Vizi1

Hopefully the Conference Call tomorrow morning sheds some more light on what happened in the quarter and YTD. I'm sure Prem will have some pearls tomorrow. Tommm50 - there were $577M in REALIZED losses on the equity hedges. Haven't got my head around how and why that happened, but that was surprising to me. I am also happy with the underwriting performance. It used to really bother me cause the float wasn't free.

I hope so. I will be interesting to see if we get a chance to buy "cheap" tomorrow and then see what happens on Monday if FFH gets BB and reveals the consortium. May be a short window to get in at a good price. Cheers

Here is the Q3 Report 2013_Q3_Interim_Report_-_Final_v002_h0h2g3.pdf

http://www.marketwired.com/press-release/fairfax-financial-holdings-limited-third-quarter-financial-results-tsx-ffh-1847317.htm

Thought FFH was looking to pick up Cara's interest. Didn't work out as originally planned. Cara Enters into Strategic Financial Partnership with Fairfax, Acquires Prime Restaurants and Appoints Bill Gregson as New President and CEO VAUGHAN, ONTARIO, Oct 31, 2013 (Marketwired via COMTEX) -- Cara Operations Limited ("Cara" or the "Company") announced today that it closed a strategic financing transaction (the "Transaction") with Fairfax Financial Holdings Limited ("Fairfax") and acquired Prime Restaurants Inc.("Prime") from Fairfax as part of the Transaction. Cara's legacy remains intact, as Cara's founders, the Phelan family, continue as its controlling shareholders. Cara is also pleased to announce Bill Gregson as President and Chief Executive Officer of the combined enterprise. With a strategic financial partner like Fairfax and the addition of Prime's casual dining restaurant brands and premium Irish pubs, including East Side Mario's, Casey's and Prime Pubs (Fionn MacCool's, D'Arcy McGee's, Paddy Flaherty's, Tir nan Og) and Belgian-style brasseries operating as the Bier Markt, Cara has solidified its position as Canada's largest full service restaurant company with iconic brands that deliver unique dining experiences for Canadians coast to coast. This combined family of restaurants significantly increases Cara's scale, strengthens its market position and provides opportunities for growth and acquisitions. Also, sharing best practices with Prime bolsters Cara's ability to deliver the perfect guest experience to all guests. Concurrent with the closing of the Transaction Mr. Bill Gregson has been appointed President and CEO of Cara. Mr. Gregson has spent over 30 years in the retail industry, most recently as Executive Chairman, President and CEO of The Brick Group. The Brick Group has both corporate and franchised stores. Prior to that, Mr. Gregson was the President and Chief Operating Officer of the Forzani Group, Canada's largest sporting goods retailer operating a number of corporate and franchised banners including Sport Chek, where he worked for 11 years. Mr. Gregson is a seasoned executive with extensive operations experience in the retail industry and has a proven track record of increasing sales and profit. His experience with franchise partners and vendors in a customer service industry makes him the right leader at this exciting time for Cara and Prime. Mr. Gregson commented, "This is a terrific transaction for both Cara and for Prime, and will create a tremendous platform for all of our brands. I am excited to be a part of this phase of Cara's long and successful history, and to work with a great financial partner like Fairfax." Mr. Michael Norris, interim Chairman of the Board of Cara added, "With Fairfax as our strategic financial partner, Cara's significant scale and expertise and the addition of Prime's strong brands, we are in an excellent position to take all of our brands to the next level, with an unwavering eye of providing the perfect guest experience in every single location. Strategically, this broadens our offering to Canadian families, and moves us further towards our vision of becoming the undisputed leader of the restaurant industry in Canada." Prime will become a wholly owned subsidiary of Cara. Mr. John A. Rothschild, who will continue as the CEO of Prime and will be the Executive Vice Chair of the Board of Cara, also commented, "This transaction creates an outstanding opportunity for Prime and the entire Prime family. Becoming part of Cara will create new and dynamic opportunities to grow the Prime brands and participate in an exciting future with Cara and Fairfax." Mr. Paul Rivett, President of Fairfax added, "Both Cara and Prime are Canadian-based success stories founded on a passion for good food, strong value and exceptional service. Prime delivers a team of skilled operators with a long-term track record as well as additional iconic brands that will fit seamlessly within the Cara family. We believe this is an excellent opportunity to combine the best of both organizations and their over 50,000 employees behind a Canadian leader with combined systems sales of almost $1.7 billion that can eventually be a global made-in-Canada success story."

Sold some BAM.A and BEP.UN Still like BAM. Reason: BAM is a big part of the portfolio for me and with the debt ceiling debate not going away, I thought some of the $$$ should sit on the sidelines to see how it all shakes out. May sell more on good days leading up to the 17th. Upside is limited and downside is meaningful until we get resolution on US government and debt ceiling questions.

Sanjeev, It was the lack of a press release that sparked my post. Even if it was for personal reasons, companies have many turns of phrase with which to put that message out. I've seen them, I've even written them. Its the lack of any communication that was strange. I won't press this any further.

Update I did a search on the Northbridge executive today and noticed a difference between what shows up in the Google search compared to the Northbridge Website. This didn't occur yesterday when I did my first recon on the news. Looks like one of the people gone is Glenn Penny, EVP claims. His name shows up on the Google search page of Northbridge executive, but not on the Northbridge Executive page. I'm still curious as to why if anyone has anything to contribute. Looks like Andy may be cleaning house....

Not looking to stir any pots, but overheard downtown yesterday that there were some executive departures at Northbridge. Looked for press releases and general internet search, but found nothing. Anyone have any information as to who and why???? Thanks

I have the movie "Other People's Money" - It is a romcom centered around an LBO/raider type guy (DeVito) and an opposing lawyer (Miller). It is a lot of fun and from a business/valuation standpoint, pretty bang on. The first clip is the heart of it from a finance perspective, but the rest of the story is good and the film gives you a decent perspective on the world of finance of the late 80s. OPM is to finance what Wall Street was to trading, except with a sense of humour. If I remember correctly, he gives a Gekko like speech at a shareholders meeting. Check it out, there are worse ways to spend 90 minutes or so, plus its a Norman Jewison film.

I just called Fairfax and got sent to Investor relations mailbox.

I agree. The book wasn't worth the time spent reading it. Its an easy read, but not much to be gleaned from it. I was expecting some decent insights, but was deeply disappointed.

"Totally Defensive" is subjective. I still hold a core position of names that I believe to be solid, FFH, BAM, BIP. Its just I am "more" defensive than I was throughout 2011.

But that money has to go somewhere, either US Govt or Banks or MBS holders. It will come off the homeowner's liability side of the balance sheet, but he assumption is that after it wipes out its liability, the homeowner will then go out an re-lever himself to start the game again. I don't know if the average US homeowner is willing to play that game since the headlines now are significantly different (read worse) than they were prior to the meltdown. I hope you are right Eric, but even the refinance doesn't change the Euro or US based sovereign risks, in fact, it may exacerbate them.

I gotta say I was a little surprised by the recent rally given the way the market was so distraught in December. Nothing has really changed in Europe or in the US. There is talk of QE3 so maybe the market is placing a lot of emphasis on this, or on the improving economic indicators coming out of the US (which seem to be subject to continual revisions in the months following their initial announcements). I find myself caught in the middle thought. Like Sanjeev, I've gone defensive and I believe that is the right thing to do for me right now. But I also find it difficult to watch this market rally while I sit on the sidelines. It the classic "discipline" problem I guess.

I wonder how a good newspaper like G&M can make such a bold statement...... But in the media business you need to grab the eyeballs...... I think the headline comes from the Reuters Newswire - G&M isn't so bold to make that kind of statement.

Agreed and much appreciated. Happy Holidays.

Cardboard, I've been watching BAC as well, but haven't pulled the trigger. Just wondering what compelled you today as opposed to anytime earlier this week? I almost pulled the trigger on Tuesday, but then got pulled away due to other work demands. Maybe there is no reason why today was special, I'm just wondering if you would be willing to offer any insight into your decision to buy today specifically. Cheers Vizi

I noticed that in many of the past bets and that seems to be true on their current deflation derivatives. However, I thought that they are currently hedging all of their long term equities, such that they do not get significant gains in an upward market? I still need to go back and re-read, so perhaps I am mistaken. I think the hedges are telling us that FFH doesn't expect an upward market and is in fact protecting against a downward market.

Thought this might be interesting to the board. It happened through Wachovia prior to Wells Fargo's acquisition/forced purchase. http://www.bloomberg.com/news/2010-06-29/banks-financing-mexico-s-drug-cartels-admitted-in-wells-fargo-s-u-s-deal.html "Wachovia admitted it didn’t do enough to spot illicit funds in handling $378.4 billion for Mexican-currency-exchange houses from 2004 to 2007. That’s the largest violation of the Bank Secrecy Act, an anti-money-laundering law, in U.S. history -- a sum equal to one-third of Mexico’s current gross domestic product. "

Great story.... http://cosmos.bcst.yahoo.com/up/player/popup/index.php?rn=222562&cl=20253008&ch=&src=canadanews

Seems like he is on the fence on this one... http://dealbook.blogs.nytimes.com/2010/06/02/buffett-defends-how-rating-agencies-are-paid/?ref=business

GGP is actually being split into two entities, with one being the traditional cash-flow generating GGP “pro-forma,” and the under-performing but highly valuable assets being put into GGO, which Ackman likened to “our little Berkshire Hathaway (BRKB).” http://blogs.barrons.com/stockstowatchtoday/2010/05/26/ira-sohn-ackman-says-pay-ratings-guys-for-performance/

Given recent market conditions FFH might realize an “unexpected” windfall from its remaining CDS investments. At Dec 31/09 FFH continued to hold $5.9 billion (out of a total $21.5 million) notional amount in CDSs. At that time, the unrealized loss on its CDS holdings was $43.2 million. During the 1st quarter of 2010 FFH reported $7.9 million of net losses related to credit default swaps. Given CDS spreads have widened considerably in recent weeks, any guesses on the level of gains that have accrued to FFH on its CDS’ since the end of March?