LC

Probably simply call options of DTV...Malone is pretty much issuing debt to buyback shares. Which makes sense given the lower capex of Satellite versus Cable providers. And of course the "low interest rate environment" The question is how much more debt he wants to saddle the horse with.

I guess the answer to my question is one of the fundamental aspects of the insurance industry... In regards to your curiosity, my gut reaction is that it is human nature. People only pay attention to what is fresh in their mind. I observe it every day at work: if we have an issue with a large client, we develop some new initiative to solve the problem. Two months later? It's forgotten. To make permanent change is very difficult, especially when dealing with problems of large magnitude but do not occur frequently.

Here's my thought: What would you do in cases where your options do not match the risk profile? So if the risk of a robbery occurs in 1/500 instances, and you have two options: hire a security guard vs. install a security camera. Now the security guard prevents 99/100 potential robberies and the security camera only prevents 1/100 potential robberies, which do you choose? Where is the line between being overly-conservative and overly-risky? I just made these probabilities up (obviously) but I hope you understand the question I am posing!

I love that joke :)

I am curious as well. All my BAC Leaps are of the 2015 variety. But my thinking is as a hedge they are more nimble. If there is a pullback this year, the 2014 options can be exercised and you haven't paid for a year of insurance which you didn't need. If there is no pullback, you can roll the puts over.

I think the only reason to sell these days is #6 on twacowfca's list. I'm about 20% cash, but I want to increase that to about 30-40%.

This comment got me thinking about how to "average up" into investments. If an investment goes from a 6x to a 3x you would average into it, despite the price having just doubled. Averaging down seems easier compared to averaging up for investors. I know for myself, if nothing has changed value-wise, I will average down after a 20% drop. But buying more after a 20% rise is more difficult. Using Pabrai's framework makes it easier psychologically to average up!

I figured it might be a good idea to list some scuttlebutt techniques to use to get an alternative perspective of a business. I personally always take a look at the "careers" page of a company. I think it gives a glimpse of what business areas management wants to strengthen. For example I am looking at Materials Science Corp (MASC). They provide acoustic materials for a variety of customers, and on their jobs page, they are looking for sales-relates positions. Taking that information in conjunction with their financials I can piece together that they are looking to improve their sagging top line. This obviously works better with small/mid sized companies than a huge company like Exxon.

FIAT There's information on the FIATY thread in the Investment Ideas section, however for simplicity's sake here's the argument: - Undervalued on an earnings basis once Chrysler is considered - Large holding by the Agnelli family Catalyst: Currently going through the courts to decide on if/how to fully acquire Chrysler. FIAT owns 60%, VEBA owns 40%. FIAT has recently gone through the motions to secure financing for the deal. I am hoping a decision will be made by end of 2013, whether that means buying out VEBA and keeping Chrysler private, or reselling some Chrysler stock in the public markets.

I second "The Elegant Universe"! An excellent read regarding modern physics!

This may be slightly off-topic, but as Charlie says, let's invert and see what we find: Disclaimer: This is in no way a criticism, just an observation! We have a 6 page topic entitled, "Ideas with Catalysts". 5 out of 6 pages are discussing the merits of a "Catalyst" and not any actual "Ideas" This is good and well and I think it is an interesting discussion! But what does this tell us? Why aren't there more "ideas" being posted? Are there not many "Ideas" with a catalyst out there? Why not? Just an observation for thought! Perhaps I am trying to rationalize my own lack of finding any ideas with a catalyst!

combined ratio in the p&c industry

Wish I had put some more money into these....any idea how to value the preferreds going forward?

I agree, there is value-added. I also agree that it is a large discretionary expense for this economic environment (hence the sagging sales). I don't feel the company is undervalued, though, despite the operating leverage. Nor do I see a catalyst, other than a general economic turnaround...which I don't really think is a catalyst specific to this business. I'd love to be convinced otherwise, though! ;D

I was looking at Ambassador's Group (EPAX) today as well. Do you think their business is in terminal decline? That was the question I could not get past. If that is the case, the company appears fairly priced. I don't know what can turn around sales. Management is already alluding that 2013 revenue is expected to be lower than 2012.

My first question: how do the economics of FIZZ look in terms of the next 21 years?

I'll take one for the team and be the physical presence for the office... and no, no, you don't have to thank me, I'm just a selfless person. ;D

I sold a few $5 april puts...somewhat hoping I get put to. If not, I might pick up some shares regardless.

I think I'm around 15-20%.

If we take Vinod's 3-tiers of business classifications, I first off try to avoid #2s...I'm either looking to load up on #1s at reasonable prices, or #3s at really cheap prices. So #1s I usually average down after about a 20% from my cost basis. #3s I rarely average down as I usually just take the Graham approach and put a little bit in a lot of them, and sell once a catalyst emerges to bring the stock to a reasonable value. In other words, I have no problem averaging down on good businesses, but I hate averaging down into bad businesses!

I'm on the opposite side of the fence here...I actually think he should NOT give away his wealth to charity. Wait, Wait! Before you stone me, hear me out! :) My thinking is this: if you look back at history, trade and industry have caused the greatest increases in the standards of living for humanity as a whole. What Warren Buffet can do is brilliant: he can effectively siphon the "excess" capital from developed societies and re-allocate it as he sees fit. 10% of everyone across the world who has excess capital and spends it on a can of Coke, he now owns that 10%. He owns the capital of everyone with excess who spends it on Sees candy. Etc. etc. etc. for all his businesses. So he sucks in the capital from all these excesses, and he can redeploy it to whatever area he sees fit, usually in some "undervalued" area. So what has he done? He's taken the excess capitol that people spend on Coke and chocolate and he invests THEIR money in railroads, solar power, and battery technology. These things will increase the standard of living for all of humanity. Buffett is using capitalism to redistribute wealth from the "rich" to the "poor". Let the man keep doing this! And I hope he finds other investors out there who can keep doing the exact same thing. History has shown that investments (and advancements) in sensible technology and industrial improvements are what hold the promise to feeding the hungry and sheltering the homeless.

I personally like the sub-300mm market...I just find I can actually understand the numbers in real business terms, whereas with huge megacaps, the numbers are so large that I find it difficult to make a business connection.

Aside from the Buffett deal (which I think is only partially horrible for shareholders, not completely horrible), the only thing I would've done differently is settle with MBIA.

http://www.cornerofberkshireandfairfax.ca/forum/investment-ideas/bac-wt-bank-of-america-warrants/msg104086/?topicseen#msg104086 I'll tell ya, there are some brilliant people on this board :)

So there IS a reason he sold his BAC.A Warrants! Damn, too bad he couldn't get back into them at a better price!