Parsad

I think alot of people wet their pants during the middle of last November! And probably rightfully so. Cheers!

XL got hammered in 2008 as well. Cheers!

He's still got a boatload of equities, so I wouldn't worry about that. I think the fact that you can find bonds and preferreds with terrific yields and far less risk is probably the point of his transactions. Most of what we've been buying over the last month has been distressed debt...the yields are unbelievable! We bought some debt maturing in three months at 73 cents on the dollar, where the company has enough in cash, receivables and lines of credit to cover their debt for the next year. Just ridiculous! That's about a 145% annualized yield! But you have to buy a basket of them to reduce any single one exploding in your face. If Buffett or Prem can get 10-15% yields on preferred stock or notes from companies like Goldman Sachs, GE, Tiffany's, etc., then why bother running the risk of increased equity exposure. Especially if you are running a leveraged insurance business where 6-10% total yield for the portfolio will give you 15-25% ROE going forward. Cheers!

There's a couple more Crip: 5) Adam Sender of Exis Capital was associating with both Spyro and Anthony Pelicano - both in jail now 6) Sender hired Pelicano to make a business partner's life "a living hell" 7) Chanos was in contact with people at SAC with information that was not public I'm sure there's a hell of alot more as well. Prem doesn't put down a bet with his reputation unless he's got the odds in his favor. Cheers!

It's been pretty active on this board in the last week or so, and I think a few more weeks should help. Remember, there are a stalwart of boardmembers still clinging to the old board, and that will disappear after next week, so we should have another flood of members come here in the next week or two. Cheers!

Al, Here is another example of things easing up a bit. Citadel is now allowing redemptions from their funds again. Cheers! http://www.bloomberg.com/apps/news?pid=20601087&sid=a90C4OeoZLP8&refer=home

What's so ironic is that the WSJ, who is reporting on this story, employs one of the primary culprits who assisted John Gwynn...Peter Eavis! As virtually all of you know, Eavis is the one who wrote some 50 articles in a six month period during 2003 for the Street.com, where Gwynn and Hempton were his sources. But I guess the WSJ hasn't figured that out yet! ??? Cheers!

On the updated version on Bloomberg, SAC says that they held shares of Fairfax and weren't shorting. Now what if two or three funds colluded in driving down a stock's price? What if one firm bought shares and held them. Then one or two shorted the hell out of the thing. The one with the actual shares could also lend the shares out and receive considerable interest income. This would also allow the others to cover positions when the stock moves in the opposite direction. Working together by naked shorting a stock, putting out negative analyst reports and media reports, they drive the stock down until the point where the funds shorting cover and pay back the hedge fund that lent the shares out. SAC's comments prove nothing about their intentions. The emails being sent between the two firms indicates that there is more to this than meets the eye. I can't wait for the trading activities at Kynikos to be unsealed. Cheers!

The one thing I've learned is that you will never have any idea where the "bottom" or "capitulation" is. If we all went back to the beginning of 2008, most of us that follow Prem would have agreed that we would probably see dramatic corrections in equities, commodities, real estate, art, etc. What I don't think anyone really expected, and probably not even Prem, was just the sheer collapse in the credit markets. I think Prem expected spreads to widen dramatically and significant tightening to occur. But the seizing of the markets the way they did...I don't think anyone expected that. After that, I think pessimism took a stranglehold to the planet, and fear became rampant. The one thing we do know is that once fear becomes rampant, usually the least likely scenario, in this case optimism, is probably more likely the correct assumption. But it takes time to prove this theory correct. It doesn't happen overnight. Just like it took Prem a couple of years to be correct on the downside, it will take a couple of years for Buffett to be correct on the upside. Cheers!

What's also very interesting is that Chano's little forum called CNBC has yet to report any of this story. Cheers!

Bloomberg reports that both Kynikos and SAC Capital had access to John Gwynn's preliminary analyst report on Fairfax before it was published. As we all know, Gwynn was subsequently fired by Morgan Keegan for releasing non-public information, and it was his original report insinuating that Fairfax was nearly $5B under-reserved that stirred the hornet's nest. This gets better and better! Cheers! http://www.bloomberg.com/apps/news?pid=20601087&sid=a1gpkAyXa8iw&refer=home

I reminded of the time when the pilots of Singapore Airlines threatened to go on strike. Prime Minister Lee Kuan Yew responded by threatening to shut down the airline and start a new airline. End of strike; no more labour disputes in the decades since; and SIA is today the strongest airline in the world sitting on $5b cash. This should work for Detroit. This does occur in North America, but it is few and far between. Regan fired all of the air traffic controllers when they went on strike. Walmart and McDonalds usually close a location if the employees succeed in unionizing. While I think unions do serve a purpose for grievances, generally like the Senate and Congress, they simply employ tactics to get what they want added to deals. I guess a free market system is based on the fact that humans are innately self-serving, but sometimes it would be nice to see individuals put their own self-interest aside for the greater good. Cheers!

The home next to Warren Buffett's house in Laguna Beach is for sale. Any boardmembers have $13M laying around? Cheers! http://southcoasthomes.freedomblogging.com/2009/02/12/be-warren-buffets-neighbor-for-13m/

John Stumpf, CEO of Wells Fargo, spoke at the Senate Committee on Financial Services. The Charlotte Business Journal has his comments. Cheers! http://charlotte.bizjournals.com/charlotte/stories/2009/02/09/daily37.html

If you guys have any more questions, please submit them. I will be putting together the questions and sending it out to John this weekend. Cheers!

LVLT had a profitable 4th Q due to one-time non-operating gains. http://sev.prnewswire.com/computer-electronics/20090211/LA6941611022009-1.html Interestingly, they are narrowing the spread between revenue and operational costs, especially by cutting G&A expenses. They are probably a year or two away, but we may actually see LVLT become profitable solely from operations. At our Fairfax Dinner last year, Sam Mitchell was asked about LVLT and how far they are from reaching a critical mass. Sam suggested that timeframe was closer to a couple of years, rather than several years. Perhaps, Southeastern will make their money back in the next few years. Cheers!

Charlie wrote an article for the Washington Post. Cheers! http://www.washingtonpost.com/wp-dyn/content/article/2009/02/10/AR2009021003122.html

Netjets Europe will acquire more small airports over time to improve runway access according to Bloomberg. Cheers! http://www.bloomberg.com/apps/news?pid=20601109&sid=aWad_WBhJob8&refer=home

Dear Members, Sorry about the board not being available for the last few hours. I was pretending to be an advanced programmer and added some code to the Simple Machines software installed and corrupted it. I had to uninstall and reinstall the software, then upload the database and make sure everything was working. Don't worry, I won't be doing any more programming! ;D All the memberships and passwords are completely active. You may get an error on the main log-in occasionally, but just reenter your password on the log-in that pops up, and you will have access. If anyone is having difficulty logging in, let me know. Thanks for all your patience, and now you can get back to using the board. Cheers! Sanjeev

Sorry Frog, I was only going by the funds. The managed account results aren't public, so perhaps many people (including myself) aren't aware of them or his performance. Cheers!

Article on Buffett's step grand-daughter Nicole. This is her perspective, but at the same time like the Snowball, I think there is a human element to Buffett we don't always see. Cheers! http://www.marieclaire.com/world-reports/news/latest/warren-buffett-granddaughter-nicole-buffett?link=rel&dom=msn&src=syn&con=slide&mag=mar

Ft.com article on value investing. Cheers! http://www.ft.com/cms/s/2/7b523338-f47f-11dd-8e76-0000779fd2ac.html

Ok folks, I've locked the voting down, and it seems as though the majority has picked keeping the current format for the board. That's what we'll go with. Cheers!

Activist investors Steelhead Partners, have moved in on Abitibi. Cheers! http://www.globeinvestor.com/servlet/story/GAM.20090209.RABITIBI09/GIStory/

I think it may be because Sprott needs a longer track record. Other than his Canadian Equity fund, most of the funds were started this decade. Also, for someone who had a pretty good idea of what was happening, his funds had an awful year in 2008 like everyone else, except for a couple his hedge funds. The small-cap hedge fund lost 50%! The Sprott Growth fund was down 63%! His oldest fund, the Canadian Equity fund, was down 43%. That's quite a different result than Prem. Cheers!