Gregmal

The Buffetts have always been very patriotic. Warren is always talking about how great America is. Only recently have liberal loonies tried to slant patriotism as something unsavory. It's disgusting.

I don’t really see how this is anything more than a classic example of “rich guy with a weird hobby”....

If I was lazy and didn't want to be thorough with my due diligence? Sure. But in that case I'd be better off buying an index fund. If I'm willing to do the work and do my own deep dive, it is entirely irrelevant.

Welcome to COBF. This stuff happens all the time. It's head scratching. So many self proclaimed "investors" regularly get hung up on totally irrelevant details, fabricate issues, and almost always look for excuses to miss the forest for the trees.

For me, this community is for two things, entertainment, and idea generation/buffering. So in regards to the later, my only concern is making MU-KNEE..... let the truth and the info available take me to where I need to be to make it. I open and welcome any and all ideas and info, it is on me to decipher it and either put it to use or discard it. Lets not worry about judging peoples character on an anonymous Internet forum/community. In a twisted sense, the most honest or transparent folks will be the ones getting assassinated while the opaque(not with standing John Hjorth who I am guessing really is John Hjorth) play judge and jury. Eric used his real name, google him, judge him, execute him. Anonymous poster never gets ridiculed.... If Eric likes pursuing teenagers, thats his prerogative. Doesn't mean he can't provide value to an investing community... Also doesn't mean he doesn't have a side to the story. Frankly I could care less.

After much thought, over quite a long time, I purchased a small position today. To me, the key man risks are outweighed by the sheer quantity of great businesses that run independently, and will IMO eventually be spun off. BRK trades at a discount to these, and IMO the current price, is kind of at the upper end of the "cheap" range. Not slam dunk, but with an IB account, only having to put up ~20% of capital in a margin account, it should either outperform the carry cost, or keep dropping, which will further skew my future expected returns and allow me to add into it with greater size.

Excellent, timely, read on the situation.

A lot of the stupid and redundant stuff is primarily CYA regulatory stuff.

I've never understood this style of shorting the market. It sounds like a good idea and is definitely sexier, but execution is quite difficult, and even then you are still basically timing things. It's quite interesting to look at many of the guys who became legends by shorting the housing crisis. Most of them haven't done too well since. Its not cuz they aren't smart or whatever, but rather the way they make their bets. I'd much rather just take the Tepper approach, where you shift your exposure. I think in mid 2009 he was levered like 3:1 at some point or something to that degree. Whereas when he's been bearish I've seen his portfolio at something like 40% equities. At least this way you still have something going for you if your macro views aren't playing out.

First, this is people posting their returns on the internet, who cares. And two, based on what's provided I'd gander a heavy concentration in high beta energy names. Lastly, agree with you entirely on the last piece.

This is kind of how I see that aspect of it as well. I could look at BRK and even without Buffett, say to myself, these are businesses I want to own. The primary reason I see most people investing in FFH is Watsa. Outside of that, as I said earlier, there isn't much, and even on the insurance side, there's better insurance related investments out there.

How big was their VRX position? I didn't know about that one... I don't recall specifically, and to be 100% forthright I could be thinking of Francis Chou(who seems to mirror Watsa with his portfolio quite a bit) but I'm pretty sure it was FFH, but maybe 1-2 years ago I saw VRX pop up in the filings. It wasn't anywhere near the top. Perhaps when VRX had crashed and was in the 30's or 40's. But the thing that stuck out for me was the pattern. WTF is the obsession with these heavily levered problem child companies? Like, you're bearish on everything; OK. I get it. But then what the heck are you doing allocating money to companies that look like this??? SD, BBRY, RFP, SSW.... Thats the whole portfolio betting on companies that more or less constitute the same sort of macro bet. You don't get home run turn arounds, if the broader market is, as you say it is(ie overvalued and headed towards chaos). That is what I've never been comfortable with. I am ok betting on managers who express differing views than me. I understand others have a circle of competence where I don't. But for the past decade, I can't reconcile the logic used for the FFH portfolio. It just hasn't made sense and the results have more or less been what I'd expect given how out there they are.

I personally view FFH to be uninvestable. This is a company I have really wanted to like for a long time, but could never get comfortable with it simply because there are others who do what they do, but are better at it. The investment decisions for the past decade have been atrocious. Off the top of my heads its what? BBRY, RFP, SHLD, VRX, SD... probably more that I am forgetting, all of which fit the same theme. Troubled companies, with mediocre management, and TONS OF DEBT. The results have been as expected given those things. Not only have these been heavily concentrated positions, but they've collectively shown poor judgment and demonstrated a lack of an ability to locate good investments in a fertile environment. Going off of a comment by rb, how the f*** was ANYONE, let alone a professional, looking at the market in 2010 and calling stocks richly valued????? I can understand having macro concerns, or thinking trouble lays ahead, but richly valued???? "Oh gee, let me short the market with the S&P trading at 13x!" Pure stupidity.

I think there is quite a bit baked in right now, but don't disagree that there could be rough patches. That said I don't think today is worth getting worked up over. People bid up a challenged company because Buffett bought it and paid the price. Just because lower and middle class people stopped seeing the need to give Apple $700-$1000 a year for the same phone with a new color or extra inch of screen space, doesn't mean the economy is slowing down. In fact, it might mean people are getting smarter or spending that money elsewhere... Although, it does seem this is all pointing the data in a direction that will give the Fed pause, and may even lead to revisions in terms of their previously hawkish stances.

All combined probably somewhere mid-high teens. Don't care enough to tally everything up, never really have. To me the idea of talking about your returns on the internet is useless. It's like talking about your dick size in high school. Everyone likes to, but it only matters once you take the leap and can prove it with action. Anyhow, I typically run very concentrated and MSG, HTL had solid years. Went into year, and exited year with FRP Holdings as top 5 position, but spent 80% of the year not in the top 5, which kind of highlights the type of year it was. Trading was were one needed to be this year to really get alpha. GM and CTO continue to be perpetual disappointments.

https://www.cnbc.com/2018/12/28/el-erian-hold-the-fed-accountable-for-its-messaging-not-rate-hike.html This sums it up. I don't disagree with the hike, but the communication sucks and is tone deaf. Which IMO is Powell's way of trying to play politics and stick it to Trump....Which is more or less a "way to go asshole, stick it to Trump at the expense of the rest of the country"...

Hopefully not. Pushback and coherent critiques are the most useful posts on this board. I know there seems to be some kind of quasi-feud with some here vs other forums, but the main reason I find VIC much more productive is because people are dicks and cut your throat analysis/logic wise. Which for me at least, is the greatest gift because it challenges my thesis. Here, let's face it, a lot of people don't contribute shit, some basically just add meaningless tidbits of already out there analysis, and some indeed give pushback. I like the later. Look at the MDXG or FB threads...People take offense to pushback or differing opinions. They even get mad at disagreement. LOL ok, enjoy your thesis drift while I make money. Cheers...

Long time favorite MSG. Whether Silver Lake gets serious w/ Dolan or not, it won't matter. With split occurring and $1B cash heading to the entertainment company, this leaves the sports teams and other assets floating at about a $4B valuation. Which won't last long. $325(~7.5B total asset value) is probably my worst case y/e target.

I think Trump needs to own his mistakes. The Fed can own theirs, if it comes to that. Also, where the the conspiracy if a Fed chair elected by Trump raises the interest rates? He could have just kept Janet Yellen, if he likes the low interest rate policy? Anyways, I see this correction more like the one in 1987. back then, we had rising interest rates, a fairly strong economy, the Regan tax cuts buffing the economy and a considerable stock market rout they in the end meant very little for the real economy. Spot on. Trump hated Yellen and handpicked Powell. I really can't explain how he would make those decisions then, with the expectations that things would be any different than they are now.

Merry Christmas all! This is a great place with some great people. Enjoy the holidays folks.

This is getting insane. You'd think we are in the midst of some massive crisis. Or that every listed company in the US is cooking it's books... I know Tepper basically just declared the Fed Put dead, but all the writing on the wall, at least to me, seems to indicate that with a little more pain, a lot of folks are going to start looking to resurrect it.

As long as those tax rates stay in place, yes the increased value is "permanent." However, I'm talking about GDP growth. Cutting taxes gives a boost to GDP growth (not GDP level) that is transitory. Which I agree in macro terms is important, but when I look at specific portfolio companies, it really isn't. If I own FRP, and their income consists of lease revenue, interest income, and cash from the rock pits... let's say all of this stays the same, just to keep things simple. At 22% tax rate the company is now significantly more valuable, even with the same figures as last year, when paying 35%. You can look at different figures, but simplistically, you should be throwing a multiple onto that incremental income, and the value of the company should be higher. The markets right now in a lot of cases are saying the opposite. People have essentially fabricated the recession narrative out of nothing, and what I'm saying is that even if it were true(to the extent that is reasonable, ie not a crisis) it doesn't in many, many instances, with a lot of companies, support lower equity prices.

Agreed. Right now Mr. Market is very pessimistic. Why? Not really sure. The stock market's ability to predict the future is less than stellar. The bond market, with 10 year US yields at 2.79%, does not look overly fussed (and I think the bond market is a much better predictor than the stock market of what may be going on in the general economy). Perhaps the ending and reversing of QE is having a much, much bigger impact on financial assets (especially the stock market) than most understand or recognize. Perhaps the current sell off in stocks has little to do with trade wars or slowing economies. I actually think the biggest catalyst for the current sell off the fact that nobody really has a good explanation for it. Fear of the unknown and also don't underestimated the significance of the time of year. No not Christmas but month 3 of the quarter. I highly doubt this continues with S&P components popping earnings out every other day. It's just a weird convergence of events and news flow IMO. Nothing more.

I personally find this whole thing to be hilarious. It's gotten so out of hand, and it's turned a lot of otherwise sensible people into clueless idiots. The stories and headlines, the emotional crap, the complete reversals in sentiment. Oh goodness. It's like everyone sits around bitching about valuations and begging for a pullbacks and then they get the most no brainer one possible and they don't know what to do with themselves...and these are just the people who call themselves investors! -Nothing changes but a .25% rate hike. So what? -The economy is still strong, but indeed shows potential signs of slowing a bit, so what? -The Fed has ALREADY basically said they fucked up and will cater to the market, if you read between the lines. These guys were out giving interviews and trying to say the right things A DAY AFTER they raised rates and saw the reaction! -The market turns the screws on Trump, I guarantee you we get a China deal next year; he needs good news. -The biggest farce I see is people saying "one time boost from tax cuts". WTF do people come up with this stuff? The tax rates don't go back up next year! How in the world is it a "one time boost" when in perpetuity companies will be keeping 40% more of their profits? And oh yea, the "boost" we saw this year? Where, S&P has responded to this increase in corporate profitability by posting -10%! -I've spoken to probably a half dozen CEO's and CFO's over the past two weeks, and maybe it's just particular to the companies Im invested in, but NONE have seen any reason to be have a different outlook or expectation that you had 6 months ago. Overall I think we just had a convergence of kind of one off events that tripped people out and caused contagious panic. First real year of widespread tax loss selling, no Santa rally on WS, massive fund liquidations and wind downs, minor softness in numbers plus super duper scary headlines and fear mongering. Fear that the Fed is going to crush the economy. People are just running with the crowds right now and have convinced themselves of something that doesn't exist. A stupid but true reality is once people started seeing turbulence, many likely just dumped shit and figured they'll pick back up after the holidays-on the institutional side there is definitely a lot of this type of stuff. I will be buying next week because I believe once the big boys get back from holiday in January things should get back on track. This downturn if anything has just given well run companies the opportunity to suck up A TON of their own shares and spring load next years numbers. Which in any case shouldn't be bad, especially at these new valuations. For example. I will be adding to MSG. If you can get to $5B on the Knicks, and add back the cash, you currently have a NEGATIVE EV! And then still have billions in other assets. There's plenty of others like this now. How does any of the shit all the pundits are "concerned" about all of a sudden effect my investments? It doesn't.... As such, I'm a buyer all the way down, screw the naysayers. There were people calling another 20% downside in the S&P when it hit 675 during the crisis. We are no where near a crisis, despite all the crazy things people are now saying that seem to be 100% reactionary to the market decline, and 0% based in what's really going on in the US.

I wouldn't be surprised. Powell is a complete hack though. I rarely agree with Jim Cramer but he nailed this whole thing. It's one thing to hike as expected. It's another to come in completely tone deaf, after talking about being data dependent, and then push some aggressive rate hike agenda that is totally data independent. What an idiot. Kevin O'Leary gave a good sound bite on this too.