Gregmal

I mean ever outside of the quality issues with the portfolio, its constructed in a terribly suboptimal way. You even look at Buffett who has WAYYYY more constraints tied to his, IE owning big portions of banks and regulated companies....and the guy finds ways to be nimble. Then you have Prem, who has tied his hands sooooo badly that he cant even take advantage of his mid cap companies going up multiples of their value because some kids on the internet like to trade options; on MULTIPLE OCCASIONS! The guy refuses to learn and do things any other way than his.

I mean you are clearly convinced that the portfolio is now all of a sudden Ackman/Buffett quality so its a waste of time to argue. Its a common phenomenon, when stocks go up people think theyre great and when they go down they get less love. The key is not to fall for it and start believing that just because something has now gone up that its high quality or some great future business(or vice versa), especially when the demonstrated track record indicates quite the opposite. But you are free to continue doing so. A lot of you guys have spent years talking this til you're blue in the face and to no avail. Missing glorious opportunity basically everywhere else. Ive laid out several times what actions need to occur, and wouldn't you know it, they announce a real buyback coupled with an asset monetization and the market likes it...but what do I know? My two main points are the Prem has stubbornly refused to monetize these. And that FFH would be better off monetizing and suring up the balance sheet and buying back stock. Get back to basics and keep it simple. Enough with the garbage, gimmicks, and complex stuff.

Exactly. But now the pendulum swings and people fall in love and think theyre great. Thats the siren song of Mr. Market. If you love FFH shares because they are cheap....how in the world do you favor owning poo poo like that over selling those names into a generous bid and then buying more FFH shares?

While I can appreciate your enthusiasm, its this exact mentality that creates cycles/in favor and out of favor opportunities. A lot of things have happened over the past 12-24 months. Some are temporary and some are not. However I can find a way to mentally do what you're falling victim to here with other stuff that is clearly crap too. I mean Gamestop? What a turnaround! And gaming is a massive future opportunity. They have paid off all debt and now have a massive net cash position and stand to benefit big time from future trends in the space! Like WTF...you see how silly that sounds even though that same enthusiasm would be just as true for yours in regards to Prems stock portfolio? Resolute is a piece of junk. The guy has owned it forever. I remember in 2013 hearing how Prem leadership and direction there was a bull case and the stock was at $16...The only exception I'd make here is Atlas but I dont want to get into arguing individual names one by one because that misses the point. Your garbage has caught a bid. Even if its something you like, your stock trades at 65 cents on the dollar, sell that shit now, and make that gap disappear. You've had 5-10 years and in some cases more to be right about your stocks, maybe they've worked. and maybe they haven't, but if you believe you are a semi reasonably capable allocator, then there is ZERO way around the fact that selling them to repurchase your own shares and sure up your liquidity position is FAR better risk/reward. And FWIW, TRS are not an equity position. He can sell those or add to them all he wants but he's only doing that because he cant afford to do a real buyback. If anything else the fact the TRS is so big now is more reason to get out of the other stuff.

People can say whatever they want and time will tell who’s right? But a decade, let alone the most prosperous one in history, is not exactly 1/2/3/ even 5 years of a rough stretch. Falling back on how much money one has is a lame argument. It’s not hard to accumulate money especially in the finance biz. Results matter and Prems resemble John Paulson… another billionaire who has sucked a big one. When your process is wrong, change, adapt! If it’s just a short term aberration, like Buffet in the late 90s(he didn’t even do that badly then so I don’t know why people use that as an example) then time will prove him right. When it’s been a decade and even Mickey Mouse has outperformed you….and still you stand pat because you’re already rich and stubborn….and then talk a big game but your personally crafted company is overlevered and lacks liquidity and can’t even buy back stock in a real way without gimmicks…..I mean come the freak on!

Buybacks work if they are done consistently through the cycle and aggressively at troughs; they work wonders if the business underneath is stable, profitable, and managed in a disciplined way. There is zero debate to this and no better example than shitty mall retailer Dillards.

Well that is why I said Buffett just happens to have an obsession with making money. Same can definitely not be said for Prem the last decade, so let’s not act like he done that. He’s blown one of the greatest bull markets in history doing unnecessary stuff, buying shitcos, bailing out “national treasuries”, unable to even execute a real buyback and constantly having to pull gimmicks because liquidity is shot… I mean you would literally have to try to pick losers consistently to do this bad and even then I don’t think one could match his past decade. So I don’t see how it’s unwarranted to criticize and wonder if there aren’t talented underlings at FFH that could and probably should be calling the shots. It’s no slight either to say that there is some excitement warranted for the next in line at Berkshire either? Why is there so much loyalty to Prem Watsa? Just cuz he s a billionaire and self made doesn’t absolve him from being a dumpster fire. You wouldn’t make the case that Larry Ellison is taking/took Oracle seriously would you? This shit happens all the time. People get to a certain point and their priorities change. That’s fine, but then don’t pretend like the throne you gave up is still yours.

Theres definitely a lot to like about this setup. The part I dont is having Mr. Watsa here, in current form, at this stage in his life. He's a self made billionaire, successful by any definition....nothing left to prove and not changing his ways. I still laugh at the commentary in one of the other FFH threads. Where Watsa is quoting Buffett or some 1950s value investor stuff and saying he's now, in 2019 figured shit out and someone was just like "yo, this guys been investing since the 70s but now 50 years later he's saying he's learned" LOL. Same sort of life priority things Ive said about Buffett except Buffett just seems mental and lives for little else than compounding dollars and making acquisitions(as evidenced by basically everyone around him admitted as much) and Berkshire actually owns good businesses and has a great abalone sheet. Bring in the new guard. The younger and hungry who are looking to fill the shoes. Yes, I own both BRK and FFH.

Eh I more so was referring to the qualitative side. They are so poorly constructed/capitalized that they dont have the liquidity to conduct real buybacks of any size. They have an equity portfolio with tons of garbage that now, much like the likes of pretty much everything in the stock market, has gone up..except they've convinced themselves these are great businesses worth holding onto, and on top of this, this sort of thing is so much part of who Fairfax is, that people have come to terms with this and just kind of accept it. As @omagh said, can you imagine these sort of stunts/issues at Berkshire LOL? The flip side is that a small change in a key variable can allow for somewhat of a rerating, especially when the sentiment is as poor as it is. So thats the angle to play IMO.

This is actually a useful reminder, so thank you for stating it so elegantly. Im in for a quick trade but its important not to lose site of what FFH actually is.

Yea I was actually thinking just that when I saw the thread pop up. I would definitely consider NVDA a FANG caliber. I long neglected to look at this because even if I tried I probably wouldnt understand the space and as a result never really appreciated how truly dominant NVDA is. Essentially the core/bones of crypto, gaming, AR....all very big pieces of the future.

Added to the losers. MSGE and Z. Bit more DIS too.

Eh, there was an awful lot of hooting and hollering and table pounding about FFH in 2019. At basically the same prices or higher than todays close. But if people want to focus on the wrong things, thats on them. When the variables that need to change start doing just that, the investment will begin working. Today was a step towards that although again, there are lingering issues on the optics of it. As was just mentioned, why not just do something straight forward? Why not sell the garbage in the equity portfolio now that its in favor? Time will tell. I think its worth a shot here as maybe, just maybe, he's starting to get it.

@John it might be. But the market wants to see a pulse here in terms of proactive and meaningful steps to reconcile the past decade. Going from being a drunken sailor to simply below average manager probably takes a good chunk off the discount ascribed. Eventually being viewed as just plain average probably adds $200 a share.

The fundamentals have been there for awhile. We've being hearing about hard markets and discount to NAV for years now. The market wants action. What is worth thinking about, to me, is why he is still refusing to unload the garbage in the equity portfolio? Sure, everyone is now convinced they're sitting on gold, but thats how cycles work...people fall and love and become believers when it swings the other way. In favor, out of favor, etc. Bottom line these arent good or best of breed companies for the most part. When you trade at a discount to NAV/BV, the textbook way to close the gap and grow per share value is buybacks. So, this is a good and welcome move and IMO this should have a nice floor for a bit, giving a window to trade this into the dividend. Wouldnt be shocked to see 15-20% in the next 2-3 months, which is an acceptable return here.

From what I am hearing, the new Keurig home bar is flying off the shelves. So I did some DD and bought one(for the office of course, biz expense) and yea, the pods are expensive as heck, but its basically a one way ticket to alcoholism. Pretty cool.

also some more CLI and FOR

Amazing what happens when you get off your ass and actually do something. Like I said, fundamentals weren’t gonna do it. Market wants to see real, meaningful action. This is definitely a start.

https://www.cnbc.com/2021/11/17/biden-calls-on-ftc-to-probe-anti-consumer-behavior-by-energy-companies-as-gas-prices-soar.html LOL. Buck stops here. Everyones fault but his own....Shut pipelines, terminate leases, sue companies for operating they way they have for decades....nah, their fault.

FRFHF at the open

The one that goes up, obviously.

small add to CLI, few more APTS 4/22 $10s

Unless this position is greater then like 20% of the portfolio I would not worry one ounce about some margin

I dont know why this is but I have learned over time not to trust this kind of stuff. If something is close and the premium is basically gone, I just close it out. Too many times Ive heard of stuff like this, where you have a $100 put sold and the stock closes Friday at 101....and then you get exercised as the stock is opening Monday at $98.....I just pay the couple bucks so I dont have to worry about getting screwed.

When selling puts you aren’t really looking to be an investor, just a dealer at the casino who takes his cut regardless, with the worst case scenario being you have to make an investment of your choice at a price and time of your choice. I like that gig.