Myth465

Thanks for the tip, I remember prior posts about it but at 50% of book one has to take a deeper look. Do you think the closed end funds are the best way to play it?

Economists are interesting. It really is the dismal science. I prefer those who make logical arguments vs. mathematical ones. It seems as though the fed is fighting deflation. I think they have the tool kit to win and will do what it takes. So for me deflation is not the risk. The main risk is unintended consequences and inflation. They will try to mop up the liquity when its time but how the hell will they know its time and these things tend to overshoot. We also have currency wars, and a bunch of other things that could go wrong. I find Hussman a bit too complex and prefer Grant or Grantham. I think they win their fight on deflation and loose with inflation / unintended consequences down the line.

Elf seems like a steal but what is Management doing to close the gap on the valuation and why the cross ownerships. I hate when things are more complicated then required. Have they eluded to increased buybacks or a take over or something?

I totally agree, and this is what annoys me most about politics around the world. The lack of adults in the room. Its very interesting because you get elected by promising to lower taxes and increase entitlements. We all know that wont work long term but its what they do each session. One day it will give though.

Lol good point, why buy shares when they come free every couple of months.

Ward is a busy man. I looked at the upcoming events for my holdings and he is at no less than 8 conferences before year end. Someone wants that SP up. I guess he is trying to get the world up and hope for a big announcement at one of those. Nov 9, 2010 Boenning & Scattergood Energy Conference - SD - Add to calendar Nov 11, 2010 Shareholders Meeting - WDC 11:00AM EST - Add to calendar Nov 12, 2010 Bank of America Merrill Lynch Global Energy Conference - SD 8:45AM EST - Add to calendar Nov 16, 2010 Barclays Capital Energy, Engineering and Construction One Day Forum - SD - Add to calendar Nov 17, 2010 UBS Energy Mini-Conference - SD - Add to calendar Nov 18, 2010 Bank of America Merrill Lynch Credit Conference - SD - Add to calendar Dec 3, 2010 JPMorgan SMid Cap Conference - SD - Add to calendar Dec 7, 2010 Capital One Southcoast, Inc Energy Conference - SD - Add to calendar Dec 8, 2010 Wells Fargo Securities Pipeline, MLP and Energy Symposium - SD

I am more worried about the EU then the US and I think the US is in terrible shape. At the end of the day Americans will take the pain and the politicians will work things out (like 5 year olds trading baseball cards). The EU doesnt even have a government (well one with any real power) and France is striking over a rise in retirement from 60 to 62. I was talking to a person on a plane over to Europe and I think Europe has it right (we are here to live not work). The problem is the world isnt as it should be, it is what is what it is. You can adapt or be forced to adapt. Those are pretty much your only 2 options.

Probably but while the music is playing .... Speaking of that we need a correction, which means the next minor event will be played up like a huge crisis. Any guesses.

FUR had a rough quarter and is moving into being un-modelable. I am sure the Analyst will hate that. Kroger really screwed things up but it doesnt look like its much money from a total exposure perspective. I really like the loan transactions. We get great double digit returns for shuffling paper on the ones which are paid back and get to take over buildings on the cheap from the other ones. If someone buys a building for $100 million, puts down $20 million, and gets a loan for $80 million. Then we buy that loan for $50 - $70 million. Next they default and we get the building. The issue is the building is not leased up and will not generate much cash flow for a while. I like both sides of the coin, and will continue to hold my reduced stack. I may add more after looking at the segment breakout.

Thanks all for the recommendations. I really like the Kindle and I think it will dramatically increase the amount of material I read. Amazon inmo is almost as good as apple at designing functional products. The Kindle is extremely user friendly and has made some great compromises between simplicity and features. Now on to the netbook.

Shorting doesnt really make sense to me on a risk reward basis. Anyway I think Amazon should buy up everything in sight as long as they use stock, its what Henry T would have done.

Probably not mispriced. I just want some cheap non callable leverage. You can go deeper in the money and avoid giving up some premium but it will still cost you a dollar or 2 of premium. I will probably go deep in the money.

My plan now is to grab the 2013s as soon as they come out on the 15th. Has LUK always had leaps? I remember checking and only seeing short term.

When the stock was in the $4s I remember pulling up 2 of the preferred issues. I can only find one now - SDRXP. This may have something to do with the exchange offer they did recently, or I could have just been a bit off. I plan to rotate into the 2013s when the come out depending on how she trades, and would probably have followed Prem into the converts if I had the right amount of capital and wanted to get paid to wait. http://www.quantumonline.com/ParentCoSearch.cfm?tickersymbol=SD The converts tend to follow the shares so you may be able to get them in the 80s should we continue to sell off.

I really like the direction LUK is going. I have no idea what Berkadia or a few of the other assets are worth, but I am sure most are worth more than book, probably multiples on book. LUK is shaping up to be a great inflation edge and I feel a bit late to the party. From cruising through the Q it looks like they are shedding quite a few low quality assets and most are at least bringing back their book value. It looks like they are simultaneously raising cash, high grading assets, and paying down debt. It should be interesting to see what they do going forward. I plan to go back and read some of the older letters.

This is a nice problem to have. Perhaps we can switch lol I want this problem, and can trade you. The same seems to happen to me. Especially in this environment. Everything is running right now. I own LRE, some CNA via L, and options on AHL which are up about 15%. I had SUR and a few others on a watch list and everything is being bought out. I plan to hold L, LRE, and a token FFH position. AHL is a trade which appears to be working out. My issue is I dont want to have 50% of my capital in cheap insurers which would be quite easy right now. I want to hold the names I am comfortable with and trade the others. FFH was my first big win. Between FFH and ORH, I really learned alot and made some decent cash. With that said its hard to buy a significant slug of it for me right now. They wont trade too far above BV unless underwriting is improved. I am pretty confident they are over reserving and will make money on the investment side but only time will tell.

I actually listened to the book a few years ago via audio. I dont remember much of it aside from the commercial style of it. I dont think you are missing anything. The only formula which consistently works is buying a $1 for 50 cents and selling when it hits a dollar. The secret is in the sauce / valuation and that is something you will have to develop a method for overtime. I think Pabrai has a better way of looking at valuation, and his methods should be combined with the ability to identify business cycles and moats. If you can do both of those you should be on your way. I think moat is best reviewed from a qualitative vs. quantitative perspective. The number should help confirm but shouldnt lead the show inmo.

I read the transcript and will give Ward the benefit of doubt. He knows what he is doing and I guess is a wild catter at heart. It looks like he thinks he has something special in Miss, and I hope he is right. With that said I will likely push out my leaps to 2013 and will rotate 20% of invested capital in a few other O&G names in case he is wrong. Lets hope FFH picks up at least some of the converts. I don’t really see the point in holding shares honestly. You could have picked up converts yielding 10% a few months back and can still get some at 7% based on the issue. You get true downside production and if Ward's right you only give up $2.5 in upside. INMO he is either very right or very wrong. Meaning we get low $5s or in the teens. I would pick up the converts, but with my small capital base leaps make much more sense. FFH definitely did the right thing by switching to preferreds. I think the shares will rebound over the next few weeks and should fully recover once asset sales and pricing are announced.

I plan to check out the call and presentation in more detail today. SAlpha has posted a transcript. I wont be adding and yesterday considered selling half for leaps on other O&G names such as PXP. After sleeping on it, I will likely hold, but may reduce should we get a rebound. The volume yesterday was huge. I think the value is their but Ward will have to play ball with WS for us to get paid. So far he hasnt and doesnt appear to want to. Its a tough one. WS typically loves dilution and M&A but we have had a bit too much of it. They cant model SD and have no idea where its going, and neither do I. I would prefer if he just drilled holes in the ground and paid off debt / played golf for half the day. Hopefully with the ramp up we get there.

I think it will have vast unintended consequences. Namely relating to global trade. China and other Asian countries will devalue or have a hard peg, Japan and the UK will follow and the EU will be screwed / annoyed. We also may spark another asset bubble. Finally while I am enjoying my stock market gains, I dont see how you re inflate the housing market. You need buyers and capital isn't flowing back into housing which is where Americans were getting their capital from. It will finally flow out of bonds but into where? They can take away the punch bowl. But what happens if some drunk idiot burns down the house or knock it over?

Thanks for the link. Everyone seems to be saying the same thing. I like Grantham the best because he acknowledges that Ben's hands are tied.

I will buy one day if it gets cheap enough. Right now inmo it still trades at a premium for management and that isnt deserved.

It seems like a no brainer to buy a pool of capital under book. But are the reserves correct. One could purchase AHL for 80% of book value. I think past reserves are fine for most insurers in P&C, but also see very little underwriting profit, and investments for most of these guys present a liability in my opinion. Its such a wild card. My major issue is why buy now. When we get a hard market, all of these companies will get crushed. You can stand on the sidelines and pick the winner. If we get a huge cat, or a huge investment fallout BV will decline and so will stock prices. Why not wait until then. The way to play seems to be to buy the decent smaller ones under book and wait for a buyout.

Leave me alone. JK :D

alertmeipp you tend to focus on whats important. I can understand TWs frustration. They are building a great oil company but due to declines in gas production wont go up much. Analyst will do what Analyst will do. This is not my usual cup of tea. I am used to pretty boring steady Eddie Management. Plus after watching this for 9 months and jumping in 3-4 months ago - I thought I missed most of the painful moments. Oh well, this too shall pass.