txlaw

Bloomberg BusinessWeek actually did a story on Huy Hong Foods a couple of months ago. Probably as a result of the Heinz deal. http://www.businessweek.com/articles/2013-02-21/sriracha-hot-sauce-catches-fire-with-only-one-rooster

Whoa, you've jumped the shark on this one. I've been pretty entertained by the AAPL discussion for a while now, but good lord . . . ;D

http://www.cornerofberkshireandfairfax.ca/forum/investment-ideas/bac-wt-bank-of-america-warrants/msg104086/?topicseen#msg104086

As long as you really wouldn't miss being in a house/neighborhood, it wouldn't be so bad living downtown. :) Especially if you work from home, and your wife would be walking to work. That will have a huge effect on your quality of life. And if you're thinking about moving out of Austin in a few years, it might not be such a bad idea to sell into this market, which is definitely a seller's market. If you wanna discuss more Austin-specific considerations, feel free to PM me.

Not so fast my good sir. The bet was $7 bil returned to the COMMON. I was very clear about it and asked that you confirm. I can't find it right now but go back to where we bet. I am still winning here. I will happily pay when it's $7 bil to the common. There is still 9.5 months to go. I went back and checked...you sneaky bugger! Yes, you stipulated in brackets "(common only), no other security". I'm going to have to get Txlaw to read any agreement between you and me on a bet going forward! ;D Remind me to give you your "100 Grand Bar" in Toronto. Now I've got to cross the border to get one. Can any of you Americans coming to Toronto, pick one up! Cheers! Haha, don't forget again that Kraven was a transactional lawyer. He knows how to craft his language just in the right way!

I am bummed as well. Will wait to see what options may be the best to switch to. Where is AMZN on this? Why can't I subscribe to RSS feeds through my Amazon account, such that they go to my Kindle app on my iPad and phone, and are available through a nice website for my desktop/laptop? They're missing an opportunity to make their customer base even stickier.

I just finished reading this book (Kindle edition). It's excellent and definitely worth reading.

Bernanke highlights: http://www.reuters.com/article/2013/02/27/usa-fed-bernanke-idUSL1N0BR41N20130227

Full transcript of Bloomberg interview on Fairholme website: http://fairholmefunds.com/sites/default/files/Bloomberg%20Transcript%20%28Clean%20Distributor%20Edits%29.pdf

http://www.bloomberg.com/video/tesla-s-musk-on-times-review-outlook-_GJ9pQALTFC88MXokC6c3w.html I love this guy -- he's the man.

Thoughts on XPO or Barry? I remember superficially looking at this company a while back because I believe Peter Lynch had bought some shares. All I know is that they are like a broker/market maker for expedited freight (delivered by truck, I believe). I never really followed through with analyzing the company and business, but this could be one to look into.

Not sure. I tend to read newspapers and magazines on my laptop or iPad.

It's not that bad at all. Actually, I have one, and I really like it. It's a good size for book reading, although it could be a bit bigger. The total UX is actually just fine for what you're intended to do with it -- that is, read books. I don't particularly care about the menus and responsiveness of the touch screen, given the price for the device, the screen quality, and the intended use case. It's not that Amazon didn't pay attention to the UI. It's that they were constrained by the technology and the costs of production.

+1

He certainly did! :D Microsoft, Silver Lake, SEAM, et al, including Sanjeev, thought otherwise. And that's what great about this board. We tend to give our opinions even when they are contrary to the greats. We should qualify what Mohnish said about DELL, and I think this is his thinking about SHLD. He believed Dell will destroy shareholder value long-term...more the business and the competition it faced. Whereas I thought DELL was cheap on a nominal basis. These two ideas aren't mutually exclusive. So I'm not sure Mohnish was wrong long-term...he was just wrong about the value in the short-term. We are out of Dell now and we would have been out at a certain price regardless of the buyout...probably in the $15-18 range. The buyout actually ended up being less than what we would have preferred to sell at, so it wasn't quite the home-run that we hoped for. We did very well in a short-period of time, but not a grand slam. I think SHLD may be similiar. On a nominal basis, it is somewhat cheap, but that doesn't mean that long-term destruction of value won't continue to happen. It's a rotten business with very good assets...now how do you monetize those assets before that rotten business eats it all up? So far, it's eaten a massive chunk! I think you've got a reasonably good chance with Eddie and Bruce controlling it, but they could do what Dell did and screw shareholders over as well. And so far, Eddie's results of monetizing those assets has been very subpar. Cheers! Perhaps "cheap on a nominal basis" is not the best choice of terminology. Because that almost sounds like you're saying that using certain value-oriented metrics, DELL and SHLD appear(ed) to be cheap at least on a short term basis. That sounds sort of like the "value trap" thesis espoused by Chanos et al. On the other hand, the substance of your post indicates that you are saying that both companies are/were trading under IV, but that there was some probability (perhaps, a high probability) that the IV at DELL and SHLD would be destroyed through mal-investment or non-optimal capital allocation (opportunity cost of not monetizing assets and reinvesting). I'm going to assume the latter is what you meant -- and then disagree with both you and Pabrai. I think that DELL's capital allocation with respect to M&A (not with buybacks or dividend) has been okay and that, while they certainly are not transforming on the cheap, they have not burned the capital used in M&A. I think DELL had no choice but to pay full prices to create a platform to become the mid-market IBM. And that over the long term, what we will see is that as the ES&S biz grows, the returns on incrementally invested capital will go up quite substantially and that DELL earnings will benefit from the operating leverage inherent in their distribution channel assets. IMO, Michael Dell understand this and is taking advantage of shareholders to steal the company and this growth platform. With SHLD, I submit to the board, as I have before, that ESL has actually preserved and increased the long term value of SHLD's assets by proceeding slowly and focusing on run-off, rather than on liquidating assets at fire sale prices. First, it is not entirely clear that ESL could ever have liquidated its RE assets during the financial crisis. Second, I think ESL avoided monetizing RE (both owned and leased) at fire sale prices. Third, liquidating a bunch of stores at once would have hurt the intangible assets -- brand values and market share in appliance, tool, and H&G equipment market. So I think ESL has done the right thing. But, hey, disagreement is what makes a market.

He certainly did! :D Microsoft, Silver Lake, SEAM, et al, including Sanjeev, thought otherwise. And that's what great about this board. We tend to give our opinions even when they are contrary to the greats.

Excellent interview. I think he's wrong on SHLD, though. (Sorry, couldn't resist saying that.)

That's what he was saying. My personal belief is that if Buffett decided to start over with $1M today, he wouldn't be doing great business, fair price nor would he be doing a pure Graham. He'd be trolling derivative markets where he wouldn't be required to put almost any capital up. The modern Buffett is a brilliant insurance/derivatives calculator. I think he'd be making those 50% returns that way. With only $1mm, he wouldn't have access to the derivatives market. Are you referring to OTC derivatives? Because he would almost certainly be looking at the cleared options market. I'm thinking about the long-term derivatives. Credit default swaps, Ackman-style equity exposure derivatives, etc. Yeah, that's true, but he probably would go into mispriced LEAPS as a hybrid strategy.

That's what he was saying. My personal belief is that if Buffett decided to start over with $1M today, he wouldn't be doing great business, fair price nor would he be doing a pure Graham. He'd be trolling derivative markets where he wouldn't be required to put almost any capital up. The modern Buffett is a brilliant insurance/derivatives calculator. I think he'd be making those 50% returns that way. With only $1mm, he wouldn't have access to the derivatives market. Are you referring to OTC derivatives? Because he would almost certainly be looking at the cleared options market.

I have had a different experience. I have more ideas than capital. Certain sectors that could very well contain fat pitches: -Automotive -Health insurance/care -Nat gas Certain financial companies are still way undervalued, and just because they have gone up in price does not mean that they are not fat pitches. So I continue to be 100% long. But I'm also willing to forego the possibility to buy very cheaply on a market correction, which I acknowledge could happen. Also, there's a difference between waiting to put capital to work and focusing one's activities on non-investment related activities. You could still use your time to learn about companies that are fairly valued or overvalued to expand your circle of competence, even if you don't make any investment decisions.

http://video.cnbc.com/gallery/?play=1&video=3000147930

You know, the beauty of this deal is the growth platform Heinz offers with the right management. Offering sauces and condiments ought to be a great business. If KO gets a royalty on hydration, Heinz gets a royalty on saucing/garnishing one's foods. Would love to see them start to acquire international sauce/condiment brands after they pay down some debt. I looked into Kikkoman a couple of years ago, but decided to pass on it because who the heck knows how Japanese management behaves.

Updated the link.

http://www.sec.gov/Archives/edgar/data/915191/000119312513059881/d487003d13fhr.txt Edit: Link was broken, but now it's fixed. To me, the most interesting move is the increase in XCO, which I own.

Nice call.