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New interview: Prem Watsa


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"U.S. municipal bonds always sold at a lower yield than US treasuries because one is tax free and the other is taxable. In the fourth quarter, we were able to sell Treasuries, yielding pre-tax 3 to 3.5%, and have been buying munis yielding an average of 5.75% after tax. This is unheard of. We bought minis guaranteed by Berkshire Hathaway [Warren Buffett's company]."



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great conf. call


one takeaway (for me) is that when they say they look at downside risks and try to hedge them out they really mean it, 2008 is the perfect example.


they are positoning the company for the stated lumpy 15% (as they historically have). 


To me, is extremelly impressive how they change their minds when the facts warrant it (in their opinion).  Historically they have been more right than wrong and there is no reason to think it will be different this time, on top of that they will not bet the farm anyway.


if you think you can do better (investing wise) than HW (blended port) FFH at book is not your best deal.  However from a risk adjusted perspective I think it is one of the beat deals out there. 


It will not triple quickly, but I think it eventually will.....


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