Parsad

Doesn't this remind you guys so much of the old Fairfax days when it traded under $100...and then took off. We were all watching it like this then too. Cheers!

Investors always feel like that after a significant rally. We are in the fourth consecutive year of market gains in the U.S., so the odds are that things are significantly less cheap than they were in the past...even with better balance sheets and higher profits. We are building cash, as there is always a new opportunity around the corner. Patience is the hardest part of this game. Be patient and only buy when you feel something is truly cheap. And I would not be surprised if insider selling does increase significantly, if it hasn't already. Cheers!

Hi Hundredwaters, welcome to the board! One word of advice...if you are asking others for ideas, you are going to get burned again or be hesitant to invest. Best to check out the posts on an idea, read the quarterly and annual report for the company or investment you may be interested in, and then on things you have questions about...ask away. Anyone familiar with the investment will respond. Over time, if you do the legwork and trust your analysis, you'll always feel comfortable with a decision...and the opinions of others won't sway you either way. Cheers!

Apple is calling a conference call tomorrow to discuss its cash balance. Cheers! http://www.cnbc.com/id/46779100

I thought a "Bollinger band" was what Al Roker had surgically implanted so he could lose weight! ;D By the way, we have plenty of cash and I did not use technicals to figure it out. Cheers!

I disagree with this statement, you are making a ton of assumptions about what will or won't happen between now and expiration. Anything can happen and will there for IMO anytime you at the mercy of time you are introducing risk. I don't disagree with the overall BAC thesis, I own warrants, common, and 2014 $10 calls. But I would never say that the warrants aren't all that risky. I think you are correct on that. Mohnish says that the warrants have a 7-8 year life...whereas equity has a 100-year life. Anything is possible in that 7-8 years period...good or bad. Cheers! Guys... come on. I said "aren't all that risky" Do this mean: a) less risky than the common b) same risk as the common c) more risky than the common If your answer isn't "c", I'm throwing a shoe. What? b)...yes, I agree...thwap! Ouch! ;D Cheers!

I disagree with this statement, you are making a ton of assumptions about what will or won't happen between now and expiration. Anything can happen and will there for IMO anytime you at the mercy of time you are introducing risk. I don't disagree with the overall BAC thesis, I own warrants, common, and 2014 $10 calls. But I would never say that the warrants aren't all that risky. I think you are correct on that. Mohnish says that the warrants have a 7-8 year life...whereas equity has a 100-year life. Anything is possible in that 7-8 years period...good or bad. Cheers!

Article on Japan and its debt load. http://www.theglobeandmail.com/globe-investor/land-of-the-rising-sum-japans-toxic-mountain-of-debt/article2372141/ Unfortunately, the Japanese population's psychology to any investment other than Japanese bonds is preventing the repricing referred to in the article, but at some point, you will get an unwinding and it will not be pretty. I would guess that at some point Japan is going to go through a massive devaluation of their currency and the population will be hit hard by inflation. Cheers!

The U.S. government will be releasing confidential census data for the 1930's on April 2nd. Cheers! http://news.yahoo.com/census-documenting-great-depression-released-151755443.html

Al, I think you called it. $9.88 after hours -- I think we can round that up to $10. Where is it headed by next weekend? I said tangible book by Christmas, but you turkeys seem to be nailing the increases on the head. Ok Al, when do you think it will now hit tangible book...so say around $12.50? Eric? Cheers!

11 months ago Doug Kass tweeted "repeating for emphasis - msft is a value trap". MSFT closed at $25.50. This one not working out so well either. That's pretty funny, because we had a shitload of MSFT call options too! More than we had in BAC or Wells...10% of the fund was in MSFT call options...and we bought them when MSFT was around $24.50 at a $20 strike! Unfortunately, in my infinite wisdom of averaging in and averaging out, we averaged out of alot of the MSFT call options over the last four months. That's the problem with no lockup...you're always making sure you mitigate risk and maintain adequate liquidity! If I had kept all of the MSFT options, we would be having the best quarter in our history...still a damn good quarter...but it would have been a blowout on par or better than Berkowitz's! And that's with OSTK being a real dog still and 40% cash in both funds. Our director Glen Rollins gave me a quote by Peter Lynch when I lamented this fact..."Make sure you don't cut the flowers and water the weeds!" Cheers! parsad, im interested in hearing your take of OSTK. what is the investment rationale there? congrats on the financial bets I'll just lay it out in one long paragraph...I just think the business is cheap...they have a decent model and could offer other services to their demographic (primarily 35-55)...core base of about 25M annual customers...$1.1 B in sales, so they realistically should be able to achieve a minimum of 1.5% net profit margin on that...they should be able to grow at a minimum of 12-15% a year for the next 10 years...not much debt...their closest competitor sold for 7 times their current valuation...CEO takes almost zero compensation...board owns 35% of the company...Fairfax owns another 15%...Chou Funds own 15%...our board and funds own 3.5%...so you have a tightly held group of shareholders...there are a handful of other, smaller things as well...customer service is great for online retailers...partnership agreements with Travelocity, etc...flexibility management gives to executives (could be good or bad). The main problem is they blow too much company on expenses (corporate, legal, technology) and not enough on driving traffic to the site. The CEO needs to focus on the business and less on his legal battles and blog. They need a true marketing expert...which they have hired and should be announced pretty soon. Cheers!

Oh yeah sorry, he works with only one analyst...himself! He and his administrative assistant, Jing, look after $1.2B. He started as a worker at Bell, where he grew a investment club fund of $50,000 to $1M over five years. It was then converted to the Chou Funds after he got his CFA. Fairfax has funds invested in the Chou Funds. Cheers! 50k into 1m in 5 years? Was he using options or some other kind of investment that wasn't more then just common stock? Was there large additions into the club fund that helped toward the 1m? Only asking bc my mouth dropped in awe after reading your statement. Let me clarify that. I was describing the fact that he grew the assets to $1M before converting it to the Chou Funds. There was capital also contributed by the club members over the years. I believe the actual investment return was something like 50% annualized though, excluding capital contributions. Not sure what he was doing, but certain it was heavily concentrated and possibly leveraged. Feel free to ask him at the AGM or dinner this year. Cheers!

Francis is the kindest person I know in the financial industry, and that says alot because I know Prem, Mohnish and Tim McElvaine, and they are also some of the most generous people I know. But Francis is unique...very unique! If I were a captain in the investment industry, he is who you hire to be your right hand man. His honesty is beyond reproach! And he will never take credit for anything. Has anyone ever heard from Francis that the CDS idea was his? Nope! You heard it from Brian Bradstreet. We all know how talented the team is at Hamblin-Watsa, but all those principals there hold Francis in very high regard. That should tell you something. Everyone else can have Sprott, I'll take Francis. Cheers! so Prem's CDS idea was Chou's? thats interesting b/c prem is known as a macro guy, and chou value. does Chou make macro calls? They were in a Hamblin-Watsa investment meeting back in late 2004 or early 2005, and Prem was asking the team for investment ideas. Things were over valued and no one had a compelling idea. Brian and Francis had previously discussed CDS' and no one was throwing any ideas out, so they looked at each other and then said to Prem...there's these credit default swaps! Actually Francis did try to buy CDS' for the Chou Funds, but had to get regulatory approval as they are mutual funds. He got approval after a few months, but prices had started to move up already. Not exactly clear on why he likes RSH, but it is distressed and cash flows are good. Cheers!

Oh yeah sorry, he works with only one analyst...himself! He and his administrative assistant, Jing, look after $1.2B. He started as a worker at Bell, where he grew a investment club fund of $50,000 to $1M over five years. It was then converted to the Chou Funds after he got his CFA. Fairfax has funds invested in the Chou Funds. Cheers!

Francis is the kindest person I know in the financial industry, and that says alot because I know Prem, Mohnish and Tim McElvaine, and they are also some of the most generous people I know. But Francis is unique...very unique! If I were a captain in the investment industry, he is who you hire to be your right hand man. His honesty is beyond reproach! And he will never take credit for anything. Has anyone ever heard from Francis that the CDS idea was his? Nope! You heard it from Brian Bradstreet. We all know how talented the team is at Hamblin-Watsa, but all those principals there hold Francis in very high regard. That should tell you something. Everyone else can have Sprott, I'll take Francis. Cheers!

11 months ago Doug Kass tweeted "repeating for emphasis - msft is a value trap". MSFT closed at $25.50. This one not working out so well either. That's pretty funny, because we had a shitload of MSFT call options too! More than we had in BAC or Wells...10% of the fund was in MSFT call options...and we bought them when MSFT was around $24.50 at a $20 strike! Unfortunately, in my infinite wisdom of averaging in and averaging out, we averaged out of alot of the MSFT call options over the last four months. That's the problem with no lockup...you're always making sure you mitigate risk and maintain adequate liquidity! If I had kept all of the MSFT options, we would be having the best quarter in our history...still a damn good quarter...but it would have been a blowout on par or better than Berkowitz's! And that's with OSTK being a real dog still and 40% cash in both funds. Our director Glen Rollins gave me a quote by Peter Lynch when I lamented this fact..."Make sure you don't cut the flowers and water the weeds!" Cheers!

Both are very good managers. You have to be willing to trust them and allow them to work though. Alot of Fairholme investors bailed, many near the bottom, because they didn't trust Berkowitz's judgement and analysis. My family knows if I die tomorrow, then put half of our money with Francis. I know him. I trust him more than anyone else in this industry. Prem trusts him intimately. When people talk about managers who would fit in at Berkshire or Hamblin-Watsa, without a doubt I would put Francis on that list...skill, honesty, ethics, and love for what he does...if he applied to Buffett, he would be hired on the spot. I'm also running a fund today because of his friendship and support, and because he's a great role model for any fund manager! His results can be a little more volatile than what you may like. His behavior with his fund is more straight forward, Ben Graham, value investments rather than just contrarian. He buys because things are cheap, like Buffett, and doesn't worry about the world ending tomorrow or a Depression that people may fear is coming. He doesn't use leverage. He's refunded parts of his management fees in years he wasn't happy with his results. And finally, to quote Good Will Hunting, "My boy's wicked smart!" Cheers!

We put 20% of the funds into BAC, WFC and AIG. We had 5% in BAC equity, 5% in BAC warrants, 7% in WFC, and 3% in AIG warrants. We do not have a lockup, so those were very large positions for us in a specific industry...financials...not to mention we already own Fairfax and Berkshire. If we had lockups, I would have put 20% into BAC alone when it was below $6. Unlike other funds, our partners can pull capital with 60 days notice, so we cannot do what you might do in your own personal account or a fund that has lockups. We sold the AIG warrants as BAC and WFC moved up, because we like the CEO's of those two companies a hell of a lot more, and we like the fact that BAC is simplifying their business back to the basics. We haven't sold a single share of BAC or WFC, or the BAC warrants. We have started to add very small amounts of out of the money puts on BAC, and we'll continue to do that as the stock continues to move to tangible book and then book value. Cheers!

Ok, enough's enough, so I don't want Harry's name mentioned on this board again. He's a big enough boy to give out the medicine, but not take it, and I don't want to keep deleting posts that he tells me are slanderous...like he just did! His account has been deleted, and he will not be posting on here anymore. Enjoy your life on Seeking Alpha Harry, and we look forward to your conquests! Cheers!

I would prefer that, but unfortunately there are quite a few professional managers on here that would not be comfortable with that. C'est la vie! Cheers!

I'm all for it Harry. That's what I like to hear. Cheers!

Article on the compensation of Berkshire and JP Morgan lieutenants. Cheers! http://www.bloomberg.com/news/2012-03-16/buffett-awards-wall-street-sized-pay-praised-by-dimon.html

Walmart is selling their iPads early! Better line up if you want one. Cheers! http://www.bloomberg.com/news/2012-03-15/wal-mart-to-start-selling-ipads-at-midnight-before-apple-stores.html

One such distortion is the damage done to net interest margin for banking. Killing ROE for all kinds of companies, like AIG for example. At the same time it's boosting companies who are borrowing at low rates. I'm looking forward to BAC's net interest margin improving over time. Yup. Very good example. It's going to kill off a bunch of life insurance companies too if it goes on too long! Just like in Japan. Cheers!

You treat people with contempt, as if they are your inferior and could never comprehend your genius. You came off that way in your phone calls with me as well, thus I've never entertained another one. I had not responded to any of your recent posts until you took a shot at Dorsia. So yeah, I'm pretty ornery and disrespectful to people who behave that way to others. If I remember correctly, you had some questions about the birth of high frequency, which I tried to answer. If my answers were in any way upsetting, I publicly apologize to you. I've never publicly or privately called you names, and I have nothing against you. I just think that the idea of finding companies which suffer from neglect, rather than controversy, has currency. And I think Kaizen will increasingly be applied to investment management. Those are my two points. If you disagree, no problem, I'm ok with that. I'm not going to drag you through the mud because you disagree with me. I appreciate and respect objective, principled disagreement. Ah no, you actually don't remember do you. In one call, you told me how you thought Sardar was a prick because he stole one of your ideas...I believe Fremont Michigan...you had sent him a white paper on it. The other call, you asked if it was possible to set up an introduction to Prem for you or any other people I may know, because you had a great idea that needed a couple of hundred million. I said that I don't do that for anyone. I've never initiated a single call to you and I would never, ever ask about HFT. I don't believe in it and I think it creates distortions in the markets. I'm not going to respond to anymore of the posts on this thread, because I don't enjoy this. You choose how you want to interact with people. Cheers!