twacowfca

There are a few inflationary periods when stocks tanked that gold out performed equity indexes e.g. 1930's, 1972-1982, but it's a lousy long term investment that doesn't compound.

WOW! Many thanks SharperD. You have given me the education of a lifetime in a succinct few paragraphs!

Slow steaming sounds like "cruising speed" for airliners, subject to possible engine maintenance issues. If so, the question would be: how much could a ship save on fuel In a time of over capacity ,compared to extra costs such as higher wages per trip and especially the time value of the cargo. Is this the point of the discussion?

Eric&Dazel, Prem gave the answer to the questions you posed at a NYC investor's conf in 03. I asked if FFH would ever buy whole, non insurance Operating cos. He said no. That was outside his area of competence. That would also crimp the flexibility FFH needed to be nimble to meet regulatory requirements and liquidity. However, he admired Buffett for being able to do this, and he felt that this skill was a great asset and luxury that BRK had.

The Schroeder interview merely continues to follow the instructions Warren gave her when he gave her the book assignment : tell it like it is; don't paint a flattering portrait. Nevertheless, acquisitive would have been a better word than greedy IMHO. The interview provides a key insight into what makes Warren run and helps explain paradoxical transformations in his life e.g. his idolizing his father who was a founding member of the John Birch Society yet now having a circle of friends, many of whom are antithetical to those views. Schroeder's key insight also opened my eyes into how a shoplifting teenager became transformed into someone who has been perhaps the best steward ever of other people's money.

Arbitragr, I believe the url is given under Alice Schroeder interview in this section :)

Oldye, I thought Alice's interview was great. It's easy to focus on the sound bite when she says Warren is greedy. However she wasn't antagonistic when she said this. She was searching for the right word and chose to call aspade a spade and not a garden tool.

Mikenhe, it's good to hear that your grandmother was successfully treated apparantly in UK. Sadly, I have personal knowledge of death from kidney failure of a neighbor who was refused dialysis after he returned home to England after his retirement in the US. Please see my complete account of this in the healthcare thread in the General discussion section, and let's continue further discussion there.

Sanj, you're right, of course. But consider this: having high priced shares has the effect of keeping BRK out of the S&P 500 and other indexes and keeping the share price at a very modest premium to BV. I personally wouldn't mind if BRK's premium to BV tracked it's IV. It would still be a relative bargain compared to most other large caps IMHO.

rkbabang is right. People Buffett's age are not generally treated in the British system when they develop a serious condition -- not necessarily terminal just serious. However these remarks belong in the general discussion IMHO.

WEB and Moodys go back a long way. He read all their manuals cover to cover when he was young. (I did the same thing at a much later date but stopped at volume V when I realized I was obsessing. Yuck!) Moody's is obviously impaired to some degree, but how much is problematic. The big Democrats in Congress still like them, so it looks like they will still be in the same government sanctioned oligopoly when the lawsuits play out. If I had to handicap them I would guess they have lost half their intrinsic value, partly reputation loss, but mostly loss of the mortgage market which would have occurred even if they had passed on the dodgy stuff. Nevertheless, if I were Buffett, I would be really ticked off at them. Therefore BRK,s Moody's shares may be a big overhang on the market for some time to come!

We used to have a position in USG and got to know their mgt very well. They are highly ethical and admirable, but would be the first to admit that they let the corporate imperative to expand get the better of them when they issued unnecessary debt less than half a year after WEB helped get them out of Cpt 11 with their stock in shareholders' hands. When they announced their expansion plans in early 07, WEB stopped supporting their stock as he had done at about $45 per share after their rights offering had expired. (By the way everything in this post is based on public information) WEB has a history of protecting and rescuing his investments. His second rescue of USG was prompted by their violating the covenants on their debt last fall. FFH's participation was necessary because BRK doesn't want to get close to a change of control situation that could jepordize USG's NOL's. USG obviously knew that they needed a partner that was on a very short list that was acceptable. That FFH was the one is powerful evidence that WEB and Charlie hold them in high esteem. :)

I'ts not a later verse from the "Suicide is painless, it brings on many changes " song in the original MASH movie, is it? If not, I'm clueless.

At the 04 or 05 BRK AGM Ajit had attracted a small crowd and someone asked him : What about Watsa; is he in trouble? Ajit didn't answer directly, but replied, "Is he in trouble or is he getting out of trouble?"

Bargainman, Eisenhower was right about the military -industrial complex. Whenever there's a government program there will be an army of pigs feeding at the public trough. Example: I have a friend who works for a nonprofit org that helps organizations that receive government grants spend the money wisely with proper controls etc. They do this efficiently for 4% of the grant even though the Feds allow up to 8%. Now officials in the new administration are telling them that they should charge 8% because they are making all the other consultants (who are also political contributors) look bad.

Well said Packer24 . People spending "free money" is a certain formula for waste and misallocation.

In the US there are all sorts of resources available for those witwout health insurance but these are unadvertised and people who are ignorant or passive or just proudly poor can fall through the cracks without an advocate to seek help. Case in point: The mother of a friend was proudly poor, living in a rural area. A lump developed in her neck, but. a local doctor wouldn't accept her as a new patient because she didn't have insurance. Medicare wouldn't. cover her even though she was 68 and had more than enough years of work to qualify because she had missed their annual deadline for filing and would have had to wait another whole year to qualify. (Yes, this is how our benevolent government operates. She paid her Medicare taxes for a lifetime of work, and now when she needs the policy she paid for and is entitled to they won't cover her!) My friend's Dr was more charitable than the first Dr. He treated her without charge called upon a friend who, knowing her situation, got her the necessary tests at no charge. Diagnosis : Burkitt's Lymphoma, one of the few cancers that can be treated successfully with chemotherapy. A couple more calls and she's now being treated at the finest cancer treatment center in the state ,and will continue to receive treatment at no charge as long as necessary.

The very best universal healthcare system is Switzerland's. It costs 10% of GDP vs 17% in the US. Their government has Little to do with it other than to require that everyone have private health insurance that individuals must pay for. However, no one has to pay more than 8% of annual individual or family income for a policy. If a basic adequate policy costs more than 8% of income, you'll get a subsidy for the difference. There are no lines, no rationing, no government authorities making life and death decisions. Insuance companies play an important role in controlling costs without telling doctors what they may or may not do. If a doctor has a history has a history of ordering unnecessary expensive tests or drugs the doctor can be required to reimburse the insurance company. This rarely happens because doctors can't be sued for failing to order expensive tests. Satisfaction levels for doctors and patients are off the charts far above levels in countries with socialized medicine or in the US.

Don't know about UK. In Australia there are good GP's who treat patients for a fee A lot of Canadians come to the US for surgery because of wait lists there, according to articles in the press. By the way chemo isn't a very effective treatment for most cancers according to Superfreakonomics.

Eric, the next thing you may lose in a government controlled health care system is your life if you are in a category that the authorities deem expendable. I have personal knowledge of a sad situation of a gentleman who lived nearby a few years ago. He was otherwise in good health,but had developed a kidney insufficiency as he approached retirement at 65and had to have dialysis. He wanted to go home to England and removed there shortly after retiring. Sadly, we learned from his relatives weeks later that he had died in England of kidney failure because the national health care system did not allow dialysis for those age 65 and older.

Oops engraved...No spell check on this i-phone readily available.

Eric, the big thing you lose when you get rid of a private health care system is innovation: continual improvements that are extremely difficult to make in government controlled systems where acceptable standards of care are ingraved in stone and there are unpleasant consequences for physicians who might upset the status quo ante.

Eric, something's wrong with the story you've been told: that no insurance company, dealing in a free market, will offer a policy that includes chemotherapy for cancer treatment. If the market in your state were truly free you would be able to buy such a policy because chemotherapy is standard on most employer provided policies. I suspect that you may live in one of our more socialist states like California where insurance cos can't price non group policies with complete coverage above their break even points. There is the phenomenon of adverse selection on the sale of individual policies especially policies with generous benefits. Therefore in a quasi socialist US state with mandates and price caps, such policies may be big losers for insurers.

Gentlemen, Lets recast the US health insurance "Public Option" into a different setting : Financial Care Reforn. Surely we can all agree that US investors would be better off with a public option , a giant fund run by illuminatti on the public payroll like those superior individuals who now manage our financial institutions taken over by Uncle Sam. This fund would cut out all the middlemen and their unnecessary fees to the great benefit of the public. It would have access to low cost government financing, thus avoiding exorbitant margin interest charged by private providers. No one would be refused the opportunity to purchase shares , and every shareholder would have an absolute guarantee against suffering a loss! this will be a huge improvement over the sorry financial performance of the broken private system. All this will be available at no cost to the public. It will be paid for entirely by cost savings taken out of the inefficient private system and by a tax(sorry,my bad) a fee on the most successful fund managers and companies that took advantage of their less fortunate peers and those investors who through no fault of their own suffered large financial losses last year. Participation in this Public Option Fund will be entirely voluntary, but any financial advisor or fund manager who refuses to provide a similar guarantee against losses for the accounts they manage will in all fairness have to pay a fee of 20% of the value of each account into the Public Option Fund. However, those very large private Funds that are first to get on board and support the Public Option Fund will be exempt from this requirement. I hope that all the members of this group will join me in putting their self interest aside to do the right thing and support the Public Option Fund. If we don't take this bold step to fix the broken system that has cost the public trillions of dollars through inefficiencies and losses, we will have only ourselves to blame, and we will also lose the opportunity to have a blanket exemption from financial malpractice lawsuits that is promised if we follow the government best practice guidelines for low risk investing.

This discussion about CR is a tempest in a teapot. FFH had many years when they under reserved. Now they appear to be over reserving because this was A very good quarter for their peers and FFH didn't have any disclosed major loss events.