biaggio

Thats what I was thinking. Also I may be mistaken in holding cash hoping for a correction only to find out that fed won t let that happen as it will be there buying, in order to support and stabilize market Is it illegal for fed to buy equities? anyone verify that?

http://business.financialpost.com/2013/04/25/central-banks-are-loading-up-on-equities/ "Central banks, guardians of the world’s $11 trillion in foreign-exchange reserves, are buying stocks in record amounts as falling bond yields push even risk-averse investors toward equities." -personally I have always felt that government will do whatever it takes to inflate there way out of this debt -they appear to have driven interest rates to near zero -are stocks next?---print money but instead of buying bonds, buy S&P ETFs or other equity. It would certainly help penson funds that are underfunded, give folks a good feeling-enough to get out + buy stuff -its scary if you re holding a lot of cash, as I can see the purchasing power of cash deteriorate. -at the same time central banks may not have the best track record-so maybe this is a contrary indicator- I am thinking of their decision to sell gold before this last run up in gold prices (I think they were selling gold at $300-400/oz...could be wrong) What s one to do?

I think mental models and check list are useful to protect you against unforced errors. -to protect you against errors caused by biases, emotional factors, and other irrational thinking. -gets you to learn from the wisdom of others (better to learn from others mistakes) - to get you to think about the decision/assessment you are about to make vs using intuition, gut feeling, anxiety/panic/greed/fear of missing out. As Kanheman explains in his book to think slow vs thinking fast

That's actually what I did. I had price targets for the other half, but they hit them all in the same day. They just kept going up $1.95, $2.20, $2.50, $2.80, $3.10 and $3.30. I kept selling bits of the remaining half after the initial $1.95 sale. By the end of the day I had hit my price targets and was out. I just had no idea that it would go up another $3 the next day. ;D Cheers! Nobody ever went broke taking a profit. Who would have thought it would have gone up another $3. How often does that happen? You better forget about it because next time instead of going up more it could go down for a round tripper. I am an expert at this (the round trip to no profit).

thanks. intersting

Thanks for posting When I was young I collected stamps- so I have thousands of them. Wish I would have gotten into coins instead. I would like to get into buying gold/silver coins...I would like to buy a couple a year + just hold onto them. I agree they are beautiful The local bank sells them. I like your idea for buying How do you know you re not getting ripped off i.e how do you know if you re getting the real deal from a pawn shop or jewllery store. Do you carry a digital scale/calibrated cylander to calculate density. There has to be a more obvious way? What do you do as far as storing? do you keep in safe? at home?

Two years ago I had surgery on April 4th. Didn't walk again for a couple of months. Last year we were in California house hunting April 1-15th. This year I turned 40 on April 10th (day of the meeting) Perhaps the right time will come along. Toronto is a good place to spend you 41st birthday.

Its a very competitive game. My hats off on the performance of the posters here. I am currently reading Howard Marks book-he indicates that the top investors over a 10 year period will spend 30% of that time in the bottom quartile in performance-so even the best will have some hard patches. The rest of us probably a bit worse. It pays to be patient when you have the right jockey. I have no opinion on Paulson

Sorry Packer,you are right I should have said a lot of people not every one...that must of been my confirmation bias coming thru. I am working on my cash balance coming down. I find it an uphill battle though

I find Allocation and sizing of positions interesting. I think the idea proposed would be that if you had an opportunities like LinTV that you thought had 81% appreciation potential- then you would estimate over what period you expect to realize this---I use 3 years but who knows---not terribly scientific in that you are guessing appreciation potential + time--- so 81% over 3 years (I would take that) would be >25% per year return so by the above thinking you would invest up to 90% of your portfolio in this and leave 10% in cash. Being the coward that I am, there is no way I would put 90% of my networth in 1 position. It would be sweet if you had 5-10 high quality business selling at such a discount then I would allocate the 90% into these. Howard Marks would add that it would be wise to measure the temperature/risk of the market as well---so I would propose that you would need to factor in the level of fear and greed---go all in when there is a lot of fear and market dislocations like in 2008/2009. There is a lot of estimating/guessing, personal bias and other things that can go wrong which probably what makes it seem not practical. But it may be helpful to have it as a framework. Something to think about + so that you are prepared when the $hit hits the fan as it always does. I find that I always under invest, always hoping/wishing for lower prices (but if you think you can get >25% what else is there to worry about---I know there is always something) Incidently everyone at FFH AGM, both the experts and other attendees seemed pretty pessimistic---most were 30-50% in cash

What % of your portfolio are you targeting? Hope that your midas touch continues for the rest of us patient FFH holders

FWIW, I like those compounders as well. My investment style has continued to evolve, hopefully to the better thanks to all the thoughtful posters here. I set target or hurdle rate when purchasing.. Example, if you are looking to buy LUK but want to make 2 x your money in 3 years then you would try to buy at 50% of what you think it's worth. Ideally, especially in taxable account I like to hold it longer if possible. As a consequence have had a fair amount of round trips, usually because of poor selection, wrong company ie not a true compounder, or wrong price. I have a small part of portfolio for more speculative buys as well Agree with gio as a working person and mere mortal I would be ecstatic to have 12-15% compounded over the next 50 years.i also believe partnering with the right people is the way to go Race,I think having a target of 12%, probably realistic but might be too low. Makes sense to aim for 20-25%. Aim for the stars you might hit the moon and still be happy

Too kind! I'm just a long-term visitor in Italy wondering, like twacowfca, why my US dollar seems so eviscerated, but nevertheless enjoying the 'bread and cheese' as well as the sights of the 'old world' (and happy to lose those 5 lbs!) I think eating bread, especially freshly baked Southern European ,and cheese is way under rated and undervalued especially if you throw in some inexpensive but good wine. I wonder if they are not a lot smarter then the rest of us who work our ass off, are always in a hurry, eat crappy fast food, etc Living a simpler life without high stress and high expectations has appealed to me recently. Sorry a bit off topic

No offence, this looks like one of those Chinese companies that look too good to be true. Mind you I just only looked at it very briefly. Be careful

Thanks for post. 62% in BRK

Have posted donation to Farnham's site- appreciate + enjoy information posted there. Thanks for posting notes here, though have not had a chance to read them, I am sure they are good.

I think is also good read from 1994: http://www.safalniveshak.com/howard-marks-how-to-identify-investment-opportunities/

Very much appreciate what you have done + all the wonderful wisdom from all your posters. congratulations!

Good thread Val9000. Agree with posters above-wait, plan (expand your circle of competence), marshal your resources...but dont bet it all unless you have gonads like ERICOPOLY. Its painful waiting if you have cash in my opinion at least partly because while you re waiting for your opportunity the purchasing power of your cash is slowly eroding. I am one that think the real CPI is higher than what the government says- no official data- just what I have noticed at the gas pump, Tim Hortons, and grocery store.

ageofsocrates, that was good, thanks for posting Interesting to get view from a 19 year old. I am taking my 2 boys (20 + 18) to the BRK meeting this year- my eldest really enjoyed it last year, even though he had no interest in investing. It was my first visit as well. I hoping my kids are smarter then me, and that goes with what they do with their money as well. Less problems for me later.

this is a lesson that it pays to make friends in business and not piss folks off.

yes wow. Seems like a good deal for BRK despite 20x earnings As BRK will get 9% return on $8b of prefered stock. + there is leverage in a very low interest environment- there (BRK + 3G) putting $8.8 b in cash and rest is financed-so overall should get decent return

Congratulations to those who bought this one...up to $44 today from ~ $25. FWIW I was wrong on this one Interesting article, angle on SHOS. http://myinvestingnotebook.blogspot.ca/2013/02/khrom-capital-q4-2012-letter.html

Munger made a good point last year that it is probably smarter long term to use up other countries energy first and keep ours in reserve for ourselves. Maybe its a good idea to make the other countries think that we don t want their energy, but continue to use it up.

Thank you for posting. Great stories. Enjoyed the Frank Martin interview- sounds like one of the worlds great people-