gfp
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Posts posted by gfp
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6 minutes ago, Munger_Disciple said:
Consumer product revenues in MSR are also down which seems to indicate that the consumer is pulling back. Doesn't seem like we are going to have a soft landing.
Yes it is pretty much as expected and as Warren laid out so simply at the Annual Meeting.
"But the businesses are what count. So, the operating earnings, as you’ll see in the first quarter, came it at about $8 billion. And I would say that in the general economy, the feedback we get is that, I would say, perhaps the majority of our businesses will actually report lower earnings this year than last year.
In various degrees in the last six months or so, at various times, the businesses have left the incredible period, which is about extraordinary as I’ve seen a business since World War II, which poured out a lot of money to people who couldn’t get goods.
It was more extreme in World War II, but this was extreme this time. And it was just a question of getting goods to deliver. And people bought, and they didn’t wait for sales. And if you couldn’t sell them one thing, they would put another thing in their backlog. It was an extraordinary period.
And that period has ended. As you know, it isn’t that employment has fallen off a cliff or anything, in the lest. But it is a different climate than it was six months ago. And a number of our managers were surprised. Some of them had too much inventory on order, and then all of a sudden it got delivered, and people weren’t in the same frame of mind as earlier.
And now we’ll start having sales at places where we didn’t need to have sales before. But despite the fact that this year I think in general will be slower than last year, we actually are situated so that I would expect, and believe me when I say expect, nothing is sure."
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29 minutes ago, MMM20 said:
I don’t get the concern. Don’t they have $30B+ in liquid fixed income? $40B?
They don't want to dividend capital out of the insurance subsidiaries into the holding company because they want to support the growth while rates are attractive. Once the fat opportunity passes, they will dial down the growth (or even shrink a little), which will free up a lot of dividend capacity up to the holdco. That is why we aren't seeing much in the way of FFH repurchase activity this year. Just small amounts. They don't really have the money to do much.
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PCC doing better finally:
PCC’s revenues were $2.3 billion in the second quarter and $4.6 billion in the first six months of 2023, increases of 28.7% in the second quarter and 28.4% in the first six months compared to 2022. PCC derives significant revenues and earnings from sales of aerospace products. The revenue increases in 2023 were primarily attributable to higher demand for aerospace products, while power/energy and general and industrial products also contributed to the overall revenue increases. Long-term industry forecasts continue to show growth and strong demand for air travel and aerospace products.
PCC’s pre-tax earnings increased 31.5% in the second quarter and 27.3% in the first six months of 2023 compared to 2022. The improved results in 2023 reflect the increases in sales and improving manufacturing and operating efficiencies. We continue to strive to improve manufacturing efficiencies, maintain safety and prepare for increasing demand for PCC’s products. Continued growth in PCC’s revenues and earnings will be predicated on the ability to successfully increase production levels to match the expected growth in aerospace products demand.
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1 minute ago, yesman182 said:
Are you laughing because it’s so small?
Sure, the size relative to a trillion dollar asset base is pretty comical, but I was mostly laughing at the maturity / duration profile. Makes FFH look like they are out on a limb at 2.4 years, especially when you consider the rest of the t-bill portfolio.
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9 minutes ago, Libs said:
Re BNSF- these are significant revenue declines in consumer products. Anyone know what's going on? Has shipping shifted from the west coast to some other port? Should this be viewed as permanent?
<Operating revenues from consumer products were $1.9 billion in the second quarter and $3.8 billion in the first six months of 2023, decreases of 22.7% and 17.0%, respectively, from 2022. The revenue declines were attributable to volume decreases of 16.1% in the second quarter and 16.2% in the first six months of 2023 compared to 2022 and lower average revenue per car/unit. The volume decreases were primarily due to lower intermodal shipments resulting from lower west coast imports, the loss of an intermodal customer and competition from lower spot rates in the trucking market which has impacted our domestic intermodal demand>
Some container traffic shifted to east coast and gulf coast ports but there is a very real global trade recession in goods at the moment. Exports out of China are down.
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6 minutes ago, ValueMaven said:
Did Warren trim $40B from Apple?? As of 6/30: the Apple stake was $119B
That was last year. This year it is $177.6 Billion
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This "bond portfolio" LOL
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Results out. Nothing too surprising so far. Operating earnings up on Insurance strength. Rail down as expected. Pilot not very profitable initially. (pilot is more profitable than it appears due to significant D&A related to acquisition accounting). I would expect to see some refinancing of Pilot's 7% bank loan debt load sometime soon.
Looks like they sold around 9.1 million shares of Chevron in the quarter. Apple position unchanged.
Float up another $1 Billion in the quarter, same as Q1. Repurchase activity slowed in the quarter.
looks like we are at 1.4x book value at Friday's close.
Warren got to print his first trillion dollar asset figure on the balance sheet, so that has to feel nice for an old fella.
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This triple A nonsense is right up there with "Social Security is going to run out of money!!!" just stupid
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10 hours ago, LC said:
Also, do we know if they have extended duration on the bond portfolio?
Sounds like they are at 2.4 years average duration at quarter end.
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13 minutes ago, Ballinvarosig Investors said:
Have been selling a lot of things and am at 70% cash.
Like a few of you, I have sold out of BRK.B. Selling at this P/B has always provided an opportunity to buy in cheaper later.
Did you have to pay tax on the Berkshire sale? What do you figure the actual real-time Price to Book is for Berkshire? Certainly it would be lower than comparing today's share price to end of march Book value.
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Interactive brokers pays 4.6% and T-bills pay 5.4%. I'm sure there are money market sweep accounts available at most brokers. Most banks are also running promotional rates on CDs if you are looking to tie up the money for 6-9 months or longer.
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Yeah, we have a simple Weber kettle - the 22" nicer one that is a step up from the basic 18" unit. It works fine for us but we don't grill out a ton in the heat of south Louisiana. Plus I like that Weber is from Palatine, Illinois, which is basically where I was born.
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Just got back from a trip where my friend was raving about his big green egg and a few thousand dollars of extra "nest" tabletops and stations and such that were also big green egg branded. He made a brisket that was fine but not amazing. He was very enthusiastic about the several thousand dollars he had dropped on the setup. There are plenty of lower priced Kamado style smoker grills competing so it might be a little bit like the tons of knock off YETI style coolers out there from an investment standpoint.
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I don't know where to post this but it is always interesting to read Tim Eriksen's quarterly letters at Cedar Creek. I am posting it here even though it isn't primarily discussing ECIP recipient banks, because there is a lot of overlap in the folks that would find both interesting. (and there is some ECIP content). Tim used to post on this board occasionally and is active in Expert Market microcaps that most brokers don't offer. Kind of a cool throwback to the types of companies a young Warren Buffett got to sift through.
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https://www.sec.gov/Archives/edgar/data/718877/000119312523188107/d491908dsc13ga.htm
Berkshire's ATVI holdings are much lower than many assumed (as of June 30th)
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1 minute ago, Castanza said:
Yeah but the stock is trading at 92 and change this morning. Picked up some calls at 95 strike at .31 this morning figuring if the deal closes they will be itm and I'll get a cash out on the merger per OCC adjustment or if we get a decent bump today I'll sell before eod. Depends on volume too (which is why it's beer money).
I guess I am missing something. I was under the impression that 95 strike calls expire worthless on a cash deal at 95. They aren't in the money at 95. It would be a loss of 31 cents.
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1 hour ago, Castanza said:
July 21st expiry 95 strike calls.....very small amount (beer money). Figure with the 18th deadline tomorrow why not?
Isn't the deal price 95 cash?
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what are the "weeklies 95s?" 95 strike call options that you are long???
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I'm not sure comparing the pricing power of tobacco companies with the pricing power of insurance companies is as simple as that. Insurance companies are price takers, despite the current point in the cycle making it look otherwise to some.
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I guess it's a sign of the times that Berkshire is so large now that a $3.3 Billion acquisition is not material enough to warrant a press release or an 8K from the parent company - just a press release and 8K for the BHE subsidiary. Now we know what they plan to do with the BYD proceeds. I wonder if there is room to expand at Cove Point.
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10 minutes ago, mattee2264 said:
1/5 of over 85s are fully invested in stocks!
Yeah I don't blame them. I heard Warren Buffett was in his 90's and hadn't diversified out of stocks at all! Seriously though, have people who are 77-86 years old in 90+% equity portfolios too.
Imagine you own Berkshire and you are old and rich. You aren't going to spend even close to what you have. Why would you sell and pay tax just to reinvest the after-tax proceeds in something else at that age?
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Yeah we didn't talk about whether he was pleased with his investment track record or not. I imagine not. He is pleased with how things are going at the operating business called St. Joe Company. He's borderline giddy on it.
(he's not broke by the way)
Berkshire Q2 2023
in Berkshire Hathaway
Posted
So I believe that technically, AIG said they had a trillion dollars of assets in 2007 before the crash. Obviously we could put an asterisk on that one.