jtvalue

Does anyone have the 2017 letter?

That's incredible - I didn't realize BBY has done so well. Where did you find all of that info about Best Buy? Is there a specific article? Makes me question the automatic death of all the retailers you mentioned. The key point that I think is missing is that both Circuit City and Radio Shack went bankrupt over the same time frame.

Nobody is taking about this, but I'm amazed at the bet Protege Partners made. A portfolio of hundreds of hedge funds with a fee rate of 3% and 20% of profits all in was going to be an index fund?? What a terrible bet!

I'm confused - is this fake news? I just found this article that states the home was sold in 2005 for 5.45 mil http://la.curbed.com/2011/10/10/10435130/laguna-beach-buyers-selling-warren-buffett-house-at-a-loss

Dumb Question - but if i I want to buy Fairfax in the US would I input the ticker FRFHF? It appears to trade OTC? If I remember correctly Fairfax delisted from the NYSE several years ago. Thx

His top holdings today are LOW, FDX, GS, JPM, Airbus, WHR, C, MMM, DHI, LEN

What type of returns has he generated?

Now 3rd longest in history http://money.cnn.com/2016/03/09/investing/stocks-bull-market-turns-seven/

What do you mean these are high cost shares? You don't think Burry could see value in BAC and Citi at huge discounts to tangible book value?

I don't think there's an easy answer to this question. I emailed a bunch of friends in 2007 with a similar "Berkshire vs. GOOG" comparison when they both had $220 bil market caps. Obviously I was strongly in favor of Berkshire at the time, but ended up being dead wrong. Today: GOOG: $511 bil market cap BRK: $318 bil market cap

This has been a brutal market environment for value investors and I see parallels between the 1998-2000 timeframe. Growth investing has now significantly outperformed value investing over the last 1, 3, 5, and 10 years. Check out the performance of several "value" investors in 2015 below. This is the time when we need to hold our conviction in value investing the most! I don't know when this trend turns or what the catalyst will be, but when it does turn it will be powerful S&P 500: +1.38% Seth Klarman: -6.7% Joel Greenblatt: -10.2% Bruce Berkowitz: -11.5% Warren Buffett: -12.5% Longleaf Partners: -18.8% David Einhorn: -20.2% Bill Ackman: -20.5% Sources: http://www.valuewalk.com/2016/01/investment-success-forget-opponents-focus-par/ http://www.valuewalk.com/2015/10/value-stocks-vs-growth/

I ordered the newsletter after reading the book, but have not dove into it yet

Updates the Thomas Phelps classic 100 to 1 in the stock market. My favorite investing book of 2015 and highly recommended http://www.amazon.com/100-Baggers-Stocks-100-1/dp/1621291650

Longs: AXP - great franchise selling at 12.5x EPS. In back half of 2016 people will starting looking towards 2017 when the Costco contract is lapped BEN: Trades at 7x EPS when excluding the $10 bil of cash on balance sheet. Key funds Templeton Global, Franklin Income, and Mutual Global Discovery have great long term track records despite a tough 2015. Value coming back into favor over growth will help their investment performance DISCK: Global content company with great CEO in Zaslav and Malone influence. Cord cutting fears are overblown in my opinion. Trades at 12x EPS and they are buying back a ton of stock Short NFLX: Trades at 450x EPS and is FCF negative. Developing their own content is very expensive and they will have to raise capital

Anybody have the 2014 letter? Here's an excerpt: http://www.beyondproxy.com/general-musings-arlington-value-capital/

For those reading Davis Dynasty the first 50 pages are slow. I would encourage you to keep going - it gets much much better and the Davis Dynasty is one of my top 5-10 investing books

A great source for new ideas http://www.forbes.com/best-small-companies/#page:10_sort:0_direction:asc_search:_filter:All%20industries_filter:All%20states

I'd be curious to hear the board's thoughts on this? I went back and looked at 7 Morningstar US Stock Fund Managers of the year and their subsequent results are not inspiring. Below I present their annualized +/- vs. S&P 500 for 1, 3, 5, and 10 year and a link to their record. What does this say about the merits of active stockpicking or the mutual fund industry in general? 2012: Mairs Power & Growth MPGFX -759 bps, +90, +46, +69 http://performance.morningstar.com/fund/performance-return.action?t=MPGFX 2011: Artisan Value ARTLX -953 bps, -517, -231, N/A http://performance.morningstar.com/fund/performance-return.action?t=ARTLX 2010: Sequoia SEQUX -1,071 bps, -167, +68, +102 http://performance.morningstar.com/fund/performance-return.action?t=SEQUX 2009: Fairholme FAIRX -2,076 bps, -279 , -607, +105 http://performance.morningstar.com/fund/performance-return.action?t=FAIRX 2008: Royce Special Equity RSIEX -1,976 bps, -714, -407, +17 bps http://performance.morningstar.com/fund/performance-return.action?t=RSEIX 2007: Fidelity Contrafund FCNTX -230 bps, -125, -4, +225 http://performance.morningstar.com/fund/performance-return.action?t=FCNTX 2006: Longleaf Partners LLPFX -781 bps, -253 bps, -215 bps, -179 bps http://performance.morningstar.com/fund/performance-return.action?t=LLPFX

Morningstar recently released an interesting article & chart quantifying the impact of taxes on returns. Since 1926, assuming 20% annual turnover, taxes have reduced stock market returns by 200 bps annually. See the link below: http://www.morningstar.com/Cover/videoCenter.aspx?id=667163

I just finished Guy's book and loved it. For me the book wasn't so much about investing. It was more so about recognizing your shortcomings as an individual and adapting to them, lessons you can take from your role models & friendships, being sure to give more than you take from other people, and his overall thoughts on how to live a more rewarding life. Highly recommended!

I saw a reference to these white papers in the book the "Warren Buffett Portfolio" by Robert Hagstrom. As the papers (links below) by Robert Arnott state "Taxes are the biggest expense investors face - more than commissions and more than management fees". "Approximately 2/3rd's fo the marketable portfolio assets in the United States have owners for who taxes are a major consideration." The role of taxes in portfolio management receives far too little attention in my opinion http://www.ifaarchive.com/media/images/pdf%20files/isyouralphabigenough.pdf http://www.researchaffiliates.com/Production%20content%20library/IWM_Jan_Feb_2011_Is_Your_Alpha_Big_Enough_to_Cover_Its_Taxes_Revisted.pdf

http://www.pimco.com/EN/Insights/Pages/One-Big-Idea.aspx

Well, this topic is about the long term. Long term means 5+, ideally 10+ years to me. For the TS, it was a minimum of 3-5 years. Maybe it's a shorter time frame for you guys, that's ok. You're returns will be much smaller with IBM than if you buy and sell various undervalued small caps over that "long term" time span but that was not how I understood the question personally. I'm not really capable of picking small caps and not looking at them for 5+ years so if I had to do it, I would lean towards IBM as a 70 cent dollar, forgoing some return but keeping my sleep. While large caps get less mispriced than small caps, I think they can still offer decent potential if your goal is simply buying and forgetting. edit: That being said and after thinking about it a bit more, maybe I should go with the JPM warrants. ;) Btw, my personal portfolio mainly consists of small caps. ;) I agree that Small Caps are generally the best place to find value, but I don't believe that's the case today. In recent interviews Greenblatt has talked about Small Caps being this expensive only 5% of the time compared to Large Caps only 40% of the time. He states that he sees most of the value in the 50 largest market cap names today (specifically cites AAPL, GOOGL, MSFT). I agree with him Maybe it's a sign of the times, but I'm also going through a change in my investment philosophy. Back in the 2005-2012 timeframe my portfolio consisted of mostly Small Caps and I turned it over 50% per year. With the recent changes in US tax laws I now have an approximate 33% rate on long-term capital gains and dividends, making the pre-tax return hurdle that much higher. Therefore I'm looking for undervalued wide moat companies (usually they are larger in market capitalization) or compounding machines that I can hold for years. As mentioned, MKL perfectly fits that bill

Admittedly it's a tough market, but I am trying to find some new long-term ideas (minimum 3-5 year holding period). Any suggestions? My favorite is Markel but it's already a full position for me. Simplistically, I have a high level of confidence the company can compound BVPS at 13-15% over the long-term. At 1.25x book today, that means it trades at 8.3x - 9.6x economic earnings.

In order of influence (a couple of mine have not been mentioned yet): Buffett Letters & Articles (ie: How Inflation Swindles the Equity Investor) Moneyball by Michael Lewis Little Book that Beats Market by Greenblatt Davis Dynasty by John Rothchild Fooled by Randomness by Nassim Taleb Stocks for Long Run Jeremy Siegel