Parsad

Parsad - a big fat MINUS for, once again, starting a thread which has NOTHING to do with value investing, BRK, or Fairfax! Sometimes there are more important things than investing...like today for those parents. If we have a debate about something other than investing once in a while, I don't think it lessens the board in any manner. Just ask Buffett about tax rates or Prem about his faith and family. Cheers!

Al, compare the per capita number of gun-related injuries or deaths in the United States to any other developed nation...including Canada. The number is shockingly disproportionate. If you had a small nuclear detonation in the United States maim or kill nearly 100,000 people, what would your reaction be? Probably the same as even those proponents of gun control...need to get nukes secure and make sure no one else ever gets their hands on a nuke. Yet, you have 100,000 people suffer from gun-related injuries or deaths in the United States every single year! Per capita data for deaths is below...even the nutjob, right-wing Australians have a rate one-ninth the United States. Canada, the most similar nation to the United States and pretty much a brother in arms has half the rate...and we have plenty of nutjobs here like you stated. Cheers! http://en.wikipedia.org/wiki/List_of_countries_by_firearm-related_death_rate

They had also just fought a war against the British, so they needed to maintain a militia to protect their interests. I don't think that has been a concern for the last 125 years, so the average citizen isn't going to need to go all "Red Dawn" on an invading China or North Korea...let alone try and overthrow their government by being armed. Of all the dictators who have been overthrown in the last 50 years, it didn't come from the citizens having weapons, but the fact that the generals in power under the dictator actually turned to support the general populace. As Gandhi, Martin Luther King, Mandela, Walesa and so many others have shown...the human spirit eventually takes care of tyrants and injustices. Cheers!

Well there is Frances Burke and there is Francis Chou. It could be one, it could be both. ;D Cheers!

The problem is the gun control crowd can't wait to make this political. They have the legislation written and laying in wait for events like this. This is like Christmas come early to the gun-control lobbyist. Or like 9/11 to the military industrial complex. People who want to take away freedom always need tragedy, they wait for it, they feed off of it. Should everyone be allowed to build their own nuclear weapons as well? Let's not confuse freedom of speech, liberty and choice with gun laws. Cheers!

So let's not make it political. Make it near impossible for 20-year old retards to obtain any sort of gun, so fewer parents have to go through what these people are now going through. Not only those parents but that entire community will never be the same for at least a generation. I can't imagine anything worse than a parent finding out their child died a horrific death, and not having the opportunity to protect them, console them and say good-bye!

No, I don't want to make this political, but when the hell is the U.S. going to join the rest of the civilized world and implement gun control for it's citizens? 18 kids dead today...nuts! NRA will be in damage control for the next week and pulling up the second amendment. Cheers!

There are six main people who make up HWIC's investment committee, with Prem having final say out of that committee. They are allocated significant capital to put into their ideas, but over a certain threshold, it goes through the committee. The analysts provide many of the ideas and do a lot of the grunt work. They are given capital to allocate as well, but much smaller. Most of the usual suspects are on that committee (Prem, Brian, Roger, Sam, Paul, Chandran), but there is also one additional person that you would not normally expect. Cheers!

He's got permanent captive capital...he can do anything he wants with no worries. Cheers!

PS If you are against naked short selling: you should have lended out your shares in Fairfax or Overstock! Naked short selling is the act of selling a security short without borrowing it first! Actually what was happening was that the actual legitimate shares were being lent out repeatedly by brokers before the shares were ever delivered to any of the institutions. By lending out the shares, I would just add to the quantity of shares being bandied around...then multiplied by 5-10 times because they were never delivered on time to any of the institutions. "A" lends to the institution who lends to the client borrowing, but the shares are lent out again by the institution to "B", "C", "D", etc, before they even hit the clearing house. You then watch as these shares fail to deliver for up to several months, but because the legitimate shares are being swapped around. Eventually you have them cleared, but in the mean time the naked short sellers leverage their ability to manipulate the stock price. Cheers!

Most likely! And a nice public advertisement to any other large blocks of stock who now know they can lock in a 15% rate on a lifetime's worth of appreciation at 13x,000/share with a call to Omaha. I hope there are more in the next few weeks. this is a one off imo. in fact the media is going to roast buffett for doing this to help a friend avoid paying higher taxes. he doesn't want to buy back a lot of stock at these levels. this is a token amount. The optics don't look particularly good, but at the same time, if he can't find better investments than his own company, then you can't fault him. I just think the timing wasn't great. He could have bought the same 9,200 shares on the market for less...no reporting, nothing. The fact that there is tax savings for a long-time investor, after Buffett so adamantly stated that taxes for the super-rich should rise, is kind of hypocritical. Cheers! I almost never disagree with you Parsad. With this I do. It is highly unlikely Warren could have purchased 9000 a shares at a lower price. This is one months volume for the A shares. The optics are fine he is signalling to the mkt he thinks his company is cheap so cheap he is willing to retire shares. I think every one wins here. Even the Warren haters because they can now say he is a hipocite. LOL Sure he could have. Take a look at the NYSE chart for BRK-A in the last month. Thousands and thousands of shares traded below $132K: http://www.nyse.com/about/listed/lcddata.html?ticker=brka&fq=D&ezd=1M&index=3 Also, the economic interest is the same whether he buys A's or B's. He could have bought hundreds of thousands of B's in the open market for less than the equivalent of $89 each, retiring tons of shares in the process. I almost never disagree with Buffett...this time I think he was doing a shareholder a favor, as well as other remaining shareholders, and the optics and timing weren't appropriate relative to his comments about taxation. Cheers! Just because shares traded below that value doesn't mean that WB would have been able to buy them at that price. Before he could execute transactions on the public market he would have to communicate the change in the buy back policy, just as BRK did yesterday, and shares almost directly jumped to a higher level. That goes back to what I said earlier that the buyback policy was silly to begin with, because it set the floor and also set the fact they would have to publically declare any changes in the policy. I know Buffett doesn't want to take advantage of any shareholders, but he is doing exactly that when he's buying large investments in public companies at discount prices...why should Berkshire be any different. If shareholders sell, then Berkshire should be able to buy stock at the right price on the open market without having to worry. For God's sake, the man's done enough over the years to enlighten his shareholder base. There's not much more he can do. It would also prevent situations like this were the optics become fuzzy because of his political views as well. Cheers!

I agree with you. That's exactly his stance. That doesn't make it right. Again, this is my personal opinion viewing his actions on this matter, and TO ME (emphasis is me), it doesn't seem right to be taking a position on a rule, and then watching/assisting someone take advantage of that rule because it hasn't changed. If I was against backdating stock options, but the rules had not changed, should I take advantage of that and backdate options while I can? Or in terms of something that happened to me in the past...I was against naked short selling, so I would not lend out my shares to short-sellers in Fairfax or Overstock when they were being heavily shorted. I could have made a fat buck, but ethically it didn't seem right based on the position I took on the matter, so I chose not to. In those terms of ethics, his action did not seem correct to me here. Not unethical per se, but the optics were fuzzy. Cheers!

Most likely! And a nice public advertisement to any other large blocks of stock who now know they can lock in a 15% rate on a lifetime's worth of appreciation at 13x,000/share with a call to Omaha. I hope there are more in the next few weeks. this is a one off imo. in fact the media is going to roast buffett for doing this to help a friend avoid paying higher taxes. he doesn't want to buy back a lot of stock at these levels. this is a token amount. The optics don't look particularly good, but at the same time, if he can't find better investments than his own company, then you can't fault him. I just think the timing wasn't great. He could have bought the same 9,200 shares on the market for less...no reporting, nothing. The fact that there is tax savings for a long-time investor, after Buffett so adamantly stated that taxes for the super-rich should rise, is kind of hypocritical. Cheers! I almost never disagree with you Parsad. With this I do. It is highly unlikely Warren could have purchased 9000 a shares at a lower price. This is one months volume for the A shares. The optics are fine he is signalling to the mkt he thinks his company is cheap so cheap he is willing to retire shares. I think every one wins here. Even the Warren haters because they can now say he is a hipocite. LOL Sure he could have. Take a look at the NYSE chart for BRK-A in the last month. Thousands and thousands of shares traded below $132K: http://www.nyse.com/about/listed/lcddata.html?ticker=brka&fq=D&ezd=1M&index=3 Also, the economic interest is the same whether he buys A's or B's. He could have bought hundreds of thousands of B's in the open market for less than the equivalent of $89 each, retiring tons of shares in the process. I almost never disagree with Buffett...this time I think he was doing a shareholder a favor, as well as other remaining shareholders, and the optics and timing weren't appropriate relative to his comments about taxation. Cheers!

If it is is "business" then why did he not buy these shares on the open market? The next time he buys a subsidiary using BRK shares as currency, he can reassure the seller that his/her heirs will be able to unload them upon death. Classy way to treat the people -- just like agreeing to never trade away the company purchased. This cultivates better transactions in the future by showing the world that any business owners willing to sell their company to Berkshire will be treated well till death do us part. Yes, I can see that perspective, as long as it was someone who sold their business to Berkshire. Do we know if that was the case here? Was it Al Uletschi's estate? Cheers!

Complete disconnect in what you are saying. Not only did he pay more by not buying in the open market, the purchase provides a huge tax windfall for someone who obviously does not need one. It wasn't business...it was charity for a long-time shareholder! The GE, GS and BAC deals were business...I have no problem with that. Cheers!

I thought the original comment about what "price to book" they would buy was silly too. Why tell everyone that you are willing to buy back stock at 110% of book? He's never blatantly given away his intrinsic value for Berkshire, so why do it now and handicap yourself to that specific buyback price? If it's a mandate for the board, so they don't even have to think about what to do with capital when he's gone, then fine...but keep it internal so quick adjustments to the threshold don't look silly like this one because they are discussed publically. All he had to do is tell shareholders at the annual meeting or in the letter that we've got a certain threshold that changes over time where we will buy back shares in Berkshire. Simple...just like he stated back in 2000. Cheers!

Most likely! And a nice public advertisement to any other large blocks of stock who now know they can lock in a 15% rate on a lifetime's worth of appreciation at 13x,000/share with a call to Omaha. I hope there are more in the next few weeks. this is a one off imo. in fact the media is going to roast buffett for doing this to help a friend avoid paying higher taxes. he doesn't want to buy back a lot of stock at these levels. this is a token amount. The optics don't look particularly good, but at the same time, if he can't find better investments than his own company, then you can't fault him. I just think the timing wasn't great. He could have bought the same 9,200 shares on the market for less...no reporting, nothing. The fact that there is tax savings for a long-time investor, after Buffett so adamantly stated that taxes for the super-rich should rise, is kind of hypocritical. Cheers!

Interview on Fool.com. Cheers! http://www.fool.com/investing/general/2012/12/11/how-investors-should-think-about-the-economy.aspx

Very funny! I think I just wet my pants. ;D Cheers!

Hi RJ, I think you are correct. Munger has a ton in BYD, thus why I'm thinking this may be it. We'll find out eventually. Cheers!

Buffett's words carved in stone. Cheers! http://www.reuters.com/article/2012/12/11/odd-sweden-buffett-idUSL5E8NB7V720121211?feedType=RSS&feedName=marketsNews&rpc=43

Buffett and Soros issue joint statement to Congress. Cheers! http://www.bloomberg.com/news/2012-12-11/buffett-joins-soros-in-effort-to-raise-taxes-on-estates.html?cmpid=yhoo

Or Japan finally blows up from its debt load, and those Japanese stocks plummet in dollar terms as the yen crumbles. Cheers!

By the way, my guess if you are talking about 10 times to 40 times return, and you know how Mohnish really digs Munger's thought process about disruptive businesses, I would be inclined to say it is BYD. But who knows, you'll have to get it out of him to know the truth! Cheers!

Well, the guess that one of Mohnish's best friend's threw out has been mentioned today. Whether it is the one, I don't know because Mohnish of course was very coy about the idea over dinner a few months ago. But some of the stuff I've heard leads me to believe that the guess may be correct. Although I'm not sure about that 10 times to 40 times return comment regarding this guess...I don't see it...but hey, I'm neither Mohnish Pabrai, nor Guy Spiers! ;D I'm a shameless clone. Cheers!