Myth465

Perhaps, but you havent even considered his arguments. For a hammer every problem is a nail. For a man with Ideology he has his answers regardless of the questions.

Bronco I think this sort of thinking is what caused the great depression. Ideology is nice, but we have a country to run. Koo has my vote as a man who understands the issue. In a chat this weekend he said Bernanke read, and understood his book. ---- John when you really think about it Japan really didnt have much of a lost decade or 2 considering that they maintained their quality of life despite having a huge bubble. Also I think Koo really argues that one shouldnt break stimulus. He says breaking stimulus twice (I think it was twice) really set the Japanese government back a ways. The US has it easy inmo. 1, consumers in the US will spend when they can (unlike Japanese consumers or corporations). 2, we have several value added projects available (considering our inadequate infrastructure and energy needs). We have worse politicians though (on both sides), and an illiterate unconcerned electorate. http://feedproxy.google.com/~r/EconomistsView/~3/auhoOgECEWE/video-richard-koo.html

Can someone explain in plan English what the point would be? How is it in the interest of shareholders to split, reverse split, and recap the shares / stock price. The only point in a multi voting structure inmo is to retain power without economic interest. Makes sense for Berkshire and FFH, due to trust. Doesnt in this case inmo.

Parsad and myself called this. He and the board will own all A shares and will get everyone else to convert to Bs one way or another. Even if it means paying a poultry dividend one time or some other shady practice.

I just looked too. I think MERC has a better business and FBK is a better investment. It looks like you may be ignoring Price/FCF. For me, that's the biggest piece of the puzzle here. Not sure how everyone else gets to sleep at night with money in FBK, but that's how I do it. --- I guess thats the discount. I dont really focus on earnings, and really pay more attention to P/FCF. One thing is for sure though, earnings get you share price appreciation. Perhaps one can split the difference and buy both. I will have to get back in before Q1 (with FBK it might be better to wait until after ;), at least thats how it has worked over the last 3 quarters).

Lol its not a finders fee. Its insider dealing. Thats what eating me. Actually I dont care, and agree with you this will be gone in a few weeks / months. This too shall pass. I dont care but it sounds like insider dealing / front running. I like to call a spade a spade when I can. Buffett has special exemptions permitting him not to disclose stock ownership till he is done buying. Its cause he can move markets. Sokol amassed a huge position coincidently shortly before Buffett bought for a $3 million gain. That doesnt smell right. Not much different then that Goldman guy who is on trial right now. Front running probably happens every day of the week. But if you turn a blind eye to it when its obvious and caught then things will only get worse. I can say 1. This isnt material to Berkshire. 2. People are making too big of a deal out of this. 3. This too shall pass from the headlines. 4. Sokol deserves the book if the dates, and disclosures all look funny. Martha Stewart got the book, that Goldman guy may get the book, Sokol should get the book if the facts support it. Legally its for the SEC to take care of but morally it doesnt smell right at all. I like Spitzer lol, though I dont know much about his history except that he got caught with his pants down. I would say Mozillo is probably the biggest ahole.

Bronco these are all quite good questions. During Mr. Sokol’s interview on CNBC last week, he said, “I guess knowing today what I know, what I would do differently is that I wouldn’t have mentioned it to Warren and just made the investment and left it alone. I think that’s a disservice to Berkshire. But if that’s what people want to do in the future, that’s fine.” Do you believe Mr. Sokol — to whom Citigroup floated the Lubrizol deal in his capacity as officer of Berkshire — had a fiduciary duty to run the idea past you? Or was he free to make a personal investment, without discussing a potential acquisition with you? What is Berkshire’s policy on such trading? Mr. Sokol also compared his investment with one that Mr. Munger, vice chairman of Berkshire and one of your best friends, previously made — that is, buying a 3 percent stake in BYD, the Chinese electric carmaker, before Berkshire took a big share in the company. Was it an apt comparison? ¶You have said that Mr. Sokol did not do anything “unlawful.” But Mr. Sokol bought shares of Lubrizol a day after he told Citigroup to indicate Berkshire’s interest in buying the company. Why don’t you consider that “material” information, a crucial component of insider trading? Do you not believe that a Lubrizol shareholder would have considered such information important to their investment decision? Clearly Lubrizol felt that Mr. Sokol’s inquiry was material enough to hold a board meeting on Jan. 6, one day before Mr. Sokol bought almost $10 million of shares. If Mr. Sokol was aware of Lubrizol’s board meeting, would you consider that material information? And if a news outlet had reported Mr. Sokol’s inquiry or Lubrizol’s decision to meet, do you not think that the price of Lubrizol’s shares would have risen? Here is another way to think about it: If a Citigroup banker had bought shares of Lubrizol at the same time as Mr. Sokol, would you have considered that insider trading? Isn’t that the definition of insider trading? What did Mr. Sokol do that was different? ---- What do you think of the last one. You are talking about bad capital allocators. While horrible its not a crime, not yet. Everyone else is talking about potential criminal activities. Would you be pro Citi employees trading on similar info, were Lubrizol’s shareholders who sold not harmed? Is it ok to do whatever you want as long as you make money?

Bronco I think you have your blinders on, due to your like of the Berkshire structure. You have basically come out pro insider dealing inmo. Sorkin has the right idea. I am just surprised he wrote such a letter given that he will be the one picking questions. I wonder if he will still have that role or what Buffett thinks of this. Either way it took some balls.

Excellent post, this is How I feel.

This is an interesting post and something I hadnt considered. I myself want to get rich so I can have some idle time to do as I please.

Interesting take. Based on this he may have had inside info. http://www.gurufocus.com/news.php?id=127910

No pink sheets offered? Thats what I do.

Just in time http://www.gurufocus.com/news.php?id=127799

Very good interview, especially the part on China.

You could both be right, just working on different timeframes. Remember the context of his comments: he is looking at the very long-term, and you are no doubt looking somewhat nearer-term Myth. This is true, 5 years feels like an eternity to me and probably an afternoon for him lol.

I like FUR long term and hate it short term. On that one loan payback they made 100% in a relatively short time. They are like SD, borrowing money at a lower rate then they project to make. I havent run the numbers but the fact that its equity kinda ruins the calculations a bit though. You would think if FUR was worth $15 - $20, why would they keep selling at $12. If they buy assets with a similar discount then its a wash, but you are right they may make up for it in Management fees. I think the best deflation hedge out there is ROICW (especially if you like REITs). Its higher than the .70 cents that I bought at, but if rates fall and reits continue to trade at 5% I think its a solid 7.5 banger. I own oil for inflation, as a hedge / pair via Petrobank / ATPG / SD. Currently looking at TAT. I also think Leaps on FTR are a great deflation hedge, and SSW is not bad for yield. To be honest though, I dont like this market and want to sell.

You may be on to something. We are the C student in the class of Ds and Fs. Politically Germany will do whats not in there interest and inmo cause severe harm to the Euro pact (A high currency would kill their exports), China is due for a bad one causing potential harm to Canada, Brazil, and Australia due to drops in most commodities. The real question is whats the catalyst and win?

I agree with him for the most part except for Nat Gas. I hold no cash though, and am trying to figure out how to raise some without selling any positions (that makes no sense). He holds so much cash 90% of the time though. Its almost like he is waiting for all hell to break loss. His fund has the right name though.

Was thinking it was time to reload on FUR based on the press release Then this came along. They must see something they like. I will have to look over the 10k and may buy when it tanks. Anyone still own FUR? http://www.sec.gov/Archives/edgar/data/37008/000095012311031569/y90576b3e424b3.htm

Yes but thats irrelevant. Would he have done better doing his own thing? More importantly now he has the capital and additional knowledge to do his own thing. Perhaps he didnt before, but now I am sure he could raise ungodly sums of money in key industries. Ask Biglari, you just cant bet equity.

INMO this is different then what Buffett and Munger did, very different. His task was to find a chemical company. He hired Citi to draw up a list for this task. Then bought the company first, then presented it to Berkshire. Its just different than buying company or treasuries or whatever in your personal account as a passive investment.

Buffett is in a tough position. I or anyone on the board would take the job. But not many qualified would. Buffett has a HUGE equity position in Berkshire and is working primarily for himself and his legacy / charities. I think Sokols beef is he does all the work and gets relatively little of the upside in terms of equity. All he gets is salary, alot of salary. But a man picking stocks wants the upside. I could see him working hard for MidAmerican but Berkshire is tough given his stock ownership. This is perhaps 1 big hole in the model.

I was going to post this but decided I have done a bit too much politically over the last few days. Munger were you buying over the last few weeks?

Tim thanks for the quick response. I am still trying to figure out how to break in, and stories like yours always help. Its been a good 5 years, and its nice to know us Corporate folks have a shot. I remember buying Parlux from your blog. That was more when I had no idea what I was doing though. Its been an interesting few years. Zeke seems like a nice guy based on the articles I have read, and he is based in Austin (the second best city in the US). I look forward to his Q&A on gurufocus.