brk64311

https://www.wsj.com/tech/ai/yann-lecun-ai-meta-0058b13c?gaa_at=eafs&gaa_n=AWEtsqepWc-uIbbtEU-VjQIIMqbYykI6pS5bEAASL-_HgnE-ManIKlHZlWRKa3al79k%3D&gaa_ts=691a7b61&gaa_sig=CKqJL6gkWJdu3O5Dod8XYeXcRnsjhmbLoCI_O_JoWe5L9ev2qxBCku-YerNn4tn2tSWWjWsMGhtBg73it413sw%3D%3D He’s Been Right About AI for 40 Years. Now He Thinks Everyone Is Wrong. .... "Meta Chief Executive Mark Zuckerberg has been pouring countless billions into the pursuit of what he calls “superintelligence,” hiring an army of top researchers tasked with developing its large language model, Llama, into something that can outperform ChatGPT and Google’s Gemini. LeCun, by his choice, has taken a different direction. He has been telling anyone who asks that he thinks large language models, or LLMs, are a dead end in the pursuit of computers that can truly outthink humans. He’s fond of comparing the current state-of-the-art models to the mind of a cat—and he believes the cat to be smarter. Several years ago, he stepped back from managing his AI division at Meta, called FAIR, in favor of a role as an individual contributor doing long-term research. “I’ve been not making friends in various corners of Silicon Valley, including at Meta, saying that within three to five years, this [world models, not LLMs] will be the dominant model for AI architectures, and nobody in their right mind would use LLMs of the type that we have today,” the 65-year-old said last month at a symposium at the Massachusetts Institute of Technology. LeCun has been talking to associates about creating a startup focused on world models, recruiting colleagues and speaking to investors, The Wall Street Journal previously reported. A world model learns about the world around it by taking in visual information, much like a baby animal or young child does, versus LLMs, which are predictive models based on vast databases of text." ....

Thanks for sharing your thoughts. The story (GPD+volume growth and pricing power ) sounds quite similar to MCO, SPGI, which are trading at better valuations?

Love the strong fundamental and tail wind for the aerospace industry, but do you mind sharing your thoughts on expectation of future return of your newly purchased GE shares given the current valuation? Safran and Airbus seem to be more reasonably priced? Thank you.

Adding to SPGI. Reasonable valuation at 4%+ LTM free cash flow yield for a high quality business acting as toll road of capital market with moat/pricing power. Its peer MCO is also getting interesting, but I already have a high concentration in it.

Thank you.

Thank you. Do you mind sharing a bit more about your experience going from public market investing to building RE and other businesses? As someone who have had reasonable success in the market, I am intrigued by the idea of diversifying some assets to RE and other more "tangible assets/businesses. I have the interests, but not sure if I have the strength/what it takes to invest beyond stock selection.

May I ask if you have any advice for someone looking to "diversify" from 100% securities portfolio(direct public equity holdings, private RE funds and hedge funds) to REs/more tangible cash flow generating businesses?

MCO, from 2000 IPO to now, 30plus X

MMM20, I think you are right. I was under the (wrong )impression that rollover IRA is subject to ERISA, which will not allow PFIC holdings. Thank you.

Yes, but the holding size will be limited, since my understanding is that it needs to be a non-rollover IRA for the PFIC to be a non-issue.

Not a concern with the current portfolio holdings, but can FIH become a PFIC somehow? For example, I'd love to continue to own EXOR, but became concerned about its PFIC status as a US investor, after Exor sold PartnerRe.

US EXOR holders - are you considering the tax complication due to PFIC ?

Any view on preferred and bond issued by BEPC(Brookfield Renewable Co): BEP/PRA(about 6.7% yield, 78% of par) and BEPH(about 8% yield and 56% of par)? Good value even in a higher rates for longer environment? Can't seem to find prospectus for BEPH and reached out to BEPC investor relation.

Gregmal, Do you mind sharing your VIX -spike related trade? Thanks.

Posted this under Exor thread as well. Thanks. Will the forming of Stellantis change Exor's PFIC status? My understanding is that Exor can count holdings where it has over 25% ownership as active businesses in the PFIC assets tests(at least 50% active businesses assets) or income tests(at least 75% from active businesses income). Prior to the Stellantis deal, FCA can be counted towards active businesses since Exor's ownership is >25%. Post Stellantis deal, Exor's ownership of Stellantis is < 25%. If we exclude Stellantis assets and earnings in the calculation, the asset and income test might not meet, or getting very close to the 50% and 75% thresholds. Is my understanding correct? Appreciate any feedback US investors might have on this issue.

The letter contains many helpful insights and very thorough analysis of BRK. But anyone else has issue with the way he proves that high growth of Fab 5 is "mathematically impossible" as shown by the tables on P63 and P64? We can discuss/debate all day about many fundamental reasons why Fab 5 will or will not grow at high rates for the next decade or two, but high growth of any company will not mathematically impossible. I believe the set up of the tables were mathematically wrong, as you need to account for the growth of Fab 5 in the first grow of the table, i.e. you can not assume S&P as a whole will only grow 4% when Fab 5 (part of S&P) grow, say 20%, for two decades. The right way is to calculate the first row in the table by assuming all companies other than Fab 5 grow 4% and Fab 5 grow at whatever rates you assume.

Thoughts, especially for P9,10? It is not a bottom-up/fundamental analysis, rather more macro/broad brush. Still curious about what others on the board think. Q2-2019-Horizon-Kinetics-Commentary-_Final-1.pdf