Tim Eriksen

The bottom line is both candidates are not just flawed, but deeply flawed. Neither is attractive but a third party vote is rather meaningless. I invert it. The House is almost assuredly going to be held by Republicans. The Senate is more likely than not going to be Republican, and could be tied such that the VP will determine which party has control. (If the Dems did win the Senate it would likely only last two years due to the high number of seats they have up for re-election in 2018). So the question I ask myself is would I rather have Hillary with a Republican Congress where major proposals of both sides are going nowhere (largely status quo) or would I rather have Trump where GOP proposals are likely to be passed and approved. With a Republican Congress most of Hilary's proposals would be dead on arrival. In other words what do I prefer on taxes - no change or a reduced corporate income tax and possibly personal income taxes? What do I prefer on immigration - tighter controls and enforcement or more of the same? What do I prefer for judicial nominations - liberal or conservative? etc. I can't think about the candidates because they both make me want to vomit, so I have to focus on the bigger picture and hold my nose and vote based on that.

Why would it be good for society or markets to allow someone to pay a manager to give him inside information?

Whoever advised Cooperman on his response should be fired. It was basically "It was not insider trading and besides I only did it in a few accounts, sure one was mine, but it was offset by a short position in my son's hedge fund (which I was unaware of but that doesn't matter), we didn't sell for nearly a year, and the rest of the buying was covering a short position (i.e. buying back covered calls) and that is not profiting.

It seems to me that the chances of a material reduction in corporate tax rates are much higher if Trump wins and Republicans retain both the House and the Senate. A reduction down to 25% would be meaningful for full tax payers.

By offering 0/25 with a 6% hurdle it was enticing to all the three other groups. It was always going to be better than 0/33 with a 6% or 0/25 with 4% (which 80% of his investors had chosen) and up to ~18% annual returns it was better than 0/16 with no hurdle. In other words it was a generous offer (i.e. price cut), and simplified the accounting which he did in house.

A lot of small managers start out with 0/25 and a 6% hurdle because that's what Buffett did. That is not very deep thinking. In fact it is not even accurate. Buffett did not offer 0/25 until later - he gave three options early on 0/33 6% hurdle. 0/25 4% hurdle and 0/16 no hurdle. I would suggest giving multiple options. I chose to start with a base fee and I think that was the better choice for me. It creates more stability for the business which is important for both you and the clients.

I am signed up. Anyone interested in going to watch a Flyers vs. Sabres game on Tuesday night after the conference? Tim

Do COO's, CFO's and other senior executives get paid 5 to 10x more than they used to? Maybe not but I bet it has grown much more than the average worker. Is that misallocation, or wise allocation? There seems to be truth in what both sides are saying. In some industries luck has more to do with it. Some oil execs made a fortune cause oil prices skyrocketed. That was luck and should not have been a major component of their compensation. In tech some destroy massive wealth and still make as much as the CEO who generates billions for a company. Yet at the same time it is not like you can cap CEO pay and solve problems without creating others. It is probably not enough to move average pay up more than a few percentage points, if that. The goal should be appropriate levels of compensation throughout the organization based on contribution to profitability. Some companies may end up with a lower ratio but others won't. It is up to wise management and boards to implement this.

The challenges are being subject to corporate income taxes instead of capital gains taxes, and the likelihood of falling under the Investment Company Act. NOLs may be able shield taxes but are limited after a change in ownership.

It is not apples to apples. First, rent is essentially principal + interest+ taxes + maintenance + profit. Mortgage interest is just what it says - interest. So making rent deductible would swing the pendulum beyond mortgage interest. Secondly, the owner of the rental property is likely already deducting the mortgage interest. You can't (or logically shouldn't) allow for something to be deducted more than once.

The greed that is almost universally ignored, particularly by politicians, was the greed of the buyers. The banks definitely made stupid loans (no doc, negative amortization), but the losses were due to buyers being unable or unwilling to pay their mortgage and walking away because they were upside down. I recognize some lost their jobs and couldn't pay. The buyers realized that it was heads they win (prices keep going up) and tails they don't lose because they can walk away after probably living for 6-12 months without paying their mortgage. While philosophically the bailout bothered me, the alternative would have meant higher mortgage rates. Of course what is also ignored is that the government made a tidy profit on the bank bailout. It irks me that one candidate states that the middle class bailed out the big banks. That is a ridiculous lie. The middle class doesn't even pay for their own share of the cost of government. How many cover the true cost of their children's education, let alone the cost of national defense? The federal government spends $11,500 per person.

Last I saw, Republicans in the House are the majority in 34 states to 14 Democratic Party states, with two split. Even if they picked up the majority representation in a few states to prevent a quorum, Democrats would look bad preventing a vote. The Senate would choose the VP from the top two in the Electoral College votes for VP (while the House chooses the President from the top 3). If the Senate flips back Democrat they could choose a Democrat VP, while a Republican House chooses a Republican President. By the way, in 1992 Perot received 19% of overall vote. He won zero states (thus receiving 0 electoral Votes) and finished second in only two. Barring Trump blowing up, it is doubtful that Bloomberg would win a red state due to his positions on gun control and social issues. He would primarily draw some independents and Democrats. I saw a recent poll that showed him at 13%, Clinton 36% and Trump 37%. The same poll had Clinton ahead of Trump in a two way race. Of course that could change as they campaigned and debated, or if Sanders is the nominee for Democrats. More importantly it is state by state results that matter but I have seen no public polls at the state level with Bloomberg in the race. In other words, it is doubtful that Bloomberg would significantly impact the Electoral College outcome, unless he can win states that would have otherwise gone Democrat. But hey all this is quite fluid which makes it fun to watch and speculate about.

While it is certainly possible that no candidate will have locked up the delegate count prior to the convention, it is very remote that anyone other than one of the top tier candidates would be chosen. I can guarantee that neither Paul or Hutchison would be selected. Paul lacks support now and most people have no clue who Hutchison is. Further, it is not like there is someone on the sidelines that everyone loves but did not choose to run. Anyone who mentions Romney clearly does not remember the lack of enthusiasm for him. So it would be most likely that the first or second place candidate would offer something to candidate #3 such as the Vice Presidency. The way delegates are awarded (some winner take all states, and thresholds in order to earn delegates) should result in only two or three candidates having a meaningful number at the end.

Since EV is capturing the market value of stock and Minority Interest an accounting figure, or book value, you have a disconnect. You need to either strip out the Minority Interest from EV along with the associated impact to EBIT, EBITDA, earnings or FCF, whichever you use since the company only has "rights" to a portion of it, as your friend suggested; or, convert the Minority Interest to its Market Value (which seems simpler).

I am not defending Turkey's actions, but I would say you are taking two separate "facts" and trying to blend them. The ten warnings do not have to be within 17 seconds. Many could have been on the jet's approach toward Turkish airspace. As for US foreign policy, there have been some successes (Israel still exists, first Gulf War, etc) and even more failings, but you seem to be blaming the current situation on the US and not them. (1) Was the Middle East turned into a "lunatic quagmire", or was it already one? (2) Was US foreign policy materially different than British or French? To really analyze it you have to go back and walk through the last 75 years.

No. That is why it is always referred to as material non public information. A director will have greater insight into the business than an investor, and a CEO has even more, but that alone is not insider trading. There is some grayness to it, since just knowing things are continuing as they have in the past is helpful, but that is not considered MNPI. Insiders can't do short term trades (holding periods of less than six months). Insider trading rules relate to trading on non-public information that an investor would consider important - a new product, loss of an account, lawsuits, etc. I am sure some lawyers monitor Form 4 filings to see if CEOs or directors violate blackout periods or do any trades before a major announcement.

Since I am on a board and manage money I will comment. You will gain great insight into the business, the quality of management, board dynamics, etc. that is overall very helpful for understanding not only that company but others as well. You will also be able to provide input that can help the business. The cons are the trade restrictions, the time involvement, and potentially frustration when things are not as you think they should. In the example you mentioned I would consider having someone else manage the liquidation. You may still have to file that the number of shares you potentially control declined due to "loss" of a client.

Give it up guys, Jurgis is not going to get it.

It is my understanding that you do not aggregate historical Form D's. The figures are to-date amounts since beginning.

Which part? I'm curious. I disagree with your rankings/distinctions. Why include acquisitions or partial purchases (security investments)? Outside of insurance, and Malone controlled entities, it is very rare that allocating funds to partial purchases in the public markets makes sense. It suffers from double taxation while repurchases has no taxation. It seems to me Group 1 (more accurate term than Option) can reinvest all FCF back into the business at very high rates of return. Group 2 cannot and decides what to do with the FCF between various options - dividends, dept repayment, repurchases, acquisitions.

Okay. I get what you are saying now that you clarified it. I just don't agree with it.

I hear this argument all the time but it seems flawed. Option 2 is riskier than Option 1 because management may screw up the repurchases. In other words management may not be good at valuing their own business which they know well and comparing it to the market price versus investing in their business. Yet in option 1 you assume management can properly judge reinvestment into its own business but also acquisitions of businesses they do not know as well as their own. That does not make sense to me. How can they be better at valuing what they do not know than what they do know.

I'm curious. Why is adesigar not getting the same comment?

What do oil imports have to do with taxes????

In terms of estate tax. It is absurd IMO for the tax rate to be higher than the long term capital gains rate. I would have no problem with heirs paying the LT rate in exchange for the stepped up cost basis, including farmers. (Having no estate tax AND getting the benefit of a stepped up cost basis doesn't make sense to me. That ends up allowing for tax avoidance). A three to five year payment option could even be given for less liquid assets. For example, the LA Lakers owner died recently. Ignoring there are some minority owners. He bought the team about 40 years ago and had a 2 billion unrealized gain. Should the children be forced to sell 55% in order to pay estate tax? Or forced to lever up the business? I don't think that makes sense. (By the way, high estate taxes distort economics such that wealthy buy expensive life insurance because it makes financial sense only because of a large estate tax).