Picasso

Prices last week were in the $130 range? I guess I'm failing to see what makes you think this was the opportunity of the year?

If my numbers are right, it's trading for cash component and none of the MTY consideration?

Anytime I can reference Cabin in the Woods, it's a good day.

Is this thread really serious? http://bfy.tw/5rGp

She's going to need a new collection of orange turtlenecks.

Your WPZ purchase was spot on. Congrats.

Hilary said she wants to destroy my coal stocks so I'll have to say not her. Plus we need a bear market to pick up some bargains again. So Trump?

If you have to plug your fund, you're probably managing peanuts. And it showed by the really crappy questions they asked. Like that Hogwarts one...

So they opened up the fund again. Anyone going to invest?

Canned Buffett response: "Absolutely, no other country in the world can bring out the best of the human spirit the way capitalism in America can. Even if GDP per capita drops, which, let me be clear, I don't think will happen, your and your children's standard of living will still be greater than even mine is today." "You know, what I look for in a business hasn't changed over the last 50, 60 years. We're still looking for the same thing: a business with a strong moat. That is the #1 thing we look for. But looking forward is difficult, I am glad that I don't have to do it! We think we have the best people available to do that job, they wouldn't be here if they didn't want to. So they have the right incentives, they're very smart, we think they're the best people for the job. Berkshire is in excellent hands." "Haha! Well you know, I always focused myself on the integrity and energy part of the equation. And I was lucky enough, fifty years or so ago to be introduced to my partner, Charlie Munger, who has all three in spades. So that would be my advice: seek out someone with all three, and it's amazing what you can do with time and energy. Charlie, what do you think? Charlie: I have nothing more to add." A bit tongue in cheek but yeah :) Man, I can picture them saying all those things.

You're right, he has a decent amount of brains to create so much wealth for himself. But it just blows my mind how badly he top ticks his various concentrated holdings. I even referenced this before 90% of the VRX debacle. He top ticked that one too. http://www.cornerofberkshireandfairfax.ca/forum/investment-ideas/agn-allergan/msg236119/#msg236119 I have a couple friends who have a similar investing rule. If Paulson is super long, just throw the idea away. I'm totally with them on that one. He strikes me as more of a sell-side type personality than someone who can really get a handle on these billion dollar long positions. He's never had to invest in this manner before and it's just crazy to see some of these mistakes he makes... Like selling out of all his BAC or HPQ at the lows.

It seems like you've answered your own question. You just have to look at the business and ask yourself whether there are certain risks in the working capital needs. The higher the risks maybe the less you want to pay for that business. I doubt there are any big insights Buffett could add to your question. Plus he talks about changes in working capital in several Berkshire letters. That's just part of what he calls "owner earnings." If you think there are extra risks within that working capital then just give it a lower multiple, no? There was a guy at the last DJCO meeting that went on and on about what discount rate to apply to different businesses. Charlie just answered by saying "of course you give a different rate to different businesses." I'd expect Buffett to say something along those lines as well... "of course you'll want to pay a lower multiple for a business with higher working capital needs."

Paulson is a bozo and his talks bore me crap out of me. He manages to get himself involved in every massive blow up. I never understood why he wanted to move to Puerto Rico all of a sudden. He hasn't made any money in years, what does he have to pay tax on?

+1. But to be fair, there aren't a lot of questions one can ask Buffett to make oneself a better investor. Buffett has already given 99% of the wisdom required to do well. It's just a matter of reading through it all and turning it into your own formula for success.

I bet it was that fellow Jurgis.

Can't argue with that. In a sense higher rents would also benefit property owners by supporting higher prices if cap rates remain steady. I would just feel bad for the low income renters because they aren't paying taxes as it is, any additional increase in rents is just pulling directly out of their remaining "wealth." And they would find it nearly impossible to save enough to buy an overpriced real estate asset. But stable home ownership has other benefits to society and low income earners. Anyway, all fun stuff to think about but probably a waste of time.

Man, I've been waiting years for the right indicator to short AZO. Monish putting 17% of the ETF in AZO after they already maxed out pricing power, face stiff competition from the likes of ORLY, and whittled book value negative to repurchase 85% of the outstanding shares is about as good as you're going to get.

Rents would sky rocket if they were tax deductible. People with less taxable income would be priced out of market fast. Unintended consequences with that.

Only issue I have with that buyback logic is the buyback can actually *make* the stock expensive. As an example, WPG is a REIT with 78% B-malls and 22% strip malls. The stock is trading at nearly half of NAV. The CEO even acknowledges that. But if they use their free cash to primarily repurchase shares, the core business will deteriorate over time and buying up shares at $10 would be a mistake. They need to reinvest their cash flows in the business. If they use their free cash to move closer to 50/50% B-malls/strips and grow NOI, then the stock will look cheap in hindsight and buybacks aren't necessary. A lot of these share cannibals are doing it at the expense of the long-term operating business. There's a difference between OUTR repurchasing shares versus say GOOG or AAPL. I'm curious how Pabrai will distinguish between that.

>>> Tesla bears screaming they can't build a bunch of Model 3's or turn a profit 5 minutes later... >>> SpaceX lands a booster stage on a floating barge in the middle of the ocean Remind me to buy some more convertible Tesla bonds on Monday...

Totes Magotes. For investment purposes their ratings are backward looking and a joke.

Nice AGN short Graham.

Wait, what? I just picture the kid in school getting a call over the intercom to come home "now." He then gets lectured on how he should be the next YouTube sensation because someone named oddball on a forum thought it was a splendid idea. To be a fly on a wall!

Am I the only guy who doesn't have a picture with Buffett or Munger? I'll third the comment on having your son look on his own. You have to throw that kid out into the fire and let him stare into the abyss and chew on some glass. Helping him isn't any help to him although it's nice that you care about your son. I'm going to have to stop myself from doing the same thing for my kid. There's a nice middle ground where you provide support without getting too involved.

How do you track so many short positions Graham? Seems like a lot of work for the potential benefit.