Packer16

I can understand sometimes your mind gets so filled with data that notes sure help. The best ideas are not always presented by the best presenters. Packer

The other major difference is liquidity so a good number of funds would probably not buy them. Packer

From what I see looking at the EM carnage out there, there appears to be three areas of interest I see: 1) Russian oil & gas companies (such as Lukoil, Tatneft and Gazprom) 2) Chinese, Russian and Brazilian banks (such as Bank of China, China Construction Bank, ICBC, Sberbank and Santandar (Brasil)); and 3) Korean Preferreds (such as SK Group, Hyundai Motors, LG Group, Amore Group and Lotte Chilsung) For 1 and 3 above, I have looked at identified some interesting names but for number 2 I have not been able to analyze these to get comfortable except to see what some other have bought. There was some discussion on BSBR on another thread but I was wondering if anyone has looked at any of the Chinese or Russian banks. TIA. Packer

Their comments are interesting as they see a possibility of the market going further up as from 1996 to 2000. This may be the case as the credit cycle is not fully engaged and there is alot of institutional money on the sidelines. I still think caution is required as Howard Marks has said move forward but with caution (maybe focusing on niches and delevering any levered positions). Packer

You are correct. I will add. How do you deal with taxes? Do you buy mainly investments that are capital gains oriented as a result? TIA Packer

Wanted to get boards feedback on using a 1 bucket strategy of putting 3 years of expenses in a ST bond fund then put the rest in a risk asset (in the examples mutual funds but could be any find of assets) to generate an income street. The record since 2000 has been pretty good. Any suggestions or alternatives would be appreciated. TIA. Packer 1_bucket.xls

I think the bigger picture is the skill/attitude of becoming a star indespensible player. Develop that where you are at and become known for that attitude and other folks in that firm or at other places will notice. It is similar to the story about Joseph in the Bible. He was put in a worse situation, a slave, did the right thing and was rewarded. Management of most firms know who are the star players they want to have on their teams and if you can develop skill you be ahead no matter what happens. Packer

First, I would find out the reason why as Kraven has said. You also mentioned peers bonus. Do they have the same base as you and are they working in the same firm? Are the circumstances the same so you can make a valid comparison? Are there some aspects of your firm that would prevent them from providing the same bonus as others (lower profits)? In most cases, in my opinion comparing yourself to others creates more trouble than it is worth because situations can be so different. The other question for your first job is do you have an interesting job and are you gaining good experience. Even if you are paid less than others if you are getting better experience it is worth it. Look at what Buffet did with Ben Graham, he worked for peanuts to get the experience of working with Ben Graham. This may also be an issue of expectations. Have you exceeded expectations laid out by your boss over the past year? If these have not been laid out with some quantitative criteria then I would ask for such so you can get some feedback. Packer

What he may have done is contribute his carried interest in the Bain funds inclusive of discounts. This is the equivalent of putting call options of the equity of levered firms into an IRA over which you have control. This could lead to higher the Buffet returns. Packer

My take on his efficiency idea is that it is prudent to think that markets are efficient unless you have evidence to the contrary and it is better to be thought of as an exception versus a rule. I also think he was speaking of primarily his world - the world of institutional asset management. If you go through his list about the junk bond market and compare it to the market or segment you are looking at you can get an idea of how inefficient the market is. I also think in general it is much more difficult to find a mispriced large stock than a smaller one. Large stocks are bargains when there is a reason to hate them and the reason has a flaw (look at BAC as an example). Packer

Does anyone have good names for these types of companies. I have not been to concerned about taxes because I have been investing in tax advantaged accounts but I have some folks I am giving recommendations to that have taxable accounts. I guess the benchmark here is BRK and FFH. Packer

Most of my assets are in tax advantaged accounts (IRAs) so I am not concerned about taxes. Packer

I set a price target and compare upside to other stocks available and will only switch if I can find 2x the upside of what I am selling. Packer

Nothing escapes 'The Great' Packers analytical eyes ! I bought MRVL around the end of 2012 when the market was more concerned about their legal problems ( although I bought before the jury award). I thought the jury award was preposterous and discounted the probability that CMU was ever going to get paid that amount. According to my calculations at that time, I estimated that MRVL should be able to get to $600-$650M of normalized EBITDA going forward and the market was over reacting to the legal risk. At the current valuation, MRVL is getting close to my sell point and estimated EBITDA multiple. In recent weeks, rumors about a KKR led buyout has boosted the stock, however I am not going to hold out based on it, if it reaches my sell target. I do not have much insight into IDCC. It's balance sheet looks great and it earns pretty good royalties/fees on it patent portfolio, but there's something about patent valuation and their business model of "pay us licensing fees or we will sue" is something I don't understand. As for Cirrus, market reactions and opinions are difficult to explain. I think CRUS had a great ride hitching it's wagon to Apple's rising fortunes but what has happened lately IMO is that the market has grown skeptical about the possibility of CRUS being able to maintain it's growth and margins -given that majority of it can be attributed to Apple ( I think ~ 80% of revs come from Apple). Growing at a pace it has grown the last few years is not sustainable long term, so the market is somewhat justified in its skepticism. Also, given that the outlook for Apple has cooled somewhat since last year ( difficult to see reading this board) and the recent loss of some business from Apple is fueling this speculation that CRUS's EBITDA and GMs will take a hit going forward and they might lose more business. If I remember correctly mgmt has also indicated they might see slightly reduced margins, although revenues may continue to grow. Thirdly, if you consider that the semiconductor industry goes through cycles every 3-7 years, and we are already in the 5-6th year of the current cycle, the market may just be displaying some caution going forward since revs and margins can drop significantly in a down cycle. Thanks for the response. From one former chip guy, a long time ago before they "closed the loop", thanks for the insights. The chip companies are nice space if you can get the right price. The only one that I like that was recently cheap enough (but is on the fence now) is Vishay. Not flashy but a sold company and another holding of Howard Marks. Packer

Interesting ideas about HSAs also on that site. Packer

Any particular reason you like Marvell versus other chip makes like Interdigtal that may be cheaper? I also always wondered why Cirrus Logic trades a discount to other chip makers that have similar margins? TIA. Packer

Started out as an EE designing integrated circuits then joined the AF and worked on satellite communications requirements and survivability (nuclear effects) for a communications satellite. Next worked as an independent cost contractor for the AF while attending MBA school. Then worked at PwC as an business appraiser. Then moved to Rochester, NY and now work as a business appraiser. Packer

Interesting. Thanks for your view. Packer

Below is Bogleheads performance bell curve for comparison: http://www.bogleheads.org/forum/viewtopic.php?f=10&t=129567 If we translate it to our bins, we get: less than 10% - 11%; 10 to 25% - 73%; 25 to 40% - 16% and above 40% - 0%. We do appear to have an above average group here. Packer

Lukoi's lifting costs are $5.7 per BOE while BP's are about $12.50 as close as I can see. See attached link for other major's data: www.lukoil.com/df.asp?id=95 Packer

SD, How do you get comfortable with upside given MTG trading at about 4x BV? TIA. Packer

Lukoil I have been listening to Jim Rogers for too long. Packer

I think Lukoil is a strong competitor. A great company in a hated country. If the company was valued at $9.00 per BoE (the same valuation as BP) this is more than a 3x upside. There is a good thread on this in the Stocks section. Packer

I agree 100%. At this point I am finding value in more business risky places (like Europe and EM) versus 12 to 24 mos ago. I expect it will be a much more volatile and bumpy ride from here and who knows 2014 may be the year I hold cash. Packer

I think each investor has his own style and has to feel comfortable with it. I like the football analogy as oddball is the grind it out on the ground, I probably throw 20 to 30 yr passes and ERICOPOLY throws the bombs. Each of has developed techniques to know when it is appropriate to apply the style and how to reduce risk so the style will not blow you up (at least for me and ERICOPOLY I think it would be hard for oddball to blow up). I find it interesting to learn about how each style works and if you happen to run across a similar circumstance you can use it. Packer