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I think that there has been a realization over the last 3 months that they may not continue liquidating which was accretive (the hiring of Macquarie and mandate confirms that) and that the remaining business does only $8 M/year of FFO at current prices. So the remaining $33 million in net debt is still just over 4 times which is over the 3 times that likely would be wanted. Moreover, their ASP project is still not operating as per the original plan and requires a decent amount of spending in polymer each year. I do believe that the selloff has been accentuated by tax loss selling and some getting out like UBS yesterday. However, the situation appears easily fixable to me with many options available. Cardboard

"We've seen 10x that amount in global central bank action over the past 6 years with near 0 impact on inflation thus far." "To the second point, banks are still sitting on tons and tons of excess reserves and most of the money the Fed has printed is not being circulated." The central banks policies combined with stricter regulations such as Dodd-Frank and new Basel rules were mostly intended to recapitalize and fix banks. As you stated, most of that cash never went into consumer hands: banks hold more reserves, banks have increased their lending standards. Trump is proposing a large infrastructure spending plan combined with fiscal stimulus (lower taxes). I think that Clinton would have done the earlier but, raised taxes. This is Helicopter Ben plan at work. The one thing that is not reacting correctly at the moment, I think, is the USD. I understand assets moving away from emerging markets but, once there is realization that the U.S. debt to GDP will skyrocket (at least temporarily), I can't see the currency heading up. Moreover, with the kind of move that we have seen in treasuries, refinancing risk goes up a lot and the share of budget going towards interest payments. At the end of the day, no one knows how this will all play out: not me, not Dalio, not Watsa, not even the ones in charge. I do believe that Fairfax should get back to plain vanilla investing and improving their business on a daily basis. They can also keep a lot of cash on hand for potential deals. That is the best hedge IMO. Cardboard

Once again, the Zargon debentures are now on sale following a 3 month decline from the stock that culminated this morning with someone at UBS getting out fast. Yield to maturity in June 2017 is above 50% with the company actively looking for a solution and that is first item on the list: "With the elimination of the Company's bank debt, the strategic alternatives process is continuing, but has been refocused to include, among other alternatives, a restructuring of the Company's current capital structure, the addition of capital to further develop the potential of the assets, the sale of the Company or a portion of the Company's assets, a merger, a farm-in or joint venture, or other such options as may be determined by the Company's Board of Directors to be in the best interests of the Company and its stakeholders. Zargon's Special Board Committee has engaged Macquarie Capital Markets Canada Ltd. ("Macquarie") as its exclusive financial advisor related to this component of its strategic alternatives process." http://www.stockwatch.com/News/Item.aspx?bid=Z-C%3aZAR-2421645&symbol=ZAR&region=C They have $24.5 million of cash and the only debt is this convertible or $57.5 million at par. The stock is also a heck of a bargain based on most metrics. Cardboard

"Also, as has been mentioned before, Fairfax has more market exposure/leverage than either Berkshire or Markel. Excluding investments in associates (which I count more as operating business and portfolio investments to be bought/sold), Fairfax has over $1,100 per share in investments per share. " This is untrue and a quoted metric that has mislead a lot of people. Berkshire Hathaway has roughly half of its book value invested into straight equities. And the rest of investments are good to great businesses generating very solid returns. That is real market exposure. People often quote their large cash pile but, that is peanuts relative to the size of other assets. Fairfax is not even at half of book value invested into equities per Q3 financials and the rest of investments/businesses earn average returns. What is it good for to have "x" amount per share in investments when "3/4 of x" amount per share in investments has to remain into cash and treasuries because insurance regulation and low rating forces them to? I mentioned that problem way back in 2005 or 2006 relative to their structure and it is not fixed yet. They need to de-lever, increase the rating on their insurance business and corporation and find more stable sources of cash flow with solid ROIC. Cardboard

Buffett says that he will buy back his stock or pay a dividend if he cannot beat the S&P anymore. Shouldn't the same criteria apply here? They are much smaller but, results have not been there and relying on 1 in 100 years type of events every 5 years or so to deliver does not seem like a real strategy. Cardboard

Costs have always been more expensive. Logistics is a big issue. Canada's population is essentially tucked against the U.S. border and it is something like 90% who live within 100 km of the border. Then you have a huge hub in the center or Toronto with 1/4 of the overall population. This is vastly different than the U.S. where you can place a distribution center in Columbus, Ohio and reach 100 million people in roughly one day of driving. Climate is another. There is a cost for this harsh winter in terms of heating cost, road maintenance, infrastructure, delays, clothing, etc. Quotas. Food cost is highly impacted by production quotas on chicken, eggs, milk, and others. Even maple syrup in Quebec! It has only benefited a small number of farmers who are now multi-millionaires because of that inherited quota. Duplicate costs. There is an EPA, car testing facilities, food safety, drug safety, etc. Basically, every regulation system that the U.S. has is duplicated in Canada. So you have to share that cost over 1/10 of the population. While Canada and the U.S. are separate countries, there are a lot of these that could be shared as they do in the EU for example. Language. There is a cost for having two official languages. It is also a huge disadvantage for french speaking people in terms of mobility. Buying peace. A lot of people, and that includes a lot on this board, like to pay taxes to keep poor people in check. Make no mistake, this is not charity. The only thing that they don't realize is that once the well runs empty, then it is a guarantee that entitled's will come for them and their daughters. Cardboard

Average wages and net worth should always be looked at as a share of the developed world wages and net worth. Hence the need to adjust for currencies. This is especially true for Canada since a lot of consumed goods are imported. The USD has a big impact on our costs. Moreover, competition seems lower: restaurants, banking, etc. and we get gouged by companies (cartels) not pricing goods at the same price that they sell them for in the U.S. even after adjusting for currencies. Cars, electronic goods. Regarding net worth, that value is so influenced by the value of housing that it is hard to see if it is real or not. Cardboard

"Not sure what your point is here. We shouldn't test for STDs? People who enjoy having sex are evil?" No, but some people definitely abuse with free testing every few months. I am not kidding here. Why do you or I pay for their frequent switching of partners without them being more cautious? "Don't forget doctors deliberately restricting the supply of physicians." That is a very good point that I forgot to mention. Actually it applies also to dentists and pharmacists. "That said, I think that Canada actually has the best of both worlds--everyone gets good healthcare at reasonable prices, and rich, grass-is-greener people can jump down to the USA." Here I disagree with hours in line, months to get some treatments. And do you think that Trudeau or Harper would wait at all? No. And they get the most competent physicians/specialists right away. So it is not fair for everyone. Cardboard

Cwericb, We agree on something politically charged!!! ;D Catdboard

"So I take it from the fact that you're against complications, that you're in favor of a single payer healthcare system? It's far less complicated, collecting the taxes that are already being collected, cutting out all the waste caused by middlemen in the US system, maximizing the negotiating abilities of the single payer, cutting the tie between jobs and healthcare, greatly increasing employment mobility. The evidence I've seen indicates that single payer leads to the same outcomes as the messed up American system, at two-thirds the cost, and you don't get all these people dying because they can't afford medical care, nor bankrupted from some random illness. A no-brainer, right?" It is not a no-brainer at all because the Canadian system means garbage for all. I have seen my father treated here and in Florida and the difference is absolutely striking. Now, I know that you seem to disregard personal experience but, to me it counts and what I also hear from many others. Two major reasons for that is abuse by patients with many still going to see their doctors for minor scratches, colds and doing things that they could do on their own such as blood pressure. Also, how much is spent each year on free and repeated STD's detection must be out of this world. People paying a little bit for each visit would help a lot. And extremely strong unions and terrible hospital administrations who render the system unproductive. Then other stupidity from the system such as prescription renewals requiring a visit to the doctor and pharmacists who can't do basic/common sense prescriptions. So no Canada is not perfect. Very far from it. Cardboard

But, you worked hard and made millions selling the business that you built Richard. Why change the trend of the system that has worked so well towards the left? Why do you believe that it would be easier to get out of poverty if there was more entitlements (what a terrible word after all), more regulations and a larger safety net? All these things make it more difficult for people to get out of poverty: reduced motivation, complications. And when one gets out of poverty in the current system, he or she likely gets out a few more along the way with whatever business was created and/or the inspiration. I am not saying that we should eliminate all safety nets but, we should certainly be worried about its expansion and effects. Cardboard

"Add to this possible changes to NAFTA, softwood lumber deal, the auto sector, etc." Softwood lumber deal is the most vulnerable IMO. On the other hand, I do believe that Trump has a positive view of Canada and the benefit of our exchanges which are fair. Mexico is another ball game. Anyway, that is my belief based on my past involvement in the Canadian manufacturing sector and working a lot with Americans. Trudeau wanting to pass a carbon tax now is a much bigger threat to the entire Canadian economy than any reasonable NAFTA change. Cardboard

http://www.theglobeandmail.com/real-estate/the-market/vancouver-home-sales-drop-nearly-33-in-september/article32229083/ 15% tax on foreign buyers since August 2 and major tightening around mortgage rules. If the real estate bubble deflates or worst pops, along with still weak oil & gas activity, what is going to be supporting Canada's economy? Imagine the effects of a banking crisis... Cardboard

Can someone explain to me why you would hedge bonds with equity hedges? Cardboard

Here is my 2 cents about this topic: You will realize that they are all idiots (vast majority) and looking only for themselves once the business stops growing. Anyone can run a business that has growing sales and profits. The returns may look a bit worst than peers if it is run by true idiots but, once you become CEO, you have a minimum salesmanship and IQ to "lie" and still make it work ok. There is also a fair amount of people looking over their shoulders to prevent a full blow up. So if you can identify a business that has growing sales and profits organically, I would say that is 90% of the battle. Cardboard

"So you're okay with continuing and expanding the practice?" When you become reasonable enough to understand that someone who did commit something vs someone who could commit something is different, then maybe we can discuss. Cardboard

"But what really concerns me is that I can't help wondering how you turn over most of the western world's top secrets to people like Trump, Bannon, Giuliani and all of the rest of Trumps crew. How do you do that and ensure these guys will not use the info for their own personal and political uses?" Don`t you realize that the Clinton`s became centi-millionaires doing exactly that? It is not like they could do it. They have done it! Cardboard

If any of you were a fan of Wal-Mart, then Warren himself by his actions has made very clear over the last 2 quarters to get out! Cardboard

"Why would anyone believe the system is just if it's basically impossible for the poor to become rich?" I don't know in what world you leave in but, I see a ton of poor who became rich and some famous. Can't say the same about Europe. At least, not at all to the same degree. Cardboard

"We mostly cleaned up the Bush mess." Pulled out of Iraq quickly, encouraged revolutions in Libya and Syria. A heck of a recipe to clean up a former bad decision. Cardboard

"For what it's worth I've got a thing for redheads...Stephanie Ruhle and Julia Boorstin are sultry as hell." Sounds like Gyp Rosetti. Do you enjoy domination as well?

But she is not a Eastern European hooker or what seemed to be your preference recently :o Cardboard

"fyi, i thought this observation was salient: the media takes trump literally but not seriously and his supporters take him seriously but not literally" +1 Hyten1 By the way, Nelson Peltz mentioned that exact same quote at lunch time on CNBC... Any connection? Cardboard

PPR-TO and CCZ-TO Cardboard

They don't all have tough skin like me to deal with people like you telling them that they are idiots or trying to make them feel as such. In related news: Obama was able to admit defeat and he is going to help with the transition and I applause him for that. Cardboard