AZ_Value

Lol... Come on guys Moore is going to scold us again. However, I think I have to agree with him. After the previous heated thread, I took a serious and objective look at my record and to be frank the number of opportunities that I've missed waiting for stuff to get cheaper outweighs the number of opportunities I profited from by waiting for stuff to get cheaper by far!! Not even close. It's been Europe for a while now, it was a double dip recession before or a debt ceiling debacle in Congress and now I've been hearing people saying that one should wait because no way the Super Committee agrees on a cost cutting deal by their deadline (November 24th) and that will certainly hit the market hard etc.. All those things will continue to be there but value is value and when it's demonstrably there and something is really cheap when valued conservatively, one shouldn't spend his time worrying about when and how Europe will hit the fan.

To me this discussion just goes straight to the point that nobody is perfect and unfortunately we will always weigh how bad their flaws were vs their qualities before deciding whether to be sad or happy when they pass; and often that has to do with how much did they hurt humankind in my opinion. The bad things that Jobs did, parking in handicap parking spots etc., definitely qualify as major dick moves that would turn off anybody and probably prompt someone to confront him except that he was "Steve Jobs" and who's going to confront him if the parking spot is outside Apple's HQ, so he not only acted like a dick but used his status to get away with it. The thing is we process that info and seem to quickly decide that he didn't kill anyone as far as we know, so we file him under "eccentric visionary who was also a dick to people" and he gets a pass. Right or wrong that's what I believe happens. Think about someone like Hitler, he could have invented penicillin it still wouldn't outweigh "that other thing" he's responsible for. I've personally thought about this a lot when studying people like Martin Luther King, he was an awful husband and cheated on his wife in virtually every city he stopped in, going as far as taking back to his hotel room 2-3 women at a time. So should parents around the country not talk to their children about the pivotal role he played in getting a deeply flawed nation to work towards equality because of his personal flaws? It sucks for his wife and family and all the women he used but I'm just being pragmatic when i say that I think the answer is no. It is OK for kids to idolize him because when they're doing that they're idolizing the message he represented and not that he couldn't keep it in his pants and that message is a wonderful message so it's OK. Same with Jobs when people here are calling him an idol they're referring to what he did to revolutionize entire industries and change the world by doing so but that doesn't mean that they're embracing him parking in handicapped spots because he thought rules don't apply to him. A few years ago no one thought they needed an Ipad until Jobs told us so, now it feels like I'm the last one without one lol. It takes a special dude to do that.

Personally I'm a big fan of Bezos and have been a shareholder for a while. I remember how many people doubted his strategy of "making products" when he launched the Kindle (me included); Now try to take my kindle away and see what I do to you ;D I will probably get a Kindle Fire because the one problem I've had so far is with reading PDF files and I tend to read many of them and a tablet seems to be the answer (along with reading magazines and newspapers etc...) and I don't want to pay up to get an Ipad. Plus all signs have been pointing towards the pre oder numbers for the Kindle Fire being off the charts. http://m.ibtimes.com/amazon-earnings-release-jeff-bezos-kindle-fire-3g-prime-apple-ipad-237518.html

Dude... Seriously just chill, it's OK. Whether you believe it or not some of us tend to agree with you a lot. For instance, I can't remember what the thread was and don't have time to look it up; but you recommended some European stocks like Telefonica and Carrefour that were totally unloved by the market and were paying you something like 8% and 11% in dividends and some of the rebuttals you got were from people saying stuff like "What if Europe this... What if Europe that..." and I remember thinking "I'm with Moore here, I've been to Europe and those are good franchises and whatever happens to Europe they're not going to stop using their cellphones or stop grocery shopping at Carrefour stores if they've been doing it for decades"; and I loved those recommendations so for me personally I've been much better off reading what you recommend believe me. However you've got to stop with that big vs small talk, us small guys have the mental capacity to agree with you whether you like it or not that sometimes people will worry about some index hitting a formula driven valuation point to get excited and miss pretty good businesses being sold for cheap. Your AUM and your big mansion have no place in a discussion where someone is presenting his point of view that valuing the general market is a tool he uses. And this business of telling people you've never met that they don't amount to 1% of your personal net worth is over the line and everybody else is right in comparing it to school boys arguing that one's d!ck is bigger than the other's.

Yeah... Sometimes ideologists make me laugh. Do you think it's easy being in Paulson's or Bernanke's shoes and day after day presiding over a country literally on fire where for instance they tell you that the JNJs, PGs etc... can't roll their commercial paper and therefore can't make payroll and are about to start sending home hundreds of thousands of people, and you just sit and say "Hey... not my problem it's the market's problem and the market will take care of it!" America was in trouble, not just the banks! The banks might have caused it but the whole country caught it and it is ludicrous to think that the people in charge of government had any choice but to do something to minimize the pain for everybody else. It's like living in a neighborhood where one family is lighting 10,000 candles every night and everybody tells them that one day their house will burn down! And eventually it does burn down, so you go to the fire department and tell them that the house with the crazy people is burning down and everybody is like "Let it burn, that'll teach them!" What if they then come back and say "Well the problem is that all the houses in town are separated by just 5 inches and if it burns it's the entire neighborhood/town that will burn down" Then what do you do? You send in the F'n fire department that's what you do if you're not insane!! And you deal with the crazy people later. And when the fire is put out and the damage somewhat limited, the same people now saying we should have let them burn, nothing would have happened to my house, are usually the same people that will then resist what I consider to be the sensible thing for the town to do which is to decide to stop (yes regulate!!) crazy people from burning thousands of candles if it puts everybody else at risk.

First let me say that I mostly agree with you guys and I like Greenblatt and his books are worth 10 times what you'll pay for them. But this board is usually fun when someone plays devil's advocate :), so I will I agree that it's their money and Burry is just investing it for them. And it's their right to get money out if they wish. But somehow I think if his name wasn't Grennblatt some of us would be calling him dumb money for pulling money out right before a once in a lifetime payday. So after five years of outstanding returns is when you decide not to trust the analysis of a guy you trusted enough to give him $100M to invest based solely on his blog?? Some on this board have been defending managers like Berkowitz saying that those who have been pulling money out now are dumb for doing so without listening to his thesis about why picks like BAC are good picks (even though it's their right) and at the very least look at his record and trust that he hasn't suddenly gone crazy. And it's not like Burry was hiding what he was doing, he had told his investors, why he was placing the bets, how he was placing them and even when they were going to pay out and he was right across the line. So if Greenblatt is himself an outstanding investor, how come he couldn't see what Burry was seeing (even as late as early 2007 I think) when he was providing them with data with foreclosures getting out of control. On this board we idolize a dude who back when he ran a partnership wouldn't even tell his partners where their money was sometimes until after he had divested from the investment; so all they had going for them was the knowledge that he was an outstanding and honest analyst who was compounding their savings at exceptional rates (notwithstanding the fact that rules and requirements were different back then) Or another one who went through "7 lean years" and those that stuck with him made a lot of money. I guess all I'm saying is that I was just a bit disappointed because one would expect from someone as respected as Greenblatt to be one of those that look at facts and analysis/evidence rather than want to get out due to a short term decline especially when you're the very person who launched Mike Burry and recognized him as an ace. If he is an outstanding value investor, I don't buy the argument of we hired you to buy stocks and nothing but stocks!! People that are Mike Burry good follow value wherever it is. Maybe the redemptions he was facing was the issue, I'll give him that as I have no clue, but what I would like to hear from Greenblatt is him explaining exactly why even with all the evidence Burry was giving them he still wanted to get out of that trade, it has to come down to the fact he either didn't think it was a good one or at the very least he had doubts. But then again, it is not my place to comment as it wasn't my $100M that was on the line so I maybe would have been the first to want out who knows :)

Bargainman, See quoted from "The Big Short":

Thanks a lot for this. I've also been wondering for a while now if there was anything with Greenblatt going on record to explain the Mike Burry episode, at least his side of the story. Because everything that was out there sure made it seem like he was pulling money from a guy that had a stupendous record over 6 years and that was also providing a very sound argument/analysis for his CDS positions.

Lol

Your wife is killing dinner with her bare hands? That's awesome. I think Eric should PM Hester to get techniques for his wife, roosters are so last year, I hear wild boar is the new thing :D

Lol... Agreed!! This one made my day: As far as I'm concerned I think the little things in life matter a lot actually and it's only when you add them up that you can frankly say that you've lived. Given that I'm still a bachelor rituals like Friday night beers with my friends and the laughter that accompany them are an integral part of my life and I won't do without them if the purpose is just to save a little bit of money. Those 2-3 beers (alright maybe 10 every now and then lol ;D) can end up costing a serious penny when it gets out of hand but I did it when I didn't have money so I damn sure will do it now that I have money!!! Unfortunately, everybody I ask tells me that I will probably stop doing it one day when the wife asks me where the F I think I'm going when she catches me trying to sneak out of the house to go have beers while a baby is crying in some room. But at the time I'm pretty sure other things will replace that like a nice vacation with said wife and baby, and I'll be happy to pay for that also when it comes I guess.

You live on $1.65 per day? ($50 per month) Is that like 32 cents on breakfast, 33 cents on lunch, and for dinner you pull out all the stops and spend $1? Do you find food scraps in dumpsters? Ate the neighbor's pets? Trapping raccoons? Stealing the neighbor's lemons off the tree? What is your secret? I bought two lemons yesterday and it cost me a dollar. That's 2/3 of your daily budget but you can't survive on 3 lemons a day. Thanks for the kind words, guys! haha Eric, Here is basically what I do. I have the healthiest diet of almost anyone I know. Recently I moved to mostly all organic/natural. Before that, I could get away about $50 a month or so (I'd suspect). I eat about 6x a day. For breakfast, I'll eat a bowl of organic cereal (kashi was $2.5 with a coupon - plus recyclebank points for future $2 off coupons) with milk. The milk (nonorganic)will last me about 1-2 weeks depending on the week. that's $2.50 for a gallon. breakfast should total about .60 or so. I'll eat a protein/nutrition bar. After buying coupons on ebay, those come in about .20 or so. Lunch. Peanut butter (natural) on organic 100% whole wheat bread. I'll buy manager special when I can and just put in it the fridge. Or if 100% nonorganic is especially cheap, I might buy that. Overall, I would the peanut butter is about $1.75 for 2-3weeks worth and break is about $3 on average for a week. I'll eat a organic spinach salad too. $3 for a pound and lasts about a week. $6/7 days + $1.75/14 days --- about a $1. 4th meal - fruit and nuts (buy in bulk) let's say .50 cents (that's probably a high estimate). 5th meal - protein shake (or veggies) $20 or so if I get it on sale and lasts about 2-3 months depending on use. .33 cents per day. 6th meal - veggie burger or mom's leftovers! let's say that averages about a $1 (again, I'd venture to guess less than that). That works out to about $3.60 a day or about $108 a month. Holly Cow!! Someone is definitely serious about retiring in 5 years By the way if you were one of my buddies, I would so make you pick up the tab every time we go to a bar because all this is not fair for the rest of us.

Then I take it back! You're my double hero ;D

There would seem to be a difference between dining with your folks and taking home some leftovers, however often that might be, and a strategy of saving money on food by doing so. Food shouldn't go to waste of course. Maybe if someone is doing this they can bring their laundry over too. While mooching on the food maybe Mom can iron the socks and underwear and pack a sack lunch for the next day. Lol... Guys let's not start judging people here. Please. All he did was share his situation and he didn't do it to be judged. I'll second the rest and say that someone running a tight ship like that is also my hero. I, for one, will tell you that I have the type of mother who, if I was living in the same city as my folks, would definitely want me home to eat almost on a daily basis for as long as I'm a bachelor at least, to make sure I'm correctly fed (or whatever reasons moms have) and she wouldn't take no for an answer.

I completeky agree with you Cardboard My very own brother is quite an irresponsible dude and somehow I fear that sooner or later his situation will blow up and I will be left worrying about his wife getting something to eat and my baby nephew getting milk everyday. i ve had this conversation with him many times so trust me I am living your point. And mind you he is my older brother and I am only 27 and still a bachelor myself but would have no choice, they're family. however there needs to come a point when someone calls bullshit on the whole personal responsibility argument. If the US is producing millions of college graduates that start their adult lives with tens and tens of thousands in debt then it is no longer their problem, it is society's problem because society has failed them. The US is the richest nation on earth and even on a per capita GDP we're still up there so there shouldnt be anything that someone can do that we can't do. So if only we could get our collective heads out of our collective behinds we could ask why is it that kids in say Finland go to school for free and get a top notch education for free so much so that they kick our asses in all subjects even in English which is considered a mother tongue in the US. Why is it that a school teacher in Germany doesnt have to worry that if his wife is diagnosed with breast cancer he will have to go through the pain of personal bankruptcy to get her treatment and why ours do? If you go back through this thread and others you'll see people talking about the free riders getting handouts and the people we're talking about are the school teachers, firemen, policemen etc.... and just because they have no way of making the kind of money I make or earning the money I earn from my investments I dont consider them any less as productive members of our society. So how about we look at whats working elsewhere and learn from it but the problem is that if we begin the conversation some people view it as more government and are quick to tell you F you! But if someone thinks that any of this will be solved without government, congress or some entity representing us collectively mandating somethimg they should share whatever they're smoking with the rest of the board. And the thing is simply that these thngs dont happen in a vaccum, they'r related. Take for example Buffett's idea that he estimates would touch some 50K people and how much he estimates that would raise in taxes, and compare that to the budget of all public universities and let's ask ourselves if its worth the trade off of having those people go from 20% to 25% or 30% if it meant that American kids (i.e. our future) doesnt start their productive lives with tens of thousands in debt and of the people those reforms would hurt I am one of them. I figure college loans reform would hurt banks and I am a BAC shareholder (yes Parsad and Al convinced me to swing lol) but I think it's worth the discussion. But the problem with far right people is that they wont even agree to talking about what would help us all if we meet in the middle. My basic point is that we shouldnt fool ourselves that sooner or later an angry majority will not turn against a lucky minority and just like Buffett I think we should agree on orderly reforms that will benefit the nation as a whole

Your understanding of how the capitalists look at the situation is incorrect. Those who disagree with Buffett are not looking for a free handout. They have a different belief in what is fair and reasonable. They also realize Buffett is making an inaccurate comparison in order to arrive at a conclusion he thinks is right. To compare just payroll and income taxes at one point in time is not looking at the whole picture. He ignores corporate taxes that companies (and shareholders indirectly) have already paid. He attributes both halves of payroll tax to the individual (when the corporation (i.e. shareholders) actually paid half) which makes it look worse for the middle class person right now but ignores that the same person will collect Social Security for many years in the future. If it is a tax now then it is a handout (opposite of a tax) when collected (and results in a hugely negative tax rate for most middle class Americans). To argue that capitalists are looking for a free handout is absurd. Buffett is not different from them in thinking everyone should pay their fair share. Capitalists in general believe that as well. They obviously have a different belief in what is fair. To posit that the free handout is provided by the government is also misleading. It is provided by taxes which largely come from the capitalists you say are wanting a free handout. You are giving Buffett too much credit and the capitalists too little. Actually, It is my personal opinion that we don't give Buffett enough credit whenever we discuss this and some try to oversimplify and others over-complicate his stance. He knows very well that whenever owners of a company get to pay a tax on the dividend they receive, that money has already been taxed at the corporate level. He knows that payroll taxes paid by employees are matched by the company (i.e. owners/shareholders), he knows that top earners are responsible for most of the income tax revenue etc... Trust me, he is aware of all those facts as they affect him much more than all of us here combined I would guess. However, I am yet to see anyone argue against (or at least address) the fundamental fact that underlies WEB's crusade dating back to that estate tax senate hearing to today's minimum tax on the wealthy talk, which is: Even with all those arguments being true (the rich are double taxed when they receive their dividend checks, they pay most of the income tax etc... etc...), even with all that, we are now solidly entrenched in a society where the very top (and a very small minority of the population) are seeing their net worth increase exponentially while the middle class has been going nowhere and an increasingly alarming number of them can't even keep up with the economic treadmill they're on and they're leaving the middle class and joining the poor, while the very top 5% or so are controlling an increasing portion of the American pie. WEB sees this and says this society is not sustainable! And personally I agree with him; Instead of berating WEB for not "supposedly" understanding who pays what taxes whenever he says tax the rich more, how about someone tries to help him solve the underlying issue with our society that he is trying to solve. I would say it is a very big problem we have on our hands unless you can show somewhere in the history of humanity where 5% of a population have gone on a long run of monopolizing for themselves an ever increasing portion of a country's resources without the remaining 95% sooner or later forcing a redistribution (often bloody redistribution). It might even be his own survivor instinct that pushes him to fight for this as he knows that if shit was to ever hit the fan there's only one guy ahead of him (for the US at least) so his head will definitely be on a hit list somewhere. So in my mind it's fruitless to engage in these debates over taxation and pretending that WEB doesn't understand taxes and who pays what because some people think that nobody should ever tax them and they wouldn't even be happy with a 0.00005% tax rate and cutting taxes will be the solution to everything; And instead try and address the underlying problem. Unless you believe it is not true that the middle class is shrinking and the poor increasing and the very top taking home more and more of the pie, in which case I'd be glad to take a look at the data you're looking at. So does someone have a better idea that doesn't involve fiscal policy like WEB advocates (i.e. the hated "T" word)? Because what we have isn't working in my opinion and undoubtedly there comes a day when 90% of a country collectively wakes up and decides that a system that isn't working for them isn't worth keeping and it can get ugly real quick and I want to avoid that; and if it means that I'll personally pay a little bit more capital gains taxes then I won't be happy but I'm willing to at least have that conversation. Just my 2c.

I second this. I've spent the last two days on the site. Thanks.

Hey moore, Thanks for the reply. I really appreciate the conversation that you've initiated over the last few weeks (months maybe) as to me a return to a gold standard for the USD had never entered my mind until it was brought up in a couple of threads on this board so that goes to tell you that I am no expert at all. And even though we disagree I like that you usually have well articulated arguments for your position. To me it seems to boil down to the fact that human beings tend to be nostalgic about what was to the detriment of what is maybe... I fail to see how one can conclude by looking at the exceptional success America has enjoyed that our system hasn't worked. We've had hiccups and we'll have more but I disagree that our monetary system hasn't worked overall. Also, if one of the answers to the point that Richard raised is this: So if we say that we start with a system where $1 is backed by let's say 30oz and Richard's scenario plays out and we wake up to find that it is no longer adequate and I assume we still have some Federal Reserve-like entity that would decide to readjust the ratio to $1/20oz, how exactly is this different from what we have right now? We'd just end up continuously readjusting the ratio I think. And maybe we would give that power to Congress so that we can give those yoyos in DC one more thing to fight about every year and hold us hostage over ;D ::)

Great post and question. I am also wondering the same but you expressed it exponentially better than I could ever have. Thanks. In my view orderly inflation is the way advanced societies deal with the widget scenario presented above and over time it works really well, actually it has worked really well if we look how great we've done over the long term. Of course, just like anything that is heavily influenced by human beings, it sometimes gets out of control and we need heroes willing to give everybody their medicine like when Volcker stepped with both feet on the brakes by raising rates to 20%, even though it meant we all went through the windshield when he did that, it was needed to break the back of out of control inflation. To me I just can't square this circle either, maybe due to my own limits, how do you tie the aggregate output of a global population that is increasingly more productive decade after decade to a set metric (the gold available to us) without incurring never ending deflation?

Terrible news... F'n sad man :( A real genius whose creations no doubt will be remembered as being an integral part of "Americana".

Yeah... alwaysinvert is right here, you can't just define it by wealth vs. work, unless your name is Paris Hilton taxing wealth usually means taxing wealth that someone has spend a lot of time working on and saving for. But in general I agree with ubuy2wron and BSB and to me it's just a question of looking at society at large and deciding what is best for 300M+ people. I'll repeat what others have said and agree that of course spending cuts that mean real reform and real savings and not kicking variable cans down the road. However, people never expand on the term "cut spending", but if we're being frank about it means cut social security for retirees, cut all kind of benefits that go to those that are already living month to month and already don't have much room to work with. Now if we agree that some of this needs to be done to bring our financial house back in order, how does that make sense not to ask Buffett to share in some of the pain by paying more than 17% on his millions? It's just good common sense policy for the greater good in my opinion. I am nowhere near where ubuy2wron is lol... I am firmly middle class working my way up hopefully, but if we're going to inflict pain on those at the bottom by cutting their social security checks they depend on for food, then even I should share some of the pain and pay a bit more to help clean up our fiscal house. And for statements like these "instead of hating the rich , the poor and middle class should be thankful for them" I just don't understand them. Data clearly shows that over the last few decades the American pie has grown and the rich have taken home a bigger slice year after year and the middle is now shrinking and joining the bottom which is taking home a smaller slice. So what do they have to be thankful for? The fact that the rich pay more in income taxes hence the poor get food stamps and medicaid and what not? At the end of the day if one group is taking home more of the pie every year that group is winning the race, however way you want to look at it; the problem is that it eventually leads to social unrest when that group represents 1-5% and 95% is losing.

Great one. Thanks for posting

That's quite amusing, since there still has been no terrorist event in the United States where the terrorist arrived via Canada. Even the idiot who planned on blowing up the space needle a few years ago was caught at the border. In fact, all the recent terrorist activity were homegrown in the U.S. or arrived via that bastion of morality and political correctness...Saudia Arabia! Some poor lady is going to get 10 lashes because she was caught driving there a couple of days ago. Talk about the U.S. speaking out the wrong arse! Cheers! You sent Justin Bieber!!!! Build that damn fence!! Actually wait until he goes back north and then build it high enough so he can't climb back ;D

True... My bad.