Parsad

New Deepcapture on SAC and Fairfax. Unbelievable how the judge threw out Fairfax's case against SAC, and just a couple of years later the government has a full all-out offensive on them as corrupt, racketeering criminals. Also, how many that were calling Byrne "tin-foil hat Byrne" are calling him that today? Where is Antar, Weiss, Conen, Eavis, Gwynn, Sender, Contogouris, Taylor, Greenberg...cronies one and all. Cheers! http://www.deepcapture.com/there-is-more-to-the-sac-capital-story/

In terms of other strategies, have you sold your stocks or portions of them? Even if they remain cheap? Have you sold covered calls in case you want to hold them longer term, but want some protection? Have you bought puts on your stocks? Yes, yes, and yes. I walk the talk. Cheers!

Sanjeev, what do you believe the probability is of a major sovereign default? 30-70...default/no default...60-40...crisis/no crisis. I think the chance of a default is reasonably high, but probably prevented through intervention. But I think the chance of a significant crisis that worries markets, because of that possibility, to be almost a given. We'll see...I may be off on the timing, just like I was with BAC hitting tangible book...but I was right about 5 months later than predicted. Cheers!

That's one of the best quotes on investing around. Cheers!

Greek CDS were triggered. http://www.reuters.com/article/2012/03/09/us-greece-cds-isda-trigger-idUSBRE82817B20120309 Now whether Parsad and JEast would consider this a major default in an advanced economy, I don't know. I consider it a default, but not a major economy. I'm talking UK, France, Germany, Italy, Japan, Spain, Russia, China, Brazil, United States, etc. One of the biggies...and a couple in particular out of such a list are really on the verge. Cheers!

At this rate, Sanjeev is going to be out a lot of money. He already is going to owe me $1 at the end of the year when BAC doesn't pay out $7 bil or more on the common. A pint too? Better pick some good stocks! I'm going broke! No wonder it feels like 1935 to me. ;D Cheers!

How are you going to decide what constitutes a default? Some people think Greece hasn't defaulted in the last two years, others think there has been one default, others think two. What countries are you talking about? The odds are against you if you include all 196. True, what constitutes a default. In my opinion, Greece has defaulted...as without any European intervention, they cannot survive. But I'm saying a "major" sovereign default in an advanced economy...major European, Asian, North/South American country...where without full intervention, they cannot survive. In other words, a signifcant global crisis. Cheers!

In theory, that is what they will do. We'll see if it works in practice. Cheers!

He's like Santa Claus. ;D He knows when you've been good, he knows when you've been bad...he'll post when he thinks he needs to. They can let the balance sheet unwind through security maturity, but the moment that the HFT, hedge fund guys get wind that they have stopped buying or are unwinding, the nutjobs may start to panic. Regardless, we have no idea what the outcome will be, because we've never been here before. It will be interesting to see how markets and rates behave. Cheers!

Then why make one? Because I like to get the board into a tizzy! ;D Cheers!

I suspect Fed selling is just around the corner. It will be interesting to see how markets react when quantitative easing turns into quantitative flooding. I hate predictions, because they make you look stupid when you are wrong, but I bet we will see a major sovereign default in the next 12-24 months after rates begin to rise. Let's see how stupid I look now in 12-24 months! ;D Cheers!

It's basically just Fairholme plus a little Fairfax, he doesn't necessarily size his positions by number of COBAF posts. :) But I do see a problem. VAFGX 1.64% FAIRX 1.00% You're probably right. But, now that you mention it, how can we be sure Bruce B doesn't lurk here.... I am sure he does, but would never admit it. I think people want to think that "superstars" don't do things like check out a message board. He is just a guy sitting in a home office. He almost certainly checks in from time to time. Interesting. What do you say, Sanj, any IP addresses from Miami?? Of course there are ip addresses from Miami...we have about 14,000 unique views a month, so some are going to be from NYC or Miami. Have no idea if Bruce visits...but I hope he does! ;D We were some of the people who thought he suddenly didn't become an idiot, when much of the world was telling him he was and his friends and brother-in-law were bailing. I'd definitely be pleased if he did read the board. Cheers!

What a fu*king joke! Apparently, according to this article, Cohen is mulling closing his fund to outside investors in exchange for admitting wrong doing at the fund. So, the a-hole gets to keep his fortune, run a family office, as long as he admits to making his money illegally and unethically. It's this type of bullcrap that gives the 99% something to protest about! Cheers! http://www.bloomberg.com/news/2013-05-20/sac-s-cohen-said-to-mull-deal-that-would-shut-hedge-fund.html

Too restrictive...fixed MER's...higher frictional costs. Cheers!

The focused fund is out. We have an area that most people don't want to participate in, whereas focused funds with lockups exist everywhere. I think we'll appeal to the investor that wants outsized, risk-adjusted returns, but still can have access to their capital and the investor will be able to sleep well at night. Cheers!

Thanks Bmi! Very kind words. I have so much fun running the funds and this board, that I don't think I will ever stop doing either. Cheers!

I don't usually post about the funds or my company on here, but I'm celebrating our seventh anniversary of operations. Here is a letter that I sent out today. Cheers! Dear Friends & Partners, We hope this letter finds you all well! May 1st was the 7th Anniversary of operations for Corner Market Capital and MPIC Fund I, LP. When Alnesh and I started the funds seven years ago, our business plan had us raising $25M over the next five years…running a successful fund and exuding a confident air about us. We had verbal commitments from about 8 people for $2.5M…the start was going to be glorious! When the fund documents were ready, we sent them out with gleeful anticipation. None of the capital materialized. Instead, three investors with no real connection to us ended up being our first investors. We launched MPIC Fund I, LP with 3 partners and $500K. An inglorious start…but a start nonetheless! For that, we would like to thank both Mr. Andrew Cooke and the Masters Family for having faith in us, as well as the Kiefer Family who joined shortly thereafter. Instead of our faces appearing all over the news as the new hotshot fund managers, we toiled in obscurity, learning our craft, slugging away, working to gather assets, and outperform our comparative index. Since inception, MPIC Fund I, LP has returned +11.5% annualized, ending April 30th, 2013, versus +5.1% for the S&P500 TR. That was achieved with no shorting, no margin or debt, and no leverage other than the occasional purchase of call options during one of the most tumultuous periods in the last 100 years. We also operated with no lockup and no fixed management expense ratio. Essentially a model that very few in the industry follow, and one that Wall Street would suggest was almost certainly doomed to failure! In seven years, we are now at $7M under management in our funds…a far cry from the $25M we dreamed about long ago. But we learned a number of things by managing such a small amount of capital. The two most important: • Being extremely efficient with fund operations. • And who we bring into the funds, is far more important than how much capital we bring in. We've been very fortunate with our partners, with very few redemptions in our history. Our partners also have a keen grasp of the type of culture we've created within our little firm. We thank you for your trust and support! We have also been fortunate to find very efficient service providers. We would like to thank: • Mr. Ajay Desai and his team at UBS in Chicago • Mr. Alan Bell at Dorsey & Whitney LLP in Salt Lake City • Mr. Ron Niemaszyk and his team at Patke & Associates in Chicago • Mr. Doug Vicic and his team at RBC Dominion in Vancouver • Mr. Scott Larson at Lohn Caulder LLP in Vancouver • Mr. Ian Robertson at Robertson Neil LLP in Vancouver Over the years, we have received requests from investors outside of North America, and have not been able to service them. We are in the process of launching MPIC Fund Offshore…aiming for July 1st, but may end up being August 1st. If you would like to join our waiting/information list, please contact us and we'll get the information out to you as soon as it is ready. We would also like to thank a few people who have helped us along the way: • Mr. Prem Watsa, for telling me to just launch a fund with whatever money I could raise to build a track record. • Mr. Francis Chou, for being the perfect role model as a manager and human being. • Mr. Tim McElvaine, for being such a great friend to us, and showing us what a manager with humility looks like. • Mr. Mohnish Pabrai, for just being the rockstar friend that you are and teaching us to think outside of the box! • Mr. Glen Rollins and Mr. Andrew Cooke, who serve as directors for Corner Market Capital U.S. and are our sounding boards! After seven years, my days seem to have gotten easier and easier. I think it's because we've gotten to know our business inside and out, and the sheer fact that we love what we do…it never feels like work! We thank you for this privilege and for your friendship! Sincerely, Sanjeev Parsad

Defaults are low because interest rates have been low for a prolonged period of time, and corporations, individuals, etc have been able to restructure their debt profile. They are in much better shape than they have been in a long time. The question becomes, what happens when rates start to rise...what happens when the government decides to start selling assets...what happens when other parts of the world that have not been able to restructure their debt profile face those circumstances? Cheers!

Generous tip for a server at Steak'n Shake. Cheers! http://news.yahoo.com/video/steak-n-shake-server-receives-215041009.html

The Vancouver Sun had a little coverage of Prem today, as well as Vice-President Paul Rivett! The story by Malcolm Parry, traced how the Eacom Timber deal with Fairfax took place, and the discussion between Fairfax and Herb Doman's son, Rick Doman. Cheers! http://www.vancouversun.com/business/Franchisees+moved+Scudamore+latest+venture/8393159/story.html

Idiots! Article was in USA Today. Cheers! http://finance.yahoo.com/news/p-cuts-berkshire-hathaway-rating-134403253.html

Bought through Crum & Forster. Cheers! http://finance.yahoo.com/news/fairfax-acquire-pet-insurance-provider-214950744.html

Wrong section! If you don't have a ticker and name, it goes in General Discussions. Cheers!

They were wrong about credit default swaps from early 2005 to early 2008 too. What happened from mid-2008? Let me ask you guys something. Just because things are good and improving in the United States...does that exclude the possibility of a crisis elsewhere around the world? I've been bullish on the U.S. for over four years now since 2008/2009, and I'm still bullish on the U.S. long-term. But I'm scared shitless of what might happen in Europe and if China's balance sheet isn't quite kosher! Your investment horizon is far too short to conclude that Fairfax is wrong on their analysis. Only in hindsight, perhaps at least another five years out, will we know for sure who is correct or not. Cheers!

Really, I have no idea but that is as likely as any scenario. My guess is if you are sitting on 50% cash right now, you will still be sitting on 50% cash during, before, and after a meltdown. I think it would depend on the investor. I remember being over 40% cash before the downturn in 2008, yet I was one of the few people on here who was fully invested by October 2008, and then again by March 2009 after the brief rally in late 2008. I've been invested in the markets for the last three years, but I think investor's are paying far too much for their stocks today. There are bulls and bears in every market, but my opinion is that one has to focus on the margin of safety in an investment, rather than be categorized as a bull or bear. This market is making less and less rational sense to me as prices continue to rise. We're still about 65% invested, but that number will continue to fall and fall if risk premiums continue to shrink. And that opinion has nothing to do with Warren Buffett or Prem Watsa, because I don't really care what either do...you have to decide for yourself if your own analysis is correct, and if you can't find many undervalued stocks, that should tell you something. Cheers!