enoch01

Let me just go on record and say that I am a big fan of Kraven. No amount of scientific data will disprove that. Ever. That makes you a Kraven ideologue...a "Kradeologue". Let me guess, you DON'T have a portfolio concentrated in 3 stocks, right?! Oh, and I bet you don't think Sears eliminated all of their liabilities when they created the non-guarantor subs. Am I getting close? Friggin' well-poisoning Kradeologues.

Enoch01, In which areas do you find Royal too eager to expand. Anything specific? or is that just in general? Mainly mortgage origination - cash back, high LTV, etc. I suspect also that they've grown too big, too fast in capital markets. Just a hunch though. From the 2012 AR: "Capital Markets has significantly advanced its global position to be a top 10 investment bank and is gaining market share in traditional investment banking businesses faster than any bank in the world." When I see leveraged institution say stuff like this, it makes my ears perk up.

https://www.fitchratings.com/creditdesk/press_releases/detail.cfm?pr_id=816871 Fitch affirms the large Canadian banks today. There are several assumptions built into the rating that are arguable, such as: "Fitch's ratings incorporate a base case housing scenario of a plateauing and orderly cooling of the housing market." They also provide cover for changing their rating, such as: "Should the CMHC alter its mortgage insurance programs or not fully make banks whole for potential loan losses on insured mortgages due to underwriting defects or other reasons, ratings could be downgraded." "Banks with significant presence outside of Canada, including RY in the U.S. and global capital markets, BNS in Latin America and Asian Markets, and BMO and TD largely in the U.S retail market, could have their ratings impacted should there be weakness in any of these markets, should it adversely impact credit quality and earnings generation." I own puts on the Royal Bank of Canada. I am skeptical of its capital levels and it's earnings capabilities over the next few years. There is most likely a housing bubble. Debt to personal income is at historically high levels. Royal Bank management strikes me as aloof, and too eager to expand in recent years. Why people continue to purchase this bank at over 2 times Book Value confuses me, even granting that it is part of an oligopoly.

Read all of the Berkshire Hathaway annual reports, in chronological order. That's the best value for your money. After you finish, then start thinking about what you want to purchase.

You need to have a little paranoia, I think, to be a good investor over the long term. Reliance on checklists can create complacency, and where there is complacency, there is risk. But if you're a little paranoid you will always be thinking about risks that are lurking behind the corner that you've never thought of before - that is, they've never shown up on a checklist. I've read enough stories of people buying something that was just so, and yet the investment still failed, that I've grown wary of a "checklist mindset". Now if a checklist includes, "does what I'm buying cost less than it's true value", well then I guess everyone here has a checklist of some kind. But personally I don't keep something by my desk to tick off before I hit "buy". Oh, and +1 to oddballstocks posts on this thread.

Me too. Autodesk has a moat, but I expect it to shrink. For example, Trimble has been making lots of acquisitions recently (Tekla, CSC, Sketchup) in an attempt to have a complete analysis, design, and documentation suite that can all talk with one another. The Rhino / Grasshopper community is also developing interesting products.

EBIX RY CRM Equal weighted

I have very little cash at the moment, versus just a couple of months ago. Recently I've bought Sears (again), Fortress Paper, and EXCO Resources, and added significantly to Sarepta Therapeutics. I've also bought puts on The Royal Bank of Canada. Enoch, A question if you are willing to share - Why, of all the financials, did you pick Royal Bank of Canada, why not a US bank (given your residency) or another of the big Canadian banks? Thanks in advance. Sent you a PM.

I have very little cash at the moment, versus just a couple of months ago. Recently I've bought Sears (again), Fortress Paper, and EXCO Resources, and added significantly to Sarepta Therapeutics. I've also bought puts on The Royal Bank of Canada.

+72% YTD It's getting harder to find cheap stuff.

Roger Lowenstein's biography is very good. http://www.amazon.com/Buffett-The-Making-American-Capitalist/dp/0812979273

I'm betting it won't play out with CMHC rolling over and the banks not settling for some amount.

I think it's very hard to take any action based on things like things like "cocktail theories". These are the types of anecdotes and rationalizations that gets everyone to nod their head when they read the book that explains, after the fact, how or why such and such crashed. These anecdotes fit nicely into the story, but are only loosely correlated with individual returns. If I can tell that something is cheap, I should buy it. If I can't, then I shouldn't. After the next crash, I'll be sure to order the Michael Lewis book.

Haha, he can't be serious. XOM has compounded about 11% per year since Buffett's sale in 1985. What's the problem again?

Rhetorically powerful, and incorrect. No, it wouldn't be the first one to be seen in advance. 5 minutes of googling will falsify this. This is practically a Pyrrhic victory. Are we supposed to be heartened by the prospect of "more irrational excess to come"? I guess he is admitting that there already is irrational excess?

Avoid any talk of deflation.

70%. Can't find much fear.

Although Sardar appears to speak non sibi, sed omnibus, you might say that, for the board, abundans cautela non nocet.

Wow, that's great! Congrats!

I'm waiting for JBird to give us the Charlie munger quote about how all intelligent investing is value investing. But although it is intelligent, that doesn't mean it "works" day in and day out. Oh well.

Why only BP? Seems cheap and disliked. I recently bought then quickly sold both MBI and BBRY. I didn't trust my initial analysis. I'm looking for some fear elsewhere, but haven't seen much that is compelling. My positions can change quickly.

Not doing anything. My only position is BP. Other than that I have tons of cash.

I bought some BP yesterday.

Largest percentage hit to my port: FMD, 2007. Beware of buying a "financial intermediary" during a huge credit bubble. I paid too high a price for a company in the middle of the boom. Largest percentage decline of individual holding: Dime Warrants, late 2011. Beware of relying on a judge's ruling for your position not to go to $0.00.

I do remember 1998, which is close. I was in college at the time. Back then I had very little interest in investing, I was just focused on my engineering work. But I had a friend/roommate who got really into trading. When he wasn't in classes, he was on the computer, researching, buying, and selling. Every once in a while he explained to me what he was doing, but I couldn't make heads or tails of it. I heard many stories about technology companies, and how they were changing the world. I heard about "bull raids", where people would talk in chat rooms about which technology or biotech name was going to go up, and then pat themselves on the back for making lots of money when it went up. But I couldn't find any logic to why this stuff was happening. It sounded completely random to me. Who the hell decided which stock should go up, and why? Couldn't all of these stocks go down a lot, too? Plus, like I said, I was focused mainly on school, so didn't give it much thought after hearing these nutty stories. So I kept on telling him how crazy all of this stuff sounded whenever he would start in on which stock was hot. Finally he tells me one day that some people buy stocks based on what a company earns, or what dividends it gives out. But then he said that because "those stocks never go up much", nobody pays much attention to them these days. That bit about earnings and dividends made sense to me. But because the only stuff skyrocketing was stuff that didn't make any money, I again decided to ignore investing. By 2000, after the bubble burst, I had heard of Buffett. After digesting all of his letters, a sensible investing methodology coalesced for me. Between then and 2005, I used value-based mutual funds. Since 2005 I've been investing in individual stocks. It's interesting to remember how much of a frenzy it was back then. Fast forward to today and you still hear tons of skepticism about the market, how much stuff is inflated from the Fed, etc. I think the climates are still very different. My friend is now a lawyer.