Munger_Disciple

It makes no sense for Warren & Greg to do this deal now. They can take their time & see what happens to the UNP deal and see if the govt lets that deal go thru' or not. If it goes thru' CSX will have no alternative suitor other than BNSF, so Warren & Greg won't have to overpay if they then acquire CSX. If it doesn't, nothing changes in the competitive landscape for BNSF so they don't have to do anything.

I feel your pain bro! I too am a suffering CA resident.

Li Lu moved to Seattle to avoid CA state taxes and then WA state which used to have 0% tax, passed a state capital gains tax which then resulted in Bezos moving to FL. I think FL or TX is the best bet to avoid CA state taxes, all things considered. But the weather in FL & TX is awful. Many rich in Silicon Valley moved to Incline Village in NV just across the border from CA. You can drive to the bay area in about an hour from there. As a result, home prices in Incline Village went thru' the roof. This article may be interest to some of you: https://smartasset.com/taxes/state-capital-gains-tax CA is the absolute worst state to realize capital gains at 14.4% top tax rate, with federal at 23.8% top LT cap gains rate, you have a cumulate top tax LT cap gains rate of 38.2% for CA residents.

Todd seems to trades too much, but not Ted. Ted seems to specialize in distressed deep value type companies (SIRI, DVA etc.), a.k.a. shitcos. But he also bought (and later sold) AAPL, a high quality compounder, in the past and has been instrumental in educating Warren about its merits which then led to Warren making a massively successful bet on it. However by focusing only their stock selections, you miss the great value they both add to Berkshire. Todd has been the CEO of GEICO for five years now and has been instrumental in its turnaround. Ted has also helped with German acquisitions and other private deals; and with the massive success BRK had with AAPL. I as a long term shareholder, feel fortunate that we have both of them working for BRK. They have already added tremendous value and will continue to do so under Greg going forward.

Barron's piece on Warren: https://www.barrons.com/articles/warren-buffett-value-working-past-65-1cf1d87f?siteid=yhoof2 Amazing illustration of the power of compound interest and a long, healthy life.

2,000 Class B shares sold by Ajit Jain (shares owned by his foundation): https://www.sec.gov/Archives/edgar/data/1067983/000172845125000006/xslF345X05/primary_doc.xml

Well said!

Excellent post @gfp! QE did appear to have created a large number of asset bubbles due to deprivation of safe income producing securities from the hands of private sector. These include VC, PE, PD, Crypto, real estate & publicly traded stock valuations, especially in MAG-7 & other tech stocks.

There is no Warren premium in the stock now especially since Greg is the CEO for all practical purposes at this point.

@charlieruane Some SIRI news FWIW: https://www.the-sun.com/entertainment/14910416/howard-stern-show-canceled-contract-up/ Canceling Stern show. Now put the baby in milking mode before the last boomer leaves the platform while the younger subscribers sign up for Spotify or Apple Music.

Amen!

I don’t understand the attraction of SIRI but then Ted is way smarter than me

Looks like Ted is reinvesting SIRI dividends and pehaps also recycling DVA proceeds.

I prefer massive buybacks assuming the stock is fairly valued (which is most of the time for BRK) instead of a special dividend. Far more tax efficient for shareholders and preserves flexibility for future capital allocation IMO.

Thanks @charlieruane for the Chris Davis clip. FWIW Buffett after his retirement announcement in May this year, has said that by continuing to be the Chairman, he could help Greg if he wanted to do something big by getting it approved by the board because he is a very large shareholder & the board knows he has close to 100% of his net worth in the company. I too watched Sue Decker on CNBC in 2024, and knew she said that about special dividends but disagree with her that it is the better approach for LT owners. Perhaps a combination of smaller annual dividends coupled with a special dividend once in awhile if they really can't even buyback a lot of stock after taking care of all the internal/external reinvestment opportunities.

Decker owns the least amount of stock among board members approaching 0 dollars as well as 0% her net worth, so it's all well and good for her to imply a special (large) dividend. But it will be horrible tax-wise for LT owners who have a large % of their net worth in BRK stock. So I hope the board shoots it down. Ideally I prefer 100% retention of earnings where every $1 of retained earnings produces > $1 of market value. But if all such opportunities are exhausted and buybacks are not attractive due to high market price of the stock, then a small annual dividend that can be periodically increased is far better than a large special dividend. It also helps the LT owners to slowly adapt to the new reality if it is indeed the case, i.e., BRK can't retain & reinvest 100% of its earnings in a way passes the earnings retention test described above.

Can you elaborate on this? What comments are you referring to? Thanks

I bought a tiny bit too today, but not as tiny as your trade . It's my small way of supporting & encouraging Greg!

It's crazy but BRK is nearly flat YTD, now trails the S&P 500 index by 7%. It doesn't make any sense to me. AI party is back on!

Here is a snippet from the Oracle himself from the 2016 AR: By the early 1990s, however, our focus was changing to the outright ownership of businesses, a shift that materially diminished the relevance of balance sheet figures. That disconnect occurred because the accounting rules (commonly referred to as “GAAP”) that apply to companies we control differ in important ways from those used to value marketable securities. Specifically, the accounting for businesses we own requires that the carrying value of “losers” be written down when their failures become apparent. “Winners,” conversely, are never revalued upwards.

That's the one. cc: @Marco Van Basten The only other (private) investment Munger had was in apartment buildings in the greater Los Angeles area managed by his friend Avi: https://www.fa-mag.com/news/billionaire-charlie-munger-s-timely-apartment-bet-began-with-hebrew-bible-64218.html

Please do inform us.

You got it backwards here especially with respect to Pabrai. He bought Buffett charity lunch, a.k.a. "The Lunch". And then Buffett introduced him to Charlie in Los Angeles (Pabrai was living in Irvine, CA at that time). I believe Pabrai, Spier & others were regularly invited to the " Berkshire/Buffett Brunch" at the annual meetings for many years. Of course Charlie liked having groupies around (who doesn't?) but he never invested with Pabrai, Tilson or Spier. He only ever gave money to two outside managers in his life: Li Lu & an Australian-American fund manager.