ragnarisapirate

Divided loyalty is what will stop him. Is he more loyal to FFH shareholders who are bleeding capital from this purchase, or is he more loyal to his colleagues on the RIMM board? Personally, I was happier when it was 100% clear who he was working for. SJ How are interests not aligned? RIMM is a big investment for Fairfax and he's CEO of Fairfax and steps in to help RIMM. Thus if he helps RIMM, he helps Fairfax. The RIMM investment is a sunk cost. How do you get as much of your investment out of it now is the question, and that is why Prem is in there...at best he saves it, at worst some damage control. It's clear who he is working for as he is not CEO of RIMM. Cheers! As I don't hold shares of RIMM or FFH (or really follow them, other than what I read on here) I have a question. Any board fees that Prem earns, who gets them? Do they go into Prem's pocket, or, are they going into FFH as revenue, since the only reason he is on the board, is due to his role in FFH? Or, does he work on the RIMM board for free?

As a person who does similar things, please share them! Here are a few but one blog tends to lead to another and there are thousands out there- http://tomtarrant.com/ http://shaunsre.blogspot.com/ http://www.biggerpockets.com/dashboard (forums) http://www.123flip.com/blog http://buildbankroll.com/ This is some kind of listing of a bunch of them - http://www.reiclub.com/realestateblog/contest-best-real-estate-investing-blog/ Ragnar - check out this little gem we looked at this morning. My friend got this place for back taxes and narrowly averted a city demolition. This is a warehouse from the 1800's that will be turned into commercial up front with 8 residential units behind. The front collapsed into the street in the middle of negotiations to purchase! http://tinyurl.com/bguhte8 http://tinyurl.com/bbpww86 Thanks for the links looking forward to checking them out. I am envious of the fun work that is getting ready to be done on that building of your friends! Can you give any more details? inquiring minds want to know!

As a person who does similar things, please share them!

I too road the Biglari gravy train at SNS and later sold. I however think that the real risk here isn't dilution or something like that; it is the huge consolidated bets that he seems to make and have made, which ironically, are what have made him do so well. Take a look at WEST, he took it over, and it had a small market cap- what? Maybe $20 mm? Can't really remember. Friendlies would have been a bigger deal. SNS had a market cap of what? $350 mm? And now CBRL, which is a larger investment, with a market cap of what- around a billion? (these are about where he bought in at, but while total swags on my part, as I don't remember exact numbers, illustrate my point.) Regardless, the rise has been meteoric. You think that the future targets can keep getting bigger at that rate so that they can keep some semblance of liquidity or not completely move the market? diversifying will potentially hurt their activism. It seems that he will have to change his tactic eventually- unless he plans on going after KO in the next decade... Hell, maybe it will eventually be BRK!? ;) Don't get me wrong, there is probably a ton more room to grow the business, but it uses a TON of leverage. But I honestly don't see how his partners at the Lion Fund didn't bail on him when SNS went to $3 bucks a share... I mean, Berkowitz didn't do nearly that bad and had a ton of redemptions! THAT, to me, is by far the greatest risk- he starts having to sell shares at a loss for redemptions, the selling of a large block (that would be public) forces the price down more, then selling begets yet even more selling. Then, he's left with a burger chain that now has leverage it didn't originally, an ownership in ITEX, and a few others. Granted, he would eventually cash flow out of the problem, but, this is a real risk that I don't think is fully appreciated. All this said, I he probably has thought all of this through- there was a part of Security Analysis called "pyramiding" that was pretty good at illustrating this. I am sure that he realizes that there is little room for error, which may be why he goes after targets the way he does- he wants to know them really well. Nothing new though, Shalab pointed this out before: http://www.cornerofberkshireandfairfax.ca/forum/general-discussion/biglari-and-corporate-pyramiding/msg32326/#msg32326 I still won't buy shares unless there is a huge margin of safety. Which, at this point, I just don't see their being.

All, I was curious if you have any favorite screeners to share.

BeerBaron... Stop being so critical. This is what is going to save (or rather, replace) your liver someday! ;)

All, This stems from the 2012 returns post. It has been long bothering me as to how to calculate out "gains" in a portfolio when investing in illiquid positions. From my own experience (and I am not trying to talk up the stock, just outlining my own circumstances) SYTE makes up a sizable position in my own and accounts that I manage... Given that I get a performance based fee for the accounts that I manage (of family members), how should I add in gains from things like SYTE or other illiquid holdings? I would hate it if someone placed a market order and bid the price up by a lot on a few dollars worth of stock on the day that fees were calculated. I bring this up, also, because if I were to liquidate my SYTE position tomorrow (which I won't do), I have no idea what would happen to the price: I would think it would go down precipitously, and I would probably lose money on it despite an averaging in well below present prices. Therefore, I don't know that using the market price is the best way to go about calculating things... The same could probably be said of, say, Parsad and ITEX (though, this is a guess). I know at one point, Buffett simply was compensated on an investment based on the increase in book value, but, a lot of my illiquid positions are trading at huge discounts to book, so, that doesn't really seem like a fair way either, as changes in book value (while a decent metric) don't go lock step with intrinsic value. I am sure that I am not the first one of us to run into this. I am hoping for a bunch of opinions as I don't want to screw any one, but at the same time, want to be treated fairly.

Ericopoly... I was hoping for an easy way to do options.... dammit! Anyway, my results form the start of the year are hard to judge. While SYTE (and other illiquid positions) did really well (which is a good chunk of my portfolio) I feel like I did better on paper than I would do if I had to liquidate my holdings tomorrow. That has to be a consideration.

I think it would be interesting to see the age breakdown of people under 25 (both on the board now and when they started posting). I think that I was like 22 when I started posting on here and might have been 19 when I read the MSN board? People like Alex Bossert were WAAAAAY younger in getting their start.

You can log out any any time you like, but you can never leave... ;) Seriously though, thanks for the great board Sanjeev.

I´m guessing that was sarcasm :D Anyways, that would be a no. By the way, I really enjoy your blog, especially the Syms stuff. That was in deed, sarcasm. :) Thanks for reading. Any more clarity as to what you were talking about?

It's obvious that you are talking about how the coal companies used to issue script to their employees in their company towns. :D muwahahaha.

I would think that due to how hard it would be to get rid of him, when coupled with the fact that the company bares his name, that it would really freak people out. I don't own the stock anymore, but if I did, I would get REALLY worried if he was fired- at this point, if you own the stock it seems to me that you are essentially betting on Bigs. Other than the compensation package (which, I think turned out to be pretty reasonable), the guy has done a great job there and I can't see why anyone would want to get rid of him. The real question, is what happens to the package in a few years when he wants a raise. I've gotta ask: why do you ask the question?

I don't read any. Do you have any suggestions?

This is something that I have been thinking about for a while. If you think about it, the transfer of wealth that is about to gradually occur has the potential to be mind boggling on a whole lot of different levels. Not just with the baby boomers retirement accounts, but also with the cashing in of inter-governmental debt as social security funds gradually get depleted. I don't think that there are many out there that can figure out what is going to happen as there are a ton of unknown variables. I I know I can't. While we have survived many bad things (referring to Buffett and his DOW analogy) we have not in the modern era had such a global expansion of debt so rapidly, for so long. I could be wrong, but I think this is uncharted territory. Especially when you consider that population growth is a lot different in the developed world than it used to be. I think it was Ken Fisher who once talked about an economy growing out of debt, but, it seems that a lot of the world is just not going to be able to do it. I won't be a bit surprised if there are some massive shifts of economic power. Don't get me wrong though, I am not really a zero hedger yet, and don't mind getting good businesses at cheaper prices. :)

Ha! I saw a decent spike in views then the link that you put up Rabbit. Calling it a case study is WAY too flattering. Regardless, I thank you for the kind words. :) There is more to come on it- and the story gets even crazier... If I wasn't working on a project house right now the series would have been done! As a side note, $250K for $1,500 in rent is a number that doesn't come close to doing much for me, even with cheap money or paying cash for the whole thing. Good thoughts on the HOA related matters. Having been on a board of one several times, in my experience, they are an absolute nightmare to deal with.

A bit late, but here are a few documents and links: http://www.cornerofberkshireandfairfax.ca/forum/general-discussion/chanticleer-holdings/30/ http://www.cornerofberkshireandfairfax.ca/forum/general-discussion/congratulations-to-chanticleer!/ http://www.cornerofberkshireandfairfax.ca/forum/general-discussion/chanticleer-holdings-puts-hooters-deal-on-hold/ http://www.cornerofberkshireandfairfax.ca/forum/general-discussion/chanticleer-holdings-947/10/ http://content.stockpr.com/chanticleerholdings/media/2d1acd72ac82097139bfde1c64a7b908.pdf http://ir.stockpr.com/chanticleerholdings/all-sec-filings/content/0001144204-12-029150/0001144204-12-029150.pdf http://www.sec.gov/Archives/edgar/data/1106838/000114420412035741/v316601_424b4.htm http://www.chanticleerinvestmentpartners.com/files/2012/02/1-Introduction.pdf http://www.scribd.com/doc/95454214/Chanticleer-Advisors-The-Case-for-Small-amp-Micro-Cap-Value-Investing-April-2012-Final http://www.chanticleeradvisors.com/files/107293/the%20manual%20of%20ideas%20-%20chanticleer%20interview.pdf http://www.valueinvestingworld.com/2012/06/chanticleer-holdings-inc.html http://www.fundinguniverse.com/company-histories/hooters-of-america-inc-history/ http://www.bizjournals.com/charlotte/print-edition/2012/07/06/chanticleer-offering-key-to-hooters.html From what I understand, HOTR/HOTRU/Chanticleer is a bet on the international expansion of Hooters. It's also a bet on the Chanticleer team. By the way, would someone smarter than me be so kind as to explain the difference between HOTRU and HOTR? I understand that one Chanticleer Holdings Unit (HOTRU) gives you one stock and one warrant. This doesn't sound too bad to me. You get the option of buying more of an illiquid stock. The price of HOTRU and HOTR is about the same, so you get the warrant for almost nothing. Maybe because Chanticleer wanted to make sure that the offering was successful, or am I missing something? Hi Hellsten, I think you have it right for the most part. As for HOTRU and HOTR, I don't think they wanted them to trade at par, but they expect the markets to arbitrage the difference. Unfortunately, to this point, the markets aren't giving any difference in value to HOTRU...nominal at best. Cheers! Right. As of today, you are basically paying 30 cents for a warrant that you have 5 years to exercise at $5 bucks. This is alone tempting; especially since the company raised a ton of cash in the offering. As I read it all this correctly, if the warrants all exercise in 5 years, there will be roughly 8.6 million shares out (compared to 3.7 million). This means there is basically a touch more than a buck a share in cash- more if they dont get above $5 bucks, but then you lose your 30 cents a share premium... As such, this isn't really being valued as a liquidation thing, but as you say, a bet on their international ops... in light of that, I am not really drawn in. thoughts?

PACER is the federal court database... It might be a good start.

But they're investing money in expansion...........

Pretty self explanatory. Feel free to discuss. :)

Forgive me in advance if I either don't remember or you don't comment on specifics, but, are you doing LEAPS, warrants, or equity? There are so many ways to be long that company, that I am interested in what individuals are doing. BTW, I may kick myself in a bit, but, I still don't feel like I am smart enough to understand banks enough to invest in any of the big ones.

Either Buffett has terrible taste detecting abilities or KO is the best marketing force on the planet. ;)

Is there a site that can do those charts for other holdings? That would be REALLY cool.

I was wondering if you guys had ever given much thought to the idea of indirect leverage (and indirect cash) in a portfolio. This came to me when thinking about my portfolio and the small percentage of it that is occupied by SVU. In my own portfolio, I view SVU as a relatively risky security, that will either go to nothing or preform quite well (largely, due to their leverage). However, I own, as a percent of my portfolio, a lot more SODI, which is a net cash play with a relatively stable business (though, one that is threatened by budget cuts). I would imagine that it would be very hard for it to go to zero as a result. The idea here, is that I get a little bit of stability from the cash of SODI, almost, but not quite, viewing it as a decent way of sitting on cash, whereas I can own some SVU to get a lot of leverage without actually paying borrowing costs out of pocket, plus, I don't really have to use margin. While I have not done any calculations, I would imagine that when contrasting each companies assets as a percent of my own portfolio, there is a lot less leverage than meets the eye- I wouldn't be a bit surprised if there is a net debt that isn't far off from 0 when looking at the 2 positions relative to one another. This can also be applied to the use of LEAPS. It seems like I have seen a lot of discussion that kind of goes around this idea, but never directly addresses it. That said, I am sure that I am not the first to think of this.

Yeah, but they cap your data... Which as a t mobile customer, really irks me...