giofranchi

Recent post by The Brooklyn Investor: http://brooklyninvestor.blogspot.it/2013/10/transdigm-group-tdg.html giofranchi

Q3 2013 Letter giofranchi Third-Point-Q3-2013-Letter.pdf

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giofranchi

How about in a non-confrontational manner? This was a shitstorm brewing because Biglari is automatically identified as the type of investor he is...my way or the highway...your shareholders, my shareholders, and everyone else be damned. He is doing nothing illegal, nor any different than many other Wall Street types. My opinion is that as a student of Buffett, maybe he should have gone that route...especially when you were pretty much writing your annual letters verbatim to Buffett's, including font type, structure, shareholders, etc. The wool was pulled over too many eyes, including mine. Now he's doing it on a bigger venue with a bigger audience. I'm tired of the minion of activists...both long and short! It's about time for a major stock market correction, because everytime one happens, many of these assholes disappear for a few years! Cheers! Wow ! That was powerful! If someone has a huge ego they will rationalize any action. The mere rationalization creates a feedback loop ( pos or neg how ever you label it) that creates more rationalizations and more and more. Sooner or later they blow up. Emotionally and mentally ( see ichan vs ackman interview on cnbc) they become unstable and reactive. The key word is "reactive" and they stop listening to anyone else. Can money be made? Absolutely! Buyers beware these type of people blow up usually after a string of rationalizations that ultimately creates a sense of invincibility. The invincibility is what creates dictators and erroneous data that gets rationalized as the "truth". This ultimately leads to your and my friend mr. cognitive dissonance. The mental disease where your actions don't match your words. Cognitive dissonance works at a subconscious level and once conscious you can work on lessening mr cog's impact. The key is be conscious, not reactive, and have a humble go with the flow mindset. There are more than enough ways to make money with people that are emotionally stable and don't have mr. cog. Most importantly they are under or at bv 8) This all may enjoy some underlying truths… but a simple business reality cannot be ignored (or, better, of course it can be ignored, but you should not!): Many businesses are undervalued because of bad management. And simply solving that problem gets the business from undervalued to fairly valued. You make something work better (and the businessman in me loves it!), while getting rich in the meantime (the investor in me loves it too! ;)). Period. You try to talk and calmly reason with management once, twice, even three times. Then, when you finally realize you are talking to a concrete wall, you simply go to Caterpillar and hire a Bulldozer! ;D giofranchi

--John D. Rockefeller Clearly, to increase debt is very often dangerous, but this doesn’t mean it is always the wrong thing to do (just ask Mr. John Malone!). In his letter, where he proposes the special dividend, Mr. Biglari explains very well: 1) That CBRL could and should increase its debt, 2) That it is wrong to leave a lot of cash in the hands of people who are very poor at allocating capital, 3) How and why the paying of a special dividend and the increasing of debt might turn out to be value accretive. He has also many times suggested what management should do with all CBRL’s cash, but management has recently published a presentation to shareholders, in which they do nothing but attacking BH, and what they propose instead is just loose talk. Sincerely, if I were a CBRL shareholder, and my fellow shareholders vote against the special dividend, I would be greatly disappointed! ;) giofranchi

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Markel Baby Berkshire Is On Sale http://seekingalpha.com/article/1762702-markel-baby-berkshire-is-on-sale?source=email_rt_article_readmore giofranchi

What do people on the board think about the idea in attachment? Thank you! :) giofranchi senvest-capital-40-discount-to-NAV.pdf

Great! :) Great! :) giofranchi

You surely already know at least 1 answer to your question, don't you? ;D Cheers, giofranchi

High Yield With Icahn giofranchi high-yield-with-icahn.pdf

Sincerely, I have no idea… The disclaimer was just meant as an example… And of course I will be investing in exactly the same companies I recommend! I guess the part of the disclaimer we will probably share is the following: Anyway, these are busy days and I haven’t find the time to check it out yet… But I will surely do as soon as possible! :) giofranchi

giofranchi

Absolutely not! I will just write something like this: Recommendation: Buy this stock below this price, or Sell that stock above that price. Readers will then have to place their own orders with their own brokers. Actually, I have always thought that a simple disclaimer, like the one Agora Financial uses (see attachment), might be enough to prevent any legal issue… But I am going to delve deeper into this and make sure I won’t run unforeseen risks. Thank you very much! :) giofranchi Agora-Financial-Disclaimer.bmp

Good question! And I haven’t checked it out yet… Mr. Carraro’s firm is an investment advisor, so he will surely be aware of any legal issue that might occur. I will ask him as soon as possible! Thank you! ;) giofranchi

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giofranchi

Goldman: Entire S&P Move Higher Is Due To Multiple Expansion; Shiller P/E Says 30% Overvalued So... Buy http://www.zerohedge.com/news/2013-10-19/goldman-entire-sp-move-higher-due-multiple-expansion-shiller-pe-says-30-overvalued-s giofranchi

That's a great point. You are publicly building a track record with no capital down. From a business point you cant lose. You have no operating expense and it your results are above average this will be easy to scale up. Perfect asset light high ROIC business. Also little to no competitors in a niche business. You already research owner/operators so you are doing what you love. This could be a home run and a great win/win I wish you continued success. Thank you, Kraven, 50centdollars, and premfan! Those were exactly my own reasonings! :) Cheers, giofranchi

Thank you very much to all the great and useful feedback! Cannot tell how much I really appreciate your help! Ah! By the way, I forgot to mention that I have called my newsletter “The Superinvestors of Singletonville”… almost nobody in Italy understands what I mean… but you surely do!! ;D I will try to answer some questions: 1) The platform will provide nearly 10 different newsletters. Mine is just one (and, constructive, I will be writing my own newsletter, I will be the only one in charge of it, and I will receive 20% of the subscription fee for each reader who decides to subscribe to my newsletter), then there is a newsletter about bonds investments only, a newsletter about ETFs (I guess it is a sort of “asset class allocation” investment newsletter), there is also a cigar butt (deep value) investment newsletter, there is a trend-following newsletter, even an “ethical investments” newsletter (never heard about ethical investments before… and I am not sure how well they might perform… but some days ago dcollon sent me this piece of news and it sounds interesting: www.cnbc.com/id/101055952). All those other newsletters will be managed by people I don’t even know. They are all Mr. Carraro’s acquaintances, though I hope I soon will get to know them well too! 2) My newsletter will be divided into “free” content and “paid for” content: each week I will publish the description (a brief introduction to) of an owner-operator. And to receive that weekly document, it is enough to fulfill a registration on-line. It is free. This way I think I can put together an Index of owner-operators in little more than a year, and people will receive not only the names of those companies, but also some (I hope useful) information about their past track-record and their future prospects. Then, there is the “paid for” content, which will consist in the management of a portfolio of 10-15 companies in the Index. Those who subscribe will receive a monthly newsletter with results and news about the companies in the portfolio. They will of course receive alerts to buy and sell, every time I add or reduce a position. Both the weekly description, the monthly newsletter, and the alerts will be posted on the platform and sent by e-mail. 3) The service will be priced at 250 Euros per year. 4) The deal I have with Mr. Carraro is that I keep 50 Euros for each subscriber who wants me to manage his/her portfolio (or at least a part of his/her portfolio). If this sounds too generous, well, I am very glad! Maybe, it is because Mr. Carraro teaches a course inside the Master in Project Management of the Master School “F.lli Pesenti”, Politecnico di Milano, and I pay him good money for each lesson of his! Talk about synergies!! ;) 5) For now the newsletter is going to be only in Italian. And, should Mr. Carraro decide one day to publish also an English version, I wouldn’t recommend it to any of you… You all are clearly too well informed and too smart! For now the target is clear: people who still have difficulties with the English language + people who don’t like to manage their own money. That’s it! Thank you again to all of you! :) giofranchi

Now I really have to leave the office for a match at my tennis club! ;D ;D But I will answer your questions with much pleasure tomorrow morning! Cheers, Gio PS What does GL! mean?!

Well, Mr. Carraro is Principal of Horo Capital (www.horocapital.it) and is well known in Italy, with a lot of connections in the business. Moreover, he already enjoys a relatively wide readers base, publishing the translation of both “Thoughts From The Frontline” by Mr. Mauldin and “The Absolute Return Letter” by Mr. Jensen. This of course is no certainty at all… But I hope it is not starting from scratch either! Thank you tombgrt! :) giofranchi

Thank you, shalab! With the exception of Lancashire, North America is where my stock market investments are… Yet, who knows? As my circle of competence grows, also the geographical scope of the newsletter might follow suit! Time will tell! :) Cheers, giofranchi

Yes! Italy is clearly much, much smaller! It won’t be easy, but the market is growing… And a few thousand subscribers will certainly be worth the effort! ;) Ah! What can I say? Mr. Carraro is a generous soul! ;D Thank you! giofranchi