gfp
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Posts posted by gfp
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No clue if this New Mexico utility would be of interest to BHE, but their deal has just fallen apart and they are contiguous with BHE's western territories.
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I had missed this updated BRK-Energy presentation from November and found it interesting. Good detail on what PacifiCorp plans to do to deal with wildfire risk and some good updates on BHE capital expenditures for the next couple years on slide 13 -
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Berkshire Hathaway Energy and its subsidiaries will spend approximately $31.4 billion from 2023-2025 for growth and operating capital expenditures, which primarily consist of new renewable generation project expansions, new electric battery and pumped hydro storage projects, and electric transmission and distribution capital expenditures"
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21 hours ago, yesman182 said:
How did you get WEB's permission to do this?
Max has been publishing Warren's letters in book form with Warren's permission / cooperation for many years. I think Warren prefers that people read his annual letters in his own words as a complete history of Berkshire Hathaway over any of the biographies or warren buffett-way type books.
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This link has a long passage from the Snowball that provides some of the narrative -
https://www.gurufocus.com/news/249886/seeking-wisdom-from-the-early-charlie-munger-
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3 minutes ago, Viking said:
Here is a link to an old writeup on Fairfax from 1999 that discusses this relationship.
Oh man I really thought that was going to be a 1999 research piece but I guess you meant 2019.
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17 minutes ago, Gmthebeau said:
Everyone and their dog saying lock in long term rates here at 4%, but virtually nobody saying it at 5%. Rest assured the crowd always wrong, and we will likely see persistent inflation and despite Jerome salivating to cut rates, the 30 year will likely re-approach 5% sometime in 2024.
On 10/11/2023 at 10:14 AM, gfp said:I think there is a lot of demand across the curve for treasury securities with a 5 handle. This year's bond market (and maybe the stock market as well) is shaping up to rhyme with 2018.
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Would you look at that...
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I wonder if we will see this price run up in FIH was the result of Fairfax Financial using the expected cash incentive fee to acquire FIH shares in the open market. It's sort of the best of both worlds when you have a fiduciary responsibility to both FIH and FFH shareholders. You don't take the FIH incentive payment in dilutive discounted shares (good for FIH shareholders, bad for FFH shareholders) but you use the expected cash payment to acquire discounted FIH shares in the market, which doesn't dilute FIH shareholders (but is good for FFH shareholders).
I suppose we would see a filing soon if this were the case. Seems like the best "fair and friendly" way to navigate the sticky situation of representing two different groups of shareholders simultaneously.
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@dealraker You're alive! I was starting to worry about you after a couple of weeks with no Charlie wisdom anywhere...
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10 minutes ago, value_hunter said:
Any news for big drop(3%+) today?
So insurance companies like BRK and FFH are down presumably because high interest rates are over. Fairfax of course has locked in decent yields for 3-4 years but the average market participant isn't real up to date on Brian Bradstreet's moves. Berkshire of course hasn't locked in shit - all t-bills as far as we know.
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18 minutes ago, OCLMTL said:
Can someone remind me the float impact of this transaction closing please? thanks!
I believe GIG had around $2 Billion USD in "float" at yearend 2022. I don't know if any portion of this was previously "counted" as Fairfax float but I doubt it.
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"when painting the tape is good for shareholders" starts today (the first day of the 10-day VWAP period)
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16 hours ago, Viking said:
The next thing to watch might be Fairfax's stock portfolio - if we get a stock market rally into year end.
At this point it's almost like, "what stock portfolio?" A little bit of Micron and some OXY but if you don't include the stuff that isn't marked to market Fairfax has a tiny stock portfolio compared to total investments. A couple billion total or something like that?
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3 hours ago, mattee2264 said:
Funny that the Fed Put has morphed into the Fed Call. Markets close to ATHs and Powell comes out and congratulates himself on beating inflation and says rate cuts are now on the table and don't worry guys inflation will be back on target in 2026.
I'm sure the short sellers don't feel like they have a "Fed Call" in their pockets to bail them out
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Billionaire Jimmy Haslam is under investigation by federal prosecutors looking into whether he offered illicit payments to executives at Pilot Travel Centers, a lawyer for the company said.
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2 hours ago, dartmonkey said:
I just took the 49% from the 2022 AR. Yes they own 54%, but I guess there are ptions or warrants outstanding that dillute this to 49%:
p. 6:
Investment / Date of Initial Investment / Ownership / Amount Invested / Fair Value (Dec 2022) / Annualized Return
Bangalore International Airport (3) / March2017 / 54.0% / 653.0 / 1,233.7 / 12.2%
(3) Fairfax India’s effective interest in Bangalore International Airport is 49.0%(on a fully diluted basis).
This press release from this evening seems relevant -
QuoteFollowing completion of the second closing, Fairfax India’s aggregate share ownership in BIAL has increased to 64% (20.4% held by its wholly-owned subsidiary and 43.6% held by its indirect subsidiary, Anchorage Infrastructure Investments Holdings Limited) from 54% last year.
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I can't find the post from the other day about the 7.5 million share cross on FIH.U that occurred after hours. FWIW, this was just intercompany transfers of Fairfax India stock between different Fairfax insurance subs.
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7 minutes ago, Spooky said:
Any new content in this book since the last version?
I think just the foreword by Collison, but the entire book is available for free and even has a clever "Berkshire Mode" that looks like their W.E.B. site.
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1 hour ago, Thrifty3000 said:
Back of the envelope, I estimate this will increase the earning power of the bond portfolio by around $5 per share. (I’m assuming less than 2% loss provision, but pulled that out of the air.)Are you assuming $5 per share is the incremental earning power of the additional $2 Billion loan investment (if it actually gets invested, this is just a commitment, not deployed) over that hypothetical $2 Billion being invested in a T-bill currently or are you assuming that hypothetical $2 Billion loan investment is earning zero currently?
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26 minutes ago, UK said:
JPMorgan Chase, a bank,
Phew, I was confused for a sec. Maybe someday we won't have to write "X, formerly known as twitter" anymore
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WSJ has a brief article on the Haslam dust-up. Not much new but a couple of quotes from outside observers on misaligned incentives
The case illustrates the difficulty of crafting incentives in complex corporate structures so that everyone is rowing in the same direction, said Jordan Barry, a law professor at the University of Southern California. For instance, EBIT clauses, such as the one at PTC, can have a positive influence, by encouraging growth.
“But you do have this issue where, when you pay out based on a particular year’s EBIT, that encourages people to try and load that one year up with as much earnings as possible,” Barry said. “And if that comes at the expense of other years, that’s not good.”
Barry gave a hypothetical example of how getting paid based on a multiple of 10 times EBIT could incentivize a company being bought to accept lower prices on contracts just to get them booked in the current year.
“Let’s say this contract would make you $100,000 normally, but you close this year if you’re willing to do it at $80,000,” Barry said. “That’s not usually a great trade. You just lost $20,000.”
But, because the company is being sold, that contract is then worth $800,000. “That’s a great trade for you,” he said.
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35 minutes ago, james22 said:
Any chance BRK is interested in Endeavor Energy?
Highly doubt it unless it somehow came through OXY. Even that would be hard to believe.
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3 minutes ago, Munger_Disciple said:
During Collison's interview, Charlie recommends evaluating investment managers using per dollar-year returns & to avoid using time weighted returns. Does anyone know what Munger meant?
He's talking about Money-weighted rate of return, you can google it. I actually think he was calling out his friend Mohnish in that segment!
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6 minutes ago, Xerxes said:
hiwhat is the source for this. It is not available on the “news” on the website ?
Read my post above yours. I linked to both Kennedy Wilson 8-Ks
2023: the year of cash and t-bills
in General Discussion
Posted
If you don't mind sharing, what did you do before returning to full time investing?