Valuebo

;D 400+ days and counting. Not that most here notice anything, on the contrary... But don't worry, negotiations restarted today and they will increase taxes significantly soon enough. We already are one of the most heavily taxed countries in the world and now they will implement capital gains taxes off 50% on realised investment gains, a """temporay""" crisis contribution, fake spending cuts, ... NVA, the big winner of the elections of last year, was the only party to vote against the current lousy proposal and now they are being put in the opposition. I am not even trying to care about it anymore...

There will always be opportunity loss, you can't time the market. Wether you have a lot of cash, are almost fully invested in high opportunity or have a combination of both, it is inevitable. Investing in BRK at current levels probably gives the same kind of win/win (anything that happens gives results and/or new opportunities) that a combination of enough cash and those 'opportunities' would give.

Hi Shane.Smith. Thanks for your second input, I appreciate it. I incorrectly assumed you took the 15-20% off only for the 'deferred' taxes. Flawed reading skills, my bad! :) You to bring up valid points regarding bonds and cash that is being held and BRK's flexibility to move in and out of great opportunities. On the other hand I believe large caps aren't all that expensive at today's prices, especially when you look at companies such as WFC, JNJ and WMT. This should leave room for some error in the valuation of the investments. I agree that BRK will underperform in a bull-market like it has in the past, but given the current stock price I am confident the stock itself should outperform. To be honest, I have no idea what the impact can be of such selling pressure on BRK's price, especially given it's low average volume. If anyone has a vision on this, please do share. Maybe it just seems likely there is some impact because it strikes me as odd that BRK and others move in the same trend as riskier financials. To conclude, I should also note that my level of expertise and experience is below any standard at the moment which makes it very unlikely I am able to compose a portfolio of the greatest buying opportunities with better risk/reward. Loss of opportunity is bad, loss of capital is worse. I don't want to pretend I have anywhere near enough experience to handpick a complete portfolio of 'normal' investments, which should explain why BRK is a no-brainer for me. I would probably feel exactly the same in your situation, but I believe it would be foolish of me to think I can achieve satisfying analysis after one year of shallow investing experience and no business experience whatsoever. Plenty of time to learn and I am in no hurry to crush the market given that I have at least 43 years to go before I retire. ;D (Hm, what a rant...!)

Why would you take 15-20% off of all investments (around $155b?) when stock holdings account for not even half of that? Most holdings like KO will probably never be sold which cuts down the number even further. Where hasn't brk outperformed the market over longer periods (in terms of increased BV)? Or are you talking about stock performance? Not sure what the relevance of stock performance could be. He has been seriously outperforming in terms of increasing BV over the last 10 years despite an ever growing capital base. It seems unlikely that this will suddenly disappear as most performance will come from what is already owned today. Furthermore, even if BRK did underperform in a long lasting bull market (which is doubtful in the current situation and overall stock market valuation) the current price would probably turn out to be a bargain, not even considering hot irons such as a hard insurance market and recovery in housing. The way I see it, BRK will : - outperform in a long-term "sideways market" - outperform in a bear market - not underperform terribly in a bull market. I don't need 70% undervaluation for BRK. I'll take that 30-50% any time of the week and let Buffett compound until it gets close enough to IV to sell or until I see companies with better risk/reward that I can be confident about in this market. I bet BRK is being "forced sold" by some, take Berkowitz for example with a fair stake in BRK facing redemptions. Lately, BRK and many other similar companies (LUK, BAM,...) are moving in a crazy trend with days far over -/+5%. I doubt all those stockholders are die-hards. ps : Ignore writing errors etc., it's way over midnight here and I have been studying for over 10 hours... Good night! ;)

Heard about them before and like what they were saying. Already checked back then but as usual they don't let European citizens in their fund. :-[ I don't think it's limited to members here. You don't need to spend much time to figure out favorable risk/reward scenario if they come within your circle of competence. Some people might not want to own these companies rigth now due to finding better risk/reward deals but these companies are very good risk/reward option going forward. I don't think GOOG is that cheap but they might make up for it with their very wide moat. Exactly. All of them are on the lists of Dataroma as well. It almost seems too simple and obvious but I guess sometimes that is all you have to do to get satisfying results. http://www.dataroma.com/m/home.php

Does Prem really think it will happen or does he view it as a worst case scenario and a major fear? There is a big difference between the two. The bet that was made is mainly a hedge to secure the insurance business FFH is in. Wouldn't serious deflation kill combined ratio's when you add the deflation to it? After all, the money you give back is worth more then when you received it, not less as is the case with inflation.

Short term fluctuations in BV don't matter. In fact, a lot of extra value can and will be added in corrections like these which ultimately give you a higher intrinsic value than if no correction would have occured. If you buy companies like BRK at current depressed prices you will win twice in the end. Buffett's annual letter of this year had an interesting part covering brk's goodwill for GEICO : If anything, BRK's stated BV is probably quite conservative compared with the overal market average BV which at times can be viewed as highly questionable. Also, operating businesses account for a larger share of the BV. How is it logical that BV now is much lower than 10 years ago when investments/share were about 90% of BRK's business when it is close to 50/50 now?

Tha, we're back! :) I sure didn't expect this volatility to continue, this is crazy.

Parsad, give me some love too!

9,4% up for BRK. my portfolio up more than 8% today. I am not complaining. (Should I tell Harrylong? ???) Funny thing is last night my broker called because I put in a sell order for FFH before market close to buy more BRK. For some reason my order didn't come through and got cancelled. So I wrote an angry e-mail. This morning my broker called me and was willing to sell FFH at 373,5 cad$ and buy BRK.B at $77,4 I accepted seeing the very green futures at the time (2,8% for the us back then, although we went -1% later). I think I will buy back my FFH's soon at this speed. I will probably even buy back more because this rise in stocks scares me as much as the drops. ::)

Berkshiremystery, you are behind a bit. http://www.bloomberg.com/apps/quote?ticker=USGG10YR:IND 2,11% yield for 10y T-bills now, the low was 2.03% :D

Are we looking at the same stocks? I am seeing plenty of that "single digit P/E 10" stuff? ??? edit : Nvm, you were talking about Schiller's PE... 50% seems crazy. Many companies are already under 2009's low valuations. People seem to be looking at price ("All that downside!!!!") but don't see value. I don't get it. Do you truly believe we can get to an S&P500 of 560 without any major depression? I am just not seeing it and the market acts like it is a serious recession already and some things will never recover.

http://www.google.com/finance?q=MUTF:FAIRX Fairholme down almost 9% today.

Russell2000 from $86 too $65.12. Must be BRK's chart... Stupid question -> How do they make money on treasury yield that goes down? They just sell their debt?

Lol $66.66. Nearly 30% from its high this year and 50% from its high in 2007. Wasn't the low of the S&P500 666? ;D It must be Berkowitz facing redemptions! (like he would ever have enough influence ::)).

I guess you are right. ;) I believe their stake in DELL is around 15% of the equity portfolio so my exposure is there. My feelings are probably more concering "timing the market" now. I see much more upside potential in DELL (and others) in the short run than I see for FFH. But that is just perception and I could be totally wrong. It's about value anyway.

Nothing wrong with holding 80% FFH but it too is going down 4-5%. Over time you will be ok though.... Nope, got 20% in FFH and 80% in BRK. ;D I didn't expect FFH to take such a big hit and the plan was to switch half to something else, now I am not sure I should. And if this isn't over I definitely don't want out.

14$ stock $4 net in cash $2-2,2 EPS inside ownership of 15% + great management changed business Probably worth a double yes. :) We'll do all right. ;D That's the point! I don't have cash left and am not sure I should sell some FFH for DELL. >:(

14$ stock $4 net in cash $2-2,2 EPS inside ownership of 15% + great management changed business Probably worth a double yes. :)

I called the bottom when BRK hit $66,50 today, that was insane. I just didn't say it out loud, bad luck. ::) --- Easy guys, easy... Stop it! >:(

Vix up almost 50% just a few minutes ago... ::)

Range 66.53 - 71.23 I missed that one... :D

Buffett pissed them off this weekend saying the US downgrade doesn't make sense? :D Or he is holding too much cash, in T-bonds for heaven's sake! :o

I'm having a good laugh here! :D

Meanwhile the redemptions at Fairholme probably multiply by the day...