Parsad

Article today about how Roubini, who is practically in the news every day talking about something, is selling his firm which has been losing money monthly. Fourteen million in revenue, 85 staff, $2M in losses. He expects 8% growth in revenues in 2012, and 40% revenue growth in 2013...ppphhhhhttttt! :P Looks like Roubini went to the Ron Insana school of business management! http://www.cnbc.com/id/44859944 What should he get for this piece of crap? One dollar in my opinion...to both stop showing up on television and definitely don't go back and teach! Cheers!

Fantastic 3rd Q letter by Mason Hawkins. I think there is a sheer disconnect between macroeconomic issues and what investors are perceiving to be risk in equities. Hawkins does a great job clarifying what Buffett has also tried to get through to the public. We are not buying the market, but individual securities. Cheers! http://www.longleafpartners.com/pdfs/11q3letter.pdf

$9500.02! Somebody really pushed the bid with the 2 cents. ;D Cheers!

Interesting statistic. Last time short-selling rose this quickly was March 2009. Professionals are always great at timing, aren't they? Cheers! http://finance.yahoo.com/news/Short-Selling-Rises-Most-bloomberg-3652051178.html;_ylt=ArVazKF6NlZMr8.vtJqpK4m7YWsA;_ylu=X3oDMTE1bHZiNzkzBHBvcwM4BHNlYwN0b3BTdG9yaWVzBHNsawNzaG9ydHNlbGxpbmc-?x=0&sec=topStories&pos=5&asset=&ccode=

Paulson's fund is now off almost 47% for the year. Cheers! http://www.cnbc.com/id/44828940

It's crazy how everyone, including those within the United States, and outside of the United States, have put the U.S. on the ropes and started a standing eight count. Take a look at the title of the article below, and you'll realize exactly how far off the thought process has gotten from reality. http://www.cnbc.com/id/44835200 It reminds me of those people who always whine and complain about how bad they have it, but never bother to look at the past and see how things really were, or even those around them presently and see how their lives really are. While the U.S. has plenty of work to do to get their fiscal house in order, calling the death of the patient while they are still on field playing football and giving as good as they are getting, is just kind of premature. I've head all of this before while I was growing up. First it was Japan, and how we all needed to learn Japanese in the 80's. Then the coalition of European countries who were going to form the biggest free trading block in the 90's. And finally how the Chinese are going to rule the world in the new millenium. We know what happened to Japan and Europe, and I'll bet $100 that China faces their own setback within the next decade. There is always a contender because they work harder or smarter, but unfortunately there is never a better system. I read this terrific article in the Daily Telegraph this weekend: http://www.telegraph.co.uk/news/worldnews/asia/china/8796486/Why-China-wont-conquer-the-world.html Maybe if more people read articles like this, they'd realize that the success of the United States over the last 200 years occurred primarily because of their system of governance, and not by the American people alone. A system that fulfills its creative destiny through entrepreneurial and innovative growth, rather than just mimicking everyone else. A system that fully ensures protection of property and intellectual property rights. A system that will kill itself to protect the individual's rights and freedoms! The best days of the United States are not behind it, but in front of it, and the world will eventually come to that realization! Cheers!

Up to $6,600 now! 6 days left to go. Cheers!

Bid is now up to $676! 6 days left. Cheers!

Other than the Target fund that went under! ;D Cheers!

Totally. He was in full force on Charlie Rose. As much as I'd like to be like WEB, I think I might rather be in Charlie Rose's shoes. He's got one of the best jobs in the world. Recently Rose was at George Clooney's villa in Italy, skinny-dipping with Marisa Tomei in Lake Como...who wouldn't want to be in Charlie Rose's shoes! Cheers!

Anyone remember that genius Lenny Dykstra? How about Ron Insana starting a fund of funds with SAC? Where are they now. It's not a sprint...except for the Wall Street morons. Cheers!

Personally, I think that 9% book value increase you cited is a questionable way to look at Prem's returns on investments. The 9% net compounded annual number you cite for Fairfax is comprised of 1) excellent investment returns relative to book far greater than 9%, and this multiplied by 2) horrible underwriting losses relative to book due to the 7 lean years of the TIG and Crum acquisitions. Fairfax breaks out their earnings into these two big categories, the first category is the investment side. I think if you worked through those numbers, the returns would be at least 10% higher compounded annually than the 7% Francis got. So I am looking at the numbers before speaking, I am just not looking at them the same way you are. You can't pick and choose. Francis' numbers are significantly higher historically as well. You can't take away Francis' losses, and you can't take away Prem's losses during the lean years...they don't just disappear...and it's also not fair to exclude from one and not the other. TIG & C&F were the equivalent of stock picks, and they killed Fairfax because they were so underreserved. That's no different than me investing say in AIG and getting killed. And they hurt Fairfax more because of the leverage. If Fairfax had the same asset to equity as Berkshire, the combined losses from 9/11, TIG & C&F and hurricane losses, would not have hurt as much. Thus the reason Fairfax NEEDS to use hedges to protect themselves from massive swings in their equity, which would result in downgrades and possibly loss of ability to underwrite property-casualty insurance. I would prefer to see Prem get the leverage down further...maybe 2.5 or 3-1. Cheers!

Incidentally, Soros recently lost his challenge to his insider trading conviction. Cheers! http://finance.yahoo.com/news/Soros-Loses-Challenge-to-nytimes-433091633.html;_ylt=AushEGfqgx4627tEMaUPkhW7YWsA;_ylu=X3oDMTE2YmgxbGVlBHBvcwMxMARzZWMDdG9wU3RvcmllcwRzbGsDc29yb3Nsb3Nlc2No?x=0&sec=topStories&pos=7&asset=&ccode=

Buffett issued a statement to CNBC on the passing of Steve Jobs: http://www.cnbc.com/id/44799649?__source=yahoo%7Cheadline%7Cquote%7Ctext%7C&par=yahoo I'm guessing the exact same thing will be said about Warren one day as well! Cheers!

I agree 100% with everything Twa said. Cheers!

Classic frat boy Ballmer! It's the one thing that worries me. Cheers!

Exactly how much better did Prem do than Francis from 2000 to 2010. Francis return 7% annualized, while Fairfax's book value increased by 9.9% annualized...using leverage and hedges! Check the numbers before shouting from the rooftops! Yes, their actual equity holdings did better on an annualized basis, but what is that position relative to the total assets within Fairfax? In my own personal portfolio, I've returned better than 20% annualized over the same period...no hedges, no leverage, no shorts. Over the last five years, MPIC Fund I, LP has returned 12.5% annualized, when the S&P500 returned about 1%...no hedges, no leverage other than the occasional use of options. Corner Market Capital's own portfolio is up about 12% this year...no hedges, no leverage, no shorts. So feel free to do what your conscious is telling you, but don't extrapolate your use of hedges and macro views as a necessity when trying to invest successfully...even in volatile times. Cheers!

Some really nice photographs of Steve Jobs. Cheers! http://news.yahoo.com/photos/steve-jobs-slideshow/#crsl=%252Fphotos%252Fsteve-jobs-slideshow%252Famericans-mourn-passing-apple-co-20111005-190222-965.html

ABC too now! Horrible news. Just terrible and a real loss. http://abcnews.go.com/Technology/steve-jobs-apple-ceo-dies/story?id=14383813

Ohhh no! That's awful. What a loss to the world! Oh, my God.

This only is true if you think current margins and returns on capital are normal and sustainable and do not require any "growth capex / investment" to maintain. Do you believe that? We all agree on earnings, Apple seems cheap. Their products have been great. Is it really so obvious that the decline curve on their current revenues and margins isn't amazingly negative without continuous massive investment and successful innovation? I can imagine scenarios where it works out, but I wouldn't think the current P/E really gives you much comfort... you have to build a P&L 3-5 years out and have some reasonable confidence what it will look like and that it will be the same or higher than now. I don't have that conviction and I think the biggest issue value investors get into is looking at what a company has done and assuming it is ordained that that level of profit may be possible again or even normal. I think you have to carefully examine that opinion here. No position at all, but I'd certainly not be long if forced. Ben - My 1 cent... cause that's all it's worth. Totally agree with Ben's 1 cent...even though it's worth more! ;D Cheers!

What I have noticed is that other good pure value investors - e.g. Munger, Whitman, Berkowitz, Chou, McElvaine, the people at AIC, Mark Mobius (someone mentioned Miller but I hesitate to put him in this category) - have had their otherwise outstanding returns significantly damaged by major bear markets. The question whether there is a lesson here. It is interesting, for example, to compare Francis Chou's performance versus FFH's given their close association and similarity of thinking. FFH's past performance over the past 3 and 5 years are significantly better. Why? It is likely that Francis was handicapped by his inability to make the same macro bets that FFH was able to because of his fund rules. None of the people you mentioned are leveraged. Prem is leveraged. I think Francis can ignore macro for the most part, because it would be nearly impossible to wipe him out. On the other hand...a 50% drop in Fairfax equities, a magnitude 5 hurricane hitting the Gulf Coast, and a magnitude 8 earthquake rocking Los Angeles all in the same year could do that at Fairfax...without hedges and reinsurance, of course! Francis, Buffett, Whitman, McElvaine, et al have the luxury of ignoring macro for the most part, Prem doesn't. Cheers!

Ah Tom, I read the same thing at the same time, and posted it in a new thread! Cheers!

Article below saying that Microsoft may take another stab at buying Yahoo, but this time with a consortium of investors. I think that would be a smart move, as I would hate to see them buy the whole damn thing. You buy with a consortium and you can then form alliances to harness the value in Yahoo's intellectual properties, without actually footing the whole damn bill for the acquisition. Cheers! http://www.foxbusiness.com/technology/2011/10/05/microsoft-mulling-yahoo-bid-report/

This is by no means a given. Consider that he grew BRK's BVPS at an annual rate of 23.6% from 1965-2000. If he had maintained his 25% fee structure, the net return to investors would only have been in the 15-18% range. Would this have been enough to make him the biggest hedge fund, let alone the biggest investment fund? That's my point...Berkshire was a constraint on his personal wealth creation. He averaged 29.5% gross and 23.8% net to partners between 1957 and 1969 inclusive, with no single down year when the Dow had four! If he was able to achieve 20% annual returns net, and I'm a firm believer that he could have easily achieved that as he got older and better, he could have readily accumulated enough in assets as a fund manager, and would be running the largest investment fund in the world today...if he had chose to do that. He also once said that with smaller sums of money, he could return 50% a year! Cheers!