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I don't care of Ajit or Greg Abel...


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Hi,

 

reading another thread I realized that my point of view about BRK is that this two people really are of no interest to me...about how to judge the future of BRK...

 

What I would like to hear is about Ted and Todd...Will we BRK shareholder have some investor superstars with no constraints ( that can move hundreds of billions when and how they want) or not?

 

Without some mega investor BRK will just be a no growth-utility like business...and I'm pretty sure that if they will not give to Ted and Todd complete power and autonomy they will just leave...and who is going to allocate capital?

 

 

Edited by Sinbius
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Insurance remains Berkshire's largest business and will continue to be the engine of the company.  So, at the very least, I would be concerned about who takes over for Ajit, as National Indemnity is not only Berkshire's biggest insurance business, but biggest business overall. 

 

Insurance is all about risk management, and if the two people best at that...Buffett and Ajit...are gone from the company, then that is a concern.  Bigger than investing float, since they could easily index the equity side, and find a good bond manager to look after the bond portfolio. 

 

Cheers! 

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Posted (edited)
55 minutes ago, Parsad said:

.... since they could easily index the equity side, and find a good bond manager to look after the bond portfolio....

 

 

 

I don't like the idea 😞

Not finding an investor to succeed Buffett is a big failure...considering he also like the idea to be remember as a teacher...a teacher that never made a real investment valuation example and that was not able to find a successor for the business?...

 

I hope he is just keeping Ted and Todd out of the spotlight for the moment but after they will have complete control...

Edited by Sinbius
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5 minutes ago, Sinbius said:

 

I don't like the idea 😞

Not finding an investor to succeed Buffet is a big failure...considering he also like the idea to be remember as a teacher...a teacher that never made a real case investment valuation example and that was not able to find a successor for the business?...

 

I hope he is just keeping Ted and Todd out of the spotlight for the moment but after they will have complete control...

 

There is an easy solution.  Berkshire should just buy Markel and make Tom Gaynor vice-president of insurance operations and president of portfolio management, while Ajit Jain is president of insurance operations and Greg Abel is president of non-insurance operations. 

 

Gaynor has worked in a co-leader position and is a terrific investor and insurance manager.  Abel is presently working as a co-leader with Buffett, and then would not have to worry about float, insurance or portfolio management if something happened to Warren and Ajit.  The two T's probably know Gaynor well, and would fit in nicely as a team.  Ajit already knows Markel and Gaynor, and Ajit's lack of ego would be a good environment for Gaynor.  And Gaynor's better at risk management than say the likes of Joe Brandon at Alleghany or many of the other Berkshire insurance subs other than National Indemnity. 

 

Cheers!

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Posted (edited)

I don't have his track record as an investor but Thomas Gayner portfolio is the classic zero conviction, know-nothing investor with lots of less than 2-3% positions....and I remember he was defending his use of EBITDA as a metric to look at...

There are people that outperform with that kind of "diversified" portfolio...but it is the opposite style Berkshire has always used...

 

Ted and Todd have that concentrated investment style and is years they are face to face with Buffett and Munger...I hope for a purpose...

Edited by Sinbius
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1 hour ago, Parsad said:

 

There is an easy solution.  Berkshire should just buy Markel and make Tom Gaynor vice-president of insurance operations and president of portfolio management, while Ajit Jain is president of insurance operations and Greg Abel is president of non-insurance operations. 

 

Gaynor has worked in a co-leader position and is a terrific investor and insurance manager.  Abel is presently working as a co-leader with Buffett, and then would not have to worry about float, insurance or portfolio management if something happened to Warren and Ajit.  The two T's probably know Gaynor well, and would fit in nicely as a team.  Ajit already knows Markel and Gaynor, and Ajit's lack of ego would be a good environment for Gaynor.  And Gaynor's better at risk management than say the likes of Joe Brandon at Alleghany or many of the other Berkshire insurance subs other than National Indemnity. 

 

Cheers!

Do you think Buffett may have bought Allegheny mainly for the people running it? it did not seem to be that great a bargain. No other bids, pretty high price, overlap of business, etc.  just musing.

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With regards to insurance re: Jain...Kara Raiguel was hand kicked by Jain to run Gen Re ... you also have Joe Brandon of Alleghany ... and the whole group over at BHSI (Eastwood etc) that are very talented.  It takes a village.  To pin all of Insurance on Jain is simply an uninformed view.  

 

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4 hours ago, Sinbius said:

 

I don't like the idea 😞

Not finding an investor to succeed Buffett is a big failure...considering he also like the idea to be remember as a teacher...a teacher that never made a real investment valuation example and that was not able to find a successor for the business?...

 

I hope he is just keeping Ted and Todd out of the spotlight for the moment but after they will have complete control...

 

Even if BRK has already hired someone better than WEB, I just can't see that person getting recognized (either socially or with the keys to the kingdom) until after WEB is gone.  Who was second-best at Apple when Steve Jobs was alive?  These are huge shoes to fill... WEB is the best in the world.  Expect to be disappointed.

 

WEB said during a recent meeting that having Ted and Todd talk at the ASM is dumb.  Like Iran bringing their nuclear researchers to a press conference.

 

WEB says he is happy with the successors.  I doubt we get any more than that.

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Posted (edited)

I just hope Ted and Todd will be completely unleashed when the time will come...and that they will be iperaggressive when needed...

I hope Warren and Charlie have been investing big time on them, behind the scene, during these years...

Edited by Sinbius
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Posted (edited)
18 minutes ago, ValueMaven said:

Greg Abel is the single most important person at Berkshire outside of Warren currently.  He oversees the two largest CAPEX business (BHE and BNSF - also MSR) which are extremely important.  

 

BRK is 590 Billions in market cap...more than 400 Billions in cash and equities...is it more hard to keep a regulated industry running or to allocate 400Billions in the most effective way possible?

 

I know it is in part misleading what I wrote but to make a point fast...

Edited by Sinbius
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Posted (edited)

I consider that operating income in the bag... 🙂 ...and all the talking and compliment on the people doing it is just the classic psychological tactic to keep the good employee loyal and good working...

Edited by Sinbius
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4 hours ago, ValueMaven said:

With regards to insurance re: Jain...Kara Raiguel was hand kicked by Jain to run Gen Re ... you also have Joe Brandon of Alleghany ... and the whole group over at BHSI (Eastwood etc) that are very talented.  It takes a village.  To pin all of Insurance on Jain is simply an uninformed view.  

 

 

It's like the difference between Fairfax insurance operations with and without Andy Barnard.  There is huge marked difference with Andy overseeing and creating a certain culture in underwriting and operations.  Buffett and Ajit maintain a similar integrity with the Berkshire insurance operations.  So yes, I'm not pinning it only on Jain...I'm pinning it on Buffett and Jain.  Cheers!

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2 hours ago, ValueMaven said:

@ParsadCan you expand on this point ... its a rather bold comment! 'And Gaynor's better at risk management than say the likes of Joe Brandon at Alleghany or many of the other Berkshire insurance subs other than National Indemnity.'

 

Joe Brandon's a terrific insurance executive, but as an executive under Ronald Ferguson he did not recognize the errors with the AIG transaction that led to criminal charges against Ferguson and a couple of other executives, nor did he recognize the derivatives risk that GenRe was carrying. 

 

Those were two big errors in a very complicated game, and if Berkshire had not acquired GenRe, GenRe would have been another AIG in 2008!  Buffett was completely involved in unwinding thousands and thousands of derivatives contracts for several years...I believe they had only a handful left before the financial crisis.

 

The Markels & Gaynor, alongside Prem, Andy & Brian, as well as Buffett & Jain, all clearly recognized the havoc and risks of derivatives.  They avoided that time bomb.

 

So, I put these insurance executives on another level than their peers.  Avoiding catastrophic outlier risk is what reinsurance is all about!  Cheers! 

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5 hours ago, ValueMaven said:

@SinbiusNo doubt ... I'm more concerned, or focused if you will on the durable aspect of the ~$40B of operating income annually that the business generates currently ... 

I couldn't agree more. After all, BRK at its core is a conglomerate of operating businesses. Very interested in protecting the moat around this group of companies.

 

Broadening "investor superstars" to "superstar capital allocators", I'm looking for continued smart allocation of the stream of cash coming into BRK, whether it's via purchase of companies in whole (including bolt-ons), purchase of companies in part (shares), buyback of BRK shares, purchase of preferred stock (special situations), loans (under favorable terms), internal capex (e.g. BHE, BNSF, etc.), arbitrage, etc.

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On 6/26/2022 at 4:10 AM, Parsad said:

 

There is an easy solution.  Berkshire should just buy Markel and make Tom Gaynor vice-president of insurance operations and president of portfolio management, while Ajit Jain is president of insurance operations and Greg Abel is president of non-insurance operations. 

 

+1

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On 6/26/2022 at 5:10 AM, Parsad said:

 

There is an easy solution.  Berkshire should just buy Markel and make Tom Gaynor vice-president of insurance operations and president of portfolio management, while Ajit Jain is president of insurance operations and Greg Abel is president of non-insurance operations. 

 

Gaynor has worked in a co-leader position and is a terrific investor and insurance manager.  Abel is presently working as a co-leader with Buffett, and then would not have to worry about float, insurance or portfolio management if something happened to Warren and Ajit.  The two T's probably know Gaynor well, and would fit in nicely as a team.  Ajit already knows Markel and Gaynor, and Ajit's lack of ego would be a good environment for Gaynor.  And Gaynor's better at risk management than say the likes of Joe Brandon at Alleghany or many of the other Berkshire insurance subs other than National Indemnity. 

 

Cheers!

Yes yes yes.

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On 6/26/2022 at 5:10 AM, Parsad said:

 

There is an easy solution.  Berkshire should just buy Markel and make Tom Gaynor vice-president of insurance operations and president of portfolio management, while Ajit Jain is president of insurance operations and Greg Abel is president of non-insurance operations. 

 

Gaynor has worked in a co-leader position and is a terrific investor and insurance manager.  Abel is presently working as a co-leader with Buffett, and then would not have to worry about float, insurance or portfolio management if something happened to Warren and Ajit.  The two T's probably know Gaynor well, and would fit in nicely as a team.  Ajit already knows Markel and Gaynor, and Ajit's lack of ego would be a good environment for Gaynor.  And Gaynor's better at risk management than say the likes of Joe Brandon at Alleghany or many of the other Berkshire insurance subs other than National Indemnity. 

 

Cheers!

Looking at Alleghany's performance, once sure hopes that these guys won't take over. I don't think that Markel has been that great either, especially with their venture / industrial side.

 

I think Abel is the right choice. BRK is so big that it's harder to do acquisitions, so a great operator should like Abel is more important than a pure capital allocator. Abel just needs to continue to buy back BRK shares at opportune times and rip out some weed that has started to take hold in some corners of the Berkshire yard.

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Greg matters the most to me.  2020 resolved questions on that score for me bigly. 

 

Ted is a beast.  IDK about Todd. 

 

Probably the potential changes with the board/ownership after WEB exits is something I'm thinking about now.  I thought maybe Gates would be there/interested to help watch over things but it seems that could be in flux.  I don't want to hang around if Howie is calling the shots.  Then we might be looking at Loews 2.0 or something (as Martin Franklin conjectured a few years back and he might have some interesting perspective on that question if his career is viewed as a continuation of that of his father Roland and/or James Goldsmith).

Edited by CorpRaider
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I think everyone should just relax. We would have Ajit, the best insurance exec in the world running insurance ops and Greg, the best energy exec in the world running everything else + filling the CEO role. I hope Ted becomes the next Warren for investments. Though it is unlikely Greg would have Warren's breadth across multiple businesses, most of the internal reinvestment of Berkshire earnings is likely to go towards energy & utilities, which is Greg's wheelhouse. So we will do fine with him as CEO. All in all, we are in good shape post-Buffett. 

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7 hours ago, Spekulatius said:

Looking at Alleghany's performance, once sure hopes that these guys won't take over. I don't think that Markel has been that great either, especially with their venture / industrial side.

 

I think Abel is the right choice. BRK is so big that it's harder to do acquisitions, so a great operator should like Abel is more important than a pure capital allocator. Abel just needs to continue to buy back BRK shares at opportune times and rip out some weed that has started to take hold in some corners of the Berkshire yard.

 

I'm not sure Berkshire should do any acquisitions after Buffett is gone.  There is no need to.  They have enough organic businesses to power the company...from insurance to energy to retail/manufacturing to distribution/transportation...they are essentially a mini S&P500 already.  They should pour enough money to grow those businesses, and then everything else should go to the portfolio managers.  That's it.  Abel doesn't need to ever acquire another business again, and BRK will continue to make tons of money.  Cheers!

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16 hours ago, Parsad said:

 

I'm not sure Berkshire should do any acquisitions after Buffett is gone.  There is no need to.  They have enough organic businesses to power the company...from insurance to energy to retail/manufacturing to distribution/transportation...they are essentially a mini S&P500 already.  They should pour enough money to grow those businesses, and then everything else should go to the portfolio managers.  That's it.  Abel doesn't need to ever acquire another business again, and BRK will continue to make tons of money.  Cheers!

 

Interesting. When does Berkshire start to diworsify? 🤨 or is it never allowed to happen?

Edited by DooDiligence
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