SharperDingaan

Nah ... I'm just ahead of everyone else The whole currency thing is that if you can pay for something with it, it's a form of cash; we just don't like the form. Could be USD, bricks of cocaine, hi-tech chips/weapons, oil, 'influence', or BTC; whichever is 'best' depends upon the purpose. Materially changing valuation is the norm, not the exception. SD

Doesn't really happen though; think of a cash holding in BTC/BTC-ETF. If you think your cash/BTC is going to be worth more next year (by at least inflation) you would be inclined to HODL .... but in reality, the cash/BTC is going to be swing traded around a core holding; hopefully for gains that will be spent within the next year. But ..... while the gains are free money, they are only going to be 'spent' as long as they are relatively small (low spending bar); the reality is that the larger gains are going to be 'invested' ... in new truck/car, mortgage repayment, house upgrades, more bonds, etc (high spending bar). But what when the cumulative gain to date has become so large, that you have now both paid off everything, and established the family 'pile' for generations to come? ... any further gains are now destructive to both you and your family. The gains get given away ... ideally on something lasting and worth while. It used to be that cash (at best) earned a real return of 0-1%; but in the BTC age ... 50%+ year is not that unusual. Changes the whole perspective. SD

Nobody is indispensable - even Julius Caesar. https://en.wikipedia.org/wiki/Assassination_of_Julius_Caesar SD

If there is going to be a lasting peace, there is going to have to be a 2 state solution; as/when there are 2 states, this will be a non-issue. After last night's fiasco, one has to think the current coalition government is done; it has now been 6 months+ since the Oct 09 attack, and the blood-lust has to be pretty much over. SD

The best outcome would be peace breaking out; Israeli withdrawal from Gaza, unrestricted aid flows across Gaza, Gulf state funded field hospitals on the Egyptian side of the Rafah crossing, Houthis give Red Sea shipping a break. Oil prices fall like a brick, partial diversion of Israeli weapons flow to Ukraine, and Israel prepares for a new round of elections. Not in many peoples interests, but the calculus changed last night. Longer term; all that destruction in Gaza has to be rebuilt. Most would expect a change in Gaza's status, gulf state money combined with Gaza labour, and Israel excluded as much as possible. Without the war spending and cheap labour, Israel goes into recession. SD

I routinely point out to both undergrad/grad students, that to get ahead - you must expose yourself to risk; and that most of us will only have two risk-windows per lifetime. We have a variety of tools by which we can mitigate and/or position ourselves to benefit from risk; but it's to us to both act, and recognise opportunity as it is passing. Most people lack the imagination, and the ability to apply; hence the well-known 'you can lead a horse to water, but can't make it drink'. However, while there are infinite possibilities, whatever you choose also needs to be a good match for you. No different to finding your 'significant other'; yet look around you .... at how few seem to be able to it. SD

The hard reality is that Israel f****d up badly when they struck the Iranian consulate in Damascus; senior officials rolled the dice, and almost pulled the US and UK into Gulf War III. There are a lot of bills to pay for last nights bail-out, and there will be consequences. The only reason we don't have Gulf War III this morning is because Iran also has very smart generals, who managed to launch a face-saving sovereign-on-sovereign strike that was designed to reliably fail. Now it's purely a personal matter between families; the perpetrators will be known, and its old world 'eye-for-an-eye'. One day ... they will be suddenly gone, the matter closed, and we will all be the safer for it. https://www.aljazeera.com/news/2024/4/4/why-does-israel-keep-launching-attacks-in-syria Lot of very smart people acted last night; we owe them all an enormous favour. SD

There is nothing wrong with dissenting opinion, and it is to be encouraged; but there's also reality. China is a communist country, and for the western investor, property rights are about 'might is right'. You have them only while China needs the West more than the West needs China, after that .... not so much. If you were unsure of that, look no further than both Hong Kong, and Taiwan. Participation also doesn't mean investment in China. China is well known for over-developing mines in 3rd world countries, and using the resultant surplus global over supply to force down the commodities price for decades. When the host nation objects, the mine and rail/port labour is simply replaced with expats and the commodity proceeds processed through the Chinese banking system. Object some more, and you're replaced with civil war. Age-old fair game .... but it's the real meaning of 'belt and road'. However; every former Colonial Power has learnt the hard way, that eventually the natives take back the assets, and the asset strip is a time limited engagement. Changing the face of the colonialist doesn't change the eventual end-game. It eventually catches up. China has made amazing progress over the decades, but it's been very much along the failed 'Asian Tiger' model. Same as Japan; burn the population pyramid to do it, finance it with extraordinary credit expansion, and allow the wealth to build up in highly leveraged real estate. Thing is ... you run out of babies 'cause everyone is working stupid hours, the real estate depends on ongoing ability to repay, and the whole thing tanks when the increasingly limited Chinese labour pool eventually ages out. As with Japan, interest rates plummet/stay there for years, and the whole world exploits the dirt cheap money. Do you really want to be the lender in this, or would you much rather be the borrower? Then add to it the dictators playbook; when things aren't going well at home, distract attention by 'creating an enemy' that everyone can be rallied around .... and in a communist country, there is only one 'leader'. If you're going to take this kind of risk, there are a great many other places with better returns/unit risk in which to do it. Not what many want to hear. SD

Do this in a tax exempt/deferred account (TFSA/RRSP), and the math looks a little different SD

The reality is that BTC-ETF's are not 'investments'; they are trading sardines, and 3-months is a long time. Lot of folks think BTC is 85K 4-months out (+21% from today's 70K ); but obviously it's not a straight line rise. Uncertainty drives FOMO that drives volatility that drives gambling. Should BTC fade back to 65K; that 4-month gain at 85K is now +31% China's BTC-ETF introduction has indeed the potential to move the market, but to move the dial it has to overcome the widely expected post-halving mining drag. There's a reason why Chinese BTC-ETF's are coming to market, after the current halving. Step away for a time, break the feedback loops, and come back with fresh eyes; the bunnies will still be there later SD

Over time each becomes its own very strong stand-alone regional business. Each does a small IPO (10-15% of the entire business) to establish a public market, a current share value, raise its own capital, and create the ability to issue its own stock options etc. The other 85% of the shares remain held by FFH, with dividends flowing up to FFH as already occurs. Puts an easy daily minimum sum of the parts value on FFH, and is standard operating procedure in most corporate finance shops. Nothing magical. SD

There are many different methodologies by which to value a company; no 'one way' is right. Most often one would use a weighted average, adjusting weights to each methodology according to whatever one expects the business climate to be over the next year. Most weighted averages would point to north of 1,600/share. Some (MW); will focus on only the lowest number, but if the arguments just aren't credible .... it's no different to the whining kid in the back of the mini-van. If the squeaky wheel gets the grease, simply buy in their shares at adjusted book value and cancel. Thank you for making it possible in a single transaction! and an adjusted book value towards 1,600. Our own view is that the US, India, and Euro-bank are obvious concentrations. One business growing into 3 new ones over time, that ultimately get spun off into majority holdings under a holding company paying a very high dividend. Good luck to all. SD

We expect a mining sell-off the closer we get to halving date, and lower prices through the summer. Anticipate buying back cheaper. We've also done very well via the BTC-ETF's; but we're trading stupid quantities of units, and our portfolio distortion is extreme. Needs to end. It also doesn't hurt that MW has also given us another opportunity by which to temporarily park some change in FFH A month out, we could well be up another 4% SD

Disclosure: We put a swing trade on BTC today, and are back down to a neutral position. We still believe, but need to reduce our market exposure until after the halving. SD

As a small-cap investor for decades, we find this whole conversation both instructive, and highly amusing. Einhorn is quite right in that small-caps don't feel the love when they do well; but why would you expect them to? They can't be bought/sold in quantity without moving the price, hence are useless to the trading market; the better trading solution is actually a small-cap ETF where the liquidity is deeper. And with that small-cap ETF, all that one need do is set up a 'bot up to buy/sell against an algorithm; and get out of way. You, as the human ... are just a liability. To do well in the small-cap space, you have to accept the inherent higher risk and view the companies as businesses - not investments. Know what they do, how they make money, where their commodity cycles are, etc. It's about continuously growing cash flow via dividends, and the reinvestment of swing trade gains, through time. Playing the same game multiple times, versus the gamblers once and done. Not conductive to typical trading. However, play well, and the dividend yield on your original $X of investment; moves to infinity over time, and becomes infinity when gains to date exceed the original investment. Hence swing trades aren't just trades, they are also a strategy not conductive to typical trading. Be mindful of the conversational framing. SD

The uncomfortable truth is that EIA reporting just isn't accurate, or reliable. It has some useful data points, but the 'roll-up' to aggregate quantities is very suspect. Sadly, the EIA is now also far from what it was, and has become a political tool - to artificially create lower prices at the pump. It has been well known, and for some time, that US shale was high-grading. Much of the recent consolidation has been driven from high-grade (high flow, fast deplete, few wells) no longer being available, and consolidation for 'manufacturing' (moderate flow, moderate deplete, many wells) purposes now being the next best alternative. Within reason, drilling long horizontals close to each other, fracking them, and controlling pressure via water injection, will get you comparable production - but at the price of a material bump in initial capex investment; hence consolidation. The downside is the huge quantity of water required, a growing issue in the US. It has also been well known, and for some time, that the EIA has issues around liquids and gas reporting. Report gas at the traditional 6:1 gas to oil conversion; as the shale gas cut progressively increases, a rising portion of the reported 'oil' production isn't actually real. Then remind yourself that shale is a gas field producing oil as by-product ..... Most would expect Canada's TMP expansion to rapidly reach its new 590K bbl/day of egress, and that most of it will go to the western US (shortest sea route). Post refining; every 1 barrel of crude imported will turn into 1+ barrels of refined/blended product, and that '+' will be reported by the EIA as US 'production'. Manipulation that is just par for the course. SD

An investor could simply take their money, and buy either a BTC-ETF, or CORZ. It's real hard to see why CORZ would be the better choice, and harder still to forecast if they will still be here a year out. SD

Nothing wrong with a fat pitch! The Satoshi Nakamoto paper came out in late 2008/early 2009; if you had a lot of BTC in 2012 it was because you were mining (& therefore knew a lot about BTC). Quite a few others (who read the paper) also saw value in BTC, and bought in their BTC at ridiculous prices (vs today). A lot of folks on this thread. BTC isn't a buy/hold, it's a trading sardine. Same as most everyone else we swing-traded and did very well, often making more on the down leg than on the up leg; but unlike most others (we're survivors from o/g), we also kept taking $ off the table, and repatriating. Simply 'cause once you have your first millions, the rest aren't particularly useful - so why incur the risk to get them. Very anti-capitalist!. By market value, we hold a lot more BTC than we would prefer; and if the price rise keeps up - will have to sell it down again to further repatriate capital this year. Ideally, the same as a market maker; we get to slowly accumulate by selling 4 of every 5 BTC we buy, and are funded entirely with house money. Point here is that there are many roads to Rome; the fun is in the journey getting there, not the destination. SD

Not to knock it, but this whole MSTR vs BTC thing is very funny ... No doubt MSTR has done very well, & continues to do so; power to them ... but it's only a 25.84B market cap. Whereas BTC is currently at 1.37T; and if it makes the much touted 'next level' 100K/BTC by year end; it will finish the year at around 1.93T - amongst the top 5 market caps in the entire world. MSTR is the mouse pissing on the elephants leg! BTC is barely out the gate. At this point, pretty much every wealth management & sovereign fund in the entire world now needs to have at least 2-5% of AUM in BTC. Every pension fund, large corporate, and state treasury around the world now also needs to have at least a 5-25% weighting to BTC within its cash equivalents allocation. And it isn't going to take years for adoption; it will only be as long as it takes for the various Investment Policy Statements to come up for renewal. And all this ..... is just the institutional side BTC is capped at 21M, but the number of BTC-ETF units is unlimited; hence as BTC rises, units simply get progressively split to keep the price around $20/unit, and the BTC-ETF becomes the ubiquitous equivalent of a $20 bill; backed by BTC and not a central bank. With central banks quite happy, as BTC-ETF's can easily be restricted within national borders; whereas BTC itself is borderless. Longer term, BTC is like owning Standard Oil and US Steel when Rockefeller/Carnegie/Morgan were still running the show. The players change, but the game essentially remains the same; may we all do very well SD

The actual FUD is 'everyday change'; framing it as Bitcoin is just gaming. 'Everyday change is a highly volatile commodity with an extremely uncertain future. A prudent person should assume everyday change will fail, if for no other reason than that most new things fail'. Folks just don't 'get' Bitcoin, don't trust it, etc., etc. .... Excellent!, that's the norm with change, and why we can all still buy it cheap. But the reality is that when the years of accumulating evidence demonstrate that Bitcoin acceptance is increasingly becoming the norm, and Bitcoin continues to rise in value; it's simply prudent to go with the evidence. It doesn't mean you're a believer; but the less folks are able to change, the more violent the eventual change will be. It's also not new. Different context; change Bitcoin to Hitler, and folks to German citizens in Germany, in the early 1940's .... German citizens just don't 'get' Hitler, don't trust Hitler, etc., etc. .... Excellent!, that's the norm with change, and why we can all still buy Hitler cheap. But the reality is that when the years of accumulating evidence demonstrate that Hitler acceptance is increasingly becoming the norm, and Hitler continues to rise in value; it's simply prudent to go with the evidence. It doesn't mean you're a believer [in Hitler]; but the less [that]German Citizens are able to change, the more violent the eventual change [to Hitler] will be. Nobody wants a repeat of the Hitler experience, but the contrast is very instructive. Overlay the increasing radicalisation of much of Europe, and the yin of Bitcoin to the yang of fiat currency; and the intrinsic value of Bitcoin becomes a lot more obvious. SD

Re crypto investment: To most people crypto investment is simply entertainment; mouthing off for kicks/glory, and gaming for a quick fortune over a few hours/days. It floats both the development and social media communities, and creates a market for the sale of sh1te coin. Not a lot different to venereal disease, it's just part of the environment. To many on the cocktail circuit, it's just an entertainment talking point. It's a scam!, that SBF crook!, that Reddit IPO - what a dog! Lot of gaming, trading of tips, and a lot of what's 'said' is often not what's actually done. But .... even if they had been tipped to buy Apple at $10/share, most would simply freeze in the headlight. Noise. Both the trading and the development community are all about the latest sardine; if you aren't trading it, or developing/marketing it, you aren't playing the game. Get rich by actually investing, and you're despised - as you've done squat, and are nothing but a HODLer. Of course .... they have to trade &/or develop, whereas you don't. Jealousy. The reality is that crypto has no comparable, and its use in investment is rapidly evolving. Like it or not it is functionally BOTH an asset class; AND its main asset (BTC), is a cash equivalent; get over it. Recognise that every IPS that does not include BTC/CBDC in its cash/cash equivalents weighting is obsolete, and you immediately add a sizeable global demand to BTC. It takes both courage and maturity to be able to think for yourself, and more still to act on your own conclusions. You get paid to recognise opportunity, take on the risk, and you do what you can to mitigate it. Do it well, and over time, you can expect to become very successful. And all those 'haters' ..... actually work for you ... at zero pay! SD

"But for me, hoping for 100-200% gains from this investment over the next 5-10 years, I would not sell because of a 10% move up or down. It is a lot easier for an investor to hang on if she knew a bit more about Fairfax, and was thus not scared off by the Muddy Waters allegations or fears about their impact." To each his own, and may it work out for you. We only point out that there is the buy/hold return on FFH itself, AND the swing trade returns from volatility. Global warming is generating bigger Super-Cat losses, and the FFH insurance business has a seasonality to it, that is just part of doing business; nothing wrong in that, but it will generate opportunities from time to time. If you able to make a success of them, you will get to your 200% a lot quicker SD

You might want to rethink this; as we recently exited our swing trade at > CAD 1500, and typically swing trade around the dividend record date. We trade FFH because it's well run; but our trades themselves are just about being opportunistic, and acting on value when we see it. We act like insurance; additional buy side demand when the sh1te hits the fan, that quietly exits later when everybody is positive. SD

25-35% of cash equivalents at cost, highest when we enter the position. As we periodically repatriate capital we trim it down, as we swing trade we fine tune the weighting; cash gains/losses into Canada's. If we've done our job well; we will only have realised swing trade gains, and HODL on unrealised losses. BTC drops 25% next month; we sell down the Canada's, re-enter at the lower price, raise our cost base, and adjust our weighting. As total cash equivalents rise, so does the amount we can safely put into BTC Do this long enough and eventually there will be a year-end with a lot of BTC at a high cost base, in a much lower priced market. Sell everything, buy it back >45+ days later, reset the cost base, and harvest the tax loss. Not for everyone, but it does the job very well. SD

If you are are a young person, looking to build your retirement nest egg 35 years from now (age 70); it is extremely stupid NOT to have a significant weighting to an BTC-ETF. The only real question is how much of a weighting you should have, and whether it should be maintained at cost or market value; the lower your risk tolerance, and the shorter your investment horizon, the lower the weighting. At the institutional level; providing company sponsored pension plans, at a 2% weighting for now ... that will rise over time. BTC is just a payment app that was created to demonstrate blockchain technology; if you think that blockchain technology is likely to materially change the world over the next 3-4 decades, it's hard to find a better vehicle than a regulated BTC-ETF. No need to predict who the winners/losers are; just a need to be in the game, and in a vehicle unlikely to sink. 35 years ago this might have been a Berkshire Hathaway share, and at a share price not much different to recent BTC prices. Most people (Joe Sixpack) just want to 'buy and forget'. A BTC-ETF is a fraction of the price of a BTC, and designed for those with zero experience/expertise in crypto; as far as 'Joe' is concerned, the PM is actually a value add and relatively cheap. Over time, the more 'Joe's' that add 2-5% weightings in their portfolios, the higher the demand for BTC goes, and the higher the price. Momentum, halving, etc. just taking price higher still. The adoption curve. And as price goes higher ... the more that FOMO kicks in; less than year ago BTC was at USD 32,000; today it's pushing USD 69,000. Not that long ago, we were being questioned for treating BTC as a portfolio 'cash equivalent' - as how could the value of a cash equivalent possibly rise by 50%+! Zero recognition that if you don't want a cash drag on your portfolio, some of that cash needs to be in BTC Back in the day cars not only replaced the horse and buggy, they replaced all the related infrastructure as well; at the time there was little idea as to how long this would take, similar disbelief prevailed, and then as now - few took up the opportunity. Same thing occurred when steam replaced sail, and wireless replaced landline. Inability to adapt to change. All good, and more for me! SD