Buffett/Berkshire - general news

[Charlie]

Berkshire adds Germany's Rubina, expanding global real estate presence

 

https://www.yahoo.com/finance/news/berkshire-adds-germanys-rubina-expanding-142350350.html

 

 

Cheers!  :)

[DooDiligence]

Here's why Warren Buffett vetoed the original color of the $BRK latest annual report & Realtor Bill Cote disses WEB's CA home saying, “It’s dreadfully overpriced. If you said it was Bette Midler’s house, it might have some cachet.”

 

Bette Midler, REALLY?

 

http://www.omaha.com/money/buffett/why-warren-buffett-vetoed-the-color-of-the-cover-for/article_4ce65a51-df34-570f-a672-91910030f7ca.html

[gfp]

Berkshire proxy filed yesterday.  Standard stuff year to year but with the board changes and appointment of Greg Abel and Ajit Jain to the board, there is some additional discussion of their responsibilities.  Next year it would show their salaries and bonus as well.  Berkshire goes out of their way to be a model for director compensation and Warren and Charlie both continue to reimburse BRK for personal use of taxes and secretaries, $50k each per year.

 

https://www.sec.gov/Archives/edgar/data/1067983/000119312518086050/d526293ddef14a.htm

[John Hjorth]

Thank you for sharing, globalfinancepartners,

 

Like a clockwork, ref. another recent topic here on CoBF in the Berkshire forum.

 

I particulary found this section of the proxy entertaining - I suppose Mr. Buffett must have been laughing in his car all the way from office to home at the end of the working day after approving this - poor guy, perhaps he needs both free coke and free burgers at office soon:

 

CEO Pay Ratio

As mandated by Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and required under Item 402(u) of Regulation S-K (“Item 402(u)”), we are disclosing the median of the annual total compensation of all employees of Berkshire and its subsidiaries other than Berkshire’s CEO and the annual total compensation of Berkshire’s CEO, Warren E. Buffett. In preparing this disclosure, Berkshire considered the fact that on September 21, 2017, the Securities & Exchange Commission (“SEC”) issued interpretive guidance to assist registrants in complying with the SEC’s Pay Ratio reporting requirements. Among other things, the SEC’s guidance addressed the use of reasonable estimates, assumptions and methodologies.

Berkshire also considered that Mr. Buffett’s annual compensation has been $100,000 for more than the past 25 years and that Mr. Buffett receives no bonus or any form of equity based compensation. Additionally, Berkshire has over 60 separate operating groups, many of whom have multiple separate operating groups. Accordingly, the identification of the median employee’s annual total compensation of the 377,000 Berkshire subsidiary employees is a significant task.

In light of the fact that Mr. Buffett’s total compensation is far less than almost all public company CEO’s, Berkshire believed that the cost/benefit of complying precisely with the requirements of Item 402(u) would provide little, if any, useful information to its shareholders. Therefore, Berkshire used a judgmental sample representing approximately 2/3 of the total employees of Berkshire and its subsidiaries to determine the median employee’s compensation.

The median employee was determined using 2017 W-2 wages for all U.S. employees and equivalent taxable compensation for all non-U.S. employees included in the sample. The median employee determination included all employees within the sample group who were employed at December 31, 2017. The annual total compensation for the median employee was calculated using the same methodology for calculating the total compensation in accordance with Item 402©(2)(x) of Regulation S-K.

Based on the information obtained as described above, the ratio of Mr. Buffett’s annual total compensation ($100,000) to the annual total compensation of the median employee ($53,510) was 1.87 to 1.

[gfp]

Another low risk public bet by Warren comes to a close, all brackets busted for the company pool ->

http://www.omaha.com/sports/ncaa-tournament/winners-will-split-in-warren-buffett-s-ncaa-bracket-challenge/article_7688236e-1074-5c3a-9212-a5732b70d766.html

[Charlie]

Good article in Barrons:

 

Why Edward Thorp Owns Only Berkshire Hathaway

 

https://www.barrons.com/articles/why-edward-thorp-only-owns-berkshire-hathaway-1521547200?mod=hp_pop

 

"Q: What’s in your portfolio now?

 

A: One good stroke of good fortune was meeting Warren Buffett in 1968. It led me to realize that I needed to invest in Berkshire Hathaway (ticker: BRK.A), although I didn’t do it until 1982. It’s my single investment in the stock market. It’s like a broad value-stocks equity index. I hold it in lieu of VTSAX [the Vanguard Total Stock Market fund]. It does about as well with no current taxes to pay. VTSAX has dividends that are taxed annually. I also have some hedge funds, but I consider them not as good as Berkshire, so I use them to spend and finance other things I do.

 

Q: Why not go out and find better investments, as you did in the past?

 

A: When I was 35, I had lots of time and less money, so doing 10% or so better than the index, with little risk, was attractive and fun. At 85, the marginal value of time is higher and the marginal value of money is lower. These are strong disincentives when I can make a long-run 10% or so by doing nothing."

[Guest longinvestor]

Good article in Barrons:

 

Why Edward Thorp Owns Only Berkshire Hathaway

 

https://www.barrons.com/articles/why-edward-thorp-only-owns-berkshire-hathaway-1521547200?mod=hp_pop

 

"Q: What’s in your portfolio now?

 

A: One good stroke of good fortune was meeting Warren Buffett in 1968. It led me to realize that I needed to invest in Berkshire Hathaway (ticker: BRK.A), although I didn’t do it until 1982. It’s my single investment in the stock market. It’s like a broad value-stocks equity index. I hold it in lieu of VTSAX [the Vanguard Total Stock Market fund]. It does about as well with no current taxes to pay. VTSAX has dividends that are taxed annually. I also have some hedge funds, but I consider them not as good as Berkshire, so I use them to spend and finance other things I do.

 

Q: Why not go out and find better investments, as you did in the past?

 

A: When I was 35, I had lots of time and less money, so doing 10% or so better than the index, with little risk, was attractive and fun. At 85, the marginal value of time is higher and the marginal value of money is lower. These are strong disincentives when I can make a long-run 10% or so by doing nothing."

 

+ 1

 

I would add that 10% is great when the index is likely to do 3-5% over the next decade.

 

Also can’t wait for 2019 to end because the headline about Berkshire would be ‘over the past decade BRK has returned >15%’

 

 

[WneverLOSE]

"Warren Buffett plans to release video archive of past shareholder meetings"

 

http://www.omaha.com/money/plus/warren-buffett-plans-to-release-video-archive-of-past-shareholder/article_06c5c9f3-6133-523c-a7e9-5d7cdea8d677.html

 

1,000 hours worth of videos going back to 1994 !  ;D ;D

 

 

[sleepydragon]

Oh yeah! My brain will get a good upgrade :)

[John Hjorth]

The video does not appear to support the article text. [?]

[Guest longinvestor]

wow! That's going to take years to listen, and will come out of my reading quota.

 

Wonder what's the thought behind this? Coming after a no photography/no recording regimen. Surely it is more than just about openness.

 

 

 

[nickenumbers]

That is going to be really interesting.

 

I clicked on the link but is says that I have to be a digital subscriber to the Herald to read the article.

 

Does it say where the video/audio will be posted?

 

Thanks.

[cubsfan]

I sure hope Munger did the same with the WESCO meetings. Those were gems.

Hope they were recorded too.

[WneverLOSE]

It doesn't say when it will be out or how but it is in the working, the company that did the photography is working on converting all the footage to a digital format.

 

The newspaper is owned by Berkshire so little doubt about the accuracy of the reporting in my opinion.

Very exciting news, hope they won't be too greedy and charge money for it  ::)

[John Hjorth]

It doesn't say when it will be out or how but it is in the working, the company that did the photography is working on converting all the footage to a digital format.

 

The newspaper is owned by Berkshire so little doubt about the accuracy of the reporting in my opinion.

Very exciting news, hope they won't be too greedy and charge money for it  ::)

 

Thank you for putting some colour on this for those of us that are non-subscribers, WneverLOOSE,

 

I speculate and suppose, now that the operational responsibilities for all the Berkshire subs have been delegated, Mr. Buffett somehow feels bored and - perhaps -  started to pump subscription sales at OWH.  [j/k - ; - D ]

[Voodooking]

This is great news! I can't wait to see / hear them.

 

I'm sure they'll end up on YouTube eventually... my commute is about to get a lot more educational  :)

[ValueMaven]

WOW!!  Thanks for sharing

[ValueMaven]

BTW: I actually bought a little more of the B's right near the close on Friday.  In the low $190s, you are basically paying 1.35x BV....not a bad L.T investment at all IMHO

[boilermaker75]

BTW: I actually bought a little more of the B's right near the close on Friday.  In the low $190s, you are basically paying 1.35x BV....not a bad L.T investment at all IMHO

 

I've written some more 190-strike puts.

[ValueMaven]

Yea, that is WAY to risky of a trade for me...I dont care what premiums you are getting upfront.  I havent written puts on BRK in the low $100s awhile ago, but I feel like where we are in the market - you really have no idea what is going to happen.  I think if a big vol induced sell-off occurs, that writing both near-dated, and long-dated puts near 1.1x - 1.x2 BV makes a ton of sense.  Back in Jan of 17 one can sell the January 2019 BRK.B Put at $137.5 strike, and collect a premium of $2.20 (bid price).  So, unless you see BRK.B falling ~37% in the next two years, and are happy to own Berkshire at much lower prices…this could be an interesting way to add synthetically to an already established long position.  Of course if the stock rallies, you collect the premium and nothing more...that trade was obviously a home-run. 

 

Sincerely,

VM

[gfp]

For boilermakers trades, it's much better to sell puts with duration of 2 months or less, over and over again.  It's not riskier than buying shares, assuming you are interested in buying additional shares and size the trade appropriately.  If you get put to, you are happy to own the underlying and if you own a bit more than you intended, you start a covered call selling regimen against the excess shares.

 

If he's the one that got $1.85 for a 3/29 expiry 190 BRK.B put, he's buying BRK.B shares at $188.15 next week - worst case scenario.  It's only risky if you don't want to buy BRK.B shares for $188.15 in a few days time.

 

Selling LEAPS puts two years out on a single company ties up a lot of capital for a long time for a comparatively small upfront premium.  Not a great trade.

 

Yea, that is WAY to risky of a trade for me...I dont care what premiums you are getting upfront.  I havent written puts on BRK in the low $100s awhile ago, but I feel like where we are in the market - you really have no idea what is going to happen.  I think if a big vol induced sell-off occurs, that writing both near-dated, and long-dated puts near 1.1x - 1.x2 BV makes a ton of sense.  Back in Jan of 17 one can sell the January 2019 BRK.B Put at $137.5 strike, and collect a premium of $2.20 (bid price).  So, unless you see BRK.B falling ~37% in the next two years, and are happy to own Berkshire at much lower prices…this could be an interesting way to add synthetically to an already established long position.  Of course if the stock rallies, you collect the premium and nothing more...that trade was obviously a home-run. 

 

Sincerely,

VM

[sleepydragon]

For boilermakers trades, it's much better to sell puts with duration of 2 months or less, over and over again.  It's not riskier than buying shares, assuming you are interested in buying additional shares and size the trade appropriately.  If you get put to, you are happy to own the underlying and if you own a bit more than you intended, you start a covered call selling regimen against the excess shares.

 

If he's the one that got $1.85 for a 3/29 expiry 190 BRK.B put, he's buying BRK.B shares at $188.15 next week - worst case scenario.  It's only risky if you don't want to buy BRK.B shares for $188.15 in a few days time.

 

Selling LEAPS puts two years out on a single company ties up a lot of capital for a long time for a comparatively small upfront premium.  Not a great trade.

 

Yea, that is WAY to risky of a trade for me...I dont care what premiums you are getting upfront.  I havent written puts on BRK in the low $100s awhile ago, but I feel like where we are in the market - you really have no idea what is going to happen.  I think if a big vol induced sell-off occurs, that writing both near-dated, and long-dated puts near 1.1x - 1.x2 BV makes a ton of sense.  Back in Jan of 17 one can sell the January 2019 BRK.B Put at $137.5 strike, and collect a premium of $2.20 (bid price).  So, unless you see BRK.B falling ~37% in the next two years, and are happy to own Berkshire at much lower prices…this could be an interesting way to add synthetically to an already established long position.  Of course if the stock rallies, you collect the premium and nothing more...that trade was obviously a home-run. 

 

Sincerely,

VM

 

It’s a good idea, but given u would have to pay short term capital gain taxes in theses trades (IRA doesn’t allow this), probably not worth it.

[gfp]

You can sell cash secured puts in an IRA at interactive brokers and others that offer that trading approval. You cannot borrow in an IRA, so you need the cash unencumbered in the account. Which is one reason shorter duration is better. Also the last month or two is when you get the most premium decay or whatever they call it

[sleepydragon]

You can sell cash secured puts in an IRA at interactive brokers and others that offer that trading approval. You cannot borrow in an IRA, so you need the cash unencumbered in the account. Which is one reason shorter duration is better. Also the last month or two is when you get the most premium decay or whatever they call it

 

I didn’t know this. Will ask my broker. Thanks!

[boilermaker75]

You can sell cash secured puts in an IRA at interactive brokers and others that offer that trading approval. You cannot borrow in an IRA, so you need the cash unencumbered in the account. Which is one reason shorter duration is better. Also the last month or two is when you get the most premium decay or whatever they call it

 

I suspect most, probably all, brokers would allow cash secured put trades in an IRA since it is an equivalent strategy to selling covered calls.

 

Although I have an IB account, my IRA is with Schwab and I do cash secured put trades in this IRA.