ander

And further out, I'm guessing closer to $4,000+ USD in 7 years. Likely should be $1500 plus today and compound 17% per year gets you there.

Definitely conservatism re: the $125 / share versus what should be $150+ normalized earnings. I would not want him to overcommit and disappoint.

@MMM20 I agree with Gregmal they're idiots if they do not have a margin of safety for stock price movement that forces their hand. I have an oversized position and added to it - am only annoyed it's not down further! But @MMM20 what do you think the price threshold would be that would actually force their hand??

Doubt MW is playing it long after covering but who knows. But wouldn't be surprised if they're wary of index inclusion with the timing of this report -- cover before Fairfax added to index maybe.

Read the presentation. Nothing stands out as material. He's not saying there is fraud but rather the accounting practices are aggressive in some cases. 1) In the interview on CNBC, he did mention x-head of PWC (the auditor) being on the board. R. William McFarland. Carson suggested this board member might be keeping the auditor less independent than otherwise would be. His bio is at the bottom. Seems like he's involved as a director at a number of their businesses. I do not necessarily like the connection if he was the former auditor for Fairfax but nothing sinister in itself. He may know the businesses better than others and can possibly add more value and is appropriate to be on the board. Anyone have a view on Bill? 2) In the interview on CNBC, Becky asked where he would cover. Carson did not answer. Said if book value should be 20% lower and should trade lower than book value at 0.8x or so instead of premium because they are manipulating book value. Overall, I find the short case to be extremely weak!! Guess it is an opportunity for investors / Fairfax to buy additional shares lower. Mr. McFarland is the Chairman of the Board of Directors of AGT Food and Ingredients Inc. and a director of our publicly traded subsidiaries, Dexterra Group Inc., Farmers Edge Inc. and Fairfax India Holdings Corporation. Mr. McFarland previously served as Chair of the Board of Directors of The Conference Board of Canada. Mr. McFarland was the Chief Executive Officer and Senior Partner of PricewaterhouseCoopers LLP (Canada) from 2011 to 2018. Prior to that, Mr. McFarland was a member of the executive team at PricewaterhouseCoopers LLP (Canada) from 2005 to 2011, having been admitted to the partnership in 1992 and having led the Greater Toronto Area audit practice from 2002 to 2005. Mr. McFarland is a Chartered Professional Accountant and a fellow of the Chartered Professional Accountants of Ontario.

I think this is an incredibly important point for all of us long-term shareholders. I do believe they are well positioned to execute and agree that "Multiple expansion HAS NOT HAPPENED." and "Multiple expansion is rocket fuel to a share price." I also agree it will happen.

"I could see Fairfax exiting the TRS position when they feel shares are close to fair value (by close i mean within 10%)." @Viking Appreciate your analyses. Any guesses what Fairfax (i.e., Prem) may view as fair value today? or what do you think is fair value today?

There is some debate re: earnings post 4 years from now and of course hard to say what the world looks like the further out we go. I have BRKb put away for the next 20+ years and will take a look then unless if anything substantial changes. I see the clear path to why FRFHF has substantial upside within the coming years, but curious if anyone has a framework for thinking about long term value accretion 10+ years down the road. I know Prem targets 15%. Is that realistic?

I think that was a smart sale - I did something similar. I think he's just getting approval so no issue with caps and gives flexibility. I'm guessing the stock drifts back down as the "meme" traders / computers are done. I do think it's worth a lot more, but this reaction seems silly. What is more important to me are the Form 4 filings.

$100 per year in income. What do you think downside risk is to that number on average?

Filed that he bought another 1.9 mil shares. Did not buy as aggressively as he did in previous days. At 181.6 million shares.

"Fairfax’s equity portfolio looks reasonably well positioned (so far) - but this could change in a hurry" --any stand out to you as potentially vulnerable?

Any thoughts on Fairfax exposure to tech (e.g., Digit, etc.) -- especially as lofty valuation multiples compress.

Re: comments on how Fairfax is allocating to bonds and thinking of duration risk, I pulled the excerpts below from the 2021 Annual Report. They have about $13 B in investments (Associates, Common and Preferred) and have $36 B between cash and bonds ($14 B in bonds). The way I interpret is that Fairfax 1) thinks of the $13 B as their "excess" capital bucket that they can invest and 2) is likely to keep the $36 B in cash / bonds and will likely keep duration on the shorter side since they don't know how high rates may go (e.g., if rates at 8% on long end) -- and if there was an increase in the duration they would probably be thinking of that as part of the $13 B "excess" capital bucket they have. As float grows so does the $36 B bucket which eventually leads to more excess capital to the $13 B bucket. That's how I think about it. 2021 Annual Report: "Inflation and higher interest rates are the big risks the markets face today. The CPI index was up 7.5% in January 2022, the highest in 40 years and the ninth consecutive monthly reading above 5%. The Fed is behind the curve as it was in the 1970s and we fear interest rates will increase significantly over time. We should benefit as our total fixed income portfolio, inclusive of cash and short term treasuries, has a duration of only 1.2 years (an average term of 2.2), but significantly higher long rates will have an impact on the economy. This may still be a few years away and, as I said earlier, we have companies with great management that should be able to navigate these “rocks” profitably! Higher interest rates will destroy the speculation we have seen in high tech and other growth stocks with high valuations, SPACS, crypto currencies, etc. Another risk we continue to see is China and its real estate bubble – which is being tested." "Interest rate risk Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. Typically, as interest rates rise, the fair value of fixed income investments decline and, conversely, as interest rates decline, the fair value of fixed income investments rise. In each case, the longer the maturity of the financial instrument, the greater the consequence of a change in interest rates. The company’s interest rate risk management strategy is to position its fixed income portfolio based on its view of future interest rates and the yield curve, balanced with liquidity requirements."

I'm not familiar with Allegheny. Does the transaction add new lines of business that Berkshire isn't involved with or is it just more with substantial overlap?