Parsad

I thought some of the Halloween stuff out at the end of August was early, but I guess nothing beats the Christmas season rush. Cheers!

I agree, but I think "The Economic Times" was more focused on an NRI who had a very large hand in saving the institution. Cheers!

Gurufocus is conducting a phone interview with Prem on September 21st. You can submit your questions for the call. Thanks to Shai for sending me the link! Cheers! http://www.gurufocus.com/news/144607/qa-with-gurus-ceo-of-fairfax-financial-prem-watsa

a) You want to make sure that they can pay out your policy if and when it is claimed. So the stronger the better. Just remember that the credit rating agencies got it all wrong during the credit crisis, so things can change over time. b) Depends on what you need. Does your wife provide income to your household? If something happened, and you have children, how much would you need to take care of them (basic necessities, baby-sitting, nannie, college, etc)? Are there outstanding loans that your wife is responsible for, that may become your responsbility if she were to die? The same sort of questions should be asked about yourself as well. That may provide a more reasonable expectation of what your policy insured value should be. c) I don't really want to tout one insurance company over another, or one agent over another. Really it comes down to the numbers on the policy, and do they meet your needs and budget? And a decent level of long-term customer service should also be part of the sale, as you will have questions and possibly future adjustments to your insurance needs. Cheers!

New article in "The Economic Times" about Prem. Cheers! http://economictimes.indiatimes.com/news/nri/nris-in-news/prem-watsa-the-indian-who-bailed-out-bank-of-ireland/articleshow/9890516.cms

Those people are nuts! They should get their thrills watching the stock market instead. ;D Cheers!

Very good excerpt Moore! Hindsight always brings much more clarity to the goings-on of the present. Cheers!

According to this article on service jobs hiring for this Christmas season, "Christmas Creep", or the practice of putting out Christmas retail deals earlier and earlier, will start in September. A few retailers already started their sales in August! Cheers! http://www.cnbc.com/id/44410418

What "kink" places are you recommending Marcowelby?! ;D Perhaps, The Brass Rail! Cheers!

The reason the premium will stay the same is because they have essentially averaged out the rate for each year. So you are paying more in the beginning, and less in the later years, than the actual cost of the insurance. That's fine as long as you know that. For some people an annual renewable term is significantly cheaper and the way to go (especially if they are unlikely to want to carry the policy long term). Obviously to buy a level premium 30 year policy will cost you a lot more than a 15 year. Probably more than twice as much per year because of the high cost to insure those later years. You need to figure out what best fits your situation. That could get very expensive if you hold the policy more than 10 years. I've seen premiums jump several fold on some policies after a few years, while the initial premium looked relatively cheap. If you do get such a policy, make sure the renewal premium prices are not affected by any changes in health. Otherwise any future illness could dramatically affect the renewal premium prices. Cheers!

Just make sure the monthly premiums stay the same over the life of the policy. Many term policies will increase their premiums every five years. There also such things as inflation-adjustment riders, which will automatically increase your premium modestly and your policy face value by say 5 or 10%. You are better off just buying a larger policy than getting the rider. Also, compare premiums for 20, 25 and 30 year policies. Depending on your age and health, the premiums might be only modestly higher and you have insurance coverage over a longer period. You never know what can happen...disability, illness,etc...could delay your ability to generate income. If you find that over time, your personal financial situation goes as planned, and all indications are that you are probably self-insured, then you can always terminate the policy. Finally, don't get caught up in any sort of term product with an investment aspect...similar to universal or whole life, but the insurance policy is a term policy...these sort of cross-bred products have been created. Either decide if you are buying just plain term insurance for protection, or you need another product because you are trying to make your finances more efficient. Term policies are effective for 90% of consumers, whereas other products really only benefit financial planning for about 10%. Make clear what you want, because many insurance agents will try and sell you what they think you need, and the industry incentives are aligned so that they sell you something significantly greater than what would be ideal. Cheers!

In Toronto, if you like good Chinese food, you should visit Lai Wah Heen...very good. Canoe is nice, but expensive. Bymark makes a killer lobster grilled cheese sandwich...again expensive. The best Kobe beef sliders are at Trevor's Kitchen & Bar. Also a number of very good pizza places...some of the best you will find outside of New York. The one thing that has gotten better in Toronto over the last few years is their coffee. When I first started going to Toronto, I couldn't find good coffee anywhere. They had hardly any Starbucks, but plenty of Timothy's, Tim Hortons and Second Cups. Now they have very good baristas at a number of cafes. Don't waste your money on a Blue Jay's game...that ballpark is probably one of the least attractive ever built. You're much better off watching an MSL game in the open field. There are plenty of touristy things to do and see in Toronto. Don't know if you like hockey, but the Hockey Hall of Fame is in Toronto. Some great architecture in Downtown, through Yorkville, etc. They've restored several pockets of downtown Toronto and saved many heritage buildings. You'll find plenty to do and see. Cheers!

No, they aren't sending it to all of the shareholders. It was available to those that attended the AGM, and whatever copies were left, were made available to shareholders who requested a copy. Cheers!

Glad others are catching up to my concerns on Salesforce.com's pro-forma accounting practices. Cheers! http://www.theglobeandmail.com/globe-investor/investment-ideas/features/vox/the-lowdown-on-salesforces-bottom-line/article2153946/

I suspect there will be multiple such settlements and trusts for all of the various lawsuits that are out there. Banks, not unlike the tobacco companies in the last decade, will put these issues behind them through settlements. Cheers! http://www.cnbc.com/id/44403367

Moore, I'm not bashing gold, I'm bashing speculation and overvaluation. I owned gold from 2003-2004 to 2009-2010. Just like I own the same technology stocks today, that I was reeling against in 1999 and early 2000. Or financial institutions from 2006-2008, which I own in abundance now and am buying more of. Now I'm reeling againt the overvaluation in gold. I don't short because the liabilities are unlimited and the upside is limited, but if I was someone who was inclined to short overvalued and irrationally priced investments, then I would be shorting the hell out of gold right now. With CRM and OPEN down significantly (CRM still has room to go), there is nothing else I can see that I would want to go completely short on right now more than gold...nothing else! We can both make arguments till the cows come home, but I see it as clear as my hand in front of my face. Based on supply/demand, gold is over double what its price should be. It probably will go higher because there just is so much fear, but it is overvalued. And when it does correct, it won't be over a long period of time, it will be a rapid correction with many late buyers getting creamed. That's just how it works: - 12 years ago Microsoft was at $140 and dominated the computer software industry. Everyone wanted to own it. Today it's at $25, makes more money per share than ever before and has virtually no debt, yet no one really wants to own it. - 10 years ago Citigroup was at $50 and was the largest financial institution in the world. Again, everyone wanted to own it. Today at a split-adjusted $5, no one wants to own it, even though spreads on lending and deposits are the best they have been in 20 plus years. - 7 years ago, gold was at $300/oz and no one wanted to own it. People thought gold had no value left and anyone buying was a fool...I was stuffing my safety deposit box. Today, it's at a higher inflation-adjusted price than the average price in 1980 when inflation was rampant, and everyone wants to buy it because they are scared. I don't need to know about the velocity of money, quantitative-easing or fiat currency. All I need to do is apply some common sense. Cheers!

The average price of an ounce of gold in 1980 was about $1,825 inflation adjusted dollars, while the single peak price was about $2,350 in 1980. At $1,900 per ounce, gold is now higher than the average 1980 inflation-adjusted price...during a period when inflation was actually rampant! While there is elevated inflation right now, it is not running significantly greater than the historical average. And in actuality, Europe without a package, may be headed into a inflationary/deflationary spiral as the economies slowly seize to a halt and the Euro devalues. That's alot of interest in gold, during a period of relatively insignificant inflation, a possibility of deflation in certain parts of the world, and stagnant economies in Europe, the U.S. and Japan. At these prices, gold investors better be right that they expect paper money to all but disappear. Cheers!

I suspect we are getting pretty close to seeing some sort of huge European bailout package/fund being approved. The $440B package was delayed till at least October due to voting, but I think we are going to see something sooner than expected. We aren't going outside of North America (no need at our size), but European investors can probably find many things that were priced as cheap as U.S. stocks in late 2008 and early 2009. I would not be surprised to see Fairfax and Berkshire announce further large investments in Europe as well. Cheers!

Sanj, have you thought about setting up a fund like that? I would think a lot of partners would easily do something like that. If I'm not comfortable doing that with another manager, then how can I expect anyone to do it with me? Although I'm happy locking up my own money with myself! ;D Cheers!

I think his goal is to just scare companies into either adding him to the board (CCA Industries) or forcing them to seek strategic intiatives (Fremont Michigan, Friendly's, Penn Miller). If he gets either option in 50% of his attempts, then he is going to do well relative to the time, effort and cost of the activism. He knows that. It's the same thing Ackman and Icahn do, and he admires both. It doesn't really matter what the argument is. For example, the criticisms of Cracker Barrel's CEO were pretty weak. So they didn't fully break out the disclosure of the two lines of business. Big deal! He's just throwing any sort of gas he can find, and then lights a little match using the threat of a proxy. You'd think at least there would be some comparables in salary, bonuses and option grants relative to competitors, poor operating performance, low return on invested capital...something of more substance. But he doesn't need it anymore. His reputation is almost enough now, and all he has to do is pick a fight. Cheers!

2) Yes, absolutely that is the only advantage we have as value investors. For this exact reason I am advocating always being fully invested, however, I am advocating hedging in certain times instead of going to cash. ie if you are a really good value investor, harness the value investing advantage at all times by hedging when others are greedy. Sorry Mungerville, I mis-understood your original comment. I thought you said you were 100% cash AND hedging. Yes, I would agree that if you are fully invested, then hedging would be a rational way to protect your capital. Personally, I prefer cash in most circumstances, as the frictional costs from hedges can eat away at returns if you are wrong for a significant period of time. We've moved pretty quickly in and out of cash over the last couple of years, simply due to the massive swings. We were fully invested a couple of weeks ago, and a couple of our investments recovered rapidly where we averaged down significantly, so we built our cash position back up to about 15%. Cheers!

According to JP Morgan, stock funds are trailing the markets the most since 1998. In the nine years that stock funds did trail by the end of August, the markets rallied in all but 2008. It doesn't mean diddly, but it's an interesting statistic. Cheers! http://www.bloomberg.com/news/2011-09-02/stock-mutual-funds-are-trailing-market-by-most-since-1998-jpmorgan-says.html

No, no, he provided those results long before. His results may be better or worse from then. I don't know what they are like now, and that's why I asked. It was over a very short time period, and from what I saw, systems did not provide any advantage whatsoever. There were also 3 and 5 year lockups. If I had a five year lockup, I could get 18-20% a year for partners. Lockups provide enormous advantages! But I personally would not feel comfortable being locked up with a manager for five years, so that is why we have no lock-up. It's the partner's money and they should have access to it if needed. It just means I have to be that much better at my job, and I can live with that if it gives them more comfort. Cheers!

100% agree Al! Also 100% agree with this! Cheers!

Hi Packer, This one is an auction and the proceeds are going to Dakshana. We are going to see exactly what the free market values it at! ;D I've got another signed copy that we will be raffling off at next year's dinner in April 2012, and those proceeds will go to "The Crohn's & Colitis Foundation of Canada". I also still have the autographed Peter Cundill book too. And that will be part of the raffle as well. Cheers!