ubuy2wron
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Posts posted by ubuy2wron
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I know nothing about how this impacts capital ratios etc. but my only question is what took them so long. This is exactly how Ireland dealt with their housing collapse. If this catches fire it could be the single biggest thing short term for housing prices. A rent to own program is a huge win for every one involved .
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ECRI are still defending their recession call. Hope the link works.http://advisoranalyst.com/glablog/2012/03/16/ecri-why-our-recession-call-stands/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+advisoranalyst+%28AdvisorAnalyst+Views%29
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I know Howard I sure would want him on my side if I was in a legal dispute.So I guess Gretchen Morgenson's routine appeasement of her hedgefund cronies desires isn't so far-fetched after all. Morgensen wrote the article last week about this, and now suddenly Kynikos and Third Point are in on it too. I'm certain both Chanos and Loeb never looked at those front-running analyst reports John Gwynn used to give them, and they would never manipulate a stock. Slimey greaseball scumbuckets the whole lot! Cheers!
Speaking of slimey, greaseball, scumbuckets ... did you read about Silvercorps lawsuit filed on the blunder from down under - John Hempton? The scuttlebutt is Howard Shapray, acting counsel to Silvercorp is an absolute animal. The biggest ass-kicker, take no prisoners lawyer in Vancouver. Have fun John.
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The consensus view is housing is a train wreck and will continue to be a mess for years... this trade is so one sided right now that I wonder if the opposite view is not a profitable way to go.
Viking, Me thinks you have not paid much attention to the homebuilders, the index has pretty much doubled since OCT. 4 the only group that has done better have been the European banks which only the TRUELY BRAVE (or foolishly brave) bought in the fall. I think Warrens little company may be one of the most interesting ways to safely participate if this residential real estate turn around has any legs.
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Plus have ya noticed some corporate equities are yielding more than their debt. Also buying stocks and then hedging with the index is basically saying I can pick stocks I can ad alpha. If anyone can make this claim its Watsa Hamblin. As I have said before FFH is a hedge fund masquerading as an insurance company without the 2 and 20 vig and all partners locked in for ever. FFH is the perfect investment for scardy cat bulls right now. If the mkt is turning and about to get a lot harder then Prem will do just fine. Now I am a shareholder again maybe I can make it to the annual meetingFlexibility around taxable gains and losses?
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I bought some today after selling my last bit day before dividend announcement. What part of " the returns over the long term will be satisfactory but lumpy is every one having a problem with"
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One of the most important books in the last 30 years IMO was the Bell Curve. It dealt with how IQ was creating a world of have and have nots. The trends were pretty much undeniable, a small subsection of the cognative elite were going to run the world. It was after reading this book I determined that I would provide my son with the best education that he could attain. He graduated in Dec with a master degree his live in girl friend will be completing her law degree in a few months. They both got a great education and no debt when they graduated. That is it however I may help in a minor way if a home is purchased in the future and I will likely spoil any grand kids a bit but no trust funds or promises of anything other than my endearing love.Racemize I know a TON of people who are careless with their money who were raised in a family that is less fortunate. I would say being of higher socio-economic status would make you more aware of finances and the need to save actually. Having said that, I agree with you that it is hard to have a sense of making it on your own but mostly that is instilled because people always look at you as if you had a silver spoon. The facts are the facts - did you make it off hard work or was it a gift.
I agree but I'll go even further. I think people are allowing their value investing bias to warp their sense of reality.
The "rich spoiled kid that does nothing with his life" is the exception. I'd wager anyone here $100USD that if you took a statistical sample of the children of the very wealthy, they'd blow the accomplishments of the middle-class sample away. And I'd take the same wager on a middle-class sample blowing a poverty-class sample away. Unfortunately, that's life. Sick but true.
My fiance and I had a discussion similar to this when talking about school for her children. She went to an elite private high school as did her older brother. She went to Yale undergrad, he went to University of Texas Plan II Honors. She is a very successful lawyer now and he is a very successful doctor.
I, however, went to a public high-school and did well for myself. However, we couldn't help but notice the difference in our paths. In their school, kids were extremely bright and going Ivy League was almost expected (I think between a third and a half of her school gets Ivy League placement.) In my school, the top 1 or 2 students out of 1000 went Ivy League. It was so fucking hard and it was a good public school. But the odds were WAY, WAY against going Ivy League. You were more likely to drop out altogether than go Ivy League (statistically.)
So, the point of my story is this: the children of the rich aren't spoiled brats. In fact, they probably represent the majority of the top-level professionals in the world. That's a fact. Sorry. The idea that keeping your money or your connections from your children to give them some "independence" or sense of personal achievement is more a nice sentiment than a rational plan (rational being defined as doing what gives your child the greatest chance of success.)
I feel that my job as a parent is giving my child the best chance to be successful. If that means sending them to the most elite schools or giving them access to any connections I have, I will do it if I can afford to do so.
Statistically speaking, I think it'd be a mistake not to do so.
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. Don't blame the gun for being shot. Had to laugh when I read that one but...... why hand out a bunch of UZI's to a bunch of sociopaths. Wall street has shown itself to be a den of thieves over and over again. I am certain we would have a better world if this stuff was not institutionalized. Dark Pools, HFT, Synthetic securities, naked shorting ,credit default swaps, the list is endless, would the world be any worse off if they all went away?
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I was going to post the link you beat me to the punch Parsad. You know if FFH or OSTK never receives legal satisfaction I will be satisified if at least some of the cock roaches are stepped on and at a few of the bigger players have some sleepless nights.Looks like they have tape recorded conversations on these guys, but us Fairfax and Overstock shareholders know it's a hell of alot bigger than this. Cheers!
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A+++++. While I was scribing my response to the debate your post appeared. This is the issue I do believe the public is ahead of both parties on this issue most believe that tax increases and enititlement reductions are required. It is only the ideologues who think otherwise.Tim,
Good post and good points. The part that Buffett is leaving out -- though he has repeatedly alluded to -- is that her benefits are going to be cut.
It's a bit frustrating that Buffett isn't making a bigger deal of the other half of his argument. That is, getting gov't spending as a percentage of GDP down to the level he has talked about -- 20 to 21% -- would require current year cuts on the order of more than $600 billion. Buffett also knows that every day we wait to make these cuts, the more we'll have to cut in the future.
Moreover, and Buffett knows this, in order to make these kinds of cuts, it will have to come in large part from Social Security and Medicare -- since that's where the bulk of the spending goes.
No one -- including Buffett -- is yet prepared to come out and say: "We're going to cut your benefits."
Interestingly, you won't get a Republican politician to say it (you might find a couple but readers get my drift) and you won't find a Democrat politician saying it. In fact, you'll find almost no one in the public eye willing to explain this.
In my experience, the average person -- no matter their political affiliation -- does NOT want to hear that their benefits are going to be cut. This is, of course, particularly true if they are at or near retirement age. And, as readers know, this is a large voting block in any generation but with the boomers now on the cusp of this group, it is a HUGE voting block.
You'll often hear things like: "Well, we need to cut defense."
Sure, and defense is being cut. Do citizens really want to cut it to zero? Unfortunately for proponents of this solution, defense simply isn't a large enough portion of the pie to solve the problem. Again, someone like Buffett, whom actually looks at all the numbers (and what the future holds) also knows this can't solve the problem.
The only thing to solve the problem is a cut in the Social Security and Medicare payments.
People often lament that: "Politicians only want to get re-elected."
Right -- and so, as voters, we get the politicians we want. Imagine a world where no politician was worried about re-election.
They want to get re-elected and so they give us what we want. And, in this instance, they're not going to give us what we don't want.
The populace is not yet ready to see these benefits cut.
My belief is that Buffett knows that the longer this is put off, the worse the risk for the future is. My belief is that Buffett knows, one way or another, the benefits will have to be cut. My belief is that Buffett is only talking about one half of the problem publicly while clearly alluding to the other half of the problem because the other half of the problem is so politically unpopular. (Recall what happened to Buffett when, as quasi-advisor for Gov. Schwarzenegger, he suggested that California should reform its property tax system. If you don't recall, go look it up...after those comments, Buffett was shunted to the background.)
So, this time around, Buffett is only attacking one half of the problem. Meanwhile, he is hoping that he can convince both parties to come together and both be willing to say what needs to be done. If both aren't willing to say it, he KNOWS NEITHER PARTY will say it -- it is still political suicide.
What use is it for a congressperson to step up and say: (1) I'm in favor of tax hikes on the rich and (2) I'm in favor of significant cuts to Social Security and Medicare, IF they are immediately going to be voted out of office. There is no way they'll be able to get anything done.
Both parties have to agree on this.
I hope, as I believe Buffett does, that this agreement is achieved before we have to enter a crisis. And, make no mistake, there will be a crisis unless this is resolved.
The math is very simple. The solution is clear. It will require both halves.
But, there is no question that human nature says it is easier to blame "the other side". The implication of this approach is that, "the problems could be solved, if only the other side would agree with me."
That's an easier approach than for each individual to face the fact that we've got a serious problem -- a disaster -- if we continue to grow GDP at 2.5% and debt at 10%. There is ZERO doubt the lines eventually cross.
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Gee Tim Buffetts secretary may or may not receive promised government benefits. It is pretty clear that if any of the current Republican contenders have their way in the matter the amount of promised benefits she will receive is pretty much moot. Plus since the pie that is being cut up here is a little larger than individuals share of government benefits do you not think it just a little misleading to focus the debate around the share of govt. benefits. I wonder how much of BRK companies profits are derived directly from govt. expenditures.To go back to the original topic of Buffett versus his Secretary, there have been reports that her compensation is modest (around $60,000). Whether true or not it is a reasonable number of a solidly middle class income (which is who Buffett and Obama are trying to imply are over paying due to our coddling the super-rich). Under Buffett's analysis, she is highly taxed and he is not. Where Buffett errs is that he is taking a snapshot in time versus looking at it over a lifetime. Let's assume she has and will earn $60k per year (from age 25 to 67) and live to normal life expectancy for a white female (81 years). In Buffett's thinking she will have been paying nearly 40% in taxes but the reality is that most of it is payroll taxes that she will recoup with "interest." Once you add back the Social Security and Medicare benefits, which I calculate at $1,891 and $695 per month, respectively her lifetime tax rate (assuming she lives to age 81) ends up at 11.5% of total salary. As I pointed out previously, Buffett of course uses taxable income in order to come up with a higher rate (and ignores that medical benefits are untaxed).
If you do not attribute the employer portion of payroll taxes to the Secretary her lifetime effective rate becomes 3.9%. This is all excluding tax benefits for children. Buffett's secretary has one child, per news reports. The additional tax savings per child amount to $34,650 over 18 years ($1,000 tax credit plus impact of additional exemption). Factoring in one child would lower her rate to 2.5% ($63,000 versus lifetime earnings of $2.5 million). If she lives past age 83 she would move into negative lifetime total tax.
Thus the question is this - Is she being asked to pay too much for the benefits she receives in our society?
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David is a master of Spin. Prolly no one is better at it than him right now. Of course he had material non public information the CEO of the company in question should also been fined. In Davids and others case however I am not sure a fine is enough. How many times have agressive hedgies gotten an "edge" and not been charged. For the truely unscrupulous this is just a tax. I am not putting Einhorn in this camp just saying.
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I read somewhere that MSFT hires more Waterloo grads than any other N.A. university. As far as Prem sitting on RIMMs board since it is one or FFH's largest investments a board position can not be construed as taking him away from FFH's interest ,more good than bad can flow to FFH and its shareholders because of this IMO.I think you guys are way over-reacting on how much of Prem's time this is going to consume. I'd attach about the equivalent of him spending 2-3 hours a month on this. Do you guys know his schedule? He is usually in the office from Tuesday to Thursday, and his schedule is non-stop during that time...he barely has a moment to take a leak. He usually leaves a little early Fridays to go to his cottage on the weekends. He probably has more work to do as chancellor of Waterloo than on the board of RIMM.
As for the University of Waterloo. It has arguably the best engineering department in all of Canada, and would rank pretty highly in North America. Waterloo itself is the city that RIMM and Nortel built...a mini-San Jose or Silicon Valley. Tons of startups are there. If RIMM goes under, it will have an impact on Waterloo economically and intellectually. Cheers!
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Hindsight bias is such that what is perfectly obvious now was at best dimly perceived at the time. That said, finding a way of profiting was very hard. (or at least it was beyond me!) Even those expecting a down turn did not expect the cataclysm that occurred.
I was pretty sure that a bubble existed in US housing by the end of 2006 the home builders were in a tail spin which I surmised was a pretty reliable tell. I felt the best way to play it was to purchase puts on the companies selling the worst mortgages hence I purchased puts on Country wide in June of 2007. Shorting country wide did not start to work until almost a year later. I would like to be able to relate how I made a bundle on my country wide bet but the options I purchased actually cost me some money as I got in too soon. The lesson learned is that it is ALWAYS difficult to see which side is winning the war in the thick of the battle.
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If Europe has a serious recession which seems to me a reasonable expectation then robust growth in the US is not very likely that said a housing turn around and I mean nothing more than an consistent uptick in housing construction and a continued uptick in auto sales should be enough to keep the American economy above zero for the forseeable future. If the 99% are not buying homes or cars there is no economy in the US.
The most interesting change in the markets in the last 3 weeks is the fact that the risk on off trade is no longer corelated to the US Euro cross. We should be back to normal volumes starting next week can the mkts continue to climb their wall of worry?
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Eric I suspect that these stats are at least partially a reflection of the of the hollowing out of the middle class through the 30 year trends in taxation and trade. The simple fact is if we have trickle up as opposed to trickle down economic policies going forward we will have a reversal of home ownersip trends and an economy which is rising much faster and lifting ALL boats.I went as far back as I could find data broken down by age. Unfortunately it only goes back to 1995:
http://www.census.gov/hhes/www/housing/hvs/qtr195/q195tab7.html
I find that all the meaningful difference is in the age 65+ category!
All the other age categories report home ownership levels below those reported in 1995. Except for the under-35 category, where there was 2/10 of a percent difference in favor of 2011.
Overall home ownership rates:
1995 Q1: 64.2%
2011 Q1: 66.4%
Age less than age 35:
1995: 37.7%
2011: 37.9%
Age 35 - 44:
1995: 64.9%
2011: 64.4%
Age 45 - 54:
1995: 74.9%
2011: 73.1%
Age 55 - 64:
1995: 79.4%
2011: 78.6%
Age 65+
1995: 77.5%
2011: 81%
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ZH- such a concentration of nasty misanthropes. I do find myself straying over there when I want to hear what the otherside is thinking and they are the other side.perhaps the greater fools in late 2011 are ZH and CW.
We agree on that one.
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I think the single best way to lose money in the mkt is to allow fear and greed to rule your investment decisions. The 2nd best method is the non judicious use of credit , the combination of the two is almost a guarantee of a train wreck. I have had personal experience with almost EVERY method that has been documented here and elsewhere to lose money and I am continually discovering new and creative ways to lose dough. I suspect that losing over all is much more difficult than this thread posits how ever. Mr Chanos has not exactly been knocking it out of the park in the last 12 years which has been arguably the best period to lose money in a couple of generations.
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This position was confirmed by another biography, I have read pretty much all of them and I can remember a passage where Warren compained of being asset rich and cash poor, according to this biographer he solved this problem by borrowing and investing personaly and the bulk of his non BRK fortune was created through this method. So basically his non BRK fortune which was close to zero in the mid seventies was built through a judicious use of margin. It would be an interesting exercise to calculate wether BRK or his personal portfolio has had the higher rate of return.Snowball, p. 343
As he had promised - but on a scale that might have staggered his partners, had they known - Buffett used the cash he got from the partnership to buy still more Berkshire and Diversified for his own account.
p. 395
While he was buying, however, most of the stocks that Buffett had accumulated were faltering. As 1974 began, stocks for which he had paid $50 million had lost a quarter of their value. Berkshire, too, started to slide, down to $64 per share. Some of the former partners who had kept the stock began to worry about whether they had made a mistake.
Buffett saw it just the opposite way. He wanted to buy more Berkshire and Blue Chip. But "I'd run out of gas. I had used all the $16 million of cash I got out of the partnership to buy stock in Berkshire and Blue Chip. So all of a sudden I woke up one day and had no money at all. I was getting $50.000 a year salary from Berkshire Hathaway and some fees from FMC. But I had to start my personal net worth over again from zero."
He was now very, very rich but cash-poor. The companies he controlled, especially Berkshire Hathaway, had cash to buy stocks however.
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I lived through it as well, and it was not so bad, the only thing thats different is now pretty much every one in the developed world is going to have to go through what Canada went through. The downside of that is that it will likely be worse in Canada now than then unless as a nation we decide to live slightly above our means.What a lot of BS. The main reason Canada is not at risk right now is because we went through the deleverage cycle in the 90s. While the US was in the midst of the greatest economy in history Canada was in a 7-8 year recession. I lived through it. It was exactly like the US and Europe now.
Our banks were in trouble in the early 90s; government was laying off and didn't hire till early 2000s; private sector was laying off; resources were at all time lows, oil $10 a barrel at one point.
I personally got laid off and didn't work full time for 5 years. Hence the frugal living and value investing. When I got interviews which I had many, the companies would be interviewing 30 people, they had so much choice.
Public sector employees in Canada have good pensions which they are generally eligible after 30
years or so of service, not 10 years.
Like any other country Canada needs to watch its finances, but its noway even comparable to anywhere in Europe or Japan. IMHO George should stick to value investing and stay out of economics.
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I am basically computer illiterate I do not know how to spell check this post I tried to set up an rss news feed today I do not know how. I am definately part of the 90 % >. My son will be home this weekend to help put of the tree he will set up my rss new feed my wife can not send me a text messgae and she has no excuse as she is only 41.Crazy: 90 Percent of People Don't Know How to Use CTRL+F
This week, I talked with Dan Russell, a search anthropologist at Google, about the time he spends with random people studying how they search for stuff. One statistic blew my mind. 90 percent of people in their studies don't know how to use CTRL/Command + F to find a word in a document or web page! I probably use that trick 20 times per day and yet the vast majority of people don't use it at all.
"90 percent of the US Internet population does not know that. This is on a sample size of thousands," Russell said. "I do these field studies and I can't tell you how many hours I've sat in somebody's house as they've read through a long document trying to find the result they're looking for. At the end I'll say to them, 'Let me show one little trick here,' and very often people will say, 'I can't believe I've been wasting my life!'"
I can't believe people have been wasting their lives like this either! It makes me think that we need a new type of class in schools across the land immediately. Electronic literacy. Just like we learn to skim tables of content or look through an index or just skim chapter titles to find what we're looking for, we need to teach people about this CTRL+F thing.
Google itself is trying to teach people a little something with their AGoogleADay.com campaign, but the ability to retrieve information via a search engine is actually much bigger than the search engine itself. We're talking about the future of almost all knowledge acquisition and yet schools don't spend nearly as much time on this skill as they do on other equally important areas.
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short bac / long MBI seems directional to me, please explain.
See attached link http://www.zerohedge.com/news/was-seth-klarman-just-exposed-bank-americas-biggest-short-and-covert-mbia-long
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Here is my prediction on the next 100 bagger. It will be on the the new low list at the end of the year it will have a mkt cap well under 1 billion. It will have so much hair on it no one here will want to buy it and if any of us do we will sell it long before it reaches multi bagger status. I have owned a few 100 baggers in my career never went along for the the complete ride a prettier girl allways comes along and yo do not make till death do us part pledges to investment s unless you are WB or its your company.
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zerohedge is suggesting its some short BAC long MBIA strategy that Klarman is executing. I frankly doubt it ,kudos to Seth if he pulls it off. The only problem I have with all of this other than its my ox he is goring cuz I am long BAC leaps, is the lawsuit does not benefit those who have suffered damages cuz Set prolly bought them super duper cheap and the poor pension fund that took the loss aint gonna benefit and the villains like Mr perma tan are also enjoying their lives pretty much care free. The teachers who have an under funded pension and will have to accept a lower standard of living for the remainder of their days will get bumpkis from all of this. But thats kinda how it works on wall street.
Alice Schroeder: Buffett Message Is ‘Do as I Say, Not as I Do’
in Berkshire Hathaway
Posted
1- I have been on Wall Street for 30 years. I can assure you I can not name 1 other Institutional AllAmerican Analyst. I also believe her reputation and career as an analyst was also aided by Warrens attention. So much for her fame prior to The Snowball.
2Regarding her wealth I have no inkling however I am guessing only a handfull of people other than Alice are aware of what her net-worth was prior to the Snowball.
3 I have also had the opportunity to listen to Alice speak and she intimated that a great deal of Warrens investment prowress was a result of inside information and that she would reveal all in her next book the great wizard would be revealed to be just a mortal.
4 I only suspect that Warren was more than a little upset of the portrayl of Susie it makes him appear to be a cuckold and her worse. Since then Alice has given him far better reasons to not want to have anything to do with her.