Parsad

I suspect they'll have to sweeten that a bit. They paid 1.3x for Northbridge, and the 1.16X they are paying for ORH doesn't include the change in book value since June 30th. Cheers!

Some board members here got it right! A 20% premium to today's prices. Cheers! http://finance.yahoo.com/news/Fairfax-Proposes-to-Acquire-iw-1475079578.html?x=0&.v=1

The first group of unemployed to lose their benefits after 18 months will occur at the end of this month...some 400K people. That number is expected to triple by year end. Currently, there are over 6M people on unemployment benefits and that number is rising by roughly 500K a month. Roughly 3.4M are already on the 53-week extended portion of their benefits the government implemented. Cheers! http://www.cnbc.com/id/32677734

As we also mentioned in our letters, we expect unemployment to continue to rise through the next year. Businesses are streamlining, becoming more efficient...the cost of which is greater profitability per employee. And the unemployment numbers below are with the Federal government more than doubling the normal term of benefits. Imagine the situation when those benefits cease, and productivity and employment don't start to increase through 2010 and 2011. Cheers! http://finance.yahoo.com/news/New-jobless-claims-dip-less-apf-386475816.html?x=0&sec=topStories&pos=4&asset=&ccode=

That was pretty funny! They even got Warren in there. Cheers!

Thanks very much! Terrific stuff. Cheers!

Well, Len Barrie, former NHL player, founder of Bear Mountain Resorts and part-owner of the Tampa Bay Lightning, may have pulled a Lenny Dykstra! Cheers! http://www.globeinvestor.com/servlet/story/GAM.20090902.LIGHTNING02ART22303/GIStory/

Berkshire and Leucadia have teamed up again in a $490M deal for Capmark Financial Group's mortgage and loan servicing business. Cheers! http://www.bloomberg.com/apps/news?pid=20601087&sid=aiWKNGNQZyNk

If you watch old episodes of "All In The Family", Rob Reiner's character (Michael) is constantly nagging his father-in-law about the Vietnam War, population explosion and the environment. I remember watching one episode in which he said the world would be out of food by the year 2000. Pphhhhttt! I was an environmental sciences major in University, and I could not disagree more with some of the rhetoric being spewed by the so-called environmentalists these days. They espouse clean energy, yet they don't focus on decreased consumption...buy a hybrid SUV, instead of driving a gasoline-powered Honda Civic. Doesn't matter if more hydrocarbons are required to create fuel cells than consumed by the smaller gasoline vehicle. Why don't governments just increase taxes on automobiles (hybrid or gasoline) and decrease fares for public transit? That would do far more for the environment. I remember Al Gore's movie and crusade that became a focal point for environmentalists and celebrities a few years ago. Yet Al Gore's home consumed 30 times more electricity than neighbouring homes. His decision was to continue to consume the same amount of electricity, but he powered it with newly installed solar panels and the purchase of carbon credits! Carbon credits! The biggest whack of horseshi* that anyone could have come up with. Let's not be responsible for our actions, but just buy our way out of it...or at least try and offset our pollution! In general, I'm very optimistic about technology & science improving lives world-wide, and that it will assist us as we do slowly deplete some resources. Cheers!

I don't disagree with anything Biggs says. In fact, we said exactly the same thing back in the first week of March in our Annual Letter to Partners, which a few boardmembers here would be able to verify: One final note on equity prices today. Just this week, the Dow Jones Index hit a 12-year low. This has happened only two times before…from 1921-1932 and 1962-1974. After 1932, the Dow was up +60% within two years. After 1974, the Dow was up +70% within two years. As horrible as the news feels these days, valuations for stocks are probably the most attractive we have seen in our investing life. In many sectors, they are probably the cheapest we will see in our remaining lifetime. Without a doubt, stocks and corporate bonds provide extraordinary value at the present time. As investors, we could not be more ecstatic! Our thinking now at this point is very much in line with what Biggs says at the end of his article: Does this mean we are in for a new bull market? Not necessarily. Secular bear markets are caused by severe structural aberrations and take time to heal. In America, such markets in 1932, 1938, and 1974 were followed by peaks and valleys lasting years. Japan's markets have had broad trading ranges for nearly 20 years since that country's bubble burst in 1990; the old highs are still far away. In this light, the U.S. and Europe have been in a bear market since 2000. I'm afraid the odds are that over the next five years, the mature G7 economies will grow more slowly than they have in the recent past, and financial-market returns will be uninspiring. That said, I would also argue that the rally that began in March has further to go, and that it's too soon to run for the hills. It takes courage to hold fast and be a pig, as they say on Wall Streetmy money is where my mouth is. The only difference is that we aren't pigs. We have no plans on ever getting slaughtered. Cheers!

Home Services of America has acquired Koenig & Strey Real Estate of Chicago. Cheers! http://www.nbcchicago.com/news/business/Warren-Buffett-Buys-Chicago-Real-Estate-Firm-56598322.html

I remain completely convinced that we will continue to see pressure on homes over the next couple of years, compounded by pressure from commercial real estate losses and credit losses. Take a look at this chart, and as expected, we are seeing considerable movement in prime losses and foreclosures. http://msnbcmedia.msn.com/i/CNBC/Sections/News_And_Analysis/_Blogs/Beat%20Blogs/Realty_Check/__DAILY%20POSTS/RC-foreclosures.pdf While subprime has stabilized due to government programs and bank workouts, prime delinqencies are rising rapidly. You now have the main drivers of consumer spending tightening their pocketbooks as they try and save their homes. As I mentioned before in a previous post, there has never been a period of such dramatic real estate losses, that wasn't accompanied by an elongated recovery process. That enormous Thanksgiving dinner isn't going to be that much easier to digest just because you chewed your food a bit longer. Cheers!

Congratulations to my friend John Zemanovich, whose children's future university education is probably more than fully-funded today! I remember John buying Marvel for about $4/share back in 2001 and adding to his holdings over the last few years. He bought that and Fairfax for his children's trusts...pretty damn good! I know some board members on the old MSN Board also bought plenty of MVL over the years. Cheers! http://finance.yahoo.com/news/Disney-to-buy-comic-book-apf-730717139.html?x=0&.v=16

Keep in mind that most all stocks in the US are still 50% off their 2007 high. Therefore, all those who think the current market is speculative, I ask compared to what? The S&P500 is off only 33% since its peak. You may be assuming that the previous high was fairly priced. In hindsight, we know it certainly wasn't. Intrinsic value is based on all the cash you can pull out of a business over its lifetime, discounted back to the present. Are cash flows going forward for the S&P500 going to be at the same level they were in October of 2007, or that the rate of growth in cash flows will be the same? I don't think so...at least not for the next five years or so. Think long-term not to make your investment statement beautiful for the end of the year. Are today's prices likely to look cheap over the next decade? If so, I would be buying on the dips as much as possible. Buffet bought BYD at $8 or so per share and is now contemplating buying more at $50/share less than a year later - if the company allows Mid-American that is. That is how investing is done, anchoring is a big mistake. Who is to say the stock is expensive at $50 even if you bought it at $8 if in 10 or 20 years it is worth $1000? You are correct. It all depends on what you expectations are. If you are happy with 7-9% returns going forward, then you probably are fine buying stocks. If you expect higher returns, it may be tougher. Buying a stock at $50 that will be worth $1000 twenty years from now, gives a return of 16% annualized. Buying the same stock at $8, gives a return of 27% annualized. That is an enormous difference. Thus, buying today all depends on what return you are aiming for. My original comments were simply meant to say that speculative money is now pouring in and those that think investing is easy are now fiercely in the game. Cheers!

AIG @ $50 is the equivalent of AIG pre-split @ $2.5. AIG at $50/share! Wow! You're kidding right? I know, too cheap! http://www.bloomberg.com/apps/news?pid=20601109&sid=a1aa.saUuNRI WFC is still down for the year. JNJ is down slightly. I think a core criteria for frothiness is that great companies at least trade in the black. PDF attached Cheers!

Hi Hawk, To clarify, the meeting is simply a gathering of investors, and Joe and Matt just happen to belong to Chanticleer. Whether they comment or don't comment on Chanticleer is up to them, but I wouldn't expect attendees to hear anything specific about Chanticleer outside of what they say in their filings and press releases. Cheers!

If you plan on attending the upcoming Pabrai Funds AGM in Chicago on September 12th, please email me at [email protected] . I'll be coordinating with Matt Miller and Joe Koster of Chanticleer Holdings, so that we can have a nice gathering before the meeting. If you would also be interested in a coordinated visit to a Steak'n Shake in the Chicago vicinity, on Friday the 11th or Sunday the 13th, please also indicate that in your email. Cheers!

I'm having a very, very hard time with what is happening in the markets these days. AIG at $50/share! Wow! You're kidding right? This weekend I was at a wedding, and a family friend of mine was telling me how his uncle has nearly doubled his stock market investment for him in a few months. The process...a little of this, a little of that, some of this and some of that. No discussion of valuation, intrinisic value, growth, balance sheet strength or economics. We expected the markets to rebound considerably from the March lows in our 1st Quarter letter, but me thinks speculation is beginning to run rampant again and the stupid fast money is flowing swiftly. Beware the rising tide! Cheers!

Hi Libor, Yes, the old board was archived, but in a somewhat inconvenient form. Use the visual hash search Uhuru posted, and then note the dates of the posts you are looking for as your guide for the archive below: http://msnbrkboardarchive.multiply.com/ Archived files are in the first five pages of the blog, and at the bottom of the fifth page is where all the archived posts start. Cheers!

Yup, and they've thrown the book at this thing to stimulate the hell out of it. Japanese corporations are flush with cash. The consumer has been saving for the last twenty years. The psychology had changed significantly with the consumer and corporate balance sheet strengthening, while the national balance sheet plummeted. Finally, they used to be the cheapest source of production 50 years ago, and then the most efficient 25 years ago, but the world has changed. The cheapest source now is China, and the most efficient is South Korea. Japan peaked twenty years ago, and is slowly finding out what it feels like to fall from the top of the food chain. The U.S. is next unless it can continue to innovate. That's what kept it on top against all these hungry competitors and it has to do so again. Cheers!

I think I'm actually looking more forward to getting my hands around some Steak'n Shake than anything else! ;D I've been so damn anxious to try the food, but there is nothing within 1500+ miles of us. Especially since they started putting those huge pictures of the burger on their website. Cheers!

It sounds so bizarre, but JP Morgan is financing California's $1.5B in IOU's. The interest rate is lower and there are no fees. Cheers! http://www.cnbc.com/id/32584157

The Chicago Meeting is on the 12th of September. We'll probably meet around 1:30-2:00pm, and then anyone going to the Pabrai Funds AGM can go at 4:00pm. Cheers!

Charles De Vaulx, protege of Jean Marie-Evillard, has set a record for the most amount of capital raised by a new mutual fund. What's interesting is the little tid-bit in this article about Garrett Van Wagoner, whose fund raised $710M in 1995, shut down when assets fell to $17.5M last year! Cheers! http://www.bloomberg.com/apps/news?pid=20601087&sid=azA3L83L_WGQ

Hi Folks, I can't make the Pabrai Funds California AGM this year, but after speaking to Mohnish, I'll be attending the Chicago meet instead. Joe Koster and Matt Miller of Chanticleer Holdings tentatively have a small gathering before the AGM. I'll speak to them, get the details on exactly where and when everyone is meeting, and then I'll put out a post. Hope to see some of you there. Cheers!