gfp Posted June 2, 2020 Posted June 2, 2020 General comments on 6/1 reinsurance renewal pricing - https://www.businessinsurance.com/article/20200602/NEWS06/912334892/Reinsurance-rates-jump-as-COVID-19-adds-uncertainty-to-market# In addition, retrocessional capacity is entering the market from sources that typically only offer substantial capacity when rates are at historically high levels, Mr. Shields said “We are hearing repeated references to companies like Berkshire Hathaway and D.E. Shaw playing a role. Their longstanding approach has been to let the market come up to their elevated levels and that’s when they’ll put their capital at risk,” Mr. Shields said.
Cigarbutt Posted June 2, 2020 Posted June 2, 2020 General comments on 6/1 reinsurance renewal pricing - https://www.businessinsurance.com/article/20200602/NEWS06/912334892/Reinsurance-rates-jump-as-COVID-19-adds-uncertainty-to-market# In addition, retrocessional capacity is entering the market from sources that typically only offer substantial capacity when rates are at historically high levels, Mr. Shields said “We are hearing repeated references to companies like Berkshire Hathaway and D.E. Shaw playing a role. Their longstanding approach has been to let the market come up to their elevated levels and that’s when they’ll put their capital at risk,” Mr. Shields said. More of the same elsewhere: https://www.reinsurancene.ws/fhcf-will-not-renew-its-private-market-reinsurance-in-2020/ "Kuczwanski notes that since 2015, there’s been ample private market capital and significant risk transfer capacity, which has enabled the FHCF to participate in the private market without lowering the amount of capacity available to direct writers in Florida. However, capital is now less abundant that in prior years..." The world has changed. The question is unfolding as to whether it's cyclical or secular.
longterminvestor Posted June 3, 2020 Posted June 3, 2020 Short term this may look bad, seem bad, but not as bad as it looks/seems. If rates continue to tick up long term, Berkshire RE will begin to take risk at "their price". Buffett has been saying for past few years RE insurance biz has not been as good of a business because of over capacity. Back in 2008, Buffett got paid $244MM as an option to "lend" $4B @ 6.5% in event of storm (see article below). Interesting structure because he was dealing with State of Florida Government (FHCF). FHCF has been running a surplus AND book of business has declined rapidly b/c private markets have taken risk so FHCF's needs for risk reduction has diminished since 2008. https://www.heraldtribune.com/article/LK/20080731/News/605231753/SH
CassiusKing1 Posted June 5, 2020 Posted June 5, 2020 Oh boy. https://www.cnbc.com/2020/06/05/trump-says-warren-buffetts-airline-stock-sale-was-a-mistake.html
DooDiligence Posted June 7, 2020 Posted June 7, 2020 Oh boy. https://www.cnbc.com/2020/06/05/trump-says-warren-buffetts-airline-stock-sale-was-a-mistake.html Yeah, WEB should have taken total ownership & decked out the planes with cashmere carpet & gold plated toilets. Great advice from the master of M & A.
fareastwarriors Posted June 8, 2020 Author Posted June 8, 2020 Warren Buffett’s lack of big moves during sell-off is ‘tied to his age,’ Ken Fisher says https://www.cnbc.com/2020/06/08/warren-buffetts-lack-of-big-moves-during-sell-off-is-tied-to-his-age-ken-fisher-says.html
LC Posted June 8, 2020 Posted June 8, 2020 fareast, thank you for posting. I think this is fair criticism. I have been wondering when is the appropriate time to ask the question, "What do people think of WB's actions during Mar/Apr?" The follow up questions being, "what does this indicate for a long-term investor in Brk, and what is the function then of the 120+B cash balance?" Perhaps it is still too early to ask such questions, but I think anyone making a meaningful investment in Brk needs to question these factors.
clutch Posted June 8, 2020 Posted June 8, 2020 The age factor is particularly salient due to his perceived risk of Covid at an old age.
bookie71 Posted June 8, 2020 Posted June 8, 2020 I think his lack of moves is because nobody knows how this will play out and the cash may be needed to protect the existing companies.
kab60 Posted June 8, 2020 Posted June 8, 2020 He seemed pretty level headed and sharp during the AGM, so I suppose he misjudged the situation - or at least the outcome - like Druckenmiller and most famous money managers as well as the majority of people on this board judging by the activity here in March. So that sucks as a shareholder. On the other hand, I think his stake in Apple shows he hasn't completely lost his marbles and turning on Airlines and banks, despite bad timing, indicates he's still flexible. Anyway, I think I'd prefer if Berkshire just put idle cash in S&P 500/BNSF/BHE/buybacks depending on the best expected returns so it became a permanent, float-levered equity on the broad market, because I think it's basically impossible for him to stockpick and beat the averages with the money he juggles with. Espescially when he won't go near stuff like Altria or Bud and cuts himself off from obvious opportunities. I Hope the old guy has an ace up his sleave and bought back a truckload in Q2, but I wouldn't count on it.
Munger_Disciple Posted June 8, 2020 Posted June 8, 2020 Warren Buffett’s lack of big moves during sell-off is ‘tied to his age,’ Ken Fisher says https://www.cnbc.com/2020/06/08/warren-buffetts-lack-of-big-moves-during-sell-off-is-tied-to-his-age-ken-fisher-says.html Recent Forbes article about Fisher: https://www.forbes.com/sites/noahkirsch/2019/10/21/unearthed...
sleepydragon Posted June 8, 2020 Posted June 8, 2020 Warren Buffett’s lack of big moves during sell-off is ‘tied to his age,’ Ken Fisher says https://www.cnbc.com/2020/06/08/warren-buffetts-lack-of-big-moves-during-sell-off-is-tied-to-his-age-ken-fisher-says.html Recent Forbes article about Fisher: https://www.forbes.com/sites/noahkirsch/2019/10/21/unearthed... If Phillips Fisher is still alive, he will slap his face a few times.
spartansaver Posted June 8, 2020 Posted June 8, 2020 Warren Buffett’s lack of big moves during sell-off is ‘tied to his age,’ Ken Fisher says https://www.cnbc.com/2020/06/08/warren-buffetts-lack-of-big-moves-during-sell-off-is-tied-to-his-age-ken-fisher-says.html It's true, back in 08/09 when Buffett was young he was able to act aggressively. (this is a joke)
mattee2264 Posted June 9, 2020 Posted June 9, 2020 https://www.marketwatch.com/story/warren-buffett-is-an-idiot-says-investor-who-claims-daytrading-is-the-easiest-game-ive-ever-played-2020-06-09?mod=home-page Echoes of 1999?
gfp Posted June 9, 2020 Posted June 9, 2020 https://www.marketwatch.com/story/warren-buffett-is-an-idiot-says-investor-who-claims-daytrading-is-the-easiest-game-ive-ever-played-2020-06-09?mod=home-page Echoes of 1999? Seems like it is in jest. Is there reason to believe that particular guy is serious?
rb Posted June 9, 2020 Posted June 9, 2020 Check out his twitter feed. He's 100% for real. You'll loose some time you won't get back but it's good for a chuckle.
sleepydragon Posted June 10, 2020 Posted June 10, 2020 https://bankunderground.co.uk/2020/06/09/covid-19-briefing-corporate-balance-sheets/ “ “While it is still very uncertain how the Covid-19 induced crisis will unfold and to what extent it will resemble the global financial crisis, some lessons from the global financial crisis might be good to keep in mind. Joseph, Kneer, Van Horen and Saleheen (2019) show that during the global financial crisis companies with limited cash holdings had to reduce their investment and therefore lost productive capacity. When demand returned and market conditions improved they were not able to catch up with their cash-rich rivals and as a result lost market share to them. Companies with large amounts of cash on their balance sheets at the onset of the coronavirus crisis might therefore emerge as winners in the post-Covid world.” Buy BRKa!
LC Posted June 10, 2020 Posted June 10, 2020 https://bankunderground.co.uk/2020/06/09/covid-19-briefing-corporate-balance-sheets/ “ “While it is still very uncertain how the Covid-19 induced crisis will unfold and to what extent it will resemble the global financial crisis, some lessons from the global financial crisis might be good to keep in mind. Joseph, Kneer, Van Horen and Saleheen (2019) show that during the global financial crisis companies with limited cash holdings had to reduce their investment and therefore lost productive capacity. When demand returned and market conditions improved they were not able to catch up with their cash-rich rivals and as a result lost market share to them. Companies with large amounts of cash on their balance sheets at the onset of the coronavirus crisis might therefore emerge as winners in the post-Covid world.” Buy BRKa! This is a very fair counterpoint to the "Buffett did nothing!" criticism. You can earn a great return investing 6, 12 months after the crisis when the smoke has cleared.
gfp Posted June 10, 2020 Posted June 10, 2020 Check out his twitter feed. He's 100% for real. You'll loose some time you won't get back but it's good for a chuckle. Yikes, I guess you are right. Seemed like he was drinking in most of his videos, day or night. I loved the irony of the 'I should be up a Billion dollars today!' line on the day old man Buffett watched his largest equity position - a tech stock - go up by $10.53 per share, while owning 250,866,566 shares of that tech stock. Looks like there is a very real possibility that Berkshire's largest equity position will be worth more than the entire market cap of Wells Fargo at some point. But seriously, what have you done for me lately old man?
Jurgis Posted June 10, 2020 Posted June 10, 2020 Check out his twitter feed. He's 100% for real. You'll loose some time you won't get back but it's good for a chuckle. Yikes, I guess you are right. Seemed like he was drinking in most of his videos, day or night. I loved the irony of the 'I should be up a Billion dollars today!' line on the day old man Buffett watched his largest equity position - a tech stock - go up by $10.53 per share, while owning 250,866,566 shares of that tech stock. Looks like there is a very real possibility that Berkshire's largest equity position will be worth more than the entire market cap of Wells Fargo at some point. But seriously, what have you done for me lately old man? OT. I watched some of his Twitter videos and I am still not sure if he's serious or if he's playing Cramer/crazy day trader dude. If he is playing, great props for staying in character. OTOH, I only watched some videos, so maybe I missed the ticks.
John Hjorth Posted June 10, 2020 Posted June 10, 2020 Personally, I perceived it like Jurgis. No matter what, I considered it great entertainment.
Guest Posted June 17, 2020 Posted June 17, 2020 ;) hahaha. I was having trouble getting a full image of it and saw the signature. I was like "Fmr Chairman...Buffett is retiring?!?!?" And then I adjusted things and got a better view. That was pretty awesome.
sleepydragon Posted June 17, 2020 Posted June 17, 2020 ;) hahaha. I was having trouble getting a full image of it and saw the signature. I was like "Fmr Chairman...Buffett is retiring?!?!?" And then I adjusted things and got a better view. That was pretty awesome. It was apparently a joke but a Chinese financial news site picked it up, and likely due to poor translation, took it for real. So last night it was widely reported in various Chinese news site that Buffett was retiring.
fareastwarriors Posted June 18, 2020 Author Posted June 18, 2020 Warren Buffett’s Next Bulk Purchase Should Be Costco https://www.washingtonpost.com/business/warren-buffetts-next-bulk-purchase-should-be-costco/2020/06/05/b38185be-a720-11ea-898e-b21b9a83f792_story.html
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