Nnejad

Can I recommend switching to Wells Fargo? ;D

"Timothy R. Price, 67, is a new nominee for election to our Board of Directors. Mr. Price has been the Chairman of Brookfield Funds, Brookfield Asset Management Inc. since 1997 and was Chairman, Brookfield Financial Corporation until December 2004. Mr. Price is a director of Brookfield Homes Corporation, HSBC Bank Canada and Canadian Tire Corporation, and serves on the audit committees of HSBC and Canadian Tire. Mr. Price is the Lead Director of Astral Media Inc. and on the Audit and Compensation Committees of Astral. He also serves on the Board of Governors of York University, the St. Michael’s Hospital Foundation Board and the Dean’s Advisory Board at the Schulich School of Business. Mr. Price is a resident of Toronto, Ontario, Canada." Anyone can immediately respect the quality of that.

Depends where it is , but im also interested. Nick

I've never been a believer in the idea of IT. I'm young and I still remember when I first began investing. At the time, there was a strong urge to learn investing; and combining that energy with curiosity made me better each year; and that passion has maintained for a good eight years now. Was this desire to invest an innate part of me? Well , I remember that my interest was first peaked by a book my dad gave me. I also remember at the time i spent a LOT of time on video games; and i thought that investing could be a "game" for which I would have something valuable to show for it. (As opposed to all the titles and accolades i was winning for Warcraft III). So some would say that it was inevitable that I would become a good investor because i had that passion. But then, I also know as a high-schooler, I was scrawny and not very athletic. And so, that drove me to basketball, and I took it very seriously for several years until I got injured. I was also terrible at communicating when I was young; but over the last few years, it has been a goal, and today I find myself very comfortable speaking, and fairly good at it too. Finally, i mentioned an injury in basketball, which basically took me out of the game for the last year and half. But this being my last semester in college, I really wanted to win one Intermural championship before I left; and so once again i devoted my time to getting back to my old self. It was much more difficult this time; i didn't have the same mental energy as I did at 15, and it was depressing at times. But it came back as i stuck with it; it took only about 5 weeks of intense rehab and drilling. So thinking back to when I was 14, right before i picked up that first book on investing. Did I have IT to be an investor? Did I have IT to be a good speaker and basketball player as well? I believe the truthful answer was I didn't have anything that I didn't earn through energy, discipline, and curiosity, as well as intense desire to see a certain result. And I was lucky to have a few intellectual breakthrough's along the way. One big thing I learned about this most recent basketball rehab experience is just how easy it is to get caught focusing on the wrong things; and it is so very hard to be certain when you've came on to an idea that's right over wrong. Hopefully my personal experiences and feelings on the matter are of some value to others here.

Ya, this was difficult to find. Here's what I got: "Taxation of dividends is often used as justification for retaining earnings, or for performing a stock buyback, in which the company buys back stock, thereby increasing the value of the stock left outstanding. In contrast, corporate shareholders often do not pay tax on dividends because the tax regime is designed to tax corporate income (as opposed to individual income) only once. The shareholder will pay a tax on capital gains (which is often taxed at a lower rate than ordinary income) only when the shareholder chooses to sell the stock. If a holder of the stock chooses to not participate in the buyback, the price of the holder's shares should rise, but the tax on these gains is delayed until the actual sale of the shares." I imagine its similar in Canada, but that's been impossible to find through google. And then, I think what Baron said is correct. I remember the whole issue with the ORH taxes and whether it was put to hold co or not. I want to say that you do not pay the deferred liability tax on capital gains of a stock you buyback, because I don't remember any additional taxes by Fairfax for the ORH or NB buyouts.

Some tax questions which would be useful to know: What would a Canadian corporation pay on dividends from a Canadian corporation (not a trust)? What would a US corporation pay on dividends from a US corporation? - i know on preferred stocks, they pay taxes on only 15% of the interest. But no clue on dividends And then: Let's say Berkshire Hathaway bought out Wells Fargo. Would it have to pay taxes on the gains from its existing stake in Wells (what is currently its deferred tax liability)? And would subsequent income earned at wells fargo have to pay a tax when its dividend'ed to the holding company?

that would be a lot more interesting if it's source for the estimates was not Shadowstats, which is basically a big conspiracy proponent of "the coming crash." The more reliable measures from the Fed for M2 to january 2010 say: seasonally adjusted annual rates for M2 3 months : -.9% 6 months : +.6% 12 months : +1.9 Source: http://www.federalreserve.gov/releases/h6/Current/

I guess the non-obvious things I would add from the report: Equity investments had a fair value of 171 million above carrying value. Adjusted book approx. 377 100 million recovery of taxes for the quarter 425(?) million decline in net receivables for the year Used up 312(?) million of tax asset Repurchased 315,000 shares during 4Q09, at a cost of 112 million. (?)- numbers off the top of my head, may be slightly off.

Txlaw, this is shockingly good. Thanks. Any of his other work worth checking out?

That article was actually crap. It never fails to amaze me how many people will warn of a funding crisis, when all the evidence you need is that there's currently an excess of money that would rather be in government bonds than invested. Krugman posted a chart some time ago showing how federal government essentially stepped up and borrowed the difference between savings and private investment. When people have the courage to move away from government bonds to making actual investments, yields will rise. . . but so will business activity, taxes, etc. If you're not going to read the economic literature, at least take some time to get comfortable with what should be the cognitive dissonance from this idea. When I see people like Niall Ferguson, i wish i had a program that let me check off and do away with ever having to see an article from him again. His reputation to me is shot (its actually been made worthless to me several times before), and I never want to support any of his words by one of my clicks. . .

No offense to that author, but if you're going to critique an investment, especially one made by the greatest investor of all time, your own reasons should probably dig deeper than a comparison of current PE to long-term average PE. The fact of the matter is Berkshire acquired a utility. It will earn him more than the current return on cash or long term treasuries. And it will give him the opportunity to re-invest significant amounts at 10%- which is significantly more than long term treasuries and cash.

Having trouble with those links? Try this: http://www.theglobeandmail.com/blogs/streetwise/article1446310.ece They're selling out for a 15% capital gain on the debentures (not including all the gains from the warrants. . . )

More good news for Fairfax.... http://www.integratir.com/newsrelease.asp?news=2131023096&ticker=T.BRK.UN&lang=EN Highlights * - December 2009 total retail sales increased 9.1% compared to December 2008. - December 2009 retail same store sales increased by 4.9% compared to December 2008. - Fourth quarter total retail sales improved significantly, with a decline of 1.9% compared with declines of 18.7%, 29.3% and 13.8% in the first, second and third quarters respectively, of 2009. - In the retail segment, fourth quarter same store sales decline over the comparable period in 2008 was 7.3% compared with declines of 21.9%, 33.0% and 19.0% in the first, second and third quarters respectively, of 2009. - The Brick Group's cash and liquidity position strengthened with zero borrowings under the GE asset-based credit facility and $68.0 million undrawn and available for use under this facility at December 31, 2009. - Cash and cash equivalents totaled approximately $18.0 million at December 31, 2009.

That's a fact? When did they lose dearly on this investment.

If I was to logically argue against your statement, I would say simply: you are relying on a simple anecdote for your evidence, when there is a clear and readily available statistic you can use to get a better picture: delinquencies. That will tell you actual amounts of people not making payments on their mortgage, and for how long.

Your double counting on some interest expense. The unsecured notes were issued mid August. Interest expense in Q2 was 37.7, so you should annualize that number instead, leading to about 10 million more in pre-tax income for year. Otherwise, it's pretty solid. :D

Calm . . . down.

His allocation sounds like a recipe for paying a lot more in fees.

Preferred Stock Placement On November 30, 2009, the Company entered into an agreement to issue and sell 2,000,000 shares of its 6.0% convertible perpetual preferred stock, par value $0.001 per share and liquidation preference of $100 per share (the “6.0% Convertible Preferred Stock”), to Fairfax Financial Holdings Limited in a private placement exempt from registration under the Securities Act of 1933, as amended (the “Securities Act”). The Company expects to receive net proceeds of approximately $200 million from the sale of its 6.0% Convertible Preferred Stock. The issuance and sale of the 6.0% Convertible Preferred Stock is to a single accredited investor and will be effected pursuant to the exemption provided by Regulation D under the Securities Act and/or Section 4(2) of such Act. The closing of the private placement of the 6.0% Convertible Preferred Stock is expected to occur on or about the same time as the closing of the Permian Basin Acquisition. Each share of 6.0% Convertible Preferred Stock will be convertible at any time on or after February 1, 2010 at the option of the holder into a number of shares of the Company’s common stock equal to the liquidation preference of $100 divided by the conversion price, which is initially $10.856 per share, subject to adjustments in certain circumstances. The initial conversion rate for the shares of 6.0% Convertible Preferred Stock is approximately 9.2115 shares of common stock per share of 6.0% Convertible Preferred Stock. Based on the initial conversion price, approximately 18,422,992 shares of the Company’s common stock would be issuable upon conversion of all of the shares of 6.0% Convertible Preferred Stock to be issued in the private placement. On the fifth anniversary of the date of issuance of the 6.0% Convertible Preferred Stock, all outstanding shares will be converted automatically into shares of the Company’s common stock at the then-prevailing conversion price if all dividends are current as of such date. The annual dividend on each share of 6.0% Convertible Preferred Stock will be $6.00 and will be payable semiannually, in arrears, on each January 15 and July 15, commencing on July 15, 2010, when, as and if declared by the Company’s board of directors. The Company may, at its option, pay dividends in cash, common stock or any combination thereof. Read more: http://www.faqs.org/sec-filings/091130/SANDRIDGE-ENERGY-INC_8-K/#ixzz0Z2ZjiRHS I think the first 70% of dividend income from preferred stock is not counted towards taxable income, meaning the effective tax rate on this interest is only 10%. So, 5.40% after-tax yield, or 8.3% pre-tax equivalent yield (right?). Also, these aren't options, but rather a convertible feature... and on the 5th year, the conversion is mandatory. It seems a little riskier than usual for a Fairfax investment. The PV of their proved reserves were 2.3 billion at YE 08, and the company had 2.4 billion in debt, plus a market cap of 1.5 billion. Then again, the company has been adding to reserves at a very healthy pace. I'm sure FFH has done its homework.

Ya, and while you're at it, can you add the canadian stocks, as well as the convertibles and warrants??? Haha, only kidding. But seriously, I do really appreciate the feature, and I even went back and read some of your previous posts and l've been on the look-out for your posts ever since. . . although you've been quiet lately. Anyways, sincerely, thank you Nick

People have mentioned or asked about this a few times in passing. Well, Jegenolf posted this google doc tracking Fairfax's portfolio with an auto-update function. I can't tell you how many times I have used it and how helpful it has been. Thank you, jegenolf. https://spreadsheets.google.com/ccc?key=0AgRisBBB7yNgdG5ZcTlJQlQxRm1ONDlKd0RvcnBuZlE&hl=en

I'm pretty sure the issue Fairfax bought is not tax-free.

For inflation, aggregate demand, spending, in nominal terms has to go up. So either people who have jobs have to spend more, or the unemployed need to be re-employed. I've yet to seen anyone who's worried about inflation explain how the low rates or increased money supply has so far built up a pent up, waiting to burst, surge in spending on the part of the consumer. Because ultimately, inflation will only come when nominal spending by households goes up. . .

Berkeley. Sounds fun, +1.

http://www.newswire.ca/en/releases/archive/September2009/21/c7288.html