Santayana

Given how I interpret your general worldview, I'm really surprised that you're not someone who sees the wage increases as leading to ongoing inflation. I'll agree that it's good for a lot of people getting the raises, but it's just classical economics, more money chasing the goods and services will always result in price increases. I know a number of restaurant owners who have significantly increased prices over the past few years, and yet they're still not making nearly as much as they were due to all the wage increases and wholesale food price increases. Which means more price hikes still to come. When you mention the grocery store, I do see the prices there have finally stabilized, but just because someone can substitute eating at home vs. going out doesn't mean their cost of living hasn't gone up. Sure I can eat more cheaply if I spend an hour cooking at home vs. having an after work cocktail at the bar, but that's assuming my time is worth 0. I've always thought substitution effects and hedonic adjustments are just BS that lets the government get away with understating the real inflation that so many people feel.

But they were mostly right 2016-2018 when we did have a rising rate environment, and then 2019-2020 may have been the steepest cutting cycle in history, and I don't think it was very easy to see that was coming. Given how much lower the float was in 2016 vs. now, how much do you really think they could have made by taking on duration when the 10yr was trading at ~2%?

Being positioned to take advantage of the higher rates was completely in management's control, and there was really only one direction rates could move.

It comes up every year, but I'm always a little surprised at the > 10% number that seem to always vote against Prem.

He's forecasting $106 for 2024 and $92 for 2025.

Thanks for all the updates Parsad!

As an anecdote, I just renewed the lease for my retail storefront, and the terms of the lease has annual increases that will increase the rent by 30% over the next 5 years. Minimum wage where I am is up 35% since the beginning of 2020. Shipping and transportation continues to climb. Yeah, inflation is going to be sticky.

That is just wild! We should all start emailing him crazy conspiracy theories about what Prem is doing. I just heard that they're going to announce that they are short BTC at the annual meeting.

I've wondered if the modest selloff in Fairfax wasn't due to concern about their losses on this.

I'm sure at least some of it will be for what they're putting together for IDBI.

I'm guessing next week.

I wonder to what degree liquidity plays factor in the index inclusion process. Would a higher average daily volume make them more likely to be included? Has Prem ever directly addressed the question of whether they'd ever do a split?

For a treasury ETF that you want to act like a cash equivalent, you pretty much have to stick with the ultra short durations. I park cash in SGOV which is almost completely agnostic to rate changes other than the monthly distribution.

This is the secret sauce. The market is starting to recognize the earnings power that's there, but doesn't understand the compounding that can happen from here.

It's a real shame to see the Allied acquisition ruining the combined ratio like that. Excited to hear what Carson Block has to say about that on the call tomorrow.

Making lots of popcorn for this call...

Wow, it really would be something if the report was on the behalf of Brett Horn. Claim Fairfax book is 20% overstated, hope for a drawdown of at least that much, and then Brett can point to his price target and say "See, I knew it was overvalued".

Actually even if they were 100% true it wouldn't be a problem. He didn't claim anything anything illegal or fraudulent was going on, just that he disagreed with how they valued certain positions. If book value really should be as low as he claims, then it just means that their ROE is even better than reported.

Oh, it's still cheap.

No one on this board is bitter about getting the chance to buy at a lower price.

I'd love it if has been short since then! It's really not clear if this is a new idea, or a last ditch attempt to unwind a position.

Wasn't the primary reason Fairfax had such a large IFRS adjustment because of the short duration of the bond portfolio? He's says "too good be true" like they just made up the fact that they had a much shorter duration than most P&C companies.

Food, household goods, car insurance, utilities, entertainment, business supplies, shipping costs, rents, property taxes...and much more are all continuing to get more expensive.

It's amazing we can all have such different experiences re: inflation. At least where I am, there is absolutely no sign of it slowing down, whether talking about personal expenditures or things I purchase for my business.

To me, this move was the biggest of all because of how they raised the money to do it. What's the current carrying value on Odyssey?