scorpioncapital

the lifespan is also a genetic limit apparently so until we advance technologically, that is not going to creep much higher than say 125.

absolutely amazing, it's shocking how in 200 years we had more progress than in the last 2000! if this trend continues we may be able to say that objectively we are evolving as a civilization.

darn, as a canadian, foreign dividend income is taxed dearly. LUK always pays yearly dividends, if any, unless it's a special dividend.

moral of the story: consider the risk of a majority-controlled public company in realizing value.

70% expect a return between 10% and 20%, that leads me to believe returns will be below 10% or above 20%, unless of course everybody here has read Buffett and think 10-20% is what they should expect :) Here's some food for thought, maybe the return you expect should be the return you need to get to achieve your goals - like inflation targeting. Maybe you need 4% to get your nest egg because you started early so why not aim for your 4%, maybe you need 50% and realize you are screwed (maybe the only way to get 50% is to start a new business).

is your question nominal or real return? 25% is easy if inflation is going up 20%.

I find it interesting that although this is considered a commercial mortgage operation, it is very much involved in residential mortgages as well: http://www.berkadia.com/Berkadia/wcfNewsRelease.aspx?id=159

there is nothing wrong with zero or less cash but you have to make sure the cost of financing is reasonable and you have a back-up plan so you won't get sold out of your best investment at the worst possible time. 50% down years (for the S&P) are rare - back to back 50% down years are even more rare. There is an argument for not worrying about another 50% drop so soon after a recent one and thus an argument for larger than usual leverage to ride the next bubble.

the only danger is a change in attitude, similar to Japan, perhaps a populist movement (the Tea party anyone?) but the argument is simple - human nature makes it hard for people to shoot themselves in the foot, who wants to reduce their standard of living and go through decades of more recession just to avoid a 2% silent, hidden tax on their wealth in the form of inflation? Everyone is screaming publicly but secretly, passively continuing the inflation attitude. Watch what people do not what they complain about.

Read Philip Fischer, 'Path to wealth through common stocks' he says in America, the seeds of inflation are sown in business depressions when inflation appears very low.

Ok, but where's the investment idea? :)

Why say probably when you can find out exactly? He made a 5% profit on it.

Unless it continues, I don't see how returning $1 billion out of $23 billion is going to solve the problem.

If they were younger they wouldn't be as good, if they were older, they'd be dead :) What's the sweet spot for age? Probably mid 40s to mid 60s. In this sense, LUK's management is slightly on the undesirable side, but about 10-15 years younger than Buffett. Still, no offence, but Mr. Cummings looked a bit portly last year, and we do know longevity is somewhat correlated with weight as well as genes. Steinberg looked in good shape.

It's only the beginning, even though it was as low as $12 during the crisis, at $27 it is still a good deal, if you use margin, given its S&P500 status and larger market-cap there are not many investments that look as appealing even at the current price. I'm seriously thinking of divesting my last batch of berkshire to buy more Lu©k

So if public companies offer owners liquidity, the purpose of the market is for owners to sell businesses, not buy them :) We should learn an important lesson here, use the market to cash out. It makes sense, as is actually happening, that in a world awash with money, public companies are being taken private, and many are.

How come, for over 45 years, Warren Buffett has been one of the few to do this? ??? On its surface, it seems too simple NOT to imitate! It's subtle but I would argue that everyone who is an investor is "trying" to do the same thing. Every shareholder of every company, every mutual fund, every hedge fund, private equity, anybody who is an investor...the only distinction is are you a public company or a private one? Berkshire is actually a bit of an anomaly. Buffett didn't have any problem raising money, just like any hedge fund has no problem raising private money - so if you can start an investment pool privately why go public? Going public is if you can't get the money privately or you need more than the appetite of any given group. This is a profoundly interesting question, in a world filled with money why is any company public?

Republican win - It means stocks are going to do pretty good!

that's the rub with the insurance business, you can report positive operating income but if your reserving parameters change, you have to average that over time, in that sense it's reputational and memories are short.

" If you look 10 years out, yes LUK outperformed BRK by 139% but if you start looking out even further, let's say 20 years BRK outperformed LUK by 29% which speaks volumes on it's own. If we look out even further it would be much more dramatic. " It's unbelievable the lack of research people do on these things and think they should post. Leucadia market price Dec 31, 1990: $1.10 Leucadia market price now (ADJUSTED FOR SPECIAL DIVIDENDS, SPINOFFS, AND DIVIDENDS): $33 CAGR (20 years): 18.5% Berkshire market price Dec 31, 1990: $6850 Berkshire market price now: $119,000 CAGR(20 years): 15.3% And yes you are right over longer the difference is even more dramatic, but not in the way you think.

Exactly, the last 4 years have been great to own Berkshire, now I'm shifting into LUK. However, I don't think 4 years is a defense of anything, try 10 years, LUK up over 200%, Berkshire maybe 100%. That's a whole lot of $$$ on the table over 10 years.

I'm shifting into luk from berkshire, berkshire is a great co. but I don't see it outperforming so why hold a single share when a co. like luk can do equal or better, makes no sense...

I wasn't aware Leucadia had any non-insurance float income, what exactly does that mean? I think something like Brookfield Asset Management or Loews has some similarities, but they also have very large differences. The big difference I see at LUK is throwing the institutional imperative against the wall and the concept of bi-modal investing. I've seen several conglomerates that have a large amount of capital in some industry and can't find themselves to sell it all and go where the money is likely to be. I've also seen some very diversified companies that have a little bit of everything and don't make large, concentrated bets on high probability deals. These features distinguish the best investors from the average ones. As a side note, I notice Buffet's new protege Combs bought some LUK in his portfolio.

think of utilities...these are expensive assets, nobody is going to fund it with 100% equity. Think mid-american energy. Think a reasonable return on (usually government-entangled) assets and earning power that are not going away for a very long time. What matters is return on invested capital. Also you'll want to adjust net income for the very large depreciation charges, some of these properties capex is far less than the amount being depreciated. FCF is 2-3x the net income figure.

Bam is one of the simplest businesses to comprehend. The CEO, Bruce Flatt has said on numerous conference calls and reports that the goal at Brookfield is simplicity and not doing things that are complicated. Each annual report has an estimate of intrinsic value so you can compare that to the current stock price. All they do is own real estate, hydro, and infrastructure assets, financed by permanent capital and long-term debt that kick off large streams of cash-flow. Simple!