SmallCap

Someone else posted this article about Bill Gross in the general forum but as I was reading it I saw an interesting correlation to the article by Buffett above. Here is the quote out of the article that I found interesting. here is the entire article again http://www.bloomberg.com/news/2010-06-24/gross-vows-this-time-different-with-el-erian-leading-push-in-global-stocks.html Cheers SmallCap

I agree, that is such a frustrating conclusion. SmallCap

I love them, they have been one of my playgrounds for the last 10 years. I just don't intend to move out of them quickly and around half of my exits have had to do with being bought out. It takes a long time horizon and a lot of conviction. SmallCap

How many of you remember this article that came out in Nov of 1999 http://www.jeffreyluke.com/Financial/Mr_Buffett_on_the_Stock_Market.html I very clearly remember where I was as I read it for the first time and I have read it a few times since. I believe this article was also used in the intro to Snowball or something like it. I still find it interesting and instructive to go back and read this article. It has been interesting to see what has happened in the market even with interest rates dropping down to nothing. using the calculations that he gives here how optimistic are you for the next say 5-7 years in the general US market? SmallCap

That is a profound statement of something that AFTER you hear it you realize that it is just good common sense. SmallCap

What companies stand a good chance to benefit from this?

with this rather symbolic gesture of allowing the yuan to appreciate against that dollar. I am wondering what the various implications of this move might be. I know that this is supposed to increase the price of Chinese imports but what other implications are there for this move? what companies will be affected and how? SmallCap

I would guess you are right based on the interest rate but I was wondering if they would not call any of them at first opportunity or call just the A shares or call both the A and B shares. I don't own any A shares but I do own some B shares SmallCap

Who thinks that they will call the A shares at the first opportunity? Who thinks that they will call the B shares at the first opportunity? SmallCap

I agree with you about the long term negative impact of Inflation, I just took a look at the situation through the short term next election cycle eyes of our politicians and it seems to me that they would want some amount of inflation NOW to alleviate the obvious problems out there. And if they had such an apparent magic wand that in the short term would ease their troubles I have a hard time understanding them not wanting to use it. I really don't want to see the problem of inflation but I never leave out of the equation the short term self interest of our politicians and what they would want to do. SmallCap

BeerBaron, It seems like you are saying that the government has total and unaccountable control over the creation of money and the dilution of the dollar and that the government can do this without any negative impact to the government besides possibly a lose of the AAA rating on it's debt. of course we all suffer because our money is worth less but that isn't directly a negative to the government. Maybe I misunderstood what you were saying but that seems to be the outcome of what you are saying. So, if that is the case and the government can actually cause inflation then some interesting opportunities arise. If the government can cause inflation then wouldn't the easy solution to deal with the housing crisis and the credit constipation crisis be to give us a jolt of say 20% inflation? It might be painful for a little while but all of the sudden a lot fewer houses are underwater and people are finding it easier to pay back the excessive amount of debt that they incurred. Also if it is so "easy" to pay back the government debt with the only consequence being some inflation then why are we really concerned about the government debt. Right now it looks like the country could use some inflation and it would also take care of the debt at the same time. I know i am greatly simplifying the situation and the various outcomes of these actions but it really seems to me that there is more to the concept of the government "printing money" then your explanation allows.

I am putting this question out there so that people much smarter then I can explain it to me. This may seem like a simple question but it is something I have never fully understood. There are so many references to the government printing their way out of deficit spending and excessive amounts of debt but how does that actually work? How does the government actually print money in a way that makes any difference? If the treasury ran their presses for a few extra hours some day, how does that impact the money supply? How do those bills end up in the money supply? Now I know that it may be that the term "printing money is figurative but if that is the case then what does the term actually mean and how does it work? does the government actually have the ability to actively cause inflation if they wanted to? say the government wanted to pay off a trillion in debt could they just do so and then the world would be flooded with extra dollars? does that actually actively cause inflation? SmallCap

in case anyone is interested A friend sent me this report and predictions from Harry Dent. Enjoy SmallCap

Short article about the fed encouraging inflation, Nothing really exceptional about the article it just states what I have been thinking about the government wanting inflation. http://finance.yahoo.com/tech-ticker/pray-for-inflation----it%27s-our-only-hope-464142.html?tickers=^dji,^gspc,spy,dia,udn,tip&sec=topStories&pos=9&asset=&ccode=

I am seeing more articles trying to lay out their reasoning for Inflation or Deflation to the point that I am fairly confused and befuddled. Usually I don't like to pay much attention to macro economic issues. I am a adherent to the Peter Lynch School of thought that for the average investor spending 15 minutes a year focused on macro economic issues is a waste of 10 minutes time. But I have been very interested in reading and seeing if I can be prepared for either eventuality. here is a new article that comments on the different theories on the issue. http://enlightened-american.com/2010/03/22/inflation-is-dead-long-live-inflation-or-deflation the reason for posting it is the articles conclusion statement. "I don’t know whether the dice will turn up inflation or deflation. But after a massive credit crisis followed by unprecedented monetary intervention, the one outcome I would definitely short is a happy ending." Enjoy SmallCap

I do not live in Vancouver but I have stayed there numerous times for work and I can tell you that it is a wonderful city, easily one of the top three most beautiful modern cities I have seen (San Fransisco and Sydney being the others). I have Climbed the rocks at Squamish and have been to Whistler a number of times but have never skied there. The drive from Vancouver to Whistler is something to see.

This blogger always gives an assessment of the changes in holdings. http://enlightened-american.com/2010/02/15/seth-klarman-meryl-witmer-q4-2009-hedge-fund-moves SmallCap

Has anyone tracked this in a spreadsheet to know which share amounts have changed? SmallCap

Are you looking in the A or B shares? I am interested in the B shares with the variable interest rate. SmallCap

I am in the US, If I am looking to pick up a small number of shares of Fairfax and holding them long term would I be better off purchasing the FRFHF.PK or the FFH.TO shares and how does the difference in currency affect these two different shares. my inclination is to go with the FRFHF.PK because of the small number of shares I would be picking up and having no plans to sell them. what are your thoughts? Smallcap

Parsad, I wouldn't feel too bad about RDN, MTG and PMI, I also invested in RDN equity in 2008 (it appeared to be the strongest capitalized in the industry), it sure seemed at the time like it was way undervalued. miraculously (more due to luck then skill) I made it out of RDN with a decent return. but I still consider RDN to be in my big mistake column. The biggest mistake I ever made was at the same time I invested in RDN I invested in a REIT CYRV using some of the same assumptions I had for RDN and that one really hurt my returns. Both of those investments I made so many mistakes in my evaluation processes and I violated some of my rules and they came back to bit me. So I know it doesn't make it any better but just know that you were not alone in your optimistic evaluation of RDN and company. SmallCap

Why do you say that this will lead to years of Stagflation? SmallCap

I would be interested in the opinion of board members about which books or resources (besides his annual letters) give the most clear and useful information from an investors perspective of Warren and His investing. I have read buffet the making of an American Capitalist and have started to read Snowball. How would you rate the different books on Warren and which ones are worth reading?

it was stated on one website that follows him that after he published the book he regretted it because he didn't want to create any more competition. I am not sure if that is the real reason or not but it also talked about how super secretive he is about his life and investments. SmallCap

Thanks guys that was exactly what I wanted to know.