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  • 2 weeks later...
Guest longinvestor

Pershing Square sold out of their berkshire position as per conference call.  Likely due to the disappointment in the lack of capital deployment

 

Sure. Buffett didn’t listen to Ackman, ha!

 

Good riddance.

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Pershing Square sold out of their berkshire position as per conference call.  Likely due to the disappointment in the lack of capital deployment

 

Sure. Buffett didn’t listen to Ackman, ha!

 

Good riddance.

 

I'm sure Buffett is really disappointed that guy who blew up his own hedge fund twice no longer owns Berkshire stock

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I think Ackman did the right thing.

A hedge fund should be actively looking for opportunities rather than invest into a long-term hold.

Folks don't pay Ackman his fees so that he parks money into Berkshire.

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I think Ackman did the right thing.

A hedge fund should be actively looking for opportunities rather than invest into a long-term hold.

Folks don't pay Ackman his fees so that he parks money into Berkshire.

I understand why one would've sold some in March, since upside was better elsewhere, but since everything rallied and Berkshire stayed in the gutter during April and May - like 170-175/share last week - I don't quiet get it. Risk/reward seems as good if not better than in early 2016. Would be great if Buffett bought back shares when he realized things probably would not turn out as bad as feared.

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I think Ackman did the right thing.

A hedge fund should be actively looking for opportunities rather than invest into a long-term hold.

Folks don't pay Ackman his fees so that he parks money into Berkshire.

 

Basically this.

 

You can rationalize holding it for personal accounts or accounts with certain risk profiles. But as an active manager who charges fees it is very hard to justify holding this. Its amazing that folks would criticize Ackman here, when Buffett is the one who's approach and performance, is if anything, the thing to look at and question.

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I think Ackman did the right thing.

A hedge fund should be actively looking for opportunities rather than invest into a long-term hold.

Folks don't pay Ackman his fees so that he parks money into Berkshire.

 

Basically this.

 

You can rationalize holding it for personal accounts or accounts with certain risk profiles. But as an active manager who charges fees it is very hard to justify holding this. Its amazing that folks would criticize Ackman here, when Buffett is the one who's approach and performance, is if anything, the thing to look at and question.

I'm not critizising Ackman here. He played it well so far, obviously. I am just surprised he didn't sell Berkshire in March but apparently after the initial strong rally in the broader market if I read this right.

 

Judging by the results it might have given him a better outcome, I just think the risk/reward is pretty unique now - more so than in March.

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I think Ackman did the right thing.

A hedge fund should be actively looking for opportunities rather than invest into a long-term hold.

Folks don't pay Ackman his fees so that he parks money into Berkshire.

 

Basically this.

 

You can rationalize holding it for personal accounts or accounts with certain risk profiles. But as an active manager who charges fees it is very hard to justify holding this. Its amazing that folks would criticize Ackman here, when Buffett is the one who's approach and performance, is if anything, the thing to look at and question.

I'm not critizising Ackman here. He played it well so far, obviously. I am just surprised he didn't sell Berkshire in March but apparently after the initial strong rally in the broader market if I read this right.

 

Judging by the results it might have given him a better outcome, I just think the risk/reward is pretty unique now - more so than in March.

 

I agree, and still own BRK. Its an interesting way to play a rebound in some of the hardest hit stuff, while having less risk than just outright buying banks and insurance stocks. I just think as a fund manager, you're getting paid to know how to navigate the rubbish and buy directly into those rebound names, which is exactly what Ackman did, almost perfectly, while Buffett was at first chasing his tail with the airlines, and then peeing in his pants. Buffett gets so many free passes though, its crazy. If you had the ability to trade back in time, you still couldn't have done a better job handling Feb/March/April than Bill Ackman.

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Pershing also has no leverage to make any recommendations or changes to berkshire.  They can buy a qsr at 20x + and still seek margin expansions, buybacks, acquisitions etc and still do better than keeping berkshire which is basically tied to the economic recovery with no alpha so long as buffet is resistant to buying dips or buying back stock.  You really need to ask the question, what is berkshire really worth if buffett isn't buying back a languish stock in the 170s if he was willing to do so at 220.  How much instrinic value does warren think was impaired? I'd imagine in feb he probably thought it was worth 250/260 at least? What is it now if he isn't pressing the buy button here.  No excuses for it moving too fast either considering it was in the 170s for a good 2 weeks

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As an investor, would one rather pay high performance/mgmt fee to Ackman to buy BRK on one’s behalf or does one directly buys Berk, and implicitly pays $100K salary to Buffet as CEO.

 

Ackman thesis was that Berk will deploy its cash. That didn’t happen. He can buy it later. and keep in mind that as Fed ramps down its support there will be distress opportunities both for Berkshire and Howard Marks from Oaktree.

 

Us, the individual BRK shareholders, are just doing time arbitrage while the above takes place (real distress opportunities)

.

Ackman, the hunter, will be going for a few kills before coming back to BRK. He is paid to hunt. That is his job. 

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Pershing also has no leverage to make any recommendations or changes to berkshire.  They can buy a qsr at 20x + and still seek margin expansions, buybacks, acquisitions etc and still do better than keeping berkshire which is basically tied to the economic recovery with no alpha so long as buffet is resistant to buying dips or buying back stock.  You really need to ask the question, what is berkshire really worth if buffett isn't buying back a languish stock in the 170s if he was willing to do so at 220.  How much instrinic value does warren think was impaired? I'd imagine in feb he probably thought it was worth 250/260 at least? What is it now if he isn't pressing the buy button here.  No excuses for it moving too fast either considering it was in the 170s for a good 2 weeks

 

Buffet is probably waiting for Fed to pull the rug out so that he can go to work. Fine by me.

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Pershing also has no leverage to make any recommendations or changes to berkshire.  They can buy a qsr at 20x + and still seek margin expansions, buybacks, acquisitions etc and still do better than keeping berkshire which is basically tied to the economic recovery with no alpha so long as buffet is resistant to buying dips or buying back stock.  You really need to ask the question, what is berkshire really worth if buffett isn't buying back a languish stock in the 170s if he was willing to do so at 220.  How much instrinic value does warren think was impaired? I'd imagine in feb he probably thought it was worth 250/260 at least? What is it now if he isn't pressing the buy button here.  No excuses for it moving too fast either considering it was in the 170s for a good 2 weeks

 

Buffet is probably waiting for Fed to pull the rug out so that he can go to work. Fine by me.

 

And what leads him or anyone else to believe that they will? People having been saying these same things about the Fed, and the music stopping, and the "stock market doesnt match the economy" for the past decade. For a 90+ year old dude, Im not sure thats a great game to be playing. Or, as we've seen from time to time in the markets, the Fed may in fact do that, and the story doesnt play out the way the pundits think it will.

 

Ive become more and more convinced that the rallying cry of "the markets are overvalued" is just a convenient and pride saving way of admitting "I missed the opportunity".

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Seems more like the feds pulled the rug out beneath Warren and he's seeing stars instead of value.

 

Pershing also has no leverage to make any recommendations or changes to berkshire.  They can buy a qsr at 20x + and still seek margin expansions, buybacks, acquisitions etc and still do better than keeping berkshire which is basically tied to the economic recovery with no alpha so long as buffet is resistant to buying dips or buying back stock.  You really need to ask the question, what is berkshire really worth if buffett isn't buying back a languish stock in the 170s if he was willing to do so at 220.  How much instrinic value does warren think was impaired? I'd imagine in feb he probably thought it was worth 250/260 at least? What is it now if he isn't pressing the buy button here.  No excuses for it moving too fast either considering it was in the 170s for a good 2 weeks

 

Buffet is probably waiting for Fed to pull the rug out so that he can go to work. Fine by me.

 

And what leads him or anyone else to believe that they will? People having been saying these same things about the Fed, and the music stopping, and the "stock market doesnt match the economy" for the past decade. For a 90+ year old dude, Im not sure thats a great game to be playing. Or, as we've seen from time to time in the markets, the Fed may in fact do that, and the story doesnt play out the way the pundits think it will.

 

Ive become more and more convinced that the rallying cry of "the markets are overvalued" is just a convenient and pride saving way of admitting "I missed the opportunity".

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Pershing also has no leverage to make any recommendations or changes to berkshire.  They can buy a qsr at 20x + and still seek margin expansions, buybacks, acquisitions etc and still do better than keeping berkshire which is basically tied to the economic recovery with no alpha so long as buffet is resistant to buying dips or buying back stock.  You really need to ask the question, what is berkshire really worth if buffett isn't buying back a languish stock in the 170s if he was willing to do so at 220.  How much instrinic value does warren think was impaired? I'd imagine in feb he probably thought it was worth 250/260 at least? What is it now if he isn't pressing the buy button here.  No excuses for it moving too fast either considering it was in the 170s for a good 2 weeks

 

Buffet is probably waiting for Fed to pull the rug out so that he can go to work. Fine by me.

 

And what leads him or anyone else to believe that they will? People having been saying these same things about the Fed, and the music stopping, and the "stock market doesnt match the economy" for the past decade. For a 90+ year old dude, Im not sure thats a great game to be playing. Or, as we've seen from time to time in the markets, the Fed may in fact do that, and the story doesnt play out the way the pundits think it will.

 

Ive become more and more convinced that the rallying cry of "the markets are overvalued" is just a convenient and pride saving way of admitting "I missed the opportunity".

From what I've seen generally the bunch that point that "ABC" has missed the opportunity just because the markets went up tend to correlate well with the bunch that claim that nobody could have seen "XYZ" event coming when asked why they don't have any money anymore.

 

Also, pretty sure Buffett doesn't give a shit about "the game" or how he should play it.

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Pershing also has no leverage to make any recommendations or changes to berkshire.  They can buy a qsr at 20x + and still seek margin expansions, buybacks, acquisitions etc and still do better than keeping berkshire which is basically tied to the economic recovery with no alpha so long as buffet is resistant to buying dips or buying back stock.  You really need to ask the question, what is berkshire really worth if buffett isn't buying back a languish stock in the 170s if he was willing to do so at 220.  How much instrinic value does warren think was impaired? I'd imagine in feb he probably thought it was worth 250/260 at least? What is it now if he isn't pressing the buy button here.  No excuses for it moving too fast either considering it was in the 170s for a good 2 weeks

 

Buffet is probably waiting for Fed to pull the rug out so that he can go to work. Fine by me.

 

And what leads him or anyone else to believe that they will? People having been saying these same things about the Fed, and the music stopping, and the "stock market doesnt match the economy" for the past decade. For a 90+ year old dude, Im not sure thats a great game to be playing. Or, as we've seen from time to time in the markets, the Fed may in fact do that, and the story doesnt play out the way the pundits think it will.

 

Ive become more and more convinced that the rallying cry of "the markets are overvalued" is just a convenient and pride saving way of admitting "I missed the opportunity".

From what I've seen generally the bunch that point that "ABC" has missed the opportunity just because the markets went up tend to correlate well with the bunch that claim that nobody could have seen "XYZ" event coming when asked why they don't have any money anymore.

 

Also, pretty sure Buffett doesn't give a shit about "the game" or how he should play it.

 

Like who? Can you name any?

 

Because once again, we saw most of the guys on top of their game, even some of the more prominent bears buying stocks in March. We saw BX and BAM buying RE hand over fist. We saw the Saudi Wealth fund buying hotels and entertainment companies. And we saw the guy who invented "the game" who "doesnt give a shit" about it now, capitulate at the bottom....

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