmitz
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Posts posted by rmitz
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IV:
Thanks for the info r.e. Hudbay and Osler ... the links below spell out some interesting contextual details:
http://www.mccarthy.ca/article_detail.aspx?id=4759
http://www.osler.com/NewsResources/Default.aspx?id=1303
It looks like everything is a shade of grey ... with interpretation based on whether you're rooting for black or white. We'll see what happens soon.
In life, everything is a shade of grey. Only people who ignore some of the facts see in black and white.
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Everybody here has the ability to look at who wrote a post and decide not to read it if they don't want to, or not to reply to it. Doing this requires very little discipline compared to the willpower required to invest money, so I think the people here should be able to manage it.
Actually, it would be great if we could see the author when reading in RSS...
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Sheesh, sorry I'm not a millionaire. Just trying to learn and get feedback here.
No one is saying you need to be a millionaire. But when you're younger and have a smaller portfolio it does mean that it makes sense to take bigger risks for bigger payoffs--a setback will not be so bad relative to your current earnings.
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But corporations are people, so you're taking the tax from two people and saying it all applies to one!?! :)
I assume you are being facetious since this is the Corner of Berkshire & Fairfax Message Board and not Mother Jones. Just in case, corporations are organizations of people. For some reason many in our society actually struggle with this concept. Personhood is basically a legal concept that allows corporations to enter into and enforce contracts, sue and be sued, etc. It seems obvious to me, that taxes on a corporation are essentially taxes on its owners. Why else do some small businesses switch structures due to changes in the differential in tax rates between individuals and corporations?
This is, again, a dramatic oversimplification. The biggest argument is that corporations make use of and require different (and larger) parts of government overhead than other individuals. In addition, the *limitation of liability* is key here. It's not *just* a collection of people. A collection of people have no additional rights than the sum of their own rights, whereas corporations certainly do.
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First I tried to make it clear that it looks like self-love is his motivation, because it does not appear obvious that rationality is the reason. The main issue is this - Is Buffett actually taxed less than his secretary? The answer is No. Not currently when corporate taxes are figured in and certainly not over a lifetime (the whole point of the 2.5% analysis). If that conclusion is disagreed with, that is what should be debated. It is not about whether the rise in income for the middle class has stagnated in the last few years. That is a separate issue from tax fairness.
If corporations are willing to give up corporate personhood, limitations (often complete limitation) of liability for officers and shareholders, and so on, then you can treat the income on a look-through basis. Until then, they should be considered wholly separate entities.
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I have nothing but goodwill towards Apple the company and I am not particularly savvy about the latest gadgets, but I just do not see any moat here.
I remember hearing about the moat around Yahoo's email and AOL's instant messenging network. I do not see why anyone would be particularly bothered by walking away from a couple of hundred dollars worth of investment at the most in apps. Also I think it is pretty likely you would have ability to import/migrate the books and data to newer apps at some point in the very near future.
At a $400 billion market cap I would think most Apple investors would be counting on earning it back in the next 10 years i.e. undiscounted earnings of about $400 billion over the next 10 years at a very high IRR. If such a large profit pool at supremely high attractive rates of return does not attract competition and drive it down to more normal levels, I would be very surprised. Not saying it is going to happen, but that would be the way to bet IMO.
Thanks
Vinod
I think the two most important things for apple are:
1) Keeping people who have a real sense of style, design, etc., and empowering them to make some of the big decisions.
2) Being willing to cannibalize their other products to innovate.
I'm not sure this is enough, and I'm not sure they can do this either, but these are necessary for their success.
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It might be a lemon, but in my house there is a hatch of flies buzzing around this fruit.
My MacBook Pro crashed (full system crash) twice in the first few months (though not again in the past year). My IPhone constantly "forgets" my WiFi password (frequently after I walk out of range of the network). I have to keep typing it in again (happens a few times a month or so). The ITunes app on my PC will hang when I try to sync to it. My wife's IPod needs to be reformatted sometimes after she syncs with ITunes (that was the only solution I found on the net as there are plenty of people complaining of this).
When the Apple TV stops "working" (my wife's words) I just walk in there and pull the power -- that usually fixes it. Otherwise, the problem is that her IMac on her desk (wireless) needs to have the "Airport" turned off and then turned back on again -- it just drops off the network and doesn't rejoin unless you refresh the Airport. And that happens also on my MacBook Pro (same issue with the airport). But it never happens on my Windows Vista laptop!
"Stink" Different -- that's my impression.
I think maybe it knows you used to work for MS. :) Honestly that level of difficulty is highly unusual in my experience; here at work they're all far more reliable than the Dells. (On the OSX side, though, you haven't actually done OS upgrades, have you? I've found not doing a totally clean install does lead to issues... also, sometimes it's an incompatibility with the particular router that doesn't show up with the MS code.)
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I bought my first apple products (2 ipods) a year ago and after loading it up with apps etc I was totally hooked. About a month after purchase I stupidly broke the screen by dropping it between the wheels of an elliptical machine. As you can imagine I was totally pissed and decided to take it to the apple store to have it fixed. After waiting for about 15 minutes the apple genius came out and gave me a brand new one for free. My takeaway is that this company does a fantastic job building their moat(A friend had a similar story with a macbook!)
Try an Apple TV if you want a change of pace -- I have to reboot it (unplug the power) time and again to fix it when it stops responding.
You should take that one back. You have a lemon.
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Dude.. you're sounding crazy. You've started by calling a legal transaction illegal, and then proposed a host of illegal or unethical remedies to solve the problem.
Stab in the dark, but if Fibrek was trying to vertically integrate, the only major public option would have been EACOM - a high cost, Eastern Canadian lumber producer which is losing money on an EBITDA basis and is a very risky producer. The valuation on a buy-out would be ridiculous.. and its perfectly rational to want to stop such a bad plan.
And you're completely exaggerating the extent of this take-under. If FBK was run rating 60 mil EBITDA, and now NBSK pulp prices are down from 1040 to 840, on 350k tons per year, you've just lost all your earnings power.
Under ABH, you can cut a lot of costs, and you vertically integrate even the RBK business, and this makes sense... so as a FBK holder, you benefit by participating in ABH's success.
You're actually also exaggerating here. FBK was never selling pulp at 1040...they are mostly locked into contracts at closer to the current spot price anyway.
The truth is somewhere in between...
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>What would the consequences be if the minimum wage were raised to $50.00/hour?
Runaway inflation.
Au contraire. There would be massive unemployment and deflation if the minimum wage were set at a level higher than current average wages. Where would the extra money needed by private employers to more than double the average payroll come from?
When the minimum wage is set at a level only slightly above the previous rate, there is only a very slight effect on current employment. The main effect is a drag on future employment, especially on the young and unskilled entering the workforce and those with rusty skills trying to reenter the jobs market
These young job seekers who lack the minimal skills needed to earn the minimum wage then drift into the underclass to gain by other means than employment.
It's a sad story of unintended consequences.
There's a bit more to the story than that. The main reason that there is some utility in a minimum wage is that the labor market is *far* from efficient. There is an information asymmetry from the employers to the employees; a person would have to spend a few hours working a day just to find the "best" opportunities for them elsewhere. So there's a reasonable amount of stickyness in jobs, and difficulty in finding a new one, even if you are very qualified for it.
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I haven't actually read about this yet, but while interesting in a theoretical sense, this feels like a loophole that someone could fly a fleet of 747s through.
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PS -> Two other posts from the stockhouse board that are worth a scan
http://www.stockhouse.com/Bullboards/MessageDetailThread.aspx?&p=0&m=30426412&r=0&s=FBK&t=LIST&pd=2
http://www.stockhouse.com/Bullboards/MessageDetailThread.aspx?&p=0&m=30435359&r=0&s=FBK&t=LIST&pd=2
Interesting the article from jdamo ... and, as a dissenter in another takeover situation, used the courts to force the suitor to cough up a higher price. Not for the faint of heart, or with expectation of a quick resolution, but definitely something to seriously consider if ABH doesn't revise their offer.
I'm willing to join such a group based on this current offer.
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If he cheated on his wife, I would find that immoral. I didn't get the feeling that he did that though. Perhaps I'm biased, but it sounds like he was so consumed with his business that his wife went searching for other people.
According to "The Snowball", this is accurate.
In terms of the people he associates with, you have to remember he is as big a celebrity as people like A-Rod or LeBron James. Alot of times, these people seek him out, and not the other way around. I would also suggest that Buffett is a person who would prefer to add value to someones life and conduct, rather than avoid them altogether. Cheers!
It isn't cheating if it's approved by all parties. It sounded like a pretty basic poly relationship setup to me.
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Thanks everyone--I'm somewhat anxious regarding the pink sheet question I had above--do I run any particular risks on the stock if I buy under FRFHF?
Thanks!
The only thing I can think of is overpaying due to the spread. Be careful with your limit order and you should be fine.
do I have any risks re selling later, e.g., if I hold for a long time? For example, could I resell back in the TO exchange if the pink sheets weren't around anymore? I really don't know what these are, other than they are OTC.
Not a bad question. A full-service broker would certainly be able to handle the conversion of the holding so that you would be able to sell it on the Toronto (or whatever) exchange. Many discount brokers probably can't, but you can easily handle the situation later by transferring your account at that time to someone capable of dealing with the details.
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Thanks everyone--I'm somewhat anxious regarding the pink sheet question I had above--do I run any particular risks on the stock if I buy under FRFHF?
Thanks!
The only thing I can think of is overpaying due to the spread. Be careful with your limit order and you should be fine.
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As long as US takes immigrants, pop shouldn't decline.
update: In fact, a great policy would be to give more visa to entrepreneurs who want to start businesses in the US and invest X amount of capital.
They actually do this already. Except that the rules are so broadly written that you can just invest X dollars in bonds which are used for a project which creates jobs and get the visa.
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I think it is difficult to ignore the macro environment at this point in time. It is pretty terrifying.
The macro environment is basically always terrifying. Even in the golden age of the post WWII we had the communists, nuclear war, korean war, inflation fears (gold bugs, including Buffett's dad), and lots more. If you can't find good or great investments at good or great prices, that's one thing. The macro boogyman is another.
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opportunities abound, I expect that a good chunk of very tired shareholders are going to take the 39% premium and reallocate the cash.
FBK has only been around in its current form for not quite a year and a half. If investors can get "very tired" over that kind of timeframe, that says an awful lot about people's attitude these days.
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Mark me down as not at all happy with this offer. I'd basically be breaking even here, and I'm sure some traders who just picked it up recently would be fine with it (and people who have equal or more value in ABH), but I'm not.
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ConnecTV expands the TV experience by allowing viewers to interact with other fans watching the same programme, while providing a broad range of related content and promotional opportunities that are directly synchronised to programmes being viewed.
Think of the occasional trouble we have here. Now multiply that by 4chan, digg, and yahoo. Unless they have some magic, it's going to be a real sewer of commentary.
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Based on these comments Sanjeev, did you sell out of Microsoft?
I did because I had "better" opportunities coming up in this latest market rout, but I am still in DELL and it sure is discouraging. The company beat EPS expectations by something like 15% last night or $0.54 instead of $0.47 and instead analysts focus on why they did not do more sales in the low margin side of the business???? And, what will be the flooding impact on hard drives?
You have a business selling for 7.4 times earnings or 5.5 times net of cash with no sign that the business is disappearing, well managed, and the stock price goes nowhere. Microsoft acts the same way and I would say that Apple too if it was not for the very large growth rate in earnings which is the only thing that moved up the share price. The P/E is very low for such rate. Some posters are talking about RIMM on a different post. Even if the company hits the $5.25 in EPS that they are talking about which makes it a 3.7 times P/E will the share price advance at all?
With the amount of doom and gloom by analysts and the never ending worries about these businesses disappearing, I think that the only chance to make money over time on them is for earnings to remain somewhat stable and for these companies to pay all cash flow and cash on hand to shareholders via dividends or massive buybacks. Cash to the owners or a large shrinkage in shares to increase the E. For them to retain so much cash seems to be a curse or a cause as to why we should be worried about their businesses.
Cardboard
No, because we've seen Microsoft running without the chief architect for the last five-six years. While Ballmer makes alot of mistakes, and he certainly doesn't have the vision of a Steve Jobs, he is smart enough to keep capex low and share buybacks high. And while Gates isn't involved on a day to day basis, Ballmer can give the largest shareholder a call anytime he wants to get some advice. Also with Microsoft what is the worst that can happen...the P/E compresses from 9 times to 7 times or 5 times? Eventually the market will have to realize that the moat isn't gone, just dented, and that Microsoft's cash flows aren't going to disappear overnight.
In Apples case, my opinion is a premature one, but one that parallels Jobs' achievements over the years. He didn't single-handedly design anything there, but he certainly came up with the ideas. You name it and Jobs originally drew up the idea...graphic interface, Mac, mouse, USB, iPod, iPhone, iPad & iTunes. All his! And his relentless pursuit of excellence was incomparable to any other CEO in the modern era. He was Thomas Edison, but unfortunately Apple is not GE. Cheers!
I have to point out that this is just wrong. Jobs may have recognized the value of these innovations, but they were there. The key was the application of design principals to make them usable. (Actually, I really don't consider iTunes particularly usable). As long as the recognition of design as being key is there, I believe Apple can continue. They were very rarely a raw technology innovator--this is exactly Bill Gs perspective (though, of course, he wasn't really much of one either). The magic is in pushing suppliers, refinements, and making technologies usable. I'm not saying this is easy, because it isn't. I also don't know for sure if Jobs grafted this permanently to Apple's DNA. But it's certainly possible.
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I watched a TV program in May that argued the same thing. Essentially, there currently isn't the labor to support it -- this is highly skilled manufacturing. It requires a lot of training and education (math for example) -- this is not push-button type jobs.
The employers followed in the program could not easily find labor to fill their job openings.
Part of the problem is that companies have gutted most of their training programs, and they don't want to spend the money on that sort of thing anymore. This stuff isn't *that* hard to learn, and it really doesn't require a college degree--it requires strong effort and the will to get through it.
The second problem is that since companies have shut most of their internal training programs down, they don't even have the expertise to be able to do it efficiently anymore...but there is probably a real opportunity for people to figure this out.
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I think some people are missing the point.
I completely agree. The point isn't that Jobs win the Nice Guy of the Year Award, it's simply that he pushed technology into areas where it hadn't gone before. These types of arguments are so bass ackwards. It's like when people discuss great baseball players and Ty Cobb comes up. But he was a racist they say. He isn't being discussed for his humanitarian endeavors, but the fact that he was a great baseball player. When people want to discuss the top assholes of all time, then we can discuss whether Jobs and Cobb belong there. In the meantime, their personal views don't detract from the subject at hand.
I really appreciate what Jobs did, but to be clear, he never really created new technologies. He took existing technologies and used his team, influence and taste to rework them into beautiful things that the vast majority of people can now use, via a variety of methods, one of the principals of which is simplicity. When the original iPod came out I totally missed how the simplicity and beauty would win over so many people.
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Fairfax has been a greater than 100 times bagger for those that bought 20+ years ago. In fact, the annual dividend is now 3-4 times greater than the share price was 25 years ago.
Although, it would have been incredibly tough for many shareholders to watch it go to $600, then plummet to $60, only to rebound to $400. That's probably why many people choose not to seek out multi-baggers. Cheers!
That's why the Circle of Competence is so important.
Either you know the company cold, so it's inside YOUR circle of competence, or you place your faith in someone like Prem, and hope the business is inside HIS circle of competence.
If you ever meet people from BPL, you'll find they're almost always the latter--they had complete and utter faith that WEB was inside his Circle of Competence.
I would also argue that there is a significant difference in holding when you have a material impact / influence on the company in question...
Munger’s Daily Journal Broadens Investment Portfolio With a Sixth Holding
in General Discussion
Posted
I rather doubt it given the problems they had with the cross-holdings back in the day with the SEC. They wouldn't want to go down that road again.