Hawk4value

Am I missing something? No Packer you are not missing anything. Our politicians and the Fed think that they can encourage a credit bubble of enormous proportions by printing money and micro-managing the economy, and then get out of it by printing even more money, further debasing the $ and creating artificial asset/commodity inflation. Not to mention the elimination of moral hazard which is the foundation of the next Bubble. Printing money down thru history has ultimately always failed. When a system screws up like ours did it is absolutely necessary for everyone to suffer. And to suffer to such an extent that the rediculous risk-taking will not occur again, or at least for a long time. Clean the system out and start over. No money printing or bailouts.

"...Spain or Italy is next, and the European Union is going to have a hard time funding that one, let alone coming to some consensus. All the while investor's go blithely by inflating every asset class except cash." Parsad, are you implying that with the ensuing crisis in Europe interest rates will have to rise thereby allowing people with cash the opportunity to finally earn a decent return???

If the recapitalization is approved, ALL shareholders (including Biglari) will be distributed 10 B shares for each A share they own -- once the recapitalization is approved, shareholders will have NO choice on whether or not to accept the B shares. I'm guessing Sardar is going to keep his A shares If I had my choice I certainly would not exchange my current shares for B shares but would want only A shares. But if the above is true and everyone, including Biglari, automatically gets exchanged into the B shares, how is this a particular advantage for Biglari over other shareholders?? Unless with his future required purchases of shares with his incentive money he only concentrates on buying the A shares as opposed to B shares. The problem with this tho' is that the float on the A shares will be a fraction of the B shares. Any thoughts???

No real explanation as to why Mustang is gone other than the fact that it was no real advantage for them to be part of a larger organization. Did not mention Linnartz specifically but the implication was that general partner will remain with Mustang. Originally, if I remember correctly, John Linnartz teamed up with Biglari partly out of a concern that if got "hit by a bus" the money in the fund, including his family's money, would be taken care of with Biglari. I guess that might have changed. When questioned about the Lion Fund and growing the AUM there, Biglari said that it would have to be the right partners and the requirement would be $5mil and a 5 year lockup. Overall he said he liked the asset management business but my impression was that he seemed to downplay its role in BH going forward.

I have a couple of more points on the meeting: Direct causality between value and customer traffic; will continue reduce costs and pass added value to customer; cost of average check at S&S has gone from $7.40 to $6.40 Typical company owned unit produces $300,000 in CF; 6 Franchise units produce same CF with lower capital requirement Prepared to open overseas; searching for the right partner Gift Cards has turned out to be a great business; currently $7mil annually with $4mil in float Sadar currently personally owns about 5500 shares

So, if there is no tax on unrealized gains then the inheritance tax is pure confiscation of an individual's wealth for the purpose of re-distribution. Is that correct???

".....capital will do good for society if it is allocated efficiently. Heriditary inheritance does a disservice to society. I think Buffett is right about inheritance tax..." Are you saying that the money generated by the inheritance which goes to the gov't for social engineering is money that will be "...allocated efficiently..."???? C'mon are you kidding??

Just curious, what case would the SEC have against Biglari???

I agree with you for the most part Hawk, but at the same time, the inherited wealth that passes amongst the top 10% is also contrary to the workings of a free-market system. That capital becomes stifled in inter-generational wealth, and does not go to where it could be used most efficiently. Two things will happen with inherited wealth: It will spent or squandered; or it will be invested and allocated properly and mutiplied. Either way society will benefit, the capital is not "stifled", it goes back into the system one way or the other. The important thing is that the individual decides the disposition of the capital, not the gov't. I don't need gov't to social engineer further with money that I have already paid taxes on during my lifetime. Hence I see no need for an inheritance tax.

"Since no one else has stepped up to say it I will": Forever analyzing and wringing our hands over "wealth distribution" is nonsense. The only people that really need to talk about this are politicians who need to throw a "bone" to the "80%" to get their votes, and the mis-directed liberals who are ideologically inclined. The facts remain that if you are a diciplined individual who is studious, hard working, frugal, and with a modicum of ambition you can be successful. This country affords everyone access to opportunity. That is all you can expect from a free society, if you want it to remain free. Class warfare and the bashing of successful people sends a horrible message to our youth. Instead of laboring over ways to confiscate the wealth of the top 1%, we should teach our young to admire and imitate success, not expect government's re-distribution largesse in the form of unemplyment insurance, food stamps, welfare checks, etc., etc., etc., and so on, and on, and on,.......................Where it stops no one knows.

Sanjeev, thanks for all of your efforts, the Board has been a life-changer for me. And thanks to all the members, a wonderful group of talented value investors for all their ideas, comments and insights.

Any suggestions on some well managed Muni Funds???

Given Pruit's abilities as a value investor, I am wondering if he will have a "Biglari" type role as capital allocator or investment advisor for unused free cash flow????? Any comments?

Does anyone have the link to the Rights Offering???

"It's funny the Republican's bailed the financial industry who acted for it's own profit but won't bail out states that acted for common good." 2 wrongs do not make a right. It was certainly wrong to bail out the banks. But that does not mean we should bail out the states. Why should people in Texas who are fiscally responsible, bailout the lunatics in Illinois. Each state needs to unwind the idiotic, politically inspired pension deals that were made with the public employee unions. Hopefully the Congress will stand its ground and resist a bailout.

"...If you go strictly by what makes economic sense, it's very rational to round up the economically unproductive bottom 1% of population every year, homeless and elderly, strip them of their citizenship, and deport them somewhere far away...". Turar, I think that your statement is very unfair. No one is saying this. The counter-point was was represented very well by Stubble when he said: "Nobody is saying that there should be no immigration, but rather that we should select those who are most likely to succeed (and having no education, no language skills, and no familiarity with the culture are rather large hurdles)....". Existing citizens deserve a gov't who will make a concerted effort to increase the quality of the population pool and minimize financial liabilities. Lets all remember that the gov't is a fiduciary for its citizens not the immigrants. To gain immigrant status is a Priviledge not a Right.

Let me clarify my position. I am pro immigration. My parents were both immigrants. I believe the US has benefited from immigration over the last 100 years. I also believe that immigration policy should be tightly controlled, and firstly and primarily benefit the country and its existing citizens, not the immigrant coming in. We need to make an assessment regarding every immigrant as to whether they will be a net benefit or a burden on society. This process should not be politically correct, but based on facts. And there is certainly nothing wrong with trying to attract and incentivize the most qualified people to immigrate, as opposed to deadbeats.

I propose Governor Christie for President!!

Immigration Policy should not be based on charity, or political correctness. The existing citizens of a country deserve to have its government properly vet every potential legal immigrant to make sure they will not be a burden on society. If the immigrant is not skilled and has no money they will become a financial burden. Who pays the bills: free healthcare, free education, food stamps, etc, etc??? The productive citizens of the country pay the tab. How is this morally correct???

As Jim Rogers has said many times, Bernanke has gotten it wrong every time. And yet our gov't keeps rewarding him with continuing employment. The same behavior in the private sector would have caused him to be kicked out on his butt. Clearly Bernanke is an academic with no practical sense or understanding of economic realty. The fact that our gov't would have such a person in a most critical position is very disturbing. Furthermore, what does this say about the people up top that are running the gov't, i.e. Obama, etc. I say its the blind leading the blind.

As an investor thru the lean years, I want to thank Prem and his team for their clarity, honesty, dedication to hard work, and their incredible ability to "navigate thru treacherous waters". I am thrilled to be a partner.

"...When you're a FAT cat, sitting high on your TREE ready to pounce down on the little canaries all around you for LUNCH, it's fairly easy to tell people to "tough it out," don't worry and don't have "ENVY" in your hearts...." ValueCarl, Charlie was not always a Fat Cat. As he said, during the Depression he and his family members "toughed it out". He persevered thru the bad times and was ready when the good times came. Charlie is basically giving these young people tough love. Stop whinning about how tough it is and get out there and roll up your sleeves. Don't depend on the gov't to bail you out or "spread the wealth", as our socialist leader believes. America was built on guts, adversity and meritocracy. Charlie has it 100% correct.

FFH currently 20% and BRK at 8%

I disagree with the article. If you keep the price of the house and the downpayment constant and vary the mortgage interest rate, the higher the rate the higher the monthly payment. The higher the monthly payment the less affordable the house becomes. The key issue though in house sales, IMHO, is the underwriting policy. During the bubble, underwriting policy deteriorated to the point where mortgages were written with no downpayment and no income verification. Effectively anyone was able to buy a house. Although artificially low interest rates helped, I believe it was pervasive poor underwriting that really fueled the bubble. Insititutions did not care whether or not the buyer was able to sustain the mortgage payments because the mortgages were securitized and sold to investors, not retained. In a normal environment without the artificial socialist benefit of Fannie and Freddie, buyers would have to have 30 to 50% downpayment, the mortgages would be 10 to 15 yrs, the interest rates would be floating, and the institution would be required to retain the mortgage. Under these circumstances society would have minimum defaults and taxpayers would cease to be ATM machines.

This may be true for private industry but not for the public employee unions. They seem intent on retiring as early as possible while padding their pension payments with excessive overtime in the last few years of their work life. The mantra is fleece the taxpayers until someone finally restructures the system.