Myth465

Berkowitz in fine form. What is Sears worth, well thats the $64 question. LOL.

Thanks for the comments guys, this one is looking interesting.

LOL great read. Mr. Berger says it is now customary for him to seek information from Mr. Hornsby about coming opponents. Mr. Berger says these communications typically begin with an email to Mr. Hornsby asking him to call Giants headquarters. That is because the teams' low-cost telephone system won't allow calls to England.

TX whats your take on the warrants and on Chartis Underwriting? I dont like and am not strong with Life Insurance, but its there. They are spinning off or selling most non core assets like Aircraft Leasing. I think I and others have made this too complex. I guess we have a well known insurance company trading at half of book. Seems like a simple enough bet for a small percent of the portfolio. The story will get simpler as they spin out more and more assets and continue cleaning up the balance sheet / legacy assets. What do you make of common vs. warrants. I am thinking of making a small allocation to the warrants, and getting to know the story overtime. I dont see myself getting to the bottom of AIG, one just has to trust its cleaned up and Berkowitz / US Gov have done there homework. Value will be unlocked as assets are shed and the story gets simpler...

Classic Buffett. What a great sense of Humor.

Yes, that's what I mean. 100% tax would obviously be bad. 0% tax would also obviously be bad. There already is a little redistribution of wealth as of 1862. The government determines what is sensible. Most western countries, with the exception of Britain and a few others, have better opportunities to succeed. Basically, this is what economic mobility is all about. (That said, if you want to argue about which countries are the best at creating really rich people and really poor people with huge gulfs between them, then US is pretty good. Though Russia and China seem to be catching up in that respect, too.) Richard you are pretty good at this. I am on the same side of the boat as you, but like the way you frame your arguments. I think you are wasting your time with Hawk (his mind is well made up), but I am learning something. Thanks for your comments.

I dont blame Bruce for holding. He probably knows what the master plan is... If only the other shareholders did as well...

I respect Niall twice as much now as I did before (and I held him in pretty high regard). It takes a big man to admit when he is wrong.... In one key way, Professor Ferguson now concedes, his adversary Paul Krugman has been right: The U.S. can carry a much-higher debt-to-GDP ratio than he thought. Read more: http://www.businessinsider.com/niall-ferguson-paul-krugman-was-right-2012-1#ixzz1l8HZueNz

I have listened to the Economist cover to cover (audio edition) for the last 3 years. I find it to be one of the finest publications currently being produced. I found the take on Private Equity to be pretty logical and non ideological. Interesting, some people follow politics, like its sports. My team is right regardless of the facts. The economist found that investors in private equity have not done all that well. That was pretty much the point of the article / series....

I think you have figured it out....

I find it interesting that the most rational person I have studied, and the most success investor of all time - Is deranged, has serious characters flaws, has fallen off the wagon, and possibly suffers from dementia - all simply because he happens to be a liberal instead of a conservative. These comments say much more about the intolerance, and inability of the posters to accept others viewpoints then Warren Buffett...... What did Munger say again about dogma?

And LOL

Post of the day.....

I have peanuts in my IRA and plan to ignore this. My have to look into how it applies to a Permanent Res vs. a Citizen. Also I wonder if the Aussie Super is taxed in the US via a similar arcane rule... Tax time will be interesting in June.

Eric does this materially change things or just make you think more about it.

People have been calling a bottom in Nat Gas for 4 years, or so. I predict as I have predicted for a while, that Nat Gas continues to be a dog. We just have endless supplies of it coming online. Even those oil wells in many of the new plays, have significant gas production. The gas aint getting flared off, and will continue to be brought on. Buy gas attached to oil reserves, get the gas for free. Buying pure gas inmo is gambling. Not too many people are making money at less than $3 an MCF. I still own SD and CHK, but for the oil potential. The gas is the kicker. Banning fracing would bring things into line, but you would have to own an offshore or conventional producer. CHK has single-handedly screwed up the economics of the natural gas market. They may do the same for liquids, but cant touch oil...

Thanks really awesome work.

Thanks alot for the paper, it looks well done. Regarding the vacancy rate, I tend to agree with it. Every debate I have had with an Aussie though, has had them bring up the fact that so and so many people are moving to Oz each year. There is probably a projected shortfall, but thats based on growth continuing, and Oz being the lucky country for another 2 decades. I am not sure if that is possible. I firmly believe there is a housing bubble here. Its not as bad as I thought it was originally, and in Melbourne at least the Inner Suburbs prices probably wont fall too much, but I still think there is a bubble. Being from Texas its hard to understand Class A realty housing. We have unlimited amounts of space and a population who has no problem driving an hour to work. In Oz most of the major cities can grow, but they really dont do urban sprawl well, and its too hard to get to the CBD using a car if you are far out (or close in). The major reason I believe there is a bubble comes from talking to locals. They have a blind and unbend-able faith in realty. No price is too much. Everyone thinks the path of wealth is via realty, and most people I have come across want to buy a house. The issue though is I cant say if it will burst, how it will burst, or when it will burst. We could have a US / Japan situation, or a WMT / MSFT sitaution (sideways valuations for 10 years, with continued growth in salaries / earnings / incomes). Hell we could have both with a crash in the outer suburbs and sideways trading on the inner ones. The paper is quite good and quite comprenhensive. I am about 20% in, and plan on finishing it and talking to a few of my friends who works in property about it. A friend who works in property says that the commercial side yields about 8%. This surprised me at frist, but makes sense with risk free bonds trading at 4% - 6%. I dont think anyone really cash flows on the residential side, at least in the cities. Rent vs. buy comparisons just seem too out of wack for me to see how people could be making cash. Alot of the houses in the city are really old lots with extremely an low basis or a fully depreciated ones. Those guys are making a killing, but I dont see how you buy a place, and pay off the loan on these prices. Where I live is actually a tear down. The guy bought a huge lot in an inner suburb, tore the old house down, built 2 townhomes, and rents both out. He might make out ok after incentives and taxes, but I think he is just braking even the first 10 years or so.

LOL

bargainman, I concur with alot of what you wrote. That just seems like the most logical answer to a straight forward question.

I have been saying this for 2 years....

How the hell do you turn around a retail business without spending cash. Sears stores suck. They will do ok in nowheres ville but they are dead in the water in most major cities. Walmarts are cheaper and look better, not sure how you beat that, let alone Target, Best Buy, Loews.... How can you turn around a retail organization by starving it of capital and buying back stock at whatever price? Lampert is smart and Sears will probably make money on RE or some other hidden asset, but that asset will be hidden, the plan will stay hidden, and the gains may not accrue to minority shareholders when it is all said and done. I wont invest until I hear a credible plan, not some BS about enhancing value, turning around retail, brand management, and shrinking sharecount.

Sears sucks. I have not liked it as an investment for a few years. Lampert isnt acting like he is running a public company and gives investors or shareholders few clues to whats the plan. You just have to hope he is the smartest guy in the room. In everyone of my investments I know what Management wants. They may feel to execute but I know where the ball is meant to go. This should be a private company and I wouldnt buy it at any price until management becomes much more transparent....

Eric you may be on to something. Perhaps a bailout of the banks was prudent, though a direct bailout of the consumer might have had a better result. Bank experiences excess earnings, and absorbs bad debts. Consumer is free from debt and is prevented from borrowing for 7-8 years. The major issue I see is much of the growth in the last few decades was fueled by borrowing. We no longer have that fuel boost....

LOL