LC

Great, thanks so much. pgs 22, 24, 25 are interesting as is the conclusion:  High quality compounders need strong management

Thanks for posting. They shrunk the business, turned a profit, and are now in a position to add capacity as Marchionne sees fit.

In that case, maybe don't watch Hannibal with him.

Was a real pleasure meeting everyone and thanks zizou.

CLCT

If you think a good bank can earn 1% on assets: 9/30/14 Assets: 2.1 trillion 1% earned: 21 billion Shares outstanding: 10.5 billion EPS: $2

Anecdotal evidence caused me to ignore this. Take everything you hear from drunks at bars with many grains of salt, my friends ;D

I outperformed over the last 3 years because I leveraged into a bull market. Pretty sure that goes more into the "lucky" vs "skillful" side of the coin.

http://www.fastcompany.com/3039887/under-fire

There was a youtube clip posted a few months ago from Malone's #2 (pre-Maffei) who pretty much said the complexity was due to the tax code, and at investor days they explained to analysts what 30 pages or so of the 600 page disclosures were important to look at. They were not trying to be opaque on purpose.

Shake shack started in a literal shack (maybe 15sqft) in Madison park in NYC. To this day there are lines which span the south end of the park during lunchtime. The burgers are as BG2008 mentioned succulent and juicy. No idea about the investment qualities as I haven't read the S1 but just in case people wanted some color.

Add "+1" after every post to make the world aware of my tacit approval. Even if it is my own post. +1

He definitely lived a full life, which is why it was a pleasure to know him and celebrate his life...another fun story is him working out of Curacao at one point as an accountant, doing inventory checks on oil tankers for George Soros' funds by dipping a rope in a drum of oil, calculating the volume and applying it to the ship's inventory!

I can vouch for Kraven's kindness and willingness to help out newbies. Today is an unfortunate day for my family. My father in law died from a massive heart attack last night, he was a man who knew both riches (net worth of tens of millions in the 80s and 90s), culture (owned the largest Rolling Stones private collection at one point), heartbreak (divorce, abandoned by his family), and abject poverty. Had it all and lost it all. He was a great friend and will be missed and I was glad to know him and have him think of me as a son, even if just for a short time. This drink is for you Tom!

SD always gives great advice! Merry Xmas!

But if the market price is undervalued, then so are the rights because they are "efficiently" priced based on that undervalued market price. The rights offering, like any rights offering, is just a way to raise money from shareholders. It's wealth-neutral. He's using the money to fund buybacks. He's just trading his own stock with OPM. That's not what I'm looking for in a business partner. He's saying, "guys our stock is undervalued I'm forcing you to give me the money to buy it". (Oh, he's not really "forcing you": you have the option to sell your right instead...just at an undervalued price)

To the first point: Only if the rights are priced appropriately. I don't follow BH so I don't know if they were. To the second: My issue is with using shareholder money to buy shareholder shares, not whether shareholders agree to sell or not. Most companies use internally generated cash to perform buybacks, or debt if they are that confident. Buffett IIRC acted as a personal banker to his shareholders when they needed cash. Imagine if it happened at an annual meeting. Biglari up at the podium saying, "OK, hi guys, thanks for coming, now everyone we all have to chip in a few hundred bucks per share so that I can buy some of you guys out."

You're telling shareholders: Pony up some more cash or I'll screw you. And then AFTER they pony up the cash, you better hope some are willing to sell. If they're not, your entire plan to buyback shares under IV with shareholder money (vs corporate earnings, or personal money, or debt, etc.) goes to waste.

I just realize I checked the wrong box. Strike one from the <-10% and add it to the <10% bucket. (I'm at 9% through November 31 but will probably end up around 11-12% due to selling some FCAU at 13.xx and selling some BAC today at 17.9X.

Enjoy the holiday season in whatever form that takes! ;D Sanjeev, can we get a photo of you in a Santa hat and smoking a Churchill given your success in 2014? ;D

So you went from 2 shareholders who owned a piece of something worth $2000 to 1 shareholder who owned something worth $1775. Isn't this kind of like getting rich off your shareholder's back? And you had to destroy $225 of company value to do so?

I feel you...I've narrowly avoided a few bad eggs too, probably by luck. But now I just behave conservatively when it comes to people... I never go into business with (i.e. make an investment in) someone who rubs people the wrong way. Good businessmen, good people can manage their image. They can figure out how to make money without leaving a trail of tears in their wake. A few commentators in this thread questioned Erby's character. When NPR hosts a show about the issues with your organization, it's a red flag. That's enough to scare me away. I'd rather miss out than make money with people who I just don't quite trust. Not to change the subject, but the same goes with Biglari. Sanjeev's word is enough to just scare me away. I could be playing it too conservatively, but frankly the potential returns aren't worth that type of grief. If I wanted to make money while having to constantly worry about and keep tabs on the people I'm doing business with, I can go sell drugs on the corner. Ocwen/Altisource may well turn out to be multibaggers for everyone here and for the longs I wish it true, I just don't think the money is worth getting into bed with untrustworthy people.

I did the same thing when Weighwatchers dropped down to ~19/share. It first dropped into the mid-low 20s, but you like you say, you have to realize it can drop further. So in my true paranoid fashion I just waited. I think when you're buying a position to trade back up on the way towards fair value, it usually pays to wait until it hits the "stupid cheap" variety. For AIQ I don't think it was "stupid cheap" at 24-25 but you may differ! That said the emotional bumps along the way can be difficult! I made a fun picture from my WTW trading pattern to illustrate: hy, you're right, tax implications take a lot of the joy out of it. thanks for the tip on options, that is a wise move I agree :)

In terms of buying/sizing: yeah you may have bought too much too early but that is with the benefit of hindsight and you never know what will happen with the stock price. This is a talked about topic, but just me personally...I have started to refine how to size and how to trade around positions. I think Eric said something in one of the BAC threads which made sense. To summarize, if you have a really concentrated portfolio, trading around positions can be very beneficial. in AIQ's case yesterday I bought under $20/sh and will look to sell those shares in the mid-low $20s. So I'll be underwater still (average purchase price is ~25/sh) but less so. Someone else once said somewhere on this board (and I think it only really applies to concentrated portfolios), "split each position into thirds: your first buy of 1/3 is your investment, your second buy of 1/3 is when you average down (my note: or up!), and the last 1/3 is a trading position." So I originally bought at higher prices than today (like $27-29/sh), averaged down at around $23/share, and now have a trading position as well. Also you need a general idea how much of a max dollar amount you want to put into the idea. For me, this number is a back-of-the-envelope range based on how undervalued the current idea is when compared to the rest of the portfolio. (Side note: the same logic applies to how I determine how much cash to hold: how much is my portfolio undervalued compared to the market, taking into account the general level of market over- or under-valuation) It also was the same case in BAC. I bought originally at maybe $7-9/share, then averaged up when the stock was ~11/share, then bought a trading position at $14/share. The trading position was sold around $17.50 or so a while back while I still hold the first two blocks. (Also the first two buys were call options/warrants but I am quoting the stock price to make it easier to follow the progression). Also I think a key is that you have to be convinced of value. If AIQ shares quote lower than $19, I would otherwise be really pissed because my "trading position" essentially became another "averaging down" position. So I have to be convinced there is value to be comfortable averaging down once, and potentially twice.

I sent you a PM but I am curious about this as well. I presume the thesis is that higher margin specialty chemicals won't experience the price-drop that feedstock has? Thanks for the idea.