Myth465

FFH was fairly complicated a few years back. They had bits and pieces of 2 public companies and had underwriting was all over the map. To get to the heart of the investment thesis you would have to have dug. Investments and CDS has propelled FFH. I also wouldnt call the insurance business easy to understand for most folks. To know that FFH had large unrealized gains in Bonds and CDS took a bit of knowledge and background.

I want to thank everyone for taking the time to respond. I have learned alot from this thread. I have even moved another oversized position to options to raise cash based on this thread and others. Based on the replies I think I will avoid callable margin. I may use leverage, but will focus on finding it in ways which give me control over when the asset is sold. I will also limit it to situation in which the yield covers the interest paid. The leverage will probably be via a 401k loan, margin backed by a line of credit (depending on which has the lower interest rate), or additional options / leaps. Thanks again everyone for the responses.

LUK is easy to understand but I dont have any idea what they are worth. They stay within the Deep value circle of confidence which is why the assets are a hodgepodge of companies / businesses. I would prefer if they got some scale and purchased material deep value businesses vs. very small immaterial businesses. Berkadia seems like a move in the right direction. Putting a 10x multiply on the owned businesses and modeling the investment portfolio / mining note is what i would typically do but the owned businesses through off very little cash flow (most appear to be hit hard by the recession), and I have no idea what ACF, Jef, and the mining assets are worth. All three businesses arent in my circle of confidence. Mining would be the easiest but its pretty much a play on China / Recovery, and I have slight doubts on each. Fairfax and Loews are much harder to understand then LUK. But I can put together an investment thesis fairly easily for them. FFH is insurance and investments. Loews is oil and gas / drilling / pipelines. With LUK for some reason I cannot. I can say FFH and Loews is worth x and I am getting it at Y. With LUK I dont know what its worth. --- Its an owner manager stock and just about everyone I like or respect has a bit of it. So I keep watching and waiting for the ah ha moment. Also most of the discussion on LUK seems to be similar to this. People say they are cheap. Others say they cant understand it. With FFH and Loews, the discussions are centered on breaking down the company and identifying the catalysts for each.

LUK is still in the too hard pile but im getting there. I look forward to being an owner sooner or later.

I think LUK just got much more interesting and now has a decent cash pile to play with. I wonder what they will do with it.

I am looking. I like the fact that they dont pay a dividend. We have a great built in catalyst.

Hilltop has always seemed like dead money to me for the reasons listed above.

This inmo is what most of those on the right who are serious about the issue truly believe. I do give you credit for speaking plainly and honestly about it.

thanks for the link.

I want to, but running out of capital. If it goes much lower I will have to add a tiny bit.

Its been an interesting ride and things have largely gone as expected though I didnt think we would see .89. US residents couldnt participate in Rights offering. and the stock pulled back considerably due to offering. I have to believe they have some sort of plan to capitalize on the pull market, or like Dazel said shareholders will push for a sell. Management has to have something up their sleeves. I only wise I had a bit more dry powder.

I agree about the Rep by Rep part, and believe if you looked at it Rep by Rep you would find a starve the best plan on the Right with few outliers. Look at the Debt commission, which was voted down by the Right. http://thehill.com/blogs/blog-briefing-room/news/77673-obama-calls-on-congress-to-create-its-own-fiscal-commission The party of no in my opinion is reality, effective or not. The Economist has even had several articles detailing the faults of the Republican party, and its far from a liberal rag (Though its not as conservative as people think). How do you compromise with people who say the debt is there biggest concern, then say no tax raises, more tax cuts, no military cuts (with the exception of Ron Paul). It doesnt make sense, and shows the deficit is just a political tool. When deficits didnt matter to Leadership in the White House where was the right or tea party? Lets call a spade a spade. That leaves spending cuts, and you cant cut your way to a balanced budget when you ring fence defense. Where is the compromise. Who on the right minus Ron Paul (I think he is against tax raises though) is saying we need tax raises, defense and spending cuts. The only compromise is what to cut, which isnt much of a compromise. In a compromise you give something up. On every issue what has the right been whiling to give up. They couldnt even vote for Financial Reform, which should have been an easy one. Aside from Scott Brown and Snow, I dont know many Senators on the right willing to compromise, but can name dozens of Liberals that have had to hold their noses and voted yes on bills they have hated. The dems largely suck and are spinless in my opinion, and I cringe when I have to think about which party im a member of. I have claimed both in the past, but now have to go with Independent. ---- We have a fiscal problem, a serious problem. One side talks a good game but is full of inaction (The Left) and the other side doesnt really care but wants to gain politically (The Right). Spending down, smart tax rises, and a bit of pain for the American public will solve this problem, but you cant get the 51 votes to agree on that. Look at the UK, its the only way to really address a long term problem. Currently the future of the US lies west. California when you have uncontrolled spending with no tax raises, and Arizona when you have controlled but raising spending with no tax raises. We have the far left minus tax rises, and the far right. Neither is very attractive. I am all for whats going on in New Jersey, and I am for cutting fat, meat, and bone if thats what it takes. I know most will dismiss this due to the source but its very interesting with regard to Arizona and shows what will happen should we not get serious about this issue - http://www.democracynow.org/2010/7/15/tea_party_in_sonora_ken_silverstein The most fiscally irresponsible thing to occur, in my lifetime which is relatively short, was cutting taxes during Bushes reign. To tell the American people they can fight 2 wars and not pay for it and deficits don't matter was a huge disservice and was very irresponsible. At least Regan was fighting the cold war, which is one we could have lost.

Interesting Krugman article. Can we now stop pretending the Republicans care about deficits. http://feedproxy.google.com/~r/EconomistsView/~3/dydCX2HRLEw/paul-krugman-redo-that-voodoo.html

That thesis actually has some merit. We may get a pullback, which in my opinion would be a good thing. ;D

I tend to give cops a pretty long piece of rope cause its a job that has to wear at your nerves but this situation was just plain awful. I have to agree with you though, because shooting a restrained guy who is doing nothing just doesnt make much sense. It seems like its a huge mistake that he will have to pay for with a big chunk of his life. I didnt know about the other cases, it sounds like things are a real mess in Cali right now.

Looks like CNA is finally starting to sell off some risks / float. http://cornerofberkshireandfairfax.ca/forum/index.php?topic=2614.0 I think its a good move. The giant portfolio has been more of a liability then an asset.

$1.5 million is cheap. The guy was shot execution style. Its unfortunate the city has to pay for it though. It is slightly ironic that it comes full circle back to the police.

Very smart man. That's exactly what I was thinking. I figure the rally has one more leg and then reality will set back in. They will either announce that they have capped the well, and it would move up, will announce that its stucturally weak and BP will trade back down a bit. Either way after that, they will have the spill to deal with and the ramifications. Legislation is moving through the House to prevent BP from buying leases for 7 years. It probably wont pass, but people still want blood it seems.

Congrats to BP longs today was definitely a good day. Maybe the under promised and overdelivered and this thing is capped.

Yes im not sure whats driving the sell off. The only down issue is the accident that they had a few days ago. I hope we dip below $5 and Feb Contracts come out, prior to earnings release. Management should have plenty of visibility with utilization this high. I dont see how they arent getting any interest in long term contracts.

Cardboard these are good points and definitely important. You are right Hete wouldnt sell shares because he was an owner and didnt want to be diluted, and these guys likely just want to ensure that they dont go bankrupt during the next potential downturn. FBK and KSP will always be workout situations due to Managements lack of ownership and actions. What I meant though is that low insider ownership will not prevent me from buying a stock. It may make the stock more of a value trade then an investment but I will still look and sniff around. I wouldnt buy my company stock and can understand why the insiders sell quite a bit. They already have plenty of skin in the game via employment. You are right, they would probably allocate capital a hell of a lot better if it was their company.

I read that as he bought the shares and accounted for 10% of the volume. I hope alot of the rights arent exercised, and FFH owns a big chunk like 30% after. I think they will get all the rights from US based employees. I dont think mine will be sold based on conversations with my broker. ---- I never knock management for not owning shares. We are talking about a company that was 1 or 2 bad quarters from bankruptcy. Management always has a gravy chain but they are fairly attached to the outcome of the business. Pushing all in with your life savings / other investment could turn out to be a stupid move. Look at AIG, Freddy, Fannie, GM, Enron, BP, and many other names. If they bought 50k the first thing I think people would say is that is immaterial.

Here is info related to holding MLPS in Roth accounts. http://www.mhinvest.com/supportArticles/MLP-IRA.pdf

I think its an interesting play which may work out quickly which is why I went with the options. I dont think its a long term holding through, but wouldnt want to sell at $10 given a $2 yield within a few quarters. So I bought the Dec options and hope to exercise them should we get $8 - $10. I would stay in until it moved back up to about a 10% yield. At that point you can sell, hopefully get $20 and then buy SSW or FUR. I think you are right on MLP taxation. This confirms it. My hope is that Management is greedy and puts back in the div asap. http://www.investopedia.com/articles/basics/07/ml_partnerships.asp

I like Talebs basic concept. Safety. Having most of your money in low risks investments and shoot for the moon with a small bit. I dont think you can look much at his funds because they would be the small bit shooting for the moon. Similar to Sea Island. I think its tough building wealth and most strategies focus on maintaining it vs building it up.