gfp

Sad thoughts, don't be like me. Just hold the damn stock

I would buy the actual bonds if I was going to hold them. For a trade that I scale into and out of I use these ETFs because they are liquid and easy. It's not as liquid as TLT (not much is), but I like this ZROZ etf of 27-ish year average strips that Pupil mentioned. There is a lot of juice on that type of STRIP! Not for the faint of heart

Don't forget, Blake Hampton LIVES IN CUSHING! His whole apartment is oil storage! jk Blake, we love you, just a little Oklahoma joke

Back to selling Berkshire... SAD

It's worth about what you paid for it! lol... Too Long Didn't Read = everyone is LTCM now (and off-the-run treasury bonds are surprisingly illiquid)

The only thing that gives me pause on Fairfax stock in the very short term is the very bad looking bear flag pattern the share price has traced out. That would suggest another couple day spike downwards - possibly with the broader market - next week or so. That would be a wonderful time to buy more shares. Otherwise, I will wait to buy more until it breaks higher and negates that bear flag pattern.

The only reason China is selling treasury bonds is because treasury bonds are the reserve asset they hold US dollars in. They need to sell treasury bonds to get actual US dollar cash to make available in their economy - through their state owned banks. When there is a crisis moment like the other night, the Chinese currency was breaking DOWN - not going up against the dollar like virtually every other currency and Gold. They are not selling the dollar except to intervene in their currency markets to try to keep the RMB from violating their control band around the midpoint they set each day. Most people on the street think China is manipulating their currency to be weak and give them an unfair trade advantage. The reality is that China's only interventions for years have been trying to keep their currency from violating the lower edge of their permissible trading band around the central midpoint. China only sells T-bonds because they have to. Not because they are making good on some geopolitical "flex." Japanese institutions, on the other hand, are selling US fixed income assets because the economics of "borrow cheap yen, transform JPY to USD through derivatives market, buy higher yielding USD fixed income assets, profit" have changed and they are no longer earning a "carry" on their highly leveraged "carry trade." Both the price of leverage in the bond market (the repo "haircut") and the price of the various Swaps they use to transform one thing into another thing have gone up with the tightening of global liquidity / deleveraging / risk aversion / whatever you want to call it. JPY is going up - because those Japanese institutions are repatriating back into Japan. Finally, our good old domestic mega-hedge funds and their "basis trade" is completely dependent on zero or almost-zero haircut repo financing for absurd amounts of leverage necessary to turn a small spread between futures and cash treasury pricing into a juicy enough return to get well paid as a massive global hedge fund. Any tightening in the cost or terms of repo leverage and they reduce the size of their leverage -> reduce the size of their holdings -> sell the underlying assets (cash bonds). But none of the above change the longer term behavior of US Treasury bonds if the US enters a recession. It's just the little overnight freak-outs that grab headlines. If the US goes into a real recession, not just some technical blip - ALL interest rates are going down and WAAAAYY down. That's how recessions work. Low interest rates = bad times. CHINA - offshore Yuan - this is an intervention to halt the slide of a Weak CNY/CNH - not a weak dollar Meanwhile in Japan - the JPY is actually strong from repatriation of assets back into Japan on a sustained basis. No government intervention - just capital flows:

I'm sure a bunch of people sold Berkshire shares the entire time they built what they built - it was always a mistake. Such is life. Fairfax is awfully well positioned and they have built one hell of an impressive company. Everything is gonna be swell

Right - no problem with Atlas/Seaspan. I was commenting on his APR Energy exit math. Which was subsidized by Fairfax sending them money more than once.

I love how Sokol claimed they got out of APR with a "small profit" - yeah, you got a "small profit" because Fairfax sent you hundreds of millions of dollars to indemnify you for the losses LOL - that's a line for the Atlas annual meeting, not the Fairfax meeting!

That's right - even a "bull steepening" (bullish for bond investors, not usually bullish for equity investors!) makes a 27 year strip like the ZROZ etf behave awfully well. Can you really "lock in" those 6% gov. guaranteed mortgages though? Seems like those will result in a lot of early principal repayments if you are "right".

I'm sure there is plenty of voluntary repatriation going on by choice. But that isn't what's driving the move in treasury bonds. That isn't what is going on with Japan and China. They don't have a choice - for two different reasons. A US recession is going to cause a drop in long bond yields. The debate may be over whether or not the US has a recession - I'm fully wondering that myself. But I'm not really wondering how long bonds are going to act if we do go into a recession. But CNBC and Blake are, I'll grant you that

I forget, Blake, what did the long bond do just after that momentary 2020 liquidity crisis?

Just allow for some probability that you don't have a 100% accurate handle on what's going on and how these markets work

I don't care what the Fed does for this trade it doesn't matter

That's what makes a market Kiddo!

What a day! My top three positions are ripping higher and I got to go long the long bond. I'm out

was this written by a 3 year old? Buy bonds!

NO WAY!!! Time to go long bonds you goof ball

I am just loving the narrative that market participants that are being forced to sell off the run treasury bonds into illiquid overnight markets are somehow making a choice to make a statement to the US or something like that.

Yep! Only 100 shares of my $14.90 order filled. rocketshipemoji

I guess Berkshire would be around 15% over that period? Maybe a bit more. Depends on which exact dates FFH was using.

new iPhone just got delivered and it's from India

We all know Berkshire as a mostly domestic enterprise, but this WSJ article had a nice visual comparison this morning -> https://www.wsj.com/economy/trade/us-exports-services-trump-tariff-calculations-fe481e2b?mod=WSJ_home_supertoppermiddle_pos_4

Here we go again with this "20 year" index - get Mr. Bradstreet back into the office