Parsad

I like the word "onkly" you've created...a combination of "only" and "frankly"?! Cheers!

F) The Great Unwind (not just government assets but all assets)

Ahhhh! I think we're 2/3rds done already. At -20.6% we're already half way down/up this list: Do we really think things are going to be as bad as the Roosevelt Recession of 1937, the Great Depression or Financial Crisis? We'll probably drop a total of 30-35% (what I said originally) into the 3rd Q as 2nd Q earnings hurt and rates continue to rise, and then rebound through the 4th Q and into the middle of next year as the economy slows somewhat, supply chain issues decrease, inflation stabilizes and the administration starts to pander to voters as they start to make their run to the 2024 elections. Cheers! Cheers!

True! At the same time, did we ever think that certain automotive issues or performance could be simply fixed by a wireless update? There are pros and cons to everything. Sure, we won't have as many people that can simply fix old automobiles, appliances, etc, but at the same time, we carry our phones all over the world with ease, drive vehicles that need very little servicing, have an abundance of food choices and in many cases, can work from home regularly, etc, etc. I always hear from family and friends how things are so much worse...and I'm sure certain things are...but I'm constantly amazed by what science and technology allow us to do as well. Cheers!

I don't think anyone disagrees with what the Fed did, just how long they did it. And then again with the pandemic. They have to step in, there was no one else of size that could inject liquidity during the GFC or support businesses during the pandemic. Just the size and duration of the support is at question...because it kind of effed things up in other ways. Cheers!

Hmmm...savers outside of GIC's did pretty well. So it wasn't just non-savers. Cheers!

Agree! Savers made it up, or should have made it up, on the bond and equity side. If they stayed in GIC's then that's their fault. Cheers!

Yeah, I partly agree with Dinar. The CPI calculation may not have shown inflation, but I've been noticing shrinkage of product volume sizes for a few years. Lower energy, commodity, and labor costs may have offset higher food and manufacturing costs pre-pandemic. Cheers!

One of my cousin's is a heavy duty mechanic, and his wife's 2012 Lexus was having some handling issues. They took it to the dealership where they finally worked their way to determining the entire front end suspension was failing and needed replacing for about $3,500. He said he would fix it himself. They said let us know what he finds. He took it home, took it apart himself, and found out that one of the shocks had failed. He went and picked up the parts from a parts store, and apparently with the Lexus, you can't just replace the shock, but have to replace the struts and coil too, plus do both sides. The total parts were something like $400. He took the failed shock absorber to the dealership and showed them after. Total cost...$400 plus about 3 hours of his time. Cheers!

That will be a great memory! Make sure you guys fix the car properly!!!!! Cheers!

I'm not sure Berkshire should do any acquisitions after Buffett is gone. There is no need to. They have enough organic businesses to power the company...from insurance to energy to retail/manufacturing to distribution/transportation...they are essentially a mini S&P500 already. They should pour enough money to grow those businesses, and then everything else should go to the portfolio managers. That's it. Abel doesn't need to ever acquire another business again, and BRK will continue to make tons of money. Cheers!

On the other end, airline ticket prices can only go up...staffing shortages, 2019 demand, traffic control shortages, fuel costs, food costs, labor costs...I own a bunch of HA Jan 2023 call options, but I may have been early. I imagine airline profits will be close to 2019 in 2022 and exceed 2019 in 2023...investors should consider Jan 2024 call options on many airlines. Cheers! https://www.cnn.com/2022/06/26/business/flight-cancellations-sunday/index.html

Oil prices flattening...metal prices cratering...commodities flattening or dropping...inventory levels getting higher and higher...some companies starting to layoff... Countered by: Supply chain backlogs...high price for distribution (shipping, gas, diesel)...continued crisis in Ukraine...lack of workers...likely increases of prices at retail level in Q3...expected 50 basis point hikes in July and September... Is inflation going to start to ease up in 3rd and 4th Quarters of 2022? I suspect some deflationary pressure in some areas where inventory levels will be too high before Christmas: https://www.cnn.com/2022/06/26/business/retail-returns/index.html Cheers!

Howard Marks is buying, so we can't be that dumb! He's a pretty bright guy. Cheers! https://www.ft.com/content/a3f14c51-0b1c-416e-84db-0fa0fc842f1f?ftcamp=traffic/partner/feed_headline/us_yahoo/auddev

Perma bears are perma bears...just like perma bulls. They will never see the upside or downside of stocks. Cheers!

Yes. There is a hardcore loyalty to Buffett and all things Buffett. That subgroup, many will choose that Berkshire without Buffett, is no longer Berkshire. 40% would be on the extreme side...but a 20-25% drop is more than plausible and probably likely. Cheers!

There was a report of two twins recently...one adopted by a U.S. family as a baby who ended up with significant economic and family issues, while the other twin was adopted as a baby by a financially comfortable family in Korea. While the twins had similar personality traits, likes and dislikes, there was a fast difference in IQ...the Korean twin's IQ was some 15-20 points higher. So, its likely the nature and nurture both have significant influence on who we are and what we become. Cheers!

+1! Cheers!

Joe Brandon's a terrific insurance executive, but as an executive under Ronald Ferguson he did not recognize the errors with the AIG transaction that led to criminal charges against Ferguson and a couple of other executives, nor did he recognize the derivatives risk that GenRe was carrying. Those were two big errors in a very complicated game, and if Berkshire had not acquired GenRe, GenRe would have been another AIG in 2008! Buffett was completely involved in unwinding thousands and thousands of derivatives contracts for several years...I believe they had only a handful left before the financial crisis. The Markels & Gaynor, alongside Prem, Andy & Brian, as well as Buffett & Jain, all clearly recognized the havoc and risks of derivatives. They avoided that time bomb. So, I put these insurance executives on another level than their peers. Avoiding catastrophic outlier risk is what reinsurance is all about! Cheers!

It's like the difference between Fairfax insurance operations with and without Andy Barnard. There is huge marked difference with Andy overseeing and creating a certain culture in underwriting and operations. Buffett and Ajit maintain a similar integrity with the Berkshire insurance operations. So yes, I'm not pinning it only on Jain...I'm pinning it on Buffett and Jain. Cheers!

There is an easy solution. Berkshire should just buy Markel and make Tom Gaynor vice-president of insurance operations and president of portfolio management, while Ajit Jain is president of insurance operations and Greg Abel is president of non-insurance operations. Gaynor has worked in a co-leader position and is a terrific investor and insurance manager. Abel is presently working as a co-leader with Buffett, and then would not have to worry about float, insurance or portfolio management if something happened to Warren and Ajit. The two T's probably know Gaynor well, and would fit in nicely as a team. Ajit already knows Markel and Gaynor, and Ajit's lack of ego would be a good environment for Gaynor. And Gaynor's better at risk management than say the likes of Joe Brandon at Alleghany or many of the other Berkshire insurance subs other than National Indemnity. Cheers!

Well, the two guys that were supposed to lead...Ajit Jain and David Sokol...one has gotten older and the other departed on poor terms (and is also older). Finding such quality people is like finding a needle in a haystack. It is sad, but are we really surprised that there aren't a lot of Buffetts or even lesser Buffetts floating around everywhere? Berkshire shareholders were not just lucky...they won the lottery with the man! He's not just a great investor, businessman and leader, but he's one that survived so long and was able to continue running the business for so long. That's a lottery win! Cheers!

Insurance remains Berkshire's largest business and will continue to be the engine of the company. So, at the very least, I would be concerned about who takes over for Ajit, as National Indemnity is not only Berkshire's biggest insurance business, but biggest business overall. Insurance is all about risk management, and if the two people best at that...Buffett and Ajit...are gone from the company, then that is a concern. Bigger than investing float, since they could easily index the equity side, and find a good bond manager to look after the bond portfolio. Cheers!

I would imagine it would be at least a 10% drop the day the news is announced and 20-40% drop over a period of time as hedge fund managers, small investors mull it over and sell. It will also depend on how much cash Berkshire has and how much support the stock gets from BRK buybacks when it starts dropping. As well as value fund managers probably buying stock too. It would be back up near fair value within 12-18 months once sellers clear and equilibrium returns and people realize the stock will still do reasonably well long-term. Cheers!

Really? Making money is that important?!