BRK IN MKE

Thanks for the explanation. I had never heard of that strategy before. What is the point of getting rid of the small shareholders? (b/c they increase costs???)

FYI... looks like they are doing a reverse/forward split. He did pretty much the same thing at DGT Holdings. I have no clue, but I am guessing liquidity will dry up a little after considering anyone holding 500 shares or less will be cashed out I might be off base with that comment So are shares going from $33 to $16,500? I am not sure if I am reading this right, but it seems like the most ridiculous thing I have ever heard. I understand the need to create long-term shareholders, but that seems excessive.

During the partnership years in particular he made this claim due to work outs (Arbs, corporate actions, stocks like Sanborn Map) generating profits regardless of how the general market performed, thus he would outperform the market in bad years, but likely lag in good years. He clearly states that the generals will likely decline similar to the indices. During the last few decades, I believe he has said that Berkshire will function similarly. I don't think he says portfolio. So I take that as being based on his focus on Berkshire's book value continuing to grow since most of the business will still be profitable in down years. I always wondered about this quote as well, but my understanding is the same as Tim's interpretation. I think Buffett is referring to book & intrinsic value. When the market is up a lot I would bet Buffett would say that the underlying intrinsic value of the companies that compose the index also underperform the performance of the index. I really think all Buffett is trying to do is set expectations. Just because we enter into a strong bull market and Bershire's intrinsic value has grown slower than the index doesn't mean that Berkshire is "out of touch" or "too big". When a strong bull market occurs and Bershire underperforms Buffett can point to his letters and say that he said it would happen this way and it doesn't mean that Berkshire will underperform the index in the long run.

About 25% for me. Up from 0% from just over a year ago.

Chicago

I remember that Buffett said... if Charlie, Warren and Ajit are ever in a sinking boat – and someone can only save one of them – swim to Ajit (Jain). That's true - his reason was that Ajit has added the most value to Berkshire out of the 3 of them. I would disagree with him there :) I agree with you that the quote is just Buffett being humble, but Ajit is also 20 years younger than Buffett. So part of Buffett reason might be because Ajit has a longer time period to impact the results at Berkshire.

I haven't seen the exact quote, but I have heard Charlie mention this in the past. My understanding is he is referring to competitve individuals that will try to win at any cost. In the short run they may be great at what they do because they are hard working and intelligent individuals. However, their competitive drive eventually becomes their downfall as they can't stand to see others outperforming them. In essence he is saying don't worry about what others are doing. Think about what is the optimal long-term strategy. Think of Chuck Prince at Citi. "As long as the music is playing, you've got to get up and dance, we're still dancing."

That is an awesome video. I think most investors could learn a lot from Mohnish and his cloning strategy. What is going on in the picture @ the 4:47 mark.

I think you might be reading too much into this situation. In my opinion I don't think Buffett or Munger would be a big fan of the way either party handles themselves. Obviously both Ackman and Icahn are great investors, but I don't think either have the type of personality Buffett and Munger like to associate with.

Whitney Tilson has used the same method in his calculation. However, over the last couple of years Tilson has used a more conservative multiplier of 8 on pre-tax earnings per share. So Tilson's method would be 114k+8x8k=178k I think your method is probably closer to the true intrinsic value, but even with a conservative calculation Berkshire is still selling well below intrinsic value.

I find this article to be really interesting. I am more surprised that the endowment kept such a concentrated portfolio for so long. While I think most on this board wouldn't have a problem with such a high level of concentration in Berkshire, I think we are a small sliver of investment professionals with that mindset. Even leaving approx. 50% of the portfolio in Berkshire is an enormous amount of concentration for an endowment of that size. While I think hindsight may prove that they endowment would have been better off keeping the shares of BRK, I am still impressed in their conviction to keep 50% of their endowment within Berkshire. I think the endowment universe would aggregate better results if more boards used concentrated-low-turnover portfolios. I am not familar with taxes on endowments like the one referenced in the article. Are they required to pay a capital gains tax? If so, that may make the decision even more painfull when they look back 20 years from now.

Sunday morning at the Omaha Marriott near Borsheims. Cheers! Actually, sorry Bill. It looks like they moved the event last year to the Omaha Hilton. Go to the MKL thread in the "Investment Ideas" section. They have the email contact at Markel. It used to just be open to everyone, but it looks like it may be by invitation now. Cheers! I don't speak for Markel, but I believe the event is still open to everyone. I think the invitation is more for the purposes of getting a head count. If anyone is planning on attending I would recommend sending and email to Myra Hey mhey@markelcorp.com as a courtesy. I have gone the last three years and the event keeps growing so I am sure it is not easy to budget for food and seating. I just got a response from her, so thanks! She indicated it "was after the Berkshire meeting"--I assume that's sunday, but could you confirm the day? The event has been on Sunday the last three years I have gone, but I would confirm with Myra as the date gets closer just to be safe. Now that she has your email she will probably send you an invitation around the end of March.

Sunday morning at the Omaha Marriott near Borsheims. Cheers! Actually, sorry Bill. It looks like they moved the event last year to the Omaha Hilton. Go to the MKL thread in the "Investment Ideas" section. They have the email contact at Markel. It used to just be open to everyone, but it looks like it may be by invitation now. Cheers! I don't speak for Markel, but I believe the event is still open to everyone. I think the invitation is more for the purposes of getting a head count. If anyone is planning on attending I would recommend sending and email to Myra Hey mhey@markelcorp.com as a courtesy. I have gone the last three years and the event keeps growing so I am sure it is not easy to budget for food and seating.

This might be a fairly naive question, but does Fairfax (FRFHF) receive a dividend? I looked at the chart on Google finance and Yahoo finance and it doesn't show any dividend payment. Also the original press release only mentions (TSX:FFH)(TSX:FFH.U).

It is held the morning after the Berkshire meeting and includes a very nice breakfast. This year it expanded to the Omaha Hilton across the street from the CenturyLink Center where the Berkshire meeting is held. Tom Gayner and Steve Markel make some opening remarks and then open it up for Q&A. The audience includes a lot of informed investors and large value investors such at Tom Russo, David Winters, Mohnish Pabrai, etc. The discussion is useful and questions are typically informed and intelligent. I have found that attending gives me an opportunity to both follow the investment and take the measure of management, whom I've found to be first class people. Thanks Val. Do you have to be a MKL shareholder? No. Cheers! I have attended the last couple years with a group of 4 or 5 and I was the only shareholder. As others have said I would highly recommend this event. I look forward to this brunch as much if not more than Berkshire's shareholder meeting. Tom Gaynor's assistant is always in charge with RSVPs. If you are planning on attending I would send her an email at least a month before the event. Her name is Myra Hey and her email is MHey@markelcorp.com.

I have an account through Pershing and I received my shares on Friday of last week.

I am kind of new to subscription rights and was wondering if someone could explain how this works for the layman. Here is an hypothetical scenario: Lets say I own 100 shares of SHLD through Scottrade. If I am reading the prospectus correctly that gives me the right to purchase 21 (.218091 * 100) shares of SHO. In this case I would need to have $315 in my account to cover the expense of buying the 21 shares. -My main question is I don't currently show anything in my brokerage account that shows I have subscription rights to buy the shares of SHO. Is it simply a matter of me calling Scottrade and informing them I would like to exercise my right? -Secondly, to me it seems like the worst option of all would be doing nothing with the rights to purchase additional shares. The rights to purchase SHO seem to have some value, but I am not sure how to sell the rights if you don't want to exercise the option. If I were to do nothing I feel like it would be letting an option that is in the money expire worthless. Is this correct or am I reading too much into this?

I think this is a very good topic to bring up, but it seems ridiculous to think that he would get payed a bonus on the example above where he earns returns of yr1= 0% yr2 =0% and yr3=8%. To take it one step further lets say he earns a return of 5% for years 1,2, & 3. In that case the numbers wouldn't have been over the hurdle and thus it would have been Mr. Biglari self interest for compensation purposes to earn 0% for years 1 and 2 and 8% for year 3. I hope someone can provide some more clarity b/c it seems like there is a conflict of interest that lies within this compensation structure.

I am sure this topic has probably been discussed before, but what Newspapers or magazines is on everyone's must read list. Currently, I get WSJ, Economist, and Businessweek. I am thinking about subscribing to Investor's Business Daily, Harvard Business Review, and Barrons. I have not yet pulled the trigger on those subscriptions, but I figured I would poll members of the message board to see what everyone's "must read" publication(s) is/are before I sign up. *For me the one that I glean the most wisdom from is the Economist. That is a subscription that I plan to carry for a long time.