wabuffo

I would highly recommend Jim Chanos's interview. He's a great analyst and does a thorough job with his overview of the role played by the investment banks in the mortgage crisis. FWIW. wabuffo

I think it was from here - McGill University's Digital Library of Annual Reports -- lots and lots of old reports mostly from Canadian companies (or Canadian subsidiaries of US multinationals). https://digital.library.mcgill.ca/hrcorpreports/search/uncat.php wabuffo

It is a mystery to me as to why investors spend so much time on the question of buybacks both at Berkshire and many other companies. From March 8, 2000 (day when Buffett first mentioned that he would consider making repurchases) vs AutoZone (serial repurchaser). http://i67.tinypic.com/jfw6s1.jpg Snowball...man, snowball! wabuffo

i think this will now change in the future. More importantly, i think Buffett finally is ok with Berkshire making significant purchases of shares. But for this to happen, Buffett first felt he needed to do a couple of things: Perhaps it is just a matter of Buffett needing to set the stage properly: Buffett wanted to make sure all shareholders had the same information from his annual letter before doing any share repurchases ... in March, 2000! It's the same siren song for almost 20 years! I am afraid he's no Henry Singleton. wabuffo

https://buffett.cnbc.com/annual-meetings/ Here you go. Click on a particular year (going back to 1994) and then go to the morning/afternoon video of session. If you click there, you not only get the complete video, but a complete trancript of every Q&A as well. wabuffo

Stocks on the pink sheets don't trade on any real exchange. In fact, in certain cases, the stocks aren't supposed to trade at all yet buys and sells happen on paper?/electronic spreadsheets? In the case of OTC stocks that are liquidating, the Company will often direct their transfer agent to cease trading in the stock. Yet the OTC brokers will continue to record transactions in the stock well after the transfer agent has frozen the final shareholder list. Thus, there are no shares transferring hands, just a bunch of brokers keeping records on their own. This sometimes creates problems with liquidating distributions, record dates and ex-dividend dates since the Company and its transfer agent "send" the distributions to the shareholder of record as of the cease trading date. The OTC brokers' back offices then have to redirect the liquidating distributions beyond the transfer agent's instructions based on the brokers' own understanding of who owned which shares on what date dependant on FINRA's interpretation of record dates and ex-dividend dates. The confusion isn't about whether you owned a stock or not after the cease trading date, but instead, confusion over what the Company's instructions mean and how they are to be executed beyond the cease trading date. Companies don't really understand the world beyond their transfer agent and this confusion can lead to people who shouldn't get a distribution to get it and vice versa. It is a bit of the wild, wild west and there have been occasional flustercucks because of this kind of activity in OTC-land. wabuffo

No answer to your question - but a couple of observations: One reason for higher median wealth in Canada is the importance of Canadian home values (particularly Toronto/Vancouver). Most of Canadians' net worth is tied to their home equity. And as we know Canadian home values are unusually high and never really collapsed in the Great Financial Crisis of 2008-2009. Costco in Canada has no club store competitors (Sams Club made a tiny attempt to enter Canada and but quickly folded up shop). Costco US competes not just with a very significantly-sized Sams Club but also BJs Wholesale Club. wabuffo

A propos of this subject -- the median stock rose 14.5%*... in January! How's your portfolio return doing so far in 2019 vs a bunch of dart-throwing monkeys? wabuffo * as per the Wilshire 5000 Equal-Weighted Index for the month ending on Jan 31st.

In some cases, though they may not have publicly-traded equity, some private companies may have publicly traded debt that requires them to continue to file SEC financials. BNSF is an example - its equity is 100% owned by BRK, but it has publicly traded debt and continues to file with the SEC. wabuffo

I vaguely remember a quote from Buffett from the late 90s when he was railing about forcing companies to expense the cost of their employee options on the income statement. He used an example that Berkshire/Buffett would just replace the 10-year employee options issued annually for cash at about a third of their strike price when BRK made an acquisition of a company with employee options. At the time, I worked out similar numbers (using a 7% long-term borrowing cost and a 35% tax rate). Buffett thinks of it as being economically similar to the company borrowing the full cost of the shares at the strike price at the time of issuance. If you then bring the total cost of the interest paid on the loan over the ten years by the company back to present-value and deduct taxes, you get a good estimate for the value given up by the Company in issuing the options every year. Today, at long-term borrowing costs of 4% and a 21% tax rate, the cost would be lower -- probably around a quarter of the strike price over 10 years. Of course, he was talking generically and not specifically about overvalued or undervalued situations. wabuffo

Great economics blog - thanks for the link. wabuffo

A preference for buying back A-shares? It definitely would be easier to spot the volume increase if that's what he targets. wabuffo

If Canada dismantled its supply management system, wouldn't the center of gravity of dairy production move west where dairy farming would be lower cost due to land availability/herd size scale advantages? I think this as much an East/West issue as a North/South issue. My own 2-cents is that Canada would be world-competitive in dairy production but it would become an BC/Alberta/Sask. industry and not a Quebec/Eastern Ontario industry anymore. Much like the US where California/Idaho dairy farms are lower cost milk producers vs Wisconsin/upstate NY. Of course, its never gonna happen in our lifetime. wabuffo

I think its important to distinguish between owners & business models that show zero/negative GAAP profit and zero Taxable profit (from an IRS POV) but generate large amounts of positive Operating Cash Flow during their rapid expansionary growth phase. Bezos/Amazon (large positive cash inflows from working capital) and Malone/TCI (positive cash flow used to finance cable company acquisitions for additive synergies) are good examples that are/were both misunderstood because of this focus on GAAP profits by traditional analysts. These both had inherently profitable core businesses but felt the opportunity to grow rapidly was more important strategically than showing a GAAP profit and paying taxes. A business that loses money but also shows large cash outflows on an operating basis is still a bad business and can only expand to the extent that debt/capital markets remain open to it. That's not to say it can't work, but the failure rate is much, much higher than companies with "profit-less", positive cash flows. wabuffo

Summary: 1) Buffett issued (ie, sold) overvalued BRK shares (instead of selling overvalued KO, G) to buy fair-valued Gen Re (an insurer with basically a big bond portfolio). 2) After the Gen Re purchase, Buffett had exchanged overvalued assets for fair-valued ones and reduced equity % of BRK's portfolio from 80% to 60%, IIRC. He didn't sell his overvalued KO, G stock directly, but reduced his exposure to them in a tax-free, value-added way (though Gen Re did end up creating some headaches for him down the road). wabuffo

Where are you seeing that? wabuffo

Thanks Gamecock! wabuffo

DJCO 10-Q is out: Confirms that Munger sold 54,900 PKX ADR shares for $4.044 million (@ $73.72 per share). He also spent $10.977 million on one or more common stocks. Since the 13F-HR did not show any other position changes (besides PKX) reported to the SEC - and Charlie didn't receive confidentiality for any new positions -- it's obviously shares purchased on a foreign exchange. wabuffo

BTW - its a small position, but based on the new 13F-HR out today, it looks like Charlie sold 85% of Daily Journal's Posco ADR holdings duriing the most recent Q ending 12/31. wabuffo

I think you also need to adjust for taxes on the appreciation of the common stocks and bond of $49 million. Based on your calculations, EV of the core biz would be closer to 150 million. wabuffo

Munger's doing nearly 40% returns (~37-38% CAGRs) with small sums (>$50 million of cost basis) at the Daily Journal since changing the investment strategy in early 2009. And he's not buying small caps ("Fortune 100 companies", etc). It has been a good period to own stocks but even so, he's beaten the broad averages handily (S&P 500 Total Return, Russell 2000). Imagine if he wasn't a billionaire and was a little hungrier.... wabuffo

I doubt it since Munger spent $11.1m buying them. ;D wabuffo

I think this it. From the 2005 y-e 10-K (end of Note 6): http://www.sec.gov/Archives/edgar/data/1310067/000104746906003414/a2168332z10-k.htm and in the next year's 10-K, a new subsidiary appears (KCD IP, LLC) and this additional disclosure: http://www.sec.gov/Archives/edgar/data/1310067/000119312507066067/d10k.htm I believe this section has been in every 10-K since. wabuffo

FWIW - you can also isolate Wesco holdings (ie, Munger). If you mark up the holdings that are keyed as "4, 3, 17, 19, 20, 21" - those are the WSC/Munger holdings. I've verified this by adding up the market values and compared them with WSC's disclosures and they cross-check. Basically Munger holds a concentrated portfolio at WSC of WFC, USB, KFT KO, PG, AXP, JNJ and GS warrants. So there you go! You can now update the article and show Simpson, Munger and Buffett side-by-side-by-side! wabuffo

Berkshire's book value grew because of the acquisition of Burlington Northern and the $14.8 billion of goodwill added to its balance sheet -- rather than due to its stock portfolio during the six month period you cite. A big acquisition tends to make BRK's book value appear to grow rapidly during the period that the acquisition is added to the balance sheet. This is because BRK issued shares at way above book value to pay for it and the value of these new shares were added to shareholders' equity. When you issue new shares at multiples of book, book value per share increases but economic value may not have. (even Buffett has said that he paid a full price for BNSF -- though of course Buffett's track record says that he gave up less value than he got.) wabuffo