Myth465
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Posts posted by Myth465
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I think even Greenspan will agree that "there was a fundamental flaw" in Ayn Rand's theories.
What would it take to convince you that those theories are simply theories and dont work in the real world?
Would you have really preferred that most of the Major financial institutions in the World have collapsed?
I wouldn't but would have preferred for the government to actually negotiate during the bailout. You cant do bailouts then refuse to bargain / negotiate to preserve a free market that you are basically bailing out. Which was there reason for not negotiating.
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Thats a good point.
Also the HALL VIC writeup provides details as to why the share price is in the tank. HALL looks like a buy in my opinion.
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Thanks you all. I fully expected this thread to turn into a useless debate on free markets vs socialism, and you all have really shown me that I need to raise my expectations.
ERICOPOLY has some very good points.
Most of the documentaries that I have watched about the crisis point to a theme of deregulate or dont regulate. The problem doesnt seem too complex and Paul Volcker (Charlie Rose in September), Warren Buffett (Charlie Rose in September), and other smart people have all offered up excellent ideas on regulation and compensation requirements.
The problem is Washington doesnt get it or doesnt want to get it. We have a bunch of people who believe in unrestricted capitalism or unrestricted useless and aggressive regulation (Fannie and Freddie had 200 regulators and the Congress watching them and failed). The same people who basically caused the crisis (Congress, and Obama's economic team) are running the clean up which makes no sense, and that is the fault of the tax payers.
Frontline Breaking the Bank - http://www.pbs.org/wgbh/pages/frontline/breakingthebank/view/?utm_campaign=viewpage&utm_medium=grid&utm_source=grid
Frontline The Warning (Very Good related to CDS) - http://www.pbs.org/wgbh/pages/frontline/warning/view/?utm_campaign=viewpage&utm_medium=grid&utm_source=grid
Frontline Inside the Meltdown - http://www.pbs.org/wgbh/pages/frontline/meltdown/view/?utm_campaign=viewpage&utm_medium=grid&utm_source=grid
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I agree as well.
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Houston is cold also. Dark and gray and cold. I dont see how people live in London or Scandinavia.
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HALL seems like Sardar's SNS without the hamburgers.
NEWCASTLE PARTNERS L P took it over and now uses some to assist in some control investments. Looks like Pizza Inn is the next target. I like the looks of it and it seems like a great owner manager company, VIC has a writeup which comes public in about 5 days.
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Thats what I dont get. I like just about everything about the company, except for management leaving, the REIT securities, and the increasing leverage. It seems like they have very little equity in the business and that the buybacks will add quite a bit of value for very little costs. A REIT that owns other REITs at high prices is a slight turn off, this doesnt seem like FUR. It looks like all the REIT securities have unrealized gains but, I am not sure why they were bought at the high prices or when they will be sold. If you saw a REIT crisis why would you sell hotels and buy REIT securities. I would prefer a sell of the REITs at a reasonable price, and a repurchase of the convertible debt at 70 cents on the dollar.
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I would be interested in hearing about Good vs Bad Checklists. He has mentioned it in interviews.
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Personally I like HALL, just overweight on insurers. Its definitely going on the watch list.
Canuks what do you all think of Royal Host. Tough to really get my arms around the business but, it looks like there is value. It also looks like they have a gain in there marketable securities which isnt in the stock. I am also trying to figure out if the debentures are a better buy then the common.
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HALL actually looks really good. Flat 08, discount to book of 25% or more, and 92% combined ratio. Plus a buyback program. This is a 2 minute review of there last release but, why so cheap. There has to be something going on. Time to dig a bit deeper.
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Loews and CNA make up about 15% of my portfolio and I own them in equal pieces. I go back and forth on CNA but one thing everyone agrees on is it is definitely cheap.
The only problem I have is it has been crappy for so long. How can you not make money with a $40 Billion Dollar portfolio. Thats alot of loses for an insurance unit to eat though. I feel fairly comfortable with the balance sheet and book value and am hoping that the losses will slow or stop with the new CEO. It is about the cheapest insurer I have found though.
I think DO (as you said cash cow) and BWP (cash cow with built in growth) are the best assets at Loews. I think the BWP GP will be worth quite a bit once all of the expansion projects are complete and as they continue to growth the dividend. The IDRs will become very valuable once they exceed the top Dividend split. Makes it hard to be a BWP common shareholder but, is a great deal at Loews.
I dont mind the hotel business but, think that now is an awful time to own any hotels. This means though that its a great time to be buying. I travel for work and wouldnt stay at Loews due to them not having enough of them and them not having a decent rewards program. My main problem with the hotel assets is that I think the platform is too small. I think they should expand it or sale it to someone with some scale. They have said they will expand the luxury line now but, want an adequate return based on todays occupency rates. I dont think they want to pay up for any type of forecast which shows imporvements.
The last call was very good, they basically said they wouldn't sale CNA because it was intrigue to Loews and that they would prefer and are looking to expand the hotel business. Looking at Highmount's cost structure shows me that these guys know what they are doing. I think at $4 gas it looks like they overpaid, but at $9 gas its a cash flow beast. Based on MCF the world needs around $6 gas and at that price I think its a good price considering the long reserve life. I think CNA and BWP have just been consuming alot of time and capital and now that attention and money will be spread around a bit.
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I finally bought MCF but was unable to grab it prior to the announcement. I thought 1 was coming but, was moving money around at year end and was unable to buy until Tuesday.
Ken Peaks is very impressive and the last presentation was very helpful. They are truly the low cost producer and I like the exploration program that they have put in. The Peak ratio in the presentation was interesting.
Highmount at Loews has all in costs at $2.73 so they too make a very nice investment. A stub investment was mentioned and if someone has enough capital to pull it off they Get Highmount and the BWP GP for free.
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Maybe im weird but that's pretty bad. Others arent much better but, still stuff like this and a 10 million dollar office. Those are not guys I want running MY COMPANY (well actually .00000000000000000000001 of the company).
There is a write-up on VIC which highlights his other bright ideas and his excellent job of taking care of shareholders.
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Based on the interview he is a whistle blower and even if he sang after he got caught why is he doing the most time compared to the people he ratted on.
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Very interesting never thought I would see another board member watching Democracy Now. LOL
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Why Is the Whistleblower Who Exposed the Massive UBS Tax Evasion Scheme the Only One Heading to Prison?
Here is a much better video.
http://www.democracynow.org/2010/1/7/why_is_the_whistleblower_who_exposed
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Thanks for the additional color. I thought he had a decent record but, it seems like he is definitely great at running things once they get going.
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Thanks for the color. That makes perfect sense. I will hold my Leap. I only own 1 and its about 24% of my portfolio. I also lack the margin access to do much in terms of exercising. It sounds like you arent buying due to valuation but arent selling significant portions of your position. Thats what I was thinking.
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We have talked about Clarus a few times on the board and it has been written up on VIC a number of times. I am a small (auctually) very small investor running my own cash. I see 10 - 20 stocks which I think are bargains on a FCF basis. These stocks all go up at some point and seem to go up rapidly (ATSG, FUR, WMAR) so I would rather park cash in these companies then wait for the blank check companies.
On the flip side they seem to work out well and REN is one of newer investments which was a reverse merger type going public blank check company sort of thing. From what I have seen they usually work out, I just have issues with the time value of money aspect of it all. Given my size I cant force anything and if I could and had access to management then I would consider such things. The valuations on these are a no brainier and a board seat / access to management to analyze their intentions would make these easy investments to make.
Without that you are just investing and hoping inmo.
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Uccmal very valid points and you do now have me thinking about collecting the Div and reducing my position.
You wouldnt buy but are you selling currently? Do you feel as though the shares are too rich to hold? Fairfax has a fairly decent quarter from a portfolio position (I think there are 2 - 3 decent gains), but I dont think anything as significant as the bond or cds gains.
Also I am in a very interesting position. All of my assets except for my Leaps are held in Roth or 401 Accounts. Thats leaves me with no available margin. I thought about this a few months ago and called my broker. They said I could exercise my shares and sort things out within a few days. I think that would allow me to collect the dividend but, timing would be very interesting.
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Loews plus CNA combine to be one of my larger holdings.
All Loews Oil and Gas holdings seem to be working out well. CNA and Loews Hotel seem to be the dogs of the group.
CNA is being fixed up. It seems like they have a new CEO to work on Underwriting and are simplifying the investment portfolio. Basically it looks like they loose money on underwriting and that kills most of the investment gains on the 45 billion dollar portfolio. I see potential here and am comfortable with there assets and BV Discounts.
Loews Hotel is very small and they said they are looking to expand it. I think they will stabalize these dogs while making new investments into other platforms. On the last call they said CNA is an intregrel part of Loews and I believe they want to fix it verses sale it.
Here is an interview with the CEO.
http://www.insurancejournal.com/news/national/2010/01/06/106430.htm
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Dont you think the cheap leverage has some sort of value?
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I enjoyed it as well. I enjoy Ron Paul and Peter Schiff but, think Joseph Stieglitz has the most rational view towards economics and globalization. Milton's models are fairly useful theoretically but fear and greed override them when they are implemented. Some of his videos can be found on Youtube.
Obamatax on Banks - Not investment related
in General Discussion
Posted
Most everyone I respect (Buffett, Volcker, and Most Former Fed Governors) agrees that all of the investment banks would have collapsed followed shortly by the Regular Banks and large insurers due to derivatives and counterparty risk. Everyone was interconnected. No one knows, but im sure we can all connect the dots. My question is why do you think everyone is wrong? Watsa seems to have thought as much with his CDS bet.
Many thought Merril was next followed by Goldman. Followed by ................
The trouble with letting companies crash is it sounds great in theory. But what happens is no one lends money to anyone. Our economy is based on trust and you arent going to give money to anyone who you dont know will be around tomorrow. After Lehman. They say credit froze. You dont think they actually meant it. No one was lending money to anyone (Bank Wise). Read the books (Too Big to Fail), check out the documentaries on Frontline (There are 3 to 4 of them which are very good). It was a real crisis not something that was simply made up by the papers. Buffetts phone was ringing because people needed cash. Goldman's former executives literally thought Goldman was next and they used to run the company. Luckily they were in government and could do something about it.
Henry Paulson ran Goldman and firmly believed in free market principles, he made this statement. In Spring 2007, Secretary Paulson told an audience at the Shanghai Futures Exchange that "An open, competitive, and liberalized financial market can effectively allocate scarce resources in a manner that promotes stability and prosperity far better than governmental intervention."[19]
Do you really think he wanted to do the bailouts. Or is it more likely he saw few other options and didnt want to be the guy who let the chips fall where they may.
Wiping out the bond holders would have ensured no one became a bondholder for a bank and would have basically crippled most insurers and pension funds (bondholders). I dont think they did the best job, but I think Buffett gives them credit because there were no easy choices.
I think they should have gone into reservership which is bankruptcy for banks. If they were bailed out then stockholders should have lost it all and maybe even bondholders given some sort of haircut / convert to ownership. I dont agree with the way the bailouts were done, but agree with them.
You do have a point. It doesn't make sense not to negotiate with the business when you are helping it. Then try to change what it does in terms of paying its employees. Im a Libertarian but these guys don't deserve their bonuses. Maybe some of the more profitable units, but not the CEOs and CFOs. Most of these profits are from phony accounting changes and government support. the government should have done what many have recommended and addressed these issues when the support was provided. We agree there.
Finally no one is debating the cause of the recession. What we are debating is who caused the greatest crisis since the great depression. The Fed has inflated asset prices for 20 years and created a super bust instead of a series of Booms and Busts (minor recessions). The minor recessions are very healthy in my opinion, but the super booms and busts are not. The causes are Congress (deregulation and lack of competent regulation), the Fed (ideology devoted to free markets, Greenspan said he didnt even believe in enforcing contracts / policing fraud),