JAllen

To (hopefully) add to the knowledge base. A couple of years ago I briefly owned CHCG. I sold it because I thought their webpage was weak, to say the least. I also thought it was weird that they put pictures of INSIDE their supposed stores and a company meeting on the website. I couldn't think of another company that did that. Here's their website now (mostly the same). It appears they stopped filing a while back. http://www.china3cgroup.com/index.asp I lost money in CXTI. Definitely makes it hard to own a non-blue chip Chinese stock.

5 years ago my NW was 2% of what it is now. ;D ( I haven't done a 50 bagger in 50 years, more like low 20% p.a) Partially from investment results and from reinvesting those results and fees earned from family members/partners for making them 20%.

Hi Eric, One key metric of insurance companies is the "loss reserve development". Insurance executives have great discretion in reporting the estimated future payouts of each years losses (as evidenced by First Mercury). So, each year the Co. reviews its business and says something like: based upon this type of business and this amount of business we wrote, we estimate that in the future we will have to payout $X. This is a measurement of management conservatism. This is another way of management being able to report how well they are writing insurance, their core business, and hopefully making money. I took a quick look at First Mercury's loss development info located here: http://bit.ly/dyqs27 (p. 68 of 2009 annual report). It shows that FM has been grossly deficient in accurately estimating its losses on each year's business in most years of the past 10. This means that in any given year we don't know how much money FM has REALLY made or lost. It's partly up to the management to decide how much money they made writing insurance that year. An insurance analyst would want to see "cumulative redundancies" indicating that management over-estimated eventual payouts of the insurance they wrote in each year which might indicate that the company actually made a little bit more that year than they reported. I took a minute to add the total deficiencies and net reserves at 12/31/09 (from the bottom of the page, net of reinsurance) The total deficiencies of the last 10 years divided by the end of year net reserve is 15% and taking each year's alone comes out to 20%. (Since they've reported redundancies the last two years when their premiums were larger it reduces what I think would be the weighted average reserve development-(the 15% one) but remember they reported redundancies after one and two years out in the prior years also! :) ) See how the reserves just grow and grow one year out, two years out etc.?? What this means is that they consistently under-report their insurance losses each year by 15-20% (probably closer to 20%) so the current year's financial results shouldn't be fully relied upon or they should at least be adjusted downwards (insurance profit down, loss ratio up). Others can chime in with more nuanced views of individual insurance lines. And, I know that there are more conservative insurance companies out there so maybe I would read everything that has been written about the ones that are so popular on the board already (FFH, MKL, FMMH come to mind) that have been pre-analyzed for you.

I haven't even checked but is it possible to change our usernames without signing up again, Sanjeev? I don't post very often but would definitely change my username to my real username if possible. Don't you have to manually enter the usernames and passwords? I personally don't think the original subject of this thread is that big of a deal. It hasn't been a problem for me.

Woah! I stopped getting emails about the thread after two replies! Glad I checked back and thanks for the feedback! It'll take me a while to sort through it all. Thanks again.

Hi folks, For 4.5 years I've been investing and for 4 years (I fortuitously showed up by Googling Fairfax when FFH was under $100 U.S) I've been reading this board hyper-religiously. Thanks to Buffett, Graham, my parents, and lots of posters here I've managed to save enough to where I now have some freedom to do and explore new things. I've always wanted to start an operating business myself so I've recently moved to the Bay Area to be around more people doing the same and who have technology skills that I don't have (I studied finance). So I've recently begun to teach myself how to program (coincidentally with the same language/environment this board is created with-PHP) and would like to start building something of my own that others will potentially use. I thought it somewhat logical to bridge my finance background to web-development so I thought I should check here with other investors to inquire if there are any web tools you've always wished existed but don't. As you probably know the web is full of various tools and finance related (blogs, wikinvest, the portfolio trackers, etc.) applications. I would, of course, rather not create one that already exists unless it would be substantially improved. Do you have any ideas you would like to see implemented or most importantly problems you'd like solved? I'd appreciate any feedback and discourse if so. Thanks a bunch!

It seems that both shrinking at mid single digits and tripling the store count are probably not the answer. My guess is low single digit growth. My long-term guess on BH stock performance is low teens. He should be able to beat the market but most of the out performance will go to him, of course.

I believe LL Group owns about 2% of BYD. and Mid-American is 9.9% or something. There are shares traded in Hong Kong (H Shares) and mainland China shares. The percentages you note are purely of the H shares, I think. Anyone know if LL Group's performance numbers are gross or net?

They're asking the E.U for money also which further implies that they're not covered. http://online.wsj.com/article/SB10001424052748704671904575193292611544742.html?mod=WSJ_hpp_LEFTTopStories

New Letter from the Committee: http://www.prnewswire.com/news-releases/the-committee-to-enhance-dennys-issues-letter-to-shareholders---urges-vote-on-gold-proxy-card-for-election-of-its-three-highly-qualified-director-nominees-90728069.html

I'm personally not very scared by dynastic wealth. The third generations are usually dried up "ski-bums". Either people come around and are decent people (Senator Rockefeller as an example)or yes they are ski or beach bums (the only other Rockefeller that I'm familiar with is a beach bum). Most of the time by the third generation the wealth gets divided by the simple fact of it being divided by 2.5 every generation and they start bickering (think Pritzkers or Bancrofts). I think the unethical earning of income in the first place should be the focus (Joe Kennedy, Rockefeller Sr.) but after a while some of them shape up (whether or not you agree with their politics or not- and I'm not a democrat although I've mentioned a few). I remember reading that there wasn't a Vanderbilt with a million dollars 50 years after Cornelius died with 100 of them. Carlos Slim is scary but I'm not Mexican. Few families are successively good with money: at least not good enough to start to really be able to screw with a large portion of our economy, IMO.

Bush's ranch isn't worth more than $7M, probably nothing close to it actually if I remember the size somewhat accurately. That rule is so family farms can be kept. It lowers the annual payment to 1/14 (or something close) of the original tax payment on the value so the farm can keep producing and not have to be sold to pay the taxes. I know this because my grandparents have been dealing with estate tax issues the past few years. They have owned their farm for 60 years so yes, the farm exemption isn't just for wealthy folks shielding their wealth from the estate tax. By the way, 1/14 of the land value per year to the government is HUGE to a farmer.

Eric, Great point. I hadn't even considered that. I am a unique case where being given some money turned me into an obsessive work-a-holic/investor. My parents gave both my sister and I $15,000 about 4 years ago (I'm 29 now) and said lose this much now, learn a few lessons, or lose much more later (or something along those lines). Them doing this had a VERY positive effect on me. But yes, I think you're right in that people take money for granted when they know their parents have a bunch. I have seen it happen with most folks that I know that grew up with well-to-do parents. How to balance between the two will be tough.

The U.S is notorious for taxing former residents for life. I (very) briefly looked into moving to Switzerland and began looking at tax issues. Most of what I learned is that the U.S will (at least attempt to) tax you wherever you are. I imagine if you weren't wanting to come back to the States you could shield more of it and the States will have less power over you, but that doesn't sound like what you want. I don't know your exact age but I know through gifts to your children (you are relatively young and you do have one or two right?) you will be able to transfer large amounts to them, over time. Of course, an attorney is in order here.

His foresight might have been a statistical illusion if he hadn't staked a large part of his fund on his beliefs and then put his CDS positions in a side-car, against the wishes of his investors including Greenblatt by the way, who flew out to San Jose personally to try and get his money back! Of course, the board is very aware of a minimum of a few others who did exactly the same thing. Watsa being the most notable (who isn't mentioned once in the book, or at least not until 90% of the way through it). I highly recommend 'The Big Short'. It goes into much more detail about the trade and some other very interesting characters. It was especially interesting for me having never worked on or even remotely near Wall Street. I learned much about how things work. I wonder exactly what he's working on now, Burry that is. The website says 'private investments'. I wonder if those are publicly traded stocks or something else. Glad he spoke up!

I really enjoyed his and Buffett's letters this year. Really great stuff. I Wish it would go cheaper. We barely own any right now.

Why not just read the book if you're doing research?

A few years ago when WAG was in the mid 40s I calculated the long-term CAGR (since the mid 1960s) and it was about 14% which ranks it up there with Exxon, Coke, etc.

I will preface this with saying that I probably missed something along the way. How do we know that Buffett is bitter? Why are we making this assumption if we don't? Finally, if he is angry at her for publishing something about his personal life that he wishes she hadn't, why did he expose her to the information?! If it was her inaccurate portrayal of something he intended to expose her to, why didn't he read the book before it was published? I'm only asking these questions because I don't understand where people have gotten the information that Buffett is bitter and that he certainly had it in his power to edit/censor anything that he didn't like if he chose to do so, no?

After following the whole OSTK, NSS etc. saga the last 4 years I can say that Patrick has kept his cool quite a bit longer than most very decent people I know. This is by far the most lascivious behavior or commentary I have seen him commit and I don't judge him negatively for it. I can say that I would rather not a CEO of a company I own a part of engage in the war that he has engaged in but I don't judge him negatively for that either. Actually, most people would just avoid the more powerful, corrupt financiers, journalists, and traders, he has exerted much energy against. I don't have any position in OSTK.

http://gregmankiw.blogspot.com/2009/06/was-keynes-really-savvy-investor.html

Thanks for the link Matt!

Re:PD After looking some of rig count info released last week I calculated the percent decline as compared to 2008 in working rigs by month for 2009. 0.23 0.33 0.51 0.30 0.46 0.53 0.59 0.60 0.52 0.45 0.33 0.13 Forgive the decimals and all, I copied and pasted them of course from the spreadsheet. So, indeed, at least for Canada, the picture is much better than it has been for all of 2009.

Actually the size of the position determines the success more so, it seems to me. And last years failures, such as Abitibi, might just take a couple of more years for us to determine any success/failure rate.

http://www.ted.com/ It's not exactly the same but is certainly educational.