Buffett_Groupie

They've been saying so for the last decade and the share price is at all-time high. Just imagine someone acting on the advice to short the stock for the last decade! :-)

I'll have a chance to help interview Buffett at his office again on Sunday, 05/05. Therefore, please vote on ONE (1) question you'd like to ask the most and I'll try to sneak it to the interviewer. This is from last year: http://jingji.cntv.cn/2012/05/15/VIDE1337091481780125.shtml The entire interview's in English (I was at 01:38) and both photos are Photoshop pics! LOL :-)

I'd double-down the equity hedge.

This is the table you're referring to, right? 2010 2011 2012 Cumulative Equity hedges (936.6) 413.9 (1,005.5) (1,528.2) CPI-linked 28.1 (233.9) (129.2) (335.0) ===== ===== ======= ====== Total (908.5) 180.0 (1,134.7) (1,863.2) It surely will be a repeat of the following: 2003 – 2006 2007 2008 Equity hedges (287) 143 2,080 CDS (211) 1,145 1,290 ===== ==== ==== Total (498) 1,288 3,370

Page 18 says: "We have invested a total of $454.1 million in these CPI-linked contracts which are carried on our books at $115.8 million, a 74.5% decline from our cost. The remaining average term on these contracts is 7.7 years." Does that mean if FFH closes the hedge today, it will lose (454.1 - 115.8)M? Or is it $1,006 million loss?

Please help me understand how FFH's S&P hedge works: For the S&P 500 hedge, they did it at 1050 with $428M and it's $115M mark-to-market on the book after the index has gone up more than 50% from their hedge. Does that mean, if the index goes to 2000, then the entire $428M will be wiped out, right? But it also shows their hedge is at a loss of more than $1 billion. Does that mean they stand to lose $1 billion if they close the hedge now? Thanks

Many money managers take to heart what Buffett said about generating 50% if he manages $1M: http://valuevista.blogspot.com/2007/06/warren-buffett-50-returns.html The fallacy here is that Buffett did NOT mean anyone can do so, did he?! :-) To any members on this board, I strongly encourage you to be entrepreneurial by starting your own business because I think anyone should do it at least once in their lives regardless the outcome so that you don't regret on your death-bed one day! It's synonymous to having kids where you'll experience a lot of stress, uncertainty, anxiety and sometime pain. But the financial returns will ALWAYS be far better than having kids! LOL :-) I'm most interested in knowing anyone who can inspire my kids to get into ivy-league schools without being a tiger parent: http://online.wsj.com/article/SB10001424052748704111504576059713528698754.html

http://www.stansberryresearch.com/growth-stock-wire/1289/Weekend-Edition Weekend Edition The simple difference between $400,000 and $4.8 million Saturday, October 9, 2010 We often warn our readers of the impracticality of the "two and 20" most hedge funds charge their clients... That is 2% of total assets and 20% of any gains. This fee structure guarantees the fund manager gets paid regardless of performance. For example, a manager with $1 billion under management earns $20 million just for walking in the door on January 1. And the 20% "kicker" encourages excessive risk. A recent article in the British newspaper the Telegraph quantifies how damaging "two and 20" is to the investor using Warren Buffett's historical returns. An excerpt from the article is below: As you are aware, Warren Buffett has produced a stellar investment performance over the past 45 years, compounding returns at 20.46 per cent per annum. If you had invested $1,000 in the shares of Berkshire Hathaway when Buffett began running it in 1965, by the end of 2009 your investment would have been worth $4.8m. However, if instead of running Berkshire Hathaway as a company in which he co-invests with you, Buffett had set it up as a hedge fund and charged 2 per cent of the value of the funds as an annual fee plus 20 per cent of any gains, of that $4.8m, $4.4m would belong to him as manager and only $400,000 would belong to you, the investor. And this is the result you would get if your hedge fund manager had equaled Warren Buffett's performance. Believe me, he or she won't. So, $1,000 invested alongside Buffett earned you $4.8 million over the past 45 years. That same $1,000 invested with Buffett while paying "2 and 20," earns $400,000. I know the numbers seem unbelievable, but it shows you the power of compounding.

http://finance.yahoo.com/quotes/CRM,LNKD,WDAY,GWRE (salute to these innovative companies in the heart of silicon valley!)

We provide IT consulting services (see attached) - a mini Cognizant, Infosys, Accenture, IBM Global Services, CSC, Wipro, CapGemini and CGI: http://finance.yahoo.com/quotes/CTSH,INFY,ACN,IBM,CSC,WIT,CAPMF,GIB AJC__Associates_Inc._Profile.pdf

Here is a story about parking: Buffett talked in funny terms about 1967 acquisition of National Idemnity for $7 million. It was known that something would set off Jack Ringwalt, and every year for “about 15 minutes” he wanted to sell. Munger kidded that everyone referred to it as “Jack is in heat”. One day, Munger friend called and said “Jack's ready”. (laughter in auditorium). Meeting was in Charlie's LA office and Jack was 10 minutes late because he was looking for parking meter that still had free time left. Buffett said “I knew right then that Jack was my kind of guy”. Deal got done but Buffett could feel Ringwalt was remorseful and was looking for excuse to kill deal. Jack said “I suppose you want audited financial statements?” Buffett knew that if he asked for them, Jack would kill deal so he said “nope”. This went on for a while but eventually deal was closed and ultimately Ringwalt realized he still ran the business.

Please sign me up if you get a place where parking is FREE! :-)

I'm certainly not tap-dancing to work and the highlight of the day is to visit your web-site! Here is my prediction for the two based on the conservative 15% which is below the historical return starting at book value over the next decade: Year BRK.A FFH 2012 $110K $370 2017 $220K $740 2022 $440K $1,480 All the best

Thank you for your participation! You folks are more responsive than my own staff! :-)

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Please vote your action from Jan 1, 2013!

Thanks for the post, can you please copy/paste the entire article due to FT's paid subscription?

You're underestimating or ignoring the power of faith and prayer!

Being correct and rational for 5 months or 5 quarters may be manageable for many, but 5 long painful years would take an extraordinary individual. Simply conviction and faith in reason and rationality may not be enough. The market can be irrational longer than you can stay liquid. Hence, I figure it must be religious faith.

Without a strong religious faith, it's difficult to withstand 5 years of pain from 2003 to 2008 watching the markets going up and up!

IMHO, Mr. Watsa has a strong religious faith which should never be under-estimated and is something that Buffett lacks.

I'm showing off mine with Munger who has a bigger smile, which is rare! :-)

Start training for the run!

Simply identify something you can be good at, then repeat the process over and over for as long as you can until all the advantages run out! :-)

Every dollar rise in share price is $50M increase! Ka-ching, Ka-ching!!! Killing the shorts...