cwericb

“I would have rather Prem and team fairly compensated salary/bonus based on performance wise instead of having to issue a dividend.” I don’t necessarily disagree with that but doing it in this way nothing is hidden, it is transparent and equitable to all shareholders. It also helps prevent some of those obscene bonuses paid out to senior staff in some companies. I also suspect there may be some tax advantages for Prem in doing it this way (?). But why not set up a profit sharing plan for the team and shareholders by extending a dividend based on the performance of the company? Also I would imagine that Prem and team are not the only ones who depend on this dividend. I suspect that there may well be many shareholders who depend on that dividend to provide them with income. That in turn perhaps makes FFH shares more desirable, increases demand and in turn increases share price. There is more to share price than company value.

This subject comes up every year at this time and Fairfax is always criticized by a few for issuing a dividend. Why criticize encouraging management to have a stake in the company and be rewarded similar to the rest of the shareholders? however, I would rather see the dividend based on yearly performance rather than a fixed amount.

Eat at Harveys fperhaps once a month. Food’s decent but service is slow. Eat at Swiss Chalet once a week during the winter. Food is usually very good and have never had chicken that wasn’t moist and tender. Roast beef is not bad and steaks are usually okay but have had a few that could have been better - wife says ‘what do you expect when you go to a chicken place and order steak?’ Clean, very good service, and excellent bang for the buck but a 20 minute wait for a table is normal on Friday evenings. I rarely ever complain when eating out, but did once at Swiss Chalet about a steak. The manager immediately came out and was very concerned and wanted to know all the details and made a correction to the bill.

-1.27% Very disappointing considering I was up by 7% in April. Since the Dow was flat and Toronto was down about 7% in 2015, I guess I shouldn’t complain. But after being up 16% in 2014 it’s a bit of a kick in the teeth. I track my results separate from an account I have invested through a financial guy and for the first time ever he beat my results, primarily through currency, which gave me an overall result of +1.2%. I’ve done worse. :) Oddballstocks: Can’t go wrong with the home purchase. Markets could nosedive, housing could dip, but you still have a roof over your head and the home in which you chose to live.

My two cents worth. A few reasons why I have held FFH since 2008: I am not nearly as smart an investor as those running FFH nor as astute as many on this board, so I let Fairfax invest for me. They may make mistakes, but I am sure they have a lot more expertise and access to information on the companies they buy than I do. Fairfax has the ability to force some of the companies they invest in to become better companies, I do not have that ability. Eg, The Brick, Blackberry (a work in progress), etc where they can plug in a manager who can effect changes. I do not have the expertise to hedge, FFH does that for me. It is my belief that Fairfax is building a strong, world-wide insurance company that will prosper well into the future. Everyone talks about their investments, but little is said about their growth as an insurance company over the last half dozen years. It is probably the only stock I hold that I really do not worry about even when it drops. It may not do as well as many, but if the crap hits the fan, of course share price may drop but I don’t think it will suffer as much as my other holdings. November 6/13 their share price was about $440 CDN, Nov 6/14 their share price was about $540 CDN and today price is about $640 CDN. I find it difficult to be disappointed with those numbers. eb

Is there not a flaw in a system where one individual can cause a party to lose an election primarily because that person is so arrogant and oblivious to public opinion that he did not have the good grace to resign two years ago before some of the best people left the party? While he could have left with some dignity back then, he let himself become reviled and fired by the voters. Unfortunately he took a lot of good people with him. Voters need to have more say in who becomes the prime minister. Had the Conservatives acquired a new leader a couple of years ago I would be willing to bet that the election results would have been quite different. But now Mr. Harper is gone and we will see what we have in Mr. Trudeau. I do like his planned Infrastructure spending. Some of our roads, bridges, sewer systems are in deplorable shape and rectifying the situation is quite labour intensive and should give a boost to employment.

Everybody's gotta eat. :)

Yes, as TwoCities said, check out Altius. It is a diversified mining royalty company operating in Canada that is operated by some pretty smart guys with a proven track record. There is an extensive thread on Altius on this board.

I'm waiting for Snoop Dogg to run. Maybe Snoop Dogg / Ice-T ticket, that might even get me to register to vote. But Sarah can see Russia from her house and this could play an important part in Donald's Foreign Policy - which I don't believe he has mentioned yet other than the expulsion of all them furreners.... Sorry for the inane remarks, but they seem appropriate to the situation. Unfortunately.

Personally I'm waiting for the Trump-Palin ticket.

Ditto :)

http://www.valuewalk.com/2015/06/exclusive-interview-with-keith-smith-of-empire-valuation-consultants/ Interview with Keith Smith. Guess this was mentioned in thread about the interview, but it's interesting to see the board get recognition.

Ben, but the point I was trying to make is that Fairfax holds a lot of investments that are outside of Canada. Eg, take two Canadian companies with a share price of $50 CDN. One has all their holdings in Canada and one has all their holdings in the US. If the Canadian dollar suddenly dropped, say 30%, the share price of the company with the US holdings would jump by about 30% in Canadian dollars while the company with the Canadian holdings would remain stable.

“...exact hedge against FRFHF...” Ha, even I am not sure what I was trying to say there! FRFHF is simply Fairfax shares priced in US dollars. What I was getting at and to put it simply, is that if the Canadian dollar sinks against the US dollar the price of FFH shares in Canadian dollars tends to rise by a similar amount - in addition to any increase or decrease in the value of the shares themselves. Because of that - for me at least - it works as protection against a fall in the CDN $ vs the US $.

Well it seems to be an exact hedge against FRFHF of course and it seems to run as a very close hedge against the US/CDN dollar, but I haven’t gone to the trouble to do the math. Also Ben is right. The value of Fairfax is directly related to their holdings which now are pretty well all over the world. But this does protect me against a decrease in the value of our currency. (It will also be a negative as our dollar increases vs the US dollar) The bottom line here, for me at least, is that I find Fairfax to be a comfortable investment for three main factors. First, Fairfax is a good company for various reasons. Second, it’s share price fluctuates with the US dollar and provides me with protection against a fall in our currency. Thirdly, it is also a hedge against deflation. If one or two of those factors becomes a negative, I have hope that the remaining factor or factors will help offset that, at least in the long run. So I see it as a relatively safe place to invest. The biggest concern I have with Fairfax is if we run into several catastrophic events that seriously impacts the insurance industry. However, should that happen I assume that it would precipitate a hard market in the industry that might drive some competition out of the business and would also lead to higher premiums and thereby increase the float over time. Am I correct in that assumption?

Fairfax results and holdings are stated in US funds. So as a Canadian investor, FFH share price will fluctuate in correlation with the US/CDN dollar. If the CDN dollar drops against the US dollar, FFH shares will increase in Canadian funds (aside from any fluctuations in actual share value). The reverse is true when the CDN dollar increases, share price will reflect a similar drop. So when we had the runup in share price from October to March the price rose by about 30% in US$ but rose by about 43% in CDN$. During the same period the CDN$ dropped by 13%. So FFH also works as a currency hedge if you reside outside the US.

I might also add that FFH also acts as a hedge against the U.S. dollar.

Just my two cents worth. Fairfax represents a significant part of my investments. They have done quite well under present conditions and I see no reason why they shouldn’t continue to do so. They are expanding and diversifying constantly with both their insurance business and their investments. Certainly there will always be other companies who will do better going forward, but Fairfax should continue to do well. However, should we encounter a period of deflation, many of those other companies may suffer and give up their gains. Since I'm a bit lazy and don’t consider myself an astute enough investor to hedge my investments, I allow Fairfax to do this for me. I’m not banking on Fairfax making billions with deflation, but I am thinking that if we hit a period of inflation the hedges will, at worst, help protect FFH’s value and at best perhaps help make up for potential losses in my other investments.

Is the Board becoming a victim of its own success? I don’t think so, but the biggest difference over the last few years it that the number of subjects of discussion has increased as the number of posters increases. that is only natural. But times are also far different too. Fairfax is not struggling for survival or to regain its reputation, the dark days of 2009 are behind us, and there is not much exciting going on in the markets right now. Also the board is much more international than it was originally. I check the board several times a day and still find it tremendously useful even if it is a little less concentrated than it used to be. I do notice that many of the older members post very little and on the other hand I am amazed where some others get the time to make so many posts. I wish there was some way to identify poster’s age group, occupation, investing background, or a rough total value of their investments because that can reflect on their credibility. Of course there is no way of checking the validity of the information they offer, but at times I will check to see how long they have been board members. But some kid living in their parents basement maybe posting their profound thoughts or paraphrasing something they read on a subject. However, if anyone is a little disillusioned by the changes here they need only look at the inane comments you will find on Stockhouse or Yahoo boards to see how great the quality of our board is. I also agree that a little more participation by Sanjeeve would be welcomed, but with the number of posts and the number of subjects how would that be possible? Methinks he has a lot on his plate at this time in other areas.

Article in Seeking Alpha today: Fairfax Financial: Intrinsic Value Exceeds Market Price http://seekingalpha.com/article/3184136-fairfax-financial-intrinsic-value-exceeds-market-price

So this investigation should put these questions at rest - from a legal aspect. However, there will still be many former Fibrek shareholders who will feel that Fairfax’s “fair and friendly acquisition” moto is a bit of exaggeration at best and a little self serving or hypocritical at the worst. Perhaps a better motto would be “all’s fair in love and war”. They bulldozed through a deal at the expense of Fibrek’s shareholders that was solely in their self interest and cut off any bidding war that might have developed before it had a chance and then you just have to wonder about the participation of Steelhead. The moral here is to be very careful in buying into any company in which Fairfax has an interest because Fairfax can be just as ruthless in the pursuit of their own interests as any other large company. “There is a difference between what is legal and what is ethical” Some here would prefer to ignore that aspect.

I must be missing something here. How was Fairfax forced into a $1.00 bid? Mercer floated an offer of $1.20 in November 2011. Fairfax countered saying the company was worth $1.50. My understanding is that It was AFTER rejecting the $1.20 bid and declaring that the shares were worth $1.50 that Fairfax entered into the lockup at just $1.00. Then Mercer raised their offer to $1.30 and in April of 2012 raised the bid to $1.40. Despite all the excuses being made, Fibrek shareholders lost 40% of what they should have been paid. In what way does this qualify as a Fair and Friendly Acquisition? And just because something may or may not have been illegal does not necessarily mean that it was ethical, fair or friendly.

Site fixed now. eb

Taking me about 20+ seconds to load a page today on Chrome and forever on Firefox. Is this just me?

Wow what a left turn. Any respect I had for Prentice went out the window when he resigned the seat to which he had just elected. Has that ever been done in Canadian politics before? Talk about gathering up your toys and going home! Probably won’t be nearly as bad as some think and it may have its overall benefits for the people of Alberta. Might have been better to have seen a minority NDP government, but the people have spoken. Hopefully this will not be a re-run of what happened in Ontario. Can’t help but think this is just one more demonstration of the ill will Harper has generated across the country.