gfp

I hope it lasts to game 6! I'm going to be in Indianapolis on the 19th and would love to see a championship game

What is your preferred inflation statistic and what is it saying right now?

The best way to outperform in a bear market is to have a huge portion of your equity portfolio (consolidated + equity method businesses) not marked to market! Watch those UNP shareholders flail while your BNSF shares stay profitable and stable. Maybe I should get into the non-traded REIT business. People love this stuff.

I don't think an issuer is allowed to trade in their own securities for the final 1/2 hour of the trading session (the rule that applies to BRK.B might be no trading in the final 10 minutes)

Ten thousand shares or ten thousand dollars worth?

One of the great things about that COVID draw down was they were basically forcing you to re-fi property if you had any economic aptitude at all. Crazy low rates for an extended period. Every mortgage broker in town was like, "why don't you bump that cash-out figure up a little more chief." Interest rates do tend to plummet in a crisis, but I wouldn't count on the length of the opportunity being as accommodating as the COVID era was. A credit line already in place sounds good and helps with the timing problem but in a true crisis it feels a bit scary to blow out your credit lines to catch more falling knives. Some have the cajones, some don't!

They will tease you about mentioning technical analysis on a value message board full of bottoms up purists but every investor needs to develop something that works for them - consistently - over a long period of time. It's going to be different for every investor. I grew up using technical analysis as a youngster. Made the first bit of capital that I've lived off ever since by using the last two years of Tulane tuition money to buy Freeport McMoRan on a mix of technical breakout and the fundamentals of a gold (and copper!) bull market. It was a multi-year saucer bottom. I've always liked the multi-year patterns better than any short term stuff. I used technical analysis for years as a youngster to sell iron condor credit spreads on the cash settled index options SPX and OEX. The credit spreads were put on every month, giving the index a broad range to move around in. You collected a credit spread above and below the market. Max losses were multiples of net credit but capped. I thought of it as an insurance company - just selling volatility insurance basically. I still can't help but see the patterns even though I don't trade on technical analysis signals per se. I use the ingrained stuff from my youth to set exit points, clouds of limit orders over a range of prices. I had limit buy orders in for Chubb for a long time based on this head and shoulders pattern and the orders started to execute at the exact low (I wish more of them had executed) - Recently I used a "bull flag" pattern to set my orders to completely exit a large position in MKTW - Similarly, I am paying awfully close attention to Fairfax India because of the way the chart looks (there was also a bull flag back in January that informed my selling decisions around my core position) - And Bitcoin recently broke a fairly obvious down-trend line that was easy enough to see - And I still buy stocks at new lows with horrible charts. Just the worst looking charts you could imagine.

Where my bond vigilantes at? Did something change about the deficit, future supply, foreign capital flows or did everyone just end up consensus on one side of the boat? My own mother! Who owns only equities, zero bonds! Even sent me this NYT article yesterday... If that isn't some kind of contrary indicator I don't know what is https://www.nytimes.com/2025/06/03/opinion/us-debt-trillions.html?unlocked_article_code=1.ME8.G5oL.3ufNb4Qmj2xE&smid=em-share

I have only a foggy memory of the prior discussion. Does that mean the value for Fairfax went up from something like $70m USD to $136m USD?

We used to develop historic tax credit real estate projects here in New Orleans and we still have some apartments that we haven't sold. I have a love/hate relationship with it. I would be very happy to not have any New Orleans real estate. But I also love the first of every month when a bunch of hard working people send a bunch of money to me. We haven't done a new property since 2020. I'm too lazy now and the economics of new projects have changed significantly. Everything we have is multifamily residential apartments and they are always 100% occupied and the tenants are fine and the notes are small and shrinking further over time. But if they all burned to the ground tomorrow I would have a certain spring in my step and go on vacation immediately.

It's interesting - the prime rate has barely come off its highs (tied to fed funds obviously) and is still at 7.5%. I just had a commercial real estate loan re-set this month at the 5 year mark from the 2020 vintage. 4.75% went to 9%. I will go and refinance it at 7 and change but still - there are a lot of CRE projects with those 2020 vintage loans coming up on their 5 year anniversary. Rents flat, taxes up, insurance doubled, flood ins. up, cost of money up up up We use 30 year fixed on everything 4 units or below but commercial loans on 5 units and up. 5 year loans, 20 year amortization type of stuff.

31 acres allocated to a new MRO facility for IndiGo https://travelradar.aero/indigo-and-bial-sign-mou-for-mro-facility-at-kempegowda-international-airport/#google_vignette

By slightly increasing or decreasing the level of deficit stimulus. Ironically, at present, one of the easiest tools to accomplish this (lowering deficit spending stimulus) would be to lower the Fed Funds rate.

If the Federal Reserve cuts interest rates by 1% tomorrow, would that increase or decrease inflation? And why?

We're really not ignoring him Blake. We all agree that inflation is the constraint on a sovereign issuer "borrowing" in their own free floating, non-convertible global reserve currency. Dimon, Druck, Wabuffo, Mosler, Buffett, Munger - everyone agrees that inflation is the constraint. You also have to listen when every member of your appeal-to-autority dream team predicting "crisis" says "I don't know if it will happen in 6 months or 6 years or..." Most of us, not you apparently, are also aware that Dimon has been actively lobbying for a change in bank capital rules that would make it easier for large banks / primarily dealers like JPM to own a lot more cash bonds on their books without taking a capital charge that makes it unattractive/uneconomic. A lot of the market distortions that people try to read into as macro tea leaves predicting the future - like persistently negative IR swap spreads - are partially just byproducts of current bank capital rules for an IR swap vs a cash treasury. Dimon would like it to be easier/less costly for primary dealers to more effectively make markets in Treasury securities and he would like the capital charges to be much lower or basically zero. --- Separately, I really think you are missing what Bill is saying when he says government surpluses lead to depressions / recessions. You are missing a major fundamental truth of the monetary system we actually have: the government's deficit is the private sector's surplus and conversely the government's surplus (paying down the "debt") creates a drain out of the private sector. The net liabilities of our government are the US dollar "money" we use to operate our highly leveraged, liquidity sensitive economy. The sooner you realize the national debt of the US government is never going to be "repaid" and will only grow, the sooner you can get on with your life and learn to make money in the system we actually have, not the one you wish we had or the one someone thinks we have in a book you read. You don't get to pick the system that evolved and exists here. It is what it is. Try to understand it, don't ever naively apply the analogy of a household budget to the US government's finances - I'm looking at you Elon Musk "we will go literally bankrupt!" Nothing elicits an eye-roll quicker than another idiot telling us that the government is going to run out of "money." Inflation is the constraint. We try to always have some inflation because deflation kills debt-based economies. So is 2% perfect? Is 3.5% the end of the world? What if they targeted 1%? Would we panic when it was 2% instead of rejoicing?

Nothing happened. Jamie Dimon made some comments that were published in the middle of the trading day on Friday. Jamie Dimon also said something like, "I just don’t know if it’s going to be a crisis in six months or six years"

A long dated zero coupon strip is pretty volatile. A 7 year coupon at par is pretty stable

And these 27 year zero coupons are more volatile than the S&P many days!

There is nothing special about 5% but it is the number I use for my trade. I think there is a wall of demand that comes in when treasury securities are offering over 5%. Interest rates are going down across the globe and the days of 5% t-bills are long gone. You cannot get 5% on government paper in very many places.

I know you guys like to make fun of me with my 5% treasury trade but I went looking for 5% government paper and the cupboards were bare! They stopped offering it! Meanwhile I have taken the same 5% out of ZROZ like half a dozen times by now.

No not really. I think that is not an accurate characterization of what float is and the 6% actually goes to equity, not float. 6% in that example is the profit.

thanks for sharing that - nice article. Is this a correct characterization? "Approximately 94 per cent of its premiums (i.e., the combined ratio) has gone to pay for insurance claims and company operations in recent years. The remaining 6 per cent has gone into the float, where the premiums are held until they are paid out and, in the interim, invested to generate gains and income."

Uh Oh Greg! Ya boy Kuppy is all cashed-up! https://pracap.com/taking-my-ball-and/?utm_medium=email&_hsenc=p2ANqtz-8Ll_Iu9mYdvk76o9i293OONoHCTXB-Vm_8rGTMyzgy-UC0pRctCmuOIP7Yzdrvoy7e52y89QKMNKgjuyh-I9HTsZYV_g&_hsmi=363926384&utm_content=363926384&utm_source=hs_email I obviously disagree with his take on the looming debt crisis but I was sort of coming around to his idea that they would be forced to "run it hot!" LOL

That was my main takeaway from this year's annual meeting - I was impressed with every single executive that spoke. Even that nepo-hire over at FIH was very impressive!

Yeah it's no big mystery. Totally rational to "participate" by selling pro-rata directly to the company. Easier for everybody. Fair and friendly. We may wish they weren't required to sell but we don't make the rules. There are worse problems to have