DooDiligence

Oh my, this is interesting, thanks!

That's interesting but intricacies of property-casualty insurers' federal taxation are not exactly the topic of the day. :) Looking at many reserves triangles over the years, it seems like there is a trend. Rarely, insurers use big-bath accounting techniques and sometimes (to varying degrees, from benign to improper) insurers use the reserves account as a "supplemental" cookie jar to mitigate underwriting results (in both directions). However, usually, there seems to be consistency for companies to maintain a relatively constant pattern of either under- or over-reserving. Why is that? IMO, companies (including BRK) that tend to consistently over-reserve do so in the spirit of financial conservatism: to maintain a margin of safety in order to be ready to mitigate potential unexpected future adverse loss development. This posture has the interesting side effect of decreasing taxes paid and increasing cashflow but i don't think that's a loophole Mr. Buffett is trying to "exploit" directly. As far as the federal tax aspect is concerned (whatever the motive), over-reserving has the potential to be particularly significant in growing and long-tail lines (the temporary difference will tend to become permanent) although the IRS requires discounting of future reserves according to prescribed rates (adjusted with the 2017 Act) and established payment patterns. The IRS has slowed down in this area (please educate me if aware of recent cases) but it has been known to go after insurers that tried to escape tax (IRS perspective) when loss estimates of prior years retrospectively became apparently disconnected from reality (owned taxes to be paid with interest and with potential penalty). Despite an industry-wide impressive reserve release record (seems to be coming to an end) in the last few years, it seems like the IRS has stayed quiet (maybe because P+C insurers have not tended to be very profitable in this ultra-super-low rate environment and the IRS budget seems to be under pressure). It seems to me the IRS would hesitate to go after BRK for an over-reserving issue and Mr. Buffett likely would prefer not be tied to a potential tax-evasion issue. At times and in selected cases, it appears that some insurers will significantly increase reserves in some lines in order to secure a premium price increase through state regulators but most regulators are not dumb and this is not BRK's style. To paraphrase; just because a mouse lives in a cookie jar doesn't make it a cookie. www.foley.com/en/insights/publications/2013/09/us-tax-court-upholds-pc-insurers-full-reported-los

Buffetts style appeals to my sense of frugality. Notably, a person can be frugal without being cheap. His lifestyle & charitable donations clearly illustrate the difference. The stock looks cheap but I think it's really just being frugal. There's a certain kind of karmic effect here that I believe gets rewarded over a lifetime. HODL on!

I wish he'd sell out of Apple. That plus the cash pile would make a nice downpayment on Greenland.

I think WEB just likes picking stocks, but unfortunately not enough to have taken advantage of last March.

You have my vote. Now, I am not on the Nobel committee, so my vote doesn't count. Alas! you say, hopes have been dashed. But not so soon! You see, all those on the committee do, in fact, vote. And as we have already established that I too vote, it can be shown that I am therefore on the committee. So, congratulations. I think therefor I am, and I do so like green eggs & ham.

Can you explain this a bit. I kind of have a sense of what you mean. Still love that WWE video that you did a few years ago in which you explain the genius of Vince going over the top. This? Good to see you again TBD.

Rings true & makes me think about BRK.

Yes. You succinctly captured the American spirit of individuality. As an outsider I had never realized it quite as starkly before this virus revealed it. A huge swath of us should not be tarred with the same brush. It's mostly folks who've bought in to the nonsense that gets fed to them by mass media talking heads & political demagogues These same people will bad mouth youngsters & minorities / foreigners for being rebellious non-conformists & yet fail to recognize the same ignorant behavior in themselves.

Searching for Truth in the Age of Misinformation www.pbs.org/show/fake-searching-truth-age-misinformation/

Petronius: "You will be worthy of the spectacle, as the spectacle is worthy of you." Nero: "You encourage me Petronius" ... Nero: "Is it possible that human beings can produce such a sound?" Petronius: "Yes, when they've been driven too far."

Thanks, couldn't get past the paywall but this SA page provided insights in the comments section. https://seekingalpha.com/news/3507213-brookfield-to-take-25-stake-in-dominions-cove-point-in-2b-deal I would love to be a fly on the wall in the meetings where Brookfield determines their fair value marks. Between this, the overpriced Railroad they bought, the GCP shopping malls, the Forest REIT projects etc. The mental gymnastics will sure make the flys head spin. It would probably kamikaze into cow poop to feel better afterwards. Buzz, buzz... ;D

I've been avoiding the corona thread for the same reason I avoid Twitter (I've not been on Twitter in 6 months or so because it's the corona thread magnified 100 times), but every now & then I take a peek & it's usually the same old garbage from the same old noisy can. What I read today in just a few posts was so incredibly ignorant that it triggered me into a reaction. The man makes inflammatory posts which are dripping with condescending sarcasm & when anyone responds (anyone is frequently the eminently intelligent & thoughtful Liberty) the troll retaliates in the fashion of a Roy Cohn or a Trump. In this case the troll accused me of fomenting a distracting & boorish non-financial environment here when he himself provides significantly more towards distracting people from intelligent conversation. He gets a pass? I'll exercise more restraint going forward. edit: I apologize to you for my corona post but I would never apologize to the troll.

You shouldn't be so hard on yourself, troll away.

I think you're misreading the situation. I think Trump's problems are self-inflicted. If he was a little smart and a little competent and had a little empathy, and was surrounded by people like that too, he'd have done what almost every single country has done and this crisis would've boosted his popularity and been a clear re-election calling card, as most successfully met challenges are for presidents (9/11 for Bush, for example). I protected you, this really bad thing happened and I dealt with it well, you can trust me to have your back for 4 more years, etc. Instead, it revealed him without a shadow of a doubt to be an incompetent bullshit artist who has no idea how to do the actual job, and polls reflect that. As for the market, it's always going to do what it's going to do. People think it should work in lockstep with the underlying economy, but if you look at the facts, it rarely does, too many factors and reflexive feedback mechanisms. If it did, it would be a lot easier to predict, because the economy moves a lot slower than the market.. While this is true, contrary to the beloved narrative some here like to peddle, I really could care less about whether Trump handled things in a way that best suited his political ambitions. In fact, theres probably a greater source of truth to the argument that without some degree of mismanagement, we wouldn't have the stimulus and rate policies that are making certain long and short term investments available and extremely compelling, not to mention predictable, right now. Short term, you have capital markets completely open at outrageous rates to companies just recently believed to be on the brink of "extinction"...longer term, you have guaranteed low rates and a put option of a party change which has already committed to an outrageous level of money printing, and yet inflation protected assets in irreplaceable locations trading at historic spreads against treasuries.... Make piss out of lemons much?

Thanks, couldn't get past the paywall but this SA page provided insights in the comments section. https://seekingalpha.com/news/3507213-brookfield-to-take-25-stake-in-dominions-cove-point-in-2b-deal

https://wvmetronews.com/2020/07/14/senators-hope-berkshire-hathaway-invests-in-west-virginia-natural-gas-projects/

Episodes 2 & 3 are excellent as well. Watching the way Einstein struggled, largely because of his rebellious nature, is inspirational. Sometimes unconventional thought produces great things. If you have ideas, you should pursue them regardless of what the so called experts say.

I did this by associating fantastic gains from the purchase & sale of LEAP Calls on EW around 2013. The gains were further extended by purchasing the equity at the same time. A gift that keeps on giving. I tried to replicate this with Altria with abysmal results. I still own the Jan 2021 $50 Calls & expect to book a loss on those. I got lucky with EW & don't believe I'll try this again. --- This concept may also apply to shallow impressions of people.

The subscription fee is only for those that want the upgraded services above and beyond the message board. Otherwise, they would have full access and use of the message board as they do now. So nothing would change for the majority of users or new users. Cheers! Good that subscription is actually a "freemium" model and doesn't deter more voices from being on the board. Sanjeev, you've done a great job with this Board and I've often wondered about the "why" behind all the effort spent. If one can align incentives for participants and for organizers, there will be a path forward. Monetizing it means it will be sustainable. Otherwise, volunteer efforts whither away and quality decreases. It seems to me that there are basically 2 populations on CoBF. The wholesale segment generates actionable intelligence which can be monetized in the markets & the retail segment which gets monetized in a more superficial way on the front end. If I were Sanjeev, I'd be primarily motivated to generate information & deal flow from the more productive members of the site. Any walls (pay or otherwise) should be implemented simply to segment the population & any pennies made on the front end can be used to offset the costs of running the site. I would most definitely be categorized as a part of the retail population & would be placed outside the walls unless I'm willing to pony up & be subject to strict posting requirements. This fact doesn't offend me in the least as long as I can still lurk around & improve my thought processes & occasionally coattail a good idea. Feel free to monetize me however possible. I'd definitely buy a cool t-shirt!

I have personally had the experience pictured & quoted above by cherzeca lately, and speculated it was a software bug. Personally, it has been, to me, an unpleasant & very annoying experience. That said, no way, I'm going to leave, nor stop participating & reading CoBF. [i suppose, if CoBF stops to exist, I'll go into suicidal mode. [ : - D]] I experience this only when using Safari on my iPad. I actually click on ads periodically, not because I'm interested in the product or service advertised, but just to throw some ad revenue to Sanjeev.

Just watched episode 1 of Genius & it was very good. https://youtu.be/SICLBlHizU

Second that & would add the title Ambassador Extraordinary and Plenipotentiary of CoBF.

I like AFL a lot too. I owned it a long time ago & sold for a nice gain, then forgot about it until recently. A decade ago, they were getting nearly 80% of their pre-tax earnings from Japan. They made their bones selling supplemental cancer insurance policies in the only country to have 2 nukes dropped on it. For years, I was perplexed by the fact that they've bombarded the US with TV ads & didn't seem to be making inroads but the geographic revenue mix has started skewing towards the US market. I also like that their payouts are fixed & non-negotiable, unlike P & C & health insurers (correct me if I'm wrong here) & they do cover payouts for covid. Most premiums are made through payroll deduction so yeah, the threat to near term earnings is real. They could also experience problems with their investment portfolio in a serious deflationary environment. As per the March 2020 conference call: "we have identified approximately $1.4 billion of middle market loans, most exposed in the current environment and have stress tested $1.3 billion of transitional real estate. While this economic crisis is unprecedented and predicting the trajectory of the economy and recovery is difficult, we have taken a pretty bearish view in our credit stress test. For instance, we have assumed an extremely severe second quarter drop in economic activity of 30% to 50% with just a modest pickup through year-end; revenue declines of 30% to 80%, depending on the specific sector and company; losses on our most sensitive below investment-grade and middle-market loans of up to 20%; oil prices staying below $20 for most of the year as demand slowly recovers. Let me emphasize that the impacts to the global and U.S. economy are going to be highly volatile and very difficult to predict. We will continue to evaluate as more economic information becomes available, along with the impacts to the sectors and companies in our portfolio. Our loss analysis estimates approximately $680 million in pre-tax potential losses. This equates to approximately 100 basis points of potential losses on our total fixed maturity and loan portfolios, of which fixed maturity corporates are 72 basis points." --- Here's a very good report from 2012 that lays out every aspect of how they operate(d). https://www.aflac.com/us/en/docs/investors/fabbook2012_06222012.pdf

I'm pretty sure most off the shelf forum software has a variety of options that can be implemented (or not) at the admins option. I agree custom software is unnecessary. Joomla is a very robust & extensible open source content management system with a vibrant community of developers. www.joomla.org Community builder is a great Joomla extension with coms, plugins & mods to accomplish just about any function mentioned here. There are a ton of other coms, plugins & mods to handle everything from tiered subscription offerings, data migration, event management, e-commerce (who doesn't want a CoBF t-shirt?), and more. I've authored many Joomla sites using LAMP installations on shared hosting plans. None of my sites served as many users as CoBF but I believe it would scale nicely if you used a dedicated host. I still can't believe that the core Joomla installation package is free.