Liberty

I haven't followed FFH's numbers closely for a while, but I think that you have to look at all those versus the equity number. If you have around 8B of equity for 24B of total assets, this means that a relatively small shock to the total assets could wipe out a large fraction of the equity, and they need to maintain a certain equity ratio for their insurance obligations. Someone else please correct me if I'm wrong.

Thanks for posting it.

Thanks. I'm just trying to apply Buffett's look-through earnings concept to other things (something that others here are also doing -- nothing original about my way of doing things). For example, I look at the leverage (or lack thereof) of the businesses in my portfolio as if it was my own. About FFH, I think Parsad has written very insightful things about their position. I tend to agree with him that their hedged position isn't exactly an 'offensive' position ("we know everything's going to hell and we're going to profit from it like we did in the GFC!") but rather a 'defensive' shift to neutral because of their capital needs as a levered insurance company. They just can't afford big shocks, so I think they're just waiting for either the storm to hit so they can deploy capital at cheaper valuations, or for the clouds to pass so they can go back to doing the kind of investing they've always done without quite as much macro incertitude. I think it's very very smart for them to do, though there are also other ways to be defensive in this environment.

I've been considering buying a few shares of SpaceX when it IPOs just for the principle, not so much as an investment :D I think Tesla has a good chance of succeeding over the long term, but they don't fit my investment criteria on many levels. I'd rather buy one of their cars someday than buy shares 8)

I thought it was mildly-interesting. Not really my style, I guess.. He seems more into short-term macro trading, at least from that interview. I was not familiar with him. But thanks for posting, always good to hear different points of view and approaches.

Not quite, though. There's no such thing as a free lunch. People are still paying for the expensive phones, they're just amortized over a 2-year contract or whatever instead of being paid all upfront. It's a cosmetic difference that, sadly, seems to fool most people into buying stuff they can't afford (same when people fixate on the monthly cost of buying a car or a house rather than the total cost). I know you know this, I just felt like venting a bit about the general state of financial illiteracy in the world :)

Which is why I won't even look at the miners. That business is too hard. I prefer either service companies that sell picks & shovels to miners (I'd rather be the guy selling shovels than the guy buying them, so to speak), or royalty/streaming companies that are basically merchant banks with options on the upside if things go better than planned and downside protection if things go south (they are not responsible for any capex after initial investment).

Eric, sorry if you've addressed this elsewhere, but I'm curious to know what is your view on how all this QE stuff will impact financial institutions (like BAC) that own lots of financial assets denominated in dollars. I have a few guesses, but I'd love your insights.. f.ex. 1) It's bad for BAC because it makes all their fixed rate assets worth less, but the margin of safety in the price is so big that it doesn't matter too much, and if this jolt helps revive animal spirits in the economy, it might be good for BAC on balance. 2) Maybe it's good for BAC in a direct manner. Can they unload some crap from their balance sheet to the federal reserve? 3) ???

I think we'll need this thread now..

I don't think you necessarily have to be defensive at that level. For example, someone who owns berkshire owns a company that should do well in a bad environment because they have a strong balance sheet and the ability to benefit from bargains. I don't plan on shorting stocks, but I like buying companies that are run in such a way that they can survive and thrive in difficult times (if not thrive immediately, at least come out stronger than their competitors because they acquired good assets in fire sales and such).

I just finished watching the keynote video and I liked what I saw. I'm sure it'll sell really well.

Didn't Ericopoly just say in the other thread that he did 110% on what I assume to be a few millions?

Every time I see a photo of him I immediately think of Steven Pinker. It's probably the reason why I noticed him in the first place, actually..

Blurb: Mining and entertainment mogul Frank Giustra in conversation with Tommy Humphreys - August 28th, 2012. Topics include inflation, natural resources and wealth creation.

Thanks guys. I know he's also a friend of Kuppy, who's stuff I tend to like (he's cool-headed and even-handed about things, with many useful insight). I want to figure out if Fleckenstein is similar, or if he's more of a one-note doomer. I'm trying to follow sources with all kinds of inclinations to hopefully get more of the full picture, and who knows, maybe he could be one of those. Not sure yet though, but thanks for the pointers :)

Hetero prisoners don't become gay, they just sometimes sleep with other men because their options are rather limited for very long periods of time, and in some situations sex can be used as a weapon (it has been in all wars throughout history, and not always man on woman). That's not the same thing at all as becoming gay. I'm pretty sure that if they had a choice, they'd sleep with a woman (and they do when they come out). For example, if I had sex with a man right now, either willingly or by force, it wouldn't make me gay. I'd still be attracted to women. I'm pretty sure that same would be the case for you. Don't confuse the act and the sexual orientation/attraction. Of course, some prisoners are gay to begin with and when they come out they are still gay. But if you have a closeted gay man who has sex with a woman for years and even has kids, that doesn't make him straight either. In other words, sometimes heterosexual people can have gay sex and homosexual people can have heterosexual sex. That doesn't change their sexual orientation. In fact, as far as I know most gays report that their first sexual experience is with someone of the opposite sex (though I'm quoting from memory, so I could be wrong on that -- maybe it depends on where they live (rural vs big city)).

Hey, So this name has been popping in a few conference calls I've listened to and on a few websites I've been reading. I found some of his free articles and also his paying newsletter. https://www.fleckensteincapital.com/index.aspx I just want to do a quick reputation check here: Any of you familiar with him? What do you think? Anyone subscribes to the newsletter and can comment? I'm not endorsing him or his ideas by asking this, I'm just curious about him. I haven't heard/read enough to know either way... Thanks!

Well, as long as you refrain from judging others...

I'll quote myself from earlier in this thread: Not that the why or how is that relevant once it's there. I mean, it's interesting to know, but even if you don't know, it's still there and the question becomes 'what do you do?', to which I answered: Imagine you were gay, then ask yourself how would you want to be treated? Then treat gays exactly like that.

http://www.theglobeandmail.com/report-on-business/us-boom-in-oil-production-spells-peril-for-canadian-crude/article4535525/ These are only projections of course - it would be interesting to go back 10 years and see what they were saying would be happening today - but still interesting.

One doesn't go without the other. That's like saying that the heterosexual act is an abomination, but that heterosexuals are just fine. They can be heterosexuals, they just can't ever do anything about it. Does that make sense to you? In the same way that being hetero means you are attracted to the opposed sex and that sometimes (if you're lucky) that leads to sex, being gay means you are attracted to the same sex and that sometimes (if they're lucky) it leads to sex. Being gay is like being a man or a woman or black or white, it's not something you choose. Saying that gays are fine but that the gay acts are abominable is like saying that women are fine but that menstruating is an abomination, or that being a man is fine, but having an erection is abominable. It's blaming people for who they are.

I'm not sure I follow you. Are you saying you believe that humans were created whole, and that they originated with Adam and Eve (presumable a few thousand years ago)? If that's the case, I think we'll have to agree to disagree and leave it at that, because I don't feel this will be a very fruitful discussion.

So from that I'm getting that you either believe that there's a god that created gays just to mess with them, or that gays are heteros who just choose to be gay, or that people don't have a 'default' sexuality but must choose one. Is that correct? Which one is it? I'll also point out that you just called gays abominable, a pretty hateful term. Statistically speaking, there are bound to be many gays reading you on this forum.

If you look at the evidence, it is. There are gay people, gay animals. It has evolved. It can either have evolved as a primary adaptation or be the side effect of another adaptation, but however it happened, it did. Otherwise we wouldn't find all these gay people and animals all around the world through the ages. You don't have to know why humans have exactly the variety of hair colors that they do (why not other colors? Why did evolution pick those?) to see that it's what we got. The 'why' might be obvious or obscure, but the end result is the same. Once you've got that, the question is: If you were gay, how would you want to be treated? Then treat gays exactly like that. In that hypothetical scenario, with only two humans in the whole world being of the same sex, it wouldn't have started. But I don't see how that's relevant since things didn't happen that way and it's not like that situation is likely to happen now.

I finished reading the piece today. Very interesting, and Soros is obviously wicked smart. But if I try to boil it all down to fundamentals, he's basically saying that a way must be found to monetize the debt of debtor nations (either with Germany on board via higher inflation, or be having Germany leave and then have the rest devaluate). Is this the central point he's making, or did I misunderstand something?