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I bought a Honda Fit for my son yesterday. Today I bought 4 tires. Is that discretionary? In a few weeks I will buy a new iPhone. I also bought some shoes from a company called Xero.

The only real surprise for me was that he continued to sell down PSX following last quarter's big sale back to the company. PSX shares continued to rise, in part because of the share retirement Buffett contributed to. He had said in the press release for the big sale back to the company that he intended to remain a large shareholder. Maybe he just wanted to give them some room to do more big repurchases before he hits 10% again. The airline and bank moves were telegraphed a couple days ago. I guess the Goldman addition is a bit of a surprise since he hasn't added to the position from net-settling the warrants until now as far as I can remember.

https://www.dataroma.com/m/holdings.php?m=BRK

Fox position is really pretty big when you add the two classes of stock together (I know it's not his entire portfolio that is disclosed, so it's really just a large percentage of his disclosed equities). I'm going to go out on a limb and guess that he didn't actually sell out of Time Warner, since AT&T stock appeared in his fund the same quarter.

Didn't ask me, but its a selling thread Why CAH and not the better managed MCK or ABC? Valuation is a bit less for CAH, but I think the better management at MCK or ABC more than compensates for the valuation difference.

Ah yes I see your point. If I had to guess I would say they are selling a small number of shares to keep it under the reporting requirements. I don't believe they have any confidential treatment for the 13G and they didn't seek confidential treatment on the 13F. We'll see if Marc gets back to me but I doubt he will be able to answer if they are indeed selling shares.

Thats a lot to read on a phone, but I think you guys got the gist of it. The most recent published share count of Apple (found at the very top of every 10Q) is the number they have to use, not quarter-end or average share counts. Apple published this: "4,829,926,000 shares of common stock, par value $0.00001 per share, issued and outstanding as of July 20, 2018" less than 10 business days ago, which I believe is the Berkshire deadline for publishing a "13G" with the SEC. If Berkshire doesn't file within 10 business days of Apple's updated share count, they either made a mistake and will update later with a 'sorry, we should have done this earlier' or they have elected to sell down their stake to stay just under what they project to be the 5% share count - for the sake of privacy one would assume. It's not very important in valuing Berkshire obviously. Hell, Berkshire could even enter into one of those deals like Advance/Newhouse did with Charter where they sell blocks back to the company to maintain their exact same % ownership level over time. Would probably save both parties a little bit on trading costs. But I don't expect that I will ask Marc Hamburg, but I seriously doubt he will answer me about this question since it involved an individual security Warren might be buying or selling.

Remember that American Express wasn't a bank until the financial crisis, so it wasn't an issue for Berkshire to be considered a bank holding company through their Amex holdings. WFC always had to be kept below 10% but Berkshire sought permission to let it drift higher through repurchases only. The Fed didn't grant it. PSX wasn't the same issue and Buffett chose to take it much higher than 10% before changing his mind about the regulatory burden. I suspect it had more to do with Energy regulators than SEC reporting requirement for 10% owners, as Buffett really likes PSX management and has taken quite a few other positions over 10%. I certainly wish he hadn't sold the most recent big block of PSX back to the company in the low 90's.

Seems like you are pretending that operating businesses aren't included in book value at all. Just because some of them are held at figures much lower than their current value doesn't mean you should pretend that book value doesn't include huge sums for operating businesses that produce those earnings. Sure, though if you just look at the liquid assets like cash, stocks, and bonds, they alone are $130/share. I get it, but it seemed an odd approach to just subtract book value. Additionally, operating income includes investment income on those assets, which is double counting even if you use the 130/share number. I do understand the two column method of valuing Berkshire though

You've got to love an investment/insurance company with $712 Billion in assets that has their Fixed Maturity (bonds) portfolio at $18.5 Billion. Hmmm. Does Warren like long term bonds right now?

Not sure where to put the BRK - AAPL comments but in the 10Q they show Apple at 47.2 Billion dollars, where it's closing price was 185.11. So we can derive that Berkshire held approximately 254.98 million shares of Apple stock at the end of the quarter, much higher than most people were assuming - and consistent with something Warren muttered under his breath in one of the Becky Quick interviews that it was 'something like 250 million' at that point. Current value of 254.98 million Apple shares: 53 Billion dollars.

Seems like you are pretending that operating businesses aren't included in book value at all. Just because some of them are held at figures much lower than their current value doesn't mean you should pretend that book value doesn't include huge sums for operating businesses that produce those earnings.

I hadn't read that far but now I have. It's not a lot of daily volume, but there are several selling shareholders also constrained by the low turnover, so there is a lot of room for average daily volume to increase. Whether or not there are direct block transfers between the Gates Foundation and Berkshire, both can increase the ADV over time. You are right though - it will be very difficult to make a material dent in either share count or cash levels without a tender (and a tender seems unlikely). Did you read my basic calculations about an open market buyback? The B shares don't seem all that liquid for their purposes from what I can tell, but I could be wrong. They'd need way, way more than that over the next decade, barring any mega-merger. It's not hard to see them earning north of $300b with already $100b+ in cash.

The Gates foundation and various Buffett family foundations are more likely sources of large blocks than S&P index funds. But I suspect Berkshire will primarily just repurchase shares in the open market - they do have a half trillion dollar market cap and the B's are fairly liquid. Occasionally a large shareholder will die or otherwise make a large block available - similar to the only large repurchase accomplished so far. If other companies can do it through open market purchases, so can BRK. We've seen the daily liquidity increase from Gates foundation selling in their filing. I doubt Berkshire cash levels will ever get below $40 billion again.

All these bird shots are awesome - thanks guys. Boiler, your shot reminds me of my Son's story from his first couple days in Alaska (he gets back Tuesday from 3 months in the Aleutian islands & Bering Sea). My kid had never seen a bald eagle in person before (he grew up in Oaxaca Mexico). He was pole fishing off the dock his first couple days up there this Summer and caught a bunch of rockfish. He pulls his first big rockfish out and right as he gets it off the hook a huge bald eagle comes in a steals it right off the ground inches from him and flies away with the huge fish still wiggling in the eagles mouth. It was definitely a 'welcome to alaska' moment for him... Eagles behind the McDonalds in Sitka, AK

This list shows the gist of how much the Gates foundation sells on a daily basis, for those who are curious - https://www.sec.gov/Archives/edgar/data/902012/000110465918046338/a18-17436_1ex99d1.htm

https://www.interactivebrokers.com/sb/en/main.php No problem if you are in the USA at least.

Can you give us the link to the proper place to answer questions about Berkshire’s weighting in the S&P 500 please? Seems fairly general but if it must be in a dedicated thread so be it

I don't know the answer to your question - since most of the shares end up sitting in the Gates foundation for quite a while they might not consider them to be much of an increase in free float right away. Over time, though, Berkshire will get higher and higher weighting in the index. It already is a big contributor to most days' price moves since many BRK shares outside of indices just sit there with capital gains nobody wants to realize. You do have to appreciate what the timing of the two announcements says about Warren, though... He could have easily made the announcements in the reverse order. His charitable gifts would have been larger. But he would never do that and it doesn't really matter. He can't use the deductions anyway ------------- I found this post from Geoff Gannon in 2010 that summarizes S&P's methodology - "According to S&P Float Adjustment Methodology: In cases where holdings in a group exceed 10% of the outstanding shares of a company, the holdings of that group will be excluded from the float-adjusted count of shares to be used in index calculations. The "groups" they are talking about include current and former officers and directors as well as Foundations. As I understand it - and I may be wrong here - this means shares given by Buffett to the Gates Foundation wouldn't change float in S&P's eyes until Gates Foundation sells shares. You can read the whole document if you google "S&P Float Adjustment Methodology" and click on the PDF."

Seems like Charlie wanted to do this for a while. They are also likely to report a pretty big headline number for consolidated cash balances in the next report, with more criticism of "swing you bum." One upside of having a board of directors full of experienced investors who personally own material amounts of stock is that they prefer this route (growing per share intrinsic value, even if it means "shrinking" the company) to growing the empire at all costs.

Yeah, Bizaro had it right - a flexible plan is the only way they actually get a meaningful repurchase done. Sadly, they won't be buying until August (if the price stays low) - "Berkshire will not initiate any share repurchases under the amended program until it publicly releases its second quarter earnings, currently scheduled after the close of the markets on Friday, August 3, 2018."

I think Kerrisdale manages a lot more money than you are assuming.

Since Wattles was from Omaha it is likely that Warren's Father was aware of his career and stories, as well as being members of civic groups and clubs for prominent Omahans - even if they were not contemporaries. Also, his career would have been covered in the local newspapers. My Sister-in-Law had her wedding at the Wattles Mansion in Los Angeles. I was trying to remember why that name sounded familiar and I suppose it is from the Snowball mention.

Bolt on of unknown size (likely small) at TTI -> https://www.electronicsweekly.com/news/business/532037-2018-07/

Clayton Properties picked up another traditional homebuilder. This one in Indianapolis -> http://www.insideindianabusiness.com/story/38565239/tennessee-company-adds-major-hoosier-homebuilder