rranjan

If Buffett thought that Intrinsic value of BRK dropped a lot and stop doing buybacks at 160-170-180 when he was willing to do it at 220, then it's fine otherwise S&P level makes no difference.

I will remember him as a great teacher.

Lack of social distancing could have caused collapse in health care. That's a great point, but shutting down all non-virus stuff in hospital is already causing collapse of healthcare in front of us. Hospitals are laying off nurses and doctors. All hospitals were waiting for spike and had resources shifted to covid-19. Some areas in country went close to capacity, but most areas have empty hospital and now laying off health care workers because many hospitals run on thin margin. Situation is not black and white as many like to see. Public policy needs to take account of greater good and collapsing healthcare is not a good outcome in any situation.

The top 20% is the least impacted by lockdown and vast majority can work from home as well. The bottom 20% is the most impacted by lockdown and vast majority can't work from home. Just going by data published by labor department. Policymakers have to balance the economic damage vs health crisis. Bottom 20% is not the loudest voice here even though they may be most at risk of catching the virus. Top 20% may be a lot more comfortable with a longer lockdown. Flatening the curve was goal to not overwhelm our health system and as long as country can operate without causing health crisis, opening should proceed with tons of centralized testing. Without centralized testing , we may be flying blind when some region gets a spike. Good thing is that bottom 20% may be getting good money for the next 4 months, but it's also bad news if you want to open up. Some of them may be making more by not taking the job. Anyway, all jobs are not comng back so quickly. Slowly, but surely steps should be there to open economy. Longer it stays in shutdown , larger damage will be done and many job for bottom 20% may not exist for years if we keep economy shut for very long. Debate sholdn't be taken as life vs economy to be honest. It's life vs life. Hospitals have started firing employees becasue we have shut down everything except virus cases. It's simply not sustainble even if Fed keeps prinintg money. I also think using terms like stimulus or bail out takes the focus away from what's happening. Businesses are simply told to shut down by governemnt for a greater good. If goverment is giving them money to not fire emplyees then it's hardly a normal bailout situation.

No one should be in stocks with less than 5 years of time frame. There are many good assets priced at decent price right now, but I get a sense that many want to time the bottom or afraid of price getting cheaper in near future. Unless, you are buying the entire market, there is always something decent to buy. Right now, you don't have to look too hard and that's the difference.

He never said that paying 30X FCF is ok. He said that if you know that interest rates will remain low for very long time(like a decade or two) then stocks are cheap. A decade or two is my interepretation here.

Thanks for posting. I didn't learn too much new here, but it was nice to hear directly from Bill.

Pretty much any time an investor will look at difference between value and price. Not sure if there is any other way to invest. Some people can do well as speculator, but I am not good at it. I simply stick to estimating normalized earnings and buying at a big discount. Discount can appear due to various reasons. If it's due to Corona virus then so be it. I can only focus on what I can control. Buy some if you find something cheap and keep some cash to buy more if things become cheaper.

Forgot to answer the second part. Imagine you have two businesses. First one produced 1 dollar when you deploy 100 dollars. Second business produces 50 dollars when you deploy 100 dollars. To get 100 dollars of income , first business has to deploy 10,000 dollars. Second business has to deploy only 200 dollars. Second business requires very little capital to grow and it will be easier to grow. In first business, you have to deploy too much increamental capital to generate additional earnings. Capital is not free. If inflation is 2% then first business is actually losing your money.

Will you take 1% interest rate on your bank deposit or take 5% interest rate? It's clear that you will take 5% interest rate. You will prefer 5% interest rate if you have 10K in bank. You will prefer 5% interest rate if you have 50K in bank. ............................................................................. ............................................................................. You will prefer 5% interest rate if youo have 5B in bank.

Im just kidding... relax. Im just shocked at the prices people pay for investing advice. I doubt that anyone mainly pays for an investment advice or as some one else indicated, to get their name in papers when it comes to having lunch with Pabrai. Most people want to donate for a good cause when money is used wisely and if it comes with a lunch with him, it's even better. Wallet, investment etc are just bonus. I will highly recommend reading Dakshana Foundation's annual report.

+1 Great thing about investing is that your knowledge compounds over time and we are not talking about 85 years old here. You have plenty of time and also if you are really curious then you can learn a lot. Pick any simple business, it doesn't have to be great. You can pick something depending on your background.. Imagine that you inherited it. Now try to understand everything about the business. How it makes money, return on invested capital, reinvestment opportunities, quality of management and anything comes in your mind. It may take you couple of months, but you will learn a great deal about industry as well. To understand business, you will be reading up on their competition. Once you are done, pick a second company. Get the ball rolling. Do all this if you are very curious and find it interesting. Good luck!

I think kids asking questions is fine. It's not as if adults are asking great questions all the time. One question asked by a kid had 3 pages of write up as a back ground before getting into actual question. That can get annoying.

I am sorry to hear your story as well. I always thought that you had retired after making certain amount of money and you were spending time with your kids. It was clear from your posts that you were not spending 100s of hours to do research. You made occasional, but big bets. I was not in this board before 2008 and I can't add much about that period. Hope things get better for you soon.

I was a great investor for the 5 years 1995-2000. Golden words.

Thanks a bunch for posting it here. It was a very clear recording and so nice to hear it all.

Or you could ignore the market, ignore the alpha and simply try to get a good rate of return over a period which takes you to your financial Independence without taking a risk of being wiped out. Easier said than done but that's how I will set my goals. I will be measuring this index thingy after the fact to judge if I should even continue doing it myself but won't really take it as my goal. I guess it's different thought process for different folks.

It's surely unrealistic and I wasn't really making that point.

When index does -2% for 10 years then an individual doing 0% for 10 years is not going to help in building wealth. But doing 12% even if market does 14% is going to help a lot as far as building wealth is concerned. Yes, after 5-10 years you should always see if your performance is better than index but when all said and done absolute performance over a long period matters. If you are a good investor then you should get more than index over a long period. It's a good idea to be honest with yourself and see if you should continue investing actively but I am not sure if setting a goal of getting more than index is the way to go.

Discussing your shorts are not different from discussing your longs. If float and average volume is very less then I can see some merit of not wanting to discuss in both cases. But in normal case, there isn't any difference when it comes to ethics.

All of us can give opinions but it will come down to how you and your wife feel about it. If both of you will be more happy at new place then go for it. Now, it's hard to tell how both of you will feel but you can make an educated guess. I can't speak on your behalf but if I were in your situation, I would have slightly preferred to keep my current job. Career wise, it will be a step up for one and a step down for another. She is a major bread earner in family but I think Philly being less costly will take care of that factor. Family is very important but I won't really think too much about it. It will be surely a bit negative due to your move but I will give it less priority. It's only 2 hours drive anyway so not a huge issue. Childcare is surely more important factor. I think you can find decent childcare. If your child goes to a childcare right now then I won't be much worried about new place. It will be bit of adjustment for sure. Also, you said that current place schedule is rigid and it allows you be the primary care giver for your child. What will be the situation in new place? If it's similar then it's not an issue. I think, it comes down to how you and your wife feel about it. If both of you are fine then go for it. You are not getting pay hike or not doing it for prestige here but it seems you will be happier in new place. Try to see how much unhappy your wife may be in new place. Less opportunities doesn't necessarily mean unhappiness. Only she can answer it truthfully. Pretty much happy wife makes a happy life.

While Googling I saw few references of folks having solo 401K at IB. Solo 401K is essentially a trust account but a qualified one. I talked to IB and they said that tax reporting is not suppressed in their trust accounts. If that's the case then i don't see how anyone can have a solo 401K account at IB. Am I missing something here? If any of you know anything about having a solo 401K at IB, I will appreciate the input.

Lenders are dealing with two different risk profiles here. If you are not owning the previous house, why any lender will allow you keep the older loan? You would have to take 150K at 8%.

Congrats!

A great one. Thanks for posting.