Liberty

Thank you very much for taking the time to write this summary, Sanjeev. I wish I had been able to make it this year, and this at least gives me a glimpse of what happened. Glad you all had such a great time!

Thanks!

Welcome to the forum!

Welcome to the forum!

I listened to many of these and they were all excellent. Great resource. Make sure to find the extended episode about Henry Singleton. But I didn't know Geoff had done one, I'll listen for sure, thank you for mentioning it!

Heh. I think you'll find that Kraven was, as they call it, "taking the mickey" out of potential responses. Best, Ragu Of course. It's usually safe to assume that most of what Kraven says in a thread not directly about investing is irony, so I was ironic in return. Guess it doesn't translate well without smileys... :)

First thing that comes to mind is that low-end is more commoditized, so Amazon and other online stores are a big factor, while higher-end tends to be more differentiated.

I just read When Irish Eyes are Crying by Michael Lewis about the RE bubble in Ireland, and many things were definitely familiar. I don't think Canada's bubble is on that scale, but many of the attitudes are recognizable. Good read for those who still haven't read it (it was published in 2011): http://www.vanityfair.com/business/features/2011/03/michael-lewis-ireland-201103.print Here's some highlights I kept (the part about Lehman's global testicles is just funny):

Thanks. I've never seen it, and actually just ordered the book (found a used copy for 1 cent on Amazon), so your timing is perfect.

Who's most curmudgeonly? ;)

Liberty, I get your point! And it is funny. ;D ;D The truth, though, is simply I see those methods as tools, nothing else. Would you prefer to have them at your disposal or to have them not? Then, when they are at your disposal, it is up to you to decide how to use them. And you must know your own situation and its needs to make the best decisions possible. ;) Gio Absolutely. I do the same thing as you, and I certainly don't consider myself on the level of any of the people I try to draw inspiration from.

Gio is... a formidable opponent! http://www.leftjabradio.com/wp-content/uploads/2012/10/Colbert.jpg ;) I'm just kidding, Gio. I know what you mean. You must learn from all the greats, but you have to see if things apply to your situation and if you think you are up to doing what they recommend doing (which might not always be easy, depending on the specific advice). Can't blindly follow advice, etc. I just thought the superposition of "I just follow what the greats did/You can't just follow what the greats did out of context if you're not of their level!" was funny :)

I couldn't tell you exactly which ones. I did this before I even registered for the forum, so it was in 2010... and at first I didn't know the posters, so everybody kind of ran together for a while until patterns and personalities emerged. But from what I was interested in back then, I can kind of reconstruct things a bit; I came here after reading everything I could about Buffett and Berkshire, and I had heard about Fairfax because they were compared to Berkshire a lot (probably how I found the forum, Googling around). So I remember I was quite interested in all the baby-berkshires back then and read very closely everything I could find about Berkshire-Fairfax-Markel-Leucadia-Loews (I never warmed to Loews). Berkshire/Buffett had also taught me a few things about insurance, so I was looking for good insurers (WRB, RLI, etc) and to learn more about insurance, and there are many threads about that buried around... But apart from that, it's just kind of cumulative. You soak it all up. Best is when a thread title doesn't seem interesting, but there's a 10-page tangent about something really cool buried in there. It's like a treasure hunt. Other times, you can just quickly skim...

I definitely second that. I'm just here to learn, as I'm nowhere near the level of many investors on this forum, and reading through the archives was an incredibly fruitful period of learning when I found this place a few years ago. In fact, I'm starting to think that I should do that again at some point (I think I've learned a lot since then, so I might get more out of certain things that were over my head back then, or that I had less context for). I've also started to be more diligent about keeping an investment journal, and, among other things, I use it to collect good stuff I find (here, in 10Ks, interviews, blog posts, etc). Re-reading through that journal once in a while should also provide good insight and reinforcement.

I will, thanks. Update 45 minutes later: Ok, done. Part IV was probably the most interesting part to me, so it was worth it. I had already seen the highlights at B.I., but it was nice reading the whole thing.

Very well-said, Kraven. To me he's one of the best role models out there demonstrating the values of honesty and rationality.

I don't want to sound too harsh about it, it was more candid and had more details than a lot of shareholder letters, and I'm sure that by reading all his previous letters you can cumulatively learn a lot about the industry and how to think about it. But maybe I was expecting too much from this one because many people were saying how good it was. That's the curse of high expectations...

I also stopped reading halfway through. Maybe the good part is the second half? It wasn't bad, I just didn't feel he was saying much other than "JPM is a good business, it'll continue to be a good business, because we'll keep going with our long term strategy, but we'll also adapt, because we're good, etc, etc".

If you really want to watch what they do, you have to watch what they do at Berkshire. The rest is probably 0.1% of their attention, which can explain why they keep it as low-maintenance as possible and only do something when it would be ridiculous not to do so (and even that doesn't really change their net worth, it's probably more for the principle). There's been a 5-part series recently at Brooklyn Investor looking at Buffett's whole history of getting in or out of stocks based on macro outlook/valuation timing. It's very informative, I recommend it.

http://www.thereformedbroker.com/2014/03/10/the-easy-money-myth/

I think people are starting to realize that it doesn't just affect rich people. The narrative is starting to mention more that "big money" is actually regular Joe's pension fund and mutual fund, and that people managing their money are complicit in them getting skimmed and the people supposed to represent them are making a lot of money from it (via their prop trading, dark pools, fees from HFT). That's what creating more outrage on top of the abstract injustice of it.

http://www.salon.com/2014/04/11/michael_lewis_hits_back_at_critics_this_time_i_punched_wall_street_in_the_balls/

Thanks, that makes sense. I just feel it would change my mind more if the reason for the underperformance was their value approach rather than their macro bets. ie. Berkshire hasn't done as well as the SP500 in the past 5 years, but I forgive them because they also didn't go down as much 6 years ago and I understand the logic behind their decisions. For Fairfax, a lot of their stock picks did well in the past 5 years (WFC, JNJ, USB, Bank of Ireland, etc), it's just that shareholders won't really see most of those gains, even if there's another huge crisis (in which case, as I said, a lot of their current holdings would also drop a lot, so it's kind of a symmetrical bet).

There's some discussion of the letter here: http://brooklyninvestor.blogspot.ca/2014/04/jpm-annual-report-2013.html

Can you elaborate on why you think it "unfairly penalizes Fairfax"? You don't feel 15-20 years is multiple cycles? If they had not hedged and had done great for the past 5 years, I don't think people would say that right now is not representative, just like they weren't saying that after the CDS win, and just like nobody is saying that now is not a good time to evaluate the performance of BRK and MKL, whether we're at a top or not. Another question we could ask is how fast book value would have to grow over the next few years to bring up the average BV growth when you include the past 15 years. They say they're aiming for 15%, and I know they say results will be lumpy, but you'd need many years of 30% growth to compensate for those who bought 15 years ago..