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This was a pleasant surprise this morning. They had announced they were exploring strategic alternatives but I wasn't expecting something so close to book so quickly. I wonder why Ace wants this at this price? I think we have Brad Radoff to thank much more than Sardar on this one. Brad's been in there talking with management for a lot longer.

I believe there is a lock up preventing them from selling the rest of the stake until 2013 Lock expired this month on their entire stake. I think they are not able to find a buyer for their entire stake. Vinod It looks like only 2 Billion of the shares are still locked up. From the most recent 10Q: "At both June 30, 2011 and December 31, 2010, the Corporation owned 25.6 billion shares representing approximately 10 percent of China Construction Bank (CCB). Of the Corporation’s investment in CCB, 23.6 billion shares are classified as AFS. Sales restrictions on the remaining two billion CCB shares continue until August 2013 and accordingly these shares continue to be carried at cost. At June 30, 2011, the cost basis of the Corporation’s total investment in CCB was $9.2 billion, the carrying value was $19.6 billion and the fair value was $20.5 billion. At December 31, 2010, the cost basis was $9.2 billion, the carrying value was $19.7 billion and the fair value was $20.8 billion. This investment is recorded in other assets. Dividend income on this investment is recorded in equity investment income and during the six months ended June 30, 2011 and 2010, the Corporation recorded dividends of $837 million and $535 million from CCB. The Corporation remains a significant shareholder in CCB and intends to continue the important long-term strategic alliance with CCB originally entered into in 2005."

I believe there is a lock up preventing them from selling the rest of the stake until 2013

Well we know one guy: http://www.sec.gov/Archives/edgar/data/789019/000122520811014766/xslF345X03/doc4.xml

Interesting article, thanks for posting it. Here's something recent that Richard has done (AU:EWC) http://www.richardchandler.com/news/2011-06-11-Energy-World-Corporation.pdf They have split their operations into: http://www.legatum.com/ , http://www.legatumcapital.com/ and http://www.richardchandler.com

I have heard attendance was about half of last year's attendance. Was it a secret that this was the last Pasadena meeting? I thought it was pretty well communicated.

$3.2 Billion in Q2 outflows for Fairholme... Time to buy financials!

Here's a link to most of them with original formatting. Always a great read - http://www.ticonline.com/buffett.partner.letters.html

The canadian stock market is closed today. Don't pay the pink sheets any mind, the primary market is in Toronto.

http://www.sec.gov/Archives/edgar/data/1067983/000107109811000003/xslF345X03/primary_doc.xml

Cracker Barrel's retail side also operates a sort of books-on-tape library / rental service, where road tripping people can rent a book-on-tape (CD) at one Cracker Barrel and return it however many miles later at another. Little stuff like this has a cult following with some road trippers, which helps drive some incremental traffic to the restaurant. Also, a competitor in much of the US South is Waffle House, which allows smoking - giving Cracker Barrel a leg up with families. I mean, with that audio book rental model, they should get NFLX's multiple - NO?

While I agree that BNSF is worth at least $40 Billion right now, it is not correct to say that Buffett paid $40 Billion for it. Buffett paid $32.5 Billion for BNI.

I agree that that's how it used to work - but the market is not too responsive to his valuation hints these days. It used to be that Munich Re would have gone up with folks learning that Buffett was over 10% and "it is intended to acquire more", but that didn't happen. There used to be a premium in the stock price for the skills of Warren Buffett. Now there is a large amount of supply every day and the general S&P index effects pushing it down on weak days for the overall market. I could see a buyback actually getting done with sentiment on Berkshire where it is these days. A huge contingent of longtime Berkshire shareholders are in the philanthropic phase of their lives - that's a lot of supply.

I'm buying shares here, but one thing you can count on is that Buffett won't announce any sort of share buyback while the WSC deal is pending. It would look too much like jawboning the share price up during the period when the average price determines the exchange ratio. He's definitely not happy about the price he will be issuing shares for WSC, though! And BRK had to eat WSC minority shareholders' share of the Q1 insurance losses.

It all comes down to the quality and integrity of his research. If he's correct, there is absolutely nothing sleazy about it. Do you think it's sleazy of Whitney Tilson and T2 to put out powerpoint after powerpoint touting BRK.A and MSFT? I know folks on this board dislike short sellers from the FFH days, but who else will effectively police the frauds in the securities markets? The last couple of years of China research was very eye opening for me. I had not been to China until last year. I recommend the book "Mr. China" by Clissold as a classic for anyone thinking about investing in or doing business with China-based companies.

It's Carson Block's China-RTO centered research website. He does extensive research, takes a short position/puts/whatever, THEN releases the report. http://www.muddywatersresearch.com/wp-content/uploads/2011/06/MW_TRE_060211.pdf

Does anybody know why Marc Hamburg is not a reporting insider with the SEC? I assume he owns at least some Berkshire stock, yet he doesn't report anything. No Stock? At other companies they at least show a dash for zero shares.

Buffett (Berkshire) owned Diageo for years. He was also a top shareholder in Anheuser Busch before the buy-out. He's not a teetotaler when it comes to buying portions of public companies.

Yeah, sorry - I should have said "In the United States." The question was about the Mississippi floods. I think there will be crop insurance claims and that type of thing. Plus some insurers will write supplemental Flood coverage above the Federal limits.

Most private insurers don't have direct flood exposure. Tornadoes tend be very localized and not very costly as a result.

Here's an example of a new piece of research that was released recently in the space. (always a bit shady when they release stuff on options expiration week) http://absaroka.com/uploads/YONG.ResearchReport.051811-vFINAL.pdf full disclosure: I have researched this company in person in Inner Mongolia and Beijing. I have no position in the company.

still nibbling on overstock http://www.sec.gov/Archives/edgar/data/1130713/000114420411030717/xslF345X03/v223232_ex.xml

If the context of the question was short-selling related, I would agree that it is a security on the reg. SHO / fail-to-deliver list, like many of the small Chinese RTO stocks (CAGC, CCME, DEER, SCEI, SCOK, YONG, etc...) If the context was Bankruptcy / Distressed investing, maybe he was referring to a "fulcrum security"?

I would say there is very little you can add without being on the ground in China. If you are there or have the budget to hire local investigators, there is probably still an opportunity to find some dubious practices. Get used to the idea that some of the companies are 50% real, others 30% real, etc... There are lots of related party transactions and inflated transaction prices, etc. The most blatant frauds have already been exposed. Also, if you are intending to make money on your original research - many of the small cap RTO equities are now expensive to borrow (or impossible) and put premiums quite high. Chinese RTO stocks are showing up on the reg-sho naked shorting lists as people who established short positions through puts were unable to borrow the shares. It's become quite popular and the short squeezes can be very painful.

It really was a great deal - as close as you're going to see Buffett get to an LBO. He borrowed $8 Billion at 1.6% and has already taken $3.25 Billion in dividends out of Burlington to pay it down. He's been pulling cash out at a Billion a quarter this year so far.