StevieV

Probably a thread on the board that would make this obvious, but what company? The only South African company I recall being discussed in depth is Bidvest. Thanks.

On just the facts written, this question is easy. Scenario 3. I don't see how there can be any other answer. In scenario 3 you are paying less for the same piece of property. The lower interest rates of the other two help even things out, but only help. A few reasons it is practically better. In scenario 3, if you wanted to pay off the mortgage, it would be cheaper. In scenario 3, you have higher tax deductions in the US. In scenario 3, if you sell the house at say $500K in the future, it is a big profit. In scenario 3, there is more opportunity to save on a refinance.

"Am I missing something here?" Yes, I think so. A daily resetting short product isn't equivalent to shorting the underlying. The daily reset makes the positions different. This may not be the best Let's say you are short $1K of VXX and it goes up 10%. Now you are short $1.1K. You have greater short exposure (same number of shares, greater dollar number). If you are long SVXY, the 10% move means you have $900, so lower exposure to the short. If VXX goes back to even, the VXX short will go back to even. The SVXY long won't. Looking at actuals, VXX and SVXY are both down over 30% in the last year. SVXY can be wiped out in a 100% daily move. VXX short won't be (though would be very painful). SVXY loss can only be 100%. VXX short is not so limited. SVXY can have a lollapalooza effect. Up close to 400% since inception. In at least some instances, SVXY may be a better position. Other times worse. Either way, they are different.

Lance, what view are you trying to express with this bet? You betting that vol is going to rise faster than 12-14% in the coming month? Something else? Seems like an unusual position to me as well. The VIX is relatively low, but huge contango now. Full disclosure - I have a very small short position in VXX

I am not familiar with Exor. Care to point me to any particular background or write-up? It doesn't look like there is a thread.

I think you can do a lot of analysis and not do much better than - buy at 1.3x or lower and you'll probably do alright. You can pick a higher or lower number depending on how picky you want to be, how long you want to hold, and how much you want to make sure that you get the shares. It's not like buying at 1.35 or 1.4 book is going to kill you, especially over a longer time frame. Trading at about 1.35x book value now.

(1) Because 8-9% is too low for the effort; OR (2) 8-9% is too low to compensate for mistakes? That is, the 9% bull case can't compensate for a mistake elsewhere so you'll end up lower? What's the effort? I don't know what StevieV means regarding effort, (he could mean the effort of actively managing money), but the point is that 8-9% is a mediocre rate of return to target for an investment. Yes, I meant the effort. I think it requires some effort to get up to speed on Berkshire. I certainly would not invest in Berkshire or any other company without investing some time. Jokes aside, I would imagine that Longinvestor and others have spent some significant time on the company. I actually own BRK and wanted to address some of the things said here. (1) I don't think the bull case is 8-9%. I would say that is the base case. Bull case may be 9-11%. (2) The entry price matters a good bit when talking about returns. A 10% 10-yr return was a lot more likely at the sub-$130 prices offered a month ago. (3) What I like about BRK, and why I own it, is I think that the compounding of value of the company is easy to see and understand. BRK is worth more than it was a few years ago if not for any other reason than they now own a significant stake in Kraft-Heinz and they own PCP. Those were bought out of profits, not stock issuances or debt (for the most part). On the negative side: (1) I think there is some 1-stock risk even with Berkshire. I think BRK is treated as though it does not have such risk. (2) I am not necessarily enamored with some of the main business lines - e.g., rails, utilities, maybe car insurance. (3) Warren's stock picking has not been awe inspiring as of late. Sorry if this post is too BRK-centric for this thread. I just wanted to respond to the posts here.

(1) Because 8-9% is too low for the effort; OR (2) 8-9% is too low to compensate for mistakes? That is, the 9% bull case can't compensate for a mistake elsewhere so you'll end up lower?

"Here is the latest to make oil plunge: http://finance.yahoo.com/news/crude-oil-tumbling-132214670.html The SPR selling part of its oil reserves starting in 2018!" Maybe it is making oil move, but I don't see why it would. If I am reading it right, they are talking about 5-10 million barrels/year. That makes it about 14-27 thousand barrels/day and that is in a couple years yet. Doesn't seem particularly material to me.

"Big Brothers & Big Sisters or Habitat for Humanity" I've volunteered for both of these organizations. Unfortunately, I am not sure I was particularly successful at either. However, I would be much more inclined to volunteer for BBBS again instead of Habitat unless, perhaps, you are a particularly skilled tradesman. I am not convinced that Habitat is a good way to build houses. When I volunteered, there weren't enough tools; people with skills; plan for building; etc. I also had a friend in low cost housing work and people had a lot of problems with Habitat houses after they were built and the people had moved in. I am sure it varies from city to city, but that was my experience. BBBS seemed ok. The reason I said it did not seem particularly successful was that I mentored a kid once a week for 4 years and I am not sure I made a positive difference. They warn you at the beginning that some people get frustrated with that, but I was still a little disappointed with our progress. At the end of the day, it was only an hour a week versus the rest of the time at home and at school. FWIW, I think the school did a nice job and tried to help the kid as well, but his problems at home were pretty bad and overwhelmed everything else.