Crip1

I agree with UhuruPeak. Everyone should keep their posts respectful (this is not the yahoo boards). Criticism strengthens our understanding but I think most of us here want to see constructive criticism that is focused on refuting ideas, not attacking individuals. This is what the old board was like when it was at its best. I respectfully suggest that all posters should re-read the Terms of Use that Sanjeev posted on the main page. http://cornerofberkshireandfairfax.ca/forum/index.php?topic=42.0 Cheers! I have nothing to add... -Crip

Prevalou, They both are. The US Real Estate market is really the sum total of hundreds of markets and sub-markets stratified by metropolitan areas, price ranges, types of housing (condo, SF Home), even down to municipalities, school districts and subdivisions. Within the over US market any one of these sub-markets can and will vary greatly. I do know that based on some reporting that the volume of transactions in California is increasing and the rate of decline is decreasing. The market is still in decline, but that decline is not as steep as it once was. This is more prevalent among homes below $500K in value (of which there are a lot more now than 2 years ago). For the past 2-3 years the rate of decline had been accelerating there and in most of the US...the fact that the decline pace has shown to be decreasing is encouraging. This is analagous to a patient who goes from critical condition to serious condition as the patient has improved, but he/she is still in serious condition. Stumpf mentioned the CA market because that is where Wells has a high level of their mortgages, so that is a greater concern to Wells. Sokol is looking nationwide and seeing areas such as the upper Midwest, Michigan and Florida, among others, which are seeing the rate of decline increase. These areas do not matter as much to Wells, but do affect the overall picture. One interesting note, according to a report a colleague pulled, the supply of homes nationwide over $750K in value is at an all time high of 40 months. This is absolutely incredible. The point of bringing this up is that looking at the overall "market" is different than looking at an individual market/sub-market. Bottom line, it still ain't pretty out there. -Crip

Long, I don't think that you will see much of a response from the folks on this board, except that posters will tend to agree with your sentiments. Investments in Technology for most businesses is not so much a matter of increasing profitability, but a matter of sheer survival. Invariably, IT projects are pitched as "productivity enhancers" or some such thing, but I would be willing to bet that the cost savings and/or profit margin enhancement projections have turned out to be overstated 99+% of the time. But firms who delay their IT investments or who do so in a less than judicious fashion will falter compared to their competition and ultimately fail. -Crip

Scotty, Residential Real Estate is a good part of my professional business. Bottom line is that you are right to wait for a motivated (which sounds better than "distressed") seller, as they will certainly make themselves known in the coming months. We are starting to see the rate of decline mitigate, meaning that the monthly decline rate is better now than a couple of months back, but it is still in sharp decline. This light at the end of the tunnel is only the first step towards a level of "normalcy" in the housing markets. -Crip

Is Bsilly0 still out there? It just occurred to me that I have not seen his name since the move to the new board. His postings had always been great, IMO, so if he did not make the move, it would be a loss for the board. -Crip

Which suggests to me that ORH is being greedy when others are fearful. -Crip

Jumped the shark? Perhaps, but that's pretty damn good. -Crip

Sanj, My deepest sympathies. Thank you for a teriffic note. You have painted a picture of a remarkable woman. -Crip

I love reading just about everything Munger says. He puts more knowledge into a single sentence as most folks do in an entire speach. I'll bet you can learn something from listening to him sneaze. -Crip

Dustin, welcome aboard. Looking forward to your contributions. You live a couple hours from one of my favorite parts of the planet, Estes Park. I vacationed there annually as a kid to visit my grandparents who had retired there. A magic place to be sure. Anyhow, welcome. -Crip

Dude, Munger says more in one minute than some people say in a day, seriously. I found him to be fascinating when I saw him at the meeting last year...his commentary is raw, unfiltered and definitely spot on. The man has a self-awarded black belt in chutzpah. Granted that we all have varying tastes in just about everything but for my money, I'll gladly listen to him any time he is willing to talk. -Crip

I agree with the above. I concur with both of you, but would add that in the unlikely event that this did happen, the feature could always be deactivated if things got a little "chippy". I see the worst-case scenario in activating this as being pretty much non-existant. -Crip

Now that Warren said that, the chances of WFC getting to $9 is pretty close to nil. I got in with a smallish position at $10.50 and need to thank the gentleman at the Corner of BRK and FFH dinner (the night before the FFH meeting) who talked me out of selling. -Crip

Munger made that exact observation at last year's Berkshire AGM, right before Buffett made reference to the "small insurance company in Canada named Fairfax". As usual, Munger is spot on. -Crip

Tariq, Thanks...pinging between the three "tweets" is almost like being there...except I am laying in bed sipping on coffee! -Crip

Does any one else find it interesting that with short interest down to the levels noted above, that the Q1 2009 earnings report was not accompanied by the news headlines such as "Fairfax's Earnings Plummet", "Fairfax loses $60 Million for the quarter" or "46% revenue decline leads to $60M loss for the quarter". -Crip

Good question. The last post was 12 February so I used that date: Votes Performance 12-Feb - 30 Apr ORH 1 -27.64% ORH.A 4 +4.83% (Which I do not believe includes dividends) FFH 18 -22.03

Netnet, http://www.fairfax.ca/Assets/Downloads/AR2008.pdf See pages 117 through 126 (or 119 - 128 where acrobat counts the cover and inside cover as pages one and two), the areas labeled "**** Accident Year Claims Reserve Development". -Crip

I posted a poll on this a few months back where the options were ORH, ORH.A and FFH and ORH was the clear loser. Of course, ORH was about 25% higher priced at that point and ORH.A was priced about 5% less that it is currently selling for. Obviously, the voting then was less about the virtues of the respective firms/issues and more about the price vs. value considerations. Right now, I have to say that they are pretty even with a slight tendency to go with FFH if for no other reason that there is a higher upside. Time will ultimately tell, but the various smaller acquisitions of Polish Re and others past and future suggest to me at least that FFH a little more attractive at current prices. It is not unlike going into a restaurant and pondering whether to go with the Porterhouse or the Filet. I have opted for the Porterhouse. -Crip

T-Bone, That was part of my thesis when I bought Suncor a couple of years back, that and they had a effective hedge on the Nat Gas required to extract the crude from the oil sands. I profited on Suncor but not NEARLY as much as I would have had I held out another 6 months or so. Now, though this is a COP thread, I am looking again at Suncor...anyone else? I thought Mungerville was positive on it as well but that was a while ago when crude pricing was on a significnt increase. -Crip

Hello All: Can anyone provide insight on a reasonably robust, and reasonably priced, portfolio tracking software package? Years ago I used Quicken for all of my personal finance and their software was decent, though a little less robust than I would have liked. I would like to be able to track buys/sells, total return, dividends reinvested, etc, and have the ability to report on total returns, total yield, etc. I want to say that there was a thread on this subject a few years back on the MSN Board but even if I could find that, the info would be rather dated. Any thoughts would be appreciated. Thanks in advance. -Crip

"It really disappointed me when they became a bank holding company. Seems like crony capitalism and I wish Buffett had been more vocal about that change." John, can you help me to understand your concerns a little? I am not agreeing or disagreeing, just want to understand, that's all. -Crip

I also agree with much of what Mark Sellers stated in the speech, but not all of it. FWIW, here is my spin on what is needed to be an outstanding investor. Humility – I’ve said it before, but it bears repeating. The vast majority of the postings on this board show a high level of humility, a trait shared by the masters. Consider the Buffetts, Watsa, Templetons and others…they ooze humility. Buffett’s folksy quip of “When you see Ajit Jain, bow deeply” is cute but speaks to Buffett’s freely admitting the expertise of others. I work for a small company which is owned by a VERY smart man who is a terrible investor. Why? Well, there are a few reasons but one of the biggest ones is that he has an undying need to be in control presuming that he can do better than others. This tendency results in his inability to let others, such as his company’s management (including myself) make many decisions. This tendency hurts his ability to invest as he is not able to run the company in which he invests. He automatically assumes that he can make better decisions whereas most of the board members here acknowledge the superiority of Buffett, Prem, Berkowitz, etc. Also, a by-product of humility is constant seeking of knowledge. Realizing one’s limitations compels one to constantly seek to know more…reading and studying…becoming a constant learning machine. Mark’s #3 point parallels this. Analytical Ability – The most often thought of application of analysis is related to numerical analysis of financial statements, but analysis also relates to understanding of how business work, physics, human psychology, etc. I would argue that, while financial numerical analysis is important, that it pales to the ability to analyze facts and figures and separate them into what is important and unimportant. This is key in that for every investment out there, someone can give you 10 reasons to NOT make the investment. Where the successful value investor differs from the non-successful investor is that the former can separate the important from unimportant and assess the relative merits of an investment based on this analysis. Analytics encompass both point 4 and 6 of Mr. Sellers. Emotional Control – Let’s be honest, taking a position and seeing it drop by 20-30-50% is disconcerting at best and scares the living hell out of you at worst. The question is whether or not that emotion causes one to act irrationally. It was instructive to read this board over the past 18 months as the markets have plummeted. Those who had moved into cash calmly deployed when the time was right (give or take a few months) and those who did not move into cash (yours truly) calmly held their undervalued positions and/or re-deployed into more undervalued positions. The key…nobody freaked out. 5 years from now, that emotional control will have shown to pay significant dividends. Emotional control is what really drives the first and final behaviors on Mr. Sellers’ list. Of course, it is worth noting that several board members predicted rain a few years back AND built an ark! Confidence – This is the “table” which is supported by the three legs referenced above (Humility, Analytics and Emotional Control). If one has the first three, then more often than not there is a feeling of confidence. This confidence (not cockiness, but confidence) is key to maintaining the emotional control. See Selles’ point #5. I do disagree with trait #2. While one certainly needs to be focused, there is not a need to be obsessed. Others’ opinions may differ, but obsession is focus taken to an unhealthy level. Now, as this relates to Mr. Seller’s speech, I think he is right that there is a small subset of individuals who posess all of these traits. That is not to say that those who do not are not intelligent or will not be successful. It’s a matter of having the total package which applies to the art and science of investing. -Crip

We have read several rumors about what Berkshire/Buffett is doing or not doing over the years...I cannot recall any of them becoming reality. -Crip

This week, ORH.A Pfd is up close to 6% where the common is down more than 1.5%. Any thoughts as to why this may be? -Crip