gfp
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Posts posted by gfp
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It's funny, with Fairfax, nobody points to the bond portfolio and panics over the idle cash. They get busy calculating the spread between 95% combined ratio cost of capital and +4.5% investment yield. At Berkshire it sits in 3 month and 6 month bills and it's some huge problem. If Warren moved $150 billion to 3 and 5 year treasury notes would everybody stop worrying about the "cash problem" and call him a genius like Brian Bradstreet? Can we just call most of Berkshire's cash the "bond portfolio" and be done with the 'big cash problem' talk?
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pdf of the article. Go ahead and remove it if an opinion section excerpt is some kind of copyright issue.
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1 hour ago, ValueArb said:
According to the FT analysis the last decade hasn't been kind to Warren's public company investments (trailing the S&P 500), but both Ted and Todd have done much worse. Their methodology is pretty ad hoc, so can't attest to the reasonableness of their conclusions.
They make one good point about Berkshire's "permanent capital" giving them an edge that few managers have. But I think overall running a $350B actively managed portfolio is probably the most challenging situation an investment manager ever had. So it's not surprising that even Buffett is trailing the S&P for long periods now.
I'm not sure what the solution can be after Buffett, I doubt the shareholder base has the stomach for an enormous one time dividend or whether it would be enough to lighten those chains to return the portfolio to consistent market beating returns. Even a $250B distribution would leave them with over $100B to allocate, and even if they produce stellar returns that's from barely 10% of Berkshire assets so how much could it move the needle?
So it's kind of a bullshit article because they don't know which investors bought which stocks. Several of their guesses appear to be incorrect.
These are likely wrong:
Aon: Buffett
Capital One: Buffett
Celanese: Combs/Weschler (not sure)
General Motors: Combs/Weschler (not sure)
Lee Enerprises: Combs/Weschler
PNC Financial: Buffett
S&P 500 ETF: Buffett
VeriSign: Combs/Weschler
Verisk Analytics: Combs/Weschler
(they also don't do enough research to figure out the actual buy and sell prices to calculate the returns, using 13F quarter-end data instead)
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Thanks for posting - nice to see they got the green light to stream the annual movie on CNBC - I'm sure there will be some great stuff in there this year.
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pretty sneaky how you subliminally inserted the nutrition information of the Tim Hortons menu into your post
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3 minutes ago, Hoodlum said:
But would it be that large under IFRS reporting?
I don't think Q1 will be that bad. Partly because of the offsetting IFRS discount effect but primarily because the real meat of the bond sell-off started the day after the quarter ended. Q1 was pretty tame. We'll see how Q2 and the rest of the year unfolds but I'm not expecting 2-7 year treasuries to stick around with a 5-handle on the yield for more than a few days. There is a lot of demand for those securities at 5%. I know I'm a broken record on that but watch the 2 year - at 5% buyers come flooding back in, which is unsurprising.
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1 hour ago, DooDiligence said:
Sorry for spamming things up here but would this be reasonably accurate (albeit a bit repetitive)?
did that article ever mention that it is unlikely that Warren Buffett was the one who actually bought the MKL stock? It was a lot of words without saying much so I couldn’t read it all. -
In case anybody hasn't read "Trillion Dollar Triage" and has an interest in the history of Fed independence from the White House, this article is basically a big excerpt from the first part of the book -
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28 minutes ago, scorpioncapital said:
I wasn't aware that someone suing a division of Berkshire can't access the parent. Is this in the sense that it can be allowed to go bankrupt and protect the cash of the parent? If so it seems another bonus of BRK's structure.
It depends on the subsidiary and how the bulkheads are constructed. I believe a subsidiary of BHE, like Pacificorp for instance, can be put into bankruptcy without the other assets of BHE being risked, much less the parent company holding company. But I'm sure there are exceptions for nefarious asset stripping or fraud. I mean, look at JNJ and the Talc stuff - you don't see all of JNJ at risk.
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Warren always said there are certain businesses where you aren't well served by having a "rich parent." He never contemplated being a helmet manufacturer, was one of his examples if I remember correctly. I think his mindset from the insurance industry has served him well over the years in considering as many risks in his other businesses as he can - which is why he gets a little crabby when he misses some.
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1 hour ago, Sweet said:
US birth rate currently 1.63, I think that’s a huge problem for the economy and stock market in the future.
https://www.wsj.com/us-news/america-birth-rate-decline-a111d21b#
"In the future" can be an awfully long way away. I wouldn't base your investment decisions on an article citing birth rates and trends.
The United States is uniquely positioned as being a very desirable (and apparently easy to sneak into LOL) destination for young, productive (and fertile), immigrants. Many other countries have much more serious demographic problems.
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1 hour ago, backtothebeach said:
Now back down to $17.30.
The founder managed to sell a few decent sized blocks at high prices. One of them to a "private fund" which sounded to me like a fund covering a short position. Predictably, they filed a preliminary prospectus to issue a ton of shares if they can get it going in time. Today's volume is high so maybe they got some shares sold?
https://www.sec.gov/Archives/edgar/data/1843974/000157587224000368/es106_n2.htm
https://www.sec.gov/Archives/edgar/data/1843974/000157587224000367/xslF345X05/ownership.xml
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HomeServices has settled their antitrust suit -
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Dusseault said HomeServices faced potential bankruptcy if it didn’t settle. To even appeal the verdict it likely would have needed to post a bond, which a judge could have set in the billions of dollars.
If Berkshire had instead stepped in to bail out its subsidiary, it would have set a precedent that could make other companies under its umbrella an appealing target for litigation. "
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1 hour ago, Jaygo said:
lol. If anyone is surprised by these numbers they are blind. When every single railroad is shrinking volumes ya know something ain’t right. Wages and employment are next.
I expected a higher GDP print (and I'm always bearish LOL). I think rail traffic is actually fairly normal if you ignore Coal volumes. I don't think coal volumes are a big economic red flag personally. There is some shifting back towards the western railroads again I would imagine. I would expect BNSF to print a decent intermodal number. Auto shipments are high. Petroleum products and chemicals are high. Looks healthy to me as far as rail traffic goes.
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Oh joy... This guy is coming to rant about Bill Gates and Epstein again.
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1 hour ago, nwoodman said:
Thanks - these transcripts are getting pretty good. How do they get a name like Gobinath's perfectly transcribed? Must not be AI?
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55 minutes ago, Viking said:
OK. So after all that… What is an investor to do?
Go short because IFRS is confusing?
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11 hours ago, Jaygo said:
Bingo. I’m not Austin Mathews so I’m not making the kind of money he is. He can do lots of dumb shit with his money because lots more is coming.
But for normal folks we have to play the game that is being played not the one we want to play. I personally feel that reasonable dept financed asset purchases is the only way to get ahead. Would I rather make 15 mil a year and not worry about this shit? Yes!
I am in the position that if I work and invest what I can ( say 30k a year) I will live a decent life with some good security as I age, I personally feel that if I want to have an excess above this level I need to accelerate the flywheel by the use of dept.
so far so good. I can borrow at 6 and expect 10 through something like brk. Safe if done right.
the 6 is tax deductible yearly and the 10 is cap gains when I decide to unwind the game. I don’t like the game but I understand it is the way it is.
Jaygo I notice you always spell "debt" with a "p" - is that a keyboard thing or a country of origin thing or what? Just curious since it has been consistent.
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3 minutes ago, Sweet said:
Sorta feel the same, and I read on Twitter it’s drones that fly about 200 mph which will be easily intercepted if true.I am certainly not an expert in any of this but I have heard the idea is to have over 100 different things (drones, cruise missiles, ballistic missiles) arriving around the same time at vastly different speeds, altitudes and directions - hoping to confuse the various air defense systems. With so much preparation I assume close to all of them will be shot down but odds are a couple will get through.
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6 minutes ago, sleepydragon said:
Can someone explain to me what does bitcoins has to do with this?
Bitcoin was probably the only market that was open. If you feel like reducing risk and raising cash, you go with the markets that are currently open. Bitcoin is always open.
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I saw the founder / promoter / whatever you call him sold $4.5m worth at $30/sh. I assume he has sold more since if allowed to. I am unclear if they can issue new shares at a premium to NAV any time soon. I covered my short with all the Levine attention but it’s been an entertaining and profitable distraction. I even held a short overnight one night
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2 hours ago, charlieruane said:
Fascinating! Mind if I ask where you heard this?
Warren told the story either at an annual meeting or in an interview. Nike was the example but he had Lou liquidate his entire portfolio before he left.
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18 hours ago, gfp said:
I don't know what they can or can't do but I don't see how they could get that extra capital invested in private companies very quickly. This thing traded $118.75 after hours tonight. (we are talking about DXYZ in case that is not obvious)
Matt Levine wrote about it in his column today, so I'm sure a bunch of people learned what it was that hadn't previously heard about it.
So DXYZ traded above $120/ share multiple times after-hours last night and this morning. Interactive brokers still had shares available to short at that time but the borrow rate was 80-90%. Less than half that price currently. NAV $5. Just a bizarre trading sardine
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1 minute ago, backtothebeach said:
>500,000,000 shares authorized, 10,879,905 shares issued and outstanding
Hmm, could there be some reflexivity here? Can they place the other 489M shares at market price?
I don't know what they can or can't do but I don't see how they could get that extra capital invested in private companies very quickly. This thing traded $118.75 after hours tonight. (we are talking about DXYZ in case that is not obvious)
Matt Levine wrote about it in his column today, so I'm sure a bunch of people learned what it was that hadn't previously heard about it.
Fairfax 2024
in Fairfax Financial
Posted
Seems like FFH share repurchases should come in around $195 million in the quarter but I may be double counting some shares. We'll see how far off I am later.
https://ceo.ca/api/sedi/?symbol=ffh&amount=&transaction=&insider=Fairfax