gfp
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Posts posted by gfp
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5 minutes ago, Gmthebeau said:
Pretty sure Berkowitz won't make much if anything ever off St Joe.
I spent a couple days with Berkowitz touring almost every St. Joe development property and I think he's pretty pleased with how things are going.
Did he have a master plan to have almost his entire fund be in one illiquid concentrated holding? No, he did not.
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So midsize banks have already stopped expanding credit since March and, while generous in its "negative haircut," programs like BTFP are at least as expensive as other funding sources (currently 5.5%). Midsize bank profitability is going to look horrible by at least the 3rd quarter, if not already in the results we start to see next week.
https://www.frbdiscountwindow.org
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"As I have mentioned many times in the last 37 years, you, our shareholders, suffer a major negative as our company is not for sale at any price."
- Prem, most recent annual letter to shareholders.
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11 hours ago, Parsad said:
At 22-23 times earnings...you are getting a 3.25% yield from the S&P500 plus like 1.5% in dividends...so around 4.75%.
Seems like 22x earnings would be more than a 3.25% earnings yield and to add dividends on top of the earnings yield is double counting. Where does the money come from to pay the dividend - the earnings you already counted.
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10 minutes ago, SharperDingaan said:
We hold a mid 30's weighting in equity cash equivalents; ubs btc, gxe. If we did nothing, we would very likely have doubles a year out, and in the interim take home a monthly 5%+ cash yield.
SD
Just to clarify, do you hold mid 30's % allocation to cash equivalents or are you counting equities like UBS Group as an "equity cash equivalent?"
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24 minutes ago, Intelligent_Investor said:
Treasury yields are popping, 30 year bond now at a 4 handle, this could be very good for FFH
Well they didn't bite the last four times it happened in the past 8 months.
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There isn't much to it but here it is as a pdf
Buffett’s derivatives bonanza doesn’t prove that Taleb is wrong | Financial Times.pdf
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Speaking of Warren and derivatives, the FT has a piece out this morning on Berkshire's use of derivatives -
https://www.ft.com/content/f6524f65-188e-4d21-a943-18f9c6a61b8d
(fwiw, I read it and didn't find it to be of much value. No mention at all that Berkshire's "huge" exposures to credit default swaps were essentially contained in a de novo bond assurance operation that was primarily writing 2nd-to-pay insurance on top of primary bond insurance coverage already in place. And no clue what the author is getting at asserting that Warren was allowed to be "creative" and "flexible" in his accounting for losses. Sheesh.)
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It's pretty great that the corner of Berkshire and Fairfax message board was named after two securities that are almost tied in performance this millennium, with the smaller up-and-comer, Fairfax, clocking in at 846% vs. Berkshire's 826%. Going forward it is likely that Fairfax will continue to outperform Berkshire over long periods due primarily to the size difference. Unfortunately my dividends are taxed so Berkshire is ahead for this taxable American.
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5 hours ago, jbwent63 said:
I'm not sure if its me or not. Did BRK.A not close at June 30 with a price of $517,810 and the B share at $341? I'm not sure why Morningstar would be showing $459,210 as a closing value for the A shares on the same date.
The way morningstar's chart works, they are telling you that Berkshire's A shares increased by that dollar amount during the period. It isn't the closing price.
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1 hour ago, Thrifty3000 said:
Knowing they don’t have an interest rate crystal ball it feels like it would be irresponsible and overly conservative to wait for rates to hit the 99th percentile before making a move.
Sure but my point was that in the 3 month period they purchased these forwards the 3Y note rate was between 4.75% and 3.4%. This isn't a case of waiting around for the 99th percentile or something. Those were the rates available during the quarter they chose to purchase the forward contracts. I think they thought they missed it and scrambled to lock in more at 3.75%.
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What did you do before you retired?
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Without dividends included gets you this, as mentioned by treasurehunt above:
The US dollar OTC ticker didn't come along until a bit later but produces a result closer to tied somehow:
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I'll have to defer to @boilermaker75 on his strategies for selecting the specific contracts to sell. I don't usually sell puts but I also don't leave unexecuted out of the money limit orders in place. Boilermaker has made a profitable consistent operation out of harvesting these premiums on stocks he would be happy to own (and immediately start selling calls against if he wanted to be lighter on them).
By acceptable premium, I mean don't do it for 10 cents or something and pay a commission on top of that. "acceptable premium" will vary with the amount of time, price and volatility risk you are taking on. I'm not a big fan of selling long dated puts on individual stocks unless there is a specific strategy that involves it. I would stick to weeklies out to 2 months max.
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I'm not sure I get this focus on the "claims duration" - the float is a revolving fund that is usually growing. This isn't some pure life insurance operation. Berkshire has never tried to match investment duration to some measure of average claims duration. The float's duration should be something like centuries in a well run, growing P&C insurer.
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2 minutes ago, Maxwave28 said:
interesting, how does one get paid for a standing limit order? By selling puts?
Yes, by selling puts over and over (don't go out too far on time to expiry, just enough to collect an acceptable premium).
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You know boilermaker mike would be getting paid for those standing limit orders! Don't give 'em away for free
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I can't remember off hand if it was 2 year or 3 year notes they were locking in with the futures/forwards, but I remember the rate they locked in was around 3.75%. It should be noted that so far that was a horrible bet. US2Y Yield is currently 4.92% and US3Y Yield is currently 4.545%.
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4 minutes ago, Spooky said:
Thanks gfp. That gives a possible range of roughly $307 - $341 per B-share for the recent buybacks.
Yeah but those dollar amounts were a total estimate by me. The price range for the actual quarter (310-341 -ish) are the possible prices. The average price is whatever it turns out to be. We hope he bought all 6.8m B-share equivalents in the low 320's but that is unlikely..
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16 hours ago, Spooky said:
Anyone have any intel on share buyback prices lately?
Not sure what you mean by share buyback prices. If you are asking about Berkshire repurchase activity, it looks from Buffett's 13D following the charitable contributions, as of 6/21, there were approximately 6.81 million fewer B-share equivalents outstanding vs. 3/31. The calculation is imprecise due to rounding. That pencils out to an estimated $2 Billion - $2.3 Billion of repurchase activity in Q2 through 6/21.
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3 hours ago, Saluki said:
I don't see this holding in Dataroma. Does Hamblin Watsa have different holdings to than FFH?
HostelWorld is not listed in the USA. Dataroma and the other 13F trackers will not show non-US listed securities, OTC securities, short positions, etc. That's why Berkshire's dataroma / 13F doesn't show Airbus, BASF, BYD, Munich Re, Insurance Australia Group or the 5 Japanese companies.
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T-Sec at my favorite local po-boy joint yesterday. Now that she has seen the $25 oyster poboy price tag first hand she has vowed to take action on this runaway inflation. Enough is enough
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Yowza, that will be a healthy book value print for Berkshire with a pre-tax $26.6 Billion gain on Apple in the 3 month period.
$58.6 Billion pre-tax year-to-date.
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2 hours ago, Intelligent_Investor said:
The striking down of the student loan forgiveness should help somewhat with inflation. Less money in people's pockets = less spending
The practical effect is pretty small though. Maybe around $2 Billion a month. The administration implemented expanded income-based repayment "help" that reduces the disinflationary impact of today's ruling. Every little bit helps though!
Berkshire Hathaway Energy
in Berkshire Hathaway
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Nice! I hadn't seen that. "funded with cash on hand including cash realized from the liquidation of certain investments." LOL - that's a new line! Sorry BYD, we would rather have the cash for LNG...
https://www.brkenergy.com/news/article/brknews_covepoint_07102023