Spooky

No chance in hell.

Agree with you there. He didn't paint an optimistic long-term portrait of the company. Barring some financial calamity where they are able to be the buyer of last resort, they will struggle to move the needle given their huge size. Given the issues discussed with BHE, if they aren't able to re-deploy their capital in a way that meets Buffett's test for retained earnings, I can see them instituting a dividend which would be unfortunate for me. As a Canadian I'll get hit with withholding taxes. The pendulum of market sentiment has changed from fear to greed, time to be cautious.

Maybe they have some attractive daughters too . Something in the water in Omaha...

Excellent letter this year. Was interesting to see him say that the five Japanese trading houses have more shareholder friendly policies than American companies like buying back shares as a discount and management not being so aggressive with their compensation. There were a few subtle and not so subtle digs at the direction the US is going such as the regulatory aspect mentioned above but also the casino mentality and Wall St. Also that part at the end about going to Omaha to meet Bertie and her attractive daughters was hilarious!

But they already have Amazon in the 13F? Believe it is one of the T&T positions.

This is essentially correct - there is a good paper out there called Buffett's alpha from 2013, I've pasted the abstract below: Berkshire Hathaway has realized a Sharpe ratio of 0.76, higher than any other stock or mutual fund with a history of more than 30 years, and Berkshire has a significant alpha to traditional risk factors. However, we find that the alpha becomes insignificant when controlling for exposures to Betting-Against-Beta and Quality-Minus-Junk factors. Further, we estimate that Buffett’s leverage is about 1.6-to-1 on average. Buffett’s returns appear to be neither luck nor magic, but, rather, reward for the use of leverage combined with a focus on cheap, safe, quality stocks. Decomposing Berkshires’ portfolio into ownership in publicly traded stocks versus wholly-owned private companies, we find that the former performs the best, suggesting that Buffett’s returns are more due to stock selection than to his effect on management. These results have broad implications for market efficiency and the implementability of academic factors.

Prem strongly refuting the MW report.

Just dialed in for the conference call... should be interesting!

Worked, thanks so much!

Can't open the link unfortunately.

This was excellent, thanks for sharing.

Thanks for this post Dealraker. So much wisdom embedded within it.

Good riddance.

Lol! I'm up significantly on my FFH position, a 10-12% drawdown is nothing. I read the report, I did not find it convincing. There is nothing to address the long term performance of the underlying business to state that it is fundamentally impaired. Still think the company is very cheap here.

I believe this is correct - you can't just buy the universe of low PE / PB stocks and expect it to work the same as in the past. Einhorn is looking for companies with a 5x or 6x P/E and that are buying back significant amount of stock. He is not banking on the market to re-rate at a higher price but rather return of capital over time. I like it.

If you don't know anything about the company why are you even posting here? Please at least bring some analysis to the table if you are going to post.

Thanks for sharing. I found his hypothesis that passive investing has broken price discovery for certain segments of small stocks interesting.

Also Fairfax

Me too. He's probably typing a novella as we speak.

picked up a handful of extra shares

If you have Microsoft word you can run a comparison in tracked changes of two PDF files. The results might be a bit messy but it works fairly well. There are also lots of legal blacklining specific tool for comparing documents you could look at.

Does anyone know any good resources that go in depth on the history of Argentina's economic problems?

Beautiful

But this is in essence my point - doesn't Trump's foreign business interests create a conflict of interest that may lead him to make decisions that are not aligned with US interests including potentially not supporting Taiwan? President Jimmy Carter, for example, put his Georgia peanut business into a trust arrangement.

"Feel free to put your support behind a President that is totally comprised by payoffs from China." -> Trump's business receives millions from the Chinese Gov't while in office -> *crickets*