giofranchi

For anyone who might be interested, please find in attachment Baupost's equity portfolio analysis by gurufocus.com giofranchi “As time goes on I get more and more convinced that the right method in investment is to put fairly large sums into enterprises which one thinks one knows something about and in the management of which one thoroughly believes. It is a mistake to think that one limits one’s risk by spreading too much between enterprises about which one knows little and has no reason for special confidence.” - John Maynard Keynes GuruFolio_SethKlarman_dec2012.pdf

Ireland shows the way with its debt deal - FT.com giofranchi “As time goes on I get more and more convinced that the right method in investment is to put fairly large sums into enterprises which one thinks one knows something about and in the management of which one thoroughly believes. It is a mistake to think that one limits one’s risk by spreading too much between enterprises about which one knows little and has no reason for special confidence.” - John Maynard Keynes Ireland_shows_the_way_with_its_debt_deal_-_FT.com.pdf

Wells Fargo on student loans giofranchi “As time goes on I get more and more convinced that the right method in investment is to put fairly large sums into enterprises which one thinks one knows something about and in the management of which one thoroughly believes. It is a mistake to think that one limits one’s risk by spreading too much between enterprises about which one knows little and has no reason for special confidence.” - John Maynard Keynes StudentLoansCEC_02112013.pdf

Sprott Market Insights February 2013 giofranchi “As time goes on I get more and more convinced that the right method in investment is to put fairly large sums into enterprises which one thinks one knows something about and in the management of which one thoroughly believes. It is a mistake to think that one limits one’s risk by spreading too much between enterprises about which one knows little and has no reason for special confidence.” - John Maynard Keynes SPPP-Market-Insights-February-2013.pdf

PlanMaestro, you obviously know many more companies than I do, and you are comfortable investing in a wide range of opportunities. If I had read every post on the BAC thread, I am sure I would be able to judge its intrinsic value as well as you do. But… I cannot find the time! Really! And, please, believe me: it is not a matter of laziness on my part! I think I am a true workaholic… and I would enjoy tremendously knowing all you know about BAC! The truth is I MUST be selective. Remember Mr. Marks? Double level thinking: not only should I be able to correctly judge the future prospects of a company, but I must also be able to have a view on them, which is different from the one held by the market, and most of all which is correct! Wow! It sounds like a lot of work is required for just one company! Hard work! I cannot delve deep into everything. Capital allocation is one responsibility of mine… maybe the most important responsibility, but of course not the only one. And I have chosen to know well a few things and to wait for the right prices before investing. It is limiting, I know. What I call my ‘circle of competence’ expands very slowly... But I think it would really be foolish for me to behave differently. giofranchi “As time goes on I get more and more convinced that the right method in investment is to put fairly large sums into enterprises which one thinks one knows something about and in the management of which one thoroughly believes. It is a mistake to think that one limits one’s risk by spreading too much between enterprises about which one knows little and has no reason for special confidence.” - John Maynard Keynes

A rare interview with Ergen (64min). http://allthingsd.com/conferences/dive-into-media/livestream/?mod=atd_divemedia2013_300x100_livestreamduringpost Sportgamma, thank you very much for posting! Always can count on you for “rare interviews” and interesting articles! giofranchi “As time goes on I get more and more convinced that the right method in investment is to put fairly large sums into enterprises which one thinks one knows something about and in the management of which one thoroughly believes. It is a mistake to think that one limits one’s risk by spreading too much between enterprises about which one knows little and has no reason for special confidence.” - John Maynard Keynes

bmichaud, you already know very well what my point of view is. But I think txitxo has a good point too. Because at the end it all depends on your circle of competence. For instance, as a business owner and manager, I like to study companies and to delve as deeply as I can into every meaningful aspects of their operations. I know personally, from my own experience of managing businesses that I control, how difficult it really is to know and understand them very well. So that I know I could never completely rely on some kind of “statistical” difference between market price and fair value. I am just too skeptical of being able to assign a fair value to 100 companies, a fair value that would still be (almost) correct, come what may in the market as a whole. And, if I cannot assign a fair value, I cannot either estimate a reliable rate of return for my investments. So, my circle of competence is VERY narrow and limited (let’s say, more or less 20 companies). And, if I cannot find bargains inside my circle of competence, I just prefer not to invest… txitxo, instead, views things differently: he is a scientist and relies very much on his statistical models to find undervalued bargains worldwide (Europe, Japan, you name it!). And he can muster the confidence that he is getting good bargains, come what may with the market in general. I understand his point of view, and I think he understands mine. I judge both of them to be valid, they are just different. :) giofranchi “As time goes on I get more and more convinced that the right method in investment is to put fairly large sums into enterprises which one thinks one knows something about and in the management of which one thoroughly believes. It is a mistake to think that one limits one’s risk by spreading too much between enterprises about which one knows little and has no reason for special confidence.” - John Maynard Keynes

hellsten, unfortunately, I have just been sucking my thumb like a perfect idiot on this one… >:( I was concerned about the debt on the balance sheet, and I chose to invest in MKL and TPOU instead… Both of which have done well until now, but they are far underperforming IEP… Right now at 1.51 x BV, IEP has closed the gap with BRK market valuation, and I think it is trading at fair price. Instead, TPOU is still trading at a discount to NAV. Anyway, IEP stays on my radar, and I hope I will get a good entry point again in the future. :) giofranchi “As time goes on I get more and more convinced that the right method in investment is to put fairly large sums into enterprises which one thinks one knows something about and in the management of which one thoroughly believes. It is a mistake to think that one limits one’s risk by spreading too much between enterprises about which one knows little and has no reason for special confidence.” - John Maynard Keynes

[amazonsearch]What's Behind The Numbers[/amazonsearch] Find in attachment a review of “What’s Behind The Numbers”. I have found the book to be an interesting read. giofranchi “As time goes on I get more and more convinced that the right method in investment is to put fairly large sums into enterprises which one thinks one knows something about and in the management of which one thoroughly believes. It is a mistake to think that one limits one’s risk by spreading too much between enterprises about which one knows little and has no reason for special confidence.” - John Maynard Keynes Review_What_s_Behind_The_Numbers.pdf

Hi Plato, I have checked and I have letters by Mr. Einhorn that go back to October 2008. I am not sure, but I guess you could find even older letters on the web. I would suggest to download the AM Presentations from the GLRE website, and to read Mr. Einhorn’s book “Fooling Some Of The People All Of The Times”, to get a better perspective on both GLRE operations and Mr. Einhorn’s abilities as an investor. giofranchi “As time goes on I get more and more convinced that the right method in investment is to put fairly large sums into enterprises which one thinks one knows something about and in the management of which one thoroughly believes. It is a mistake to think that one limits one’s risk by spreading too much between enterprises about which one knows little and has no reason for special confidence.” - John Maynard Keynes

giofranchi: can you stop for about a week? I need my bid filled at 0.9xBook :) ;D ;D ;D giofranchi “As time goes on I get more and more convinced that the right method in investment is to put fairly large sums into enterprises which one thinks one knows something about and in the management of which one thoroughly believes. It is a mistake to think that one limits one’s risk by spreading too much between enterprises about which one knows little and has no reason for special confidence.” - John Maynard Keynes

Einhorn's letter to Apple shareholders. giofranchi “As time goes on I get more and more convinced that the right method in investment is to put fairly large sums into enterprises which one thinks one knows something about and in the management of which one thoroughly believes. It is a mistake to think that one limits one’s risk by spreading too much between enterprises about which one knows little and has no reason for special confidence.” - John Maynard Keynes Einhorn-Urges-Apple-Shareholders.pdf

Parsad, may I ask why? I have just bought the book Mr. Munger suggested at the DJCO Annual Meeting: “Something Out of Nothing”. It seems that Mr. Krauss “shows” how a universe doesn’t need a Creator. And I am really curious to know the true reasonings that stay behind such a statement, and to which conclusions they might lead the author. Even if it were plausible that something could be created out of nothing, I believe Mr. Pascal judgment is still very relevant: I cannot be sure if God exists, and I cannot be sure if God doesn’t exist. Therefore, I choose to believe in the existence of God, because it is more convenient for me. And I choose to act accordingly. Please, don’t misunderstand me: this has nothing to do with investment results. I don’t know if faith adds or subtracts value, as far as investment results are concerned. I don’t think I have paid enough attention to which consequences faith might have on investment results… so, I really cannot judge. My question strictly pertains to your statement, that I have quoted. Thank you, giofranchi “As time goes on I get more and more convinced that the right method in investment is to put fairly large sums into enterprises which one thinks one knows something about and in the management of which one thoroughly believes. It is a mistake to think that one limits one’s risk by spreading too much between enterprises about which one knows little and has no reason for special confidence.” - John Maynard Keynes

Might be right in the short term, especially if the market continues marching higher. But the stock price seems to reflect this sentiment, and I personally wouldn't bet against them in the long run. I keep on buying Fairfax... and buying, and buying, and buying... giofranchi “As time goes on I get more and more convinced that the right method in investment is to put fairly large sums into enterprises which one thinks one knows something about and in the management of which one thoroughly believes. It is a mistake to think that one limits one’s risk by spreading too much between enterprises about which one knows little and has no reason for special confidence.” - John Maynard Keynes

Yes indeed. He mentioned Otis Elevators as an example of a US manufacturing concern that actually had/has a moat. This was related to the question about manufacturing in the US. I found it surprising to see Gio post on Otis, when I had only heard about the company a couple of days before. txlaw, I would really like to say that Mr. Munger and me share some sort of “telepathic thought affinity”… unfortunately, I must admit that was just plain good luck!! ;D ;D ;D giofranchi “As time goes on I get more and more convinced that the right method in investment is to put fairly large sums into enterprises which one thinks one knows something about and in the management of which one thoroughly believes. It is a mistake to think that one limits one’s risk by spreading too much between enterprises about which one knows little and has no reason for special confidence.” - John Maynard Keynes

The following is a bearish thesis on GreenlightRe that, needless to say, I clearly don't believe in. But I think it is always very useful to listen to the arguments of people who disagree with my point of view: http://www.econmatters.com/2013/02/so-david-einhorn-is-dumb-money-on-apple.html giofranchi “As time goes on I get more and more convinced that the right method in investment is to put fairly large sums into enterprises which one thinks one knows something about and in the management of which one thoroughly believes. It is a mistake to think that one limits one’s risk by spreading too much between enterprises about which one knows little and has no reason for special confidence.” - John Maynard Keynes

I don't know if someone has already posted this, but here is a good interview of Mr. Einhorn on Bloomberg about Apple: http://www.bloomberg.com/video/einhorn-urges-investors-to-send-message-to-apple-5p8zH57HT8SO63ufjW1InA.html# giofranchi “As time goes on I get more and more convinced that the right method in investment is to put fairly large sums into enterprises which one thinks one knows something about and in the management of which one thoroughly believes. It is a mistake to think that one limits one’s risk by spreading too much between enterprises about which one knows little and has no reason for special confidence.” - John Maynard Keynes

Yes! I think it is a good book. Most of all I think it is useful. Mr. Pink has the ability to focus on the 1% that is really important in many fascinating books and articles he has read. Then he knows how to put all those 1% together in a cohesive narrative. Nothing really new! But after reading a little book of 233 pages, you feel like you have read an entire library!! ;D I also enjoyed “Drive”. giofranchi “As time goes on I get more and more convinced that the right method in investment is to put fairly large sums into enterprises which one thinks one knows something about and in the management of which one thoroughly believes. It is a mistake to think that one limits one’s risk by spreading too much between enterprises about which one knows little and has no reason for special confidence.” - John Maynard Keynes

TO SELL IS HUMAN, by Daniel H. Pink giofranchi “As time goes on I get more and more convinced that the right method in investment is to put fairly large sums into enterprises which one thinks one knows something about and in the management of which one thoroughly believes. It is a mistake to think that one limits one’s risk by spreading too much between enterprises about which one knows little and has no reason for special confidence.” - John Maynard Keynes

Sorry, I have to disagree completely :). I think that you have to be completely rational and you should have all your facts straight: only then can you make an informed decision about price vs. value. My intuition can't tell the difference between Bear Stearns right before it collapsed and Bank of America when it was trading at $5. Only good research can. In time, all the effort you put in investing will probably result in a 'gut feeling' about investments in the future. That feeling might be right most of the time but it is the result of years and years of hard work and it should always be double checked. Grandmasters in chess also see the right move in 99% of the cases, but in a critical position they still revert to the hard work of calculating all variations to make sure they're right. I'm pretty sure Warren Buffett and Bruce Berkowitz do the same. writser, I agree with you and I am a true believer in “deliberate practice”. Yet, almost by definition, very few investors will be in the same league of Mr. Buffett and Mr. Watsa, right? What I think premfan is trying to say is that the secret to be in that league cannot be exactly… in plain sight!! What kind of secret would it then be?! That’s why study is important, research is important, hard work is important, though maybe they are not really sufficient… Remember that “deliberate practice” is not just… practice. Instead, it is to find and to deeply analyze your weaknesses, and then to devise exercises in order to eliminate those weaknesses, and to repeat those exercises from early in the morning to late in the night. To do over and over again what you are most uncomfortable in doing! As soon as you have been successful in eliminating one weakness, to concentrate on the following weakness. And to repeat the process as many times as possible. So, is it really a surprise to find that the path followed by every extremely successful person is very unique? I have long ago given up trying to fathom why someone is successful, and why others are not… Instead, I just stick with successful people. Both in the businesses that I control and in the businesses in which I invest. giofranchi “As time goes on I get more and more convinced that the right method in investment is to put fairly large sums into enterprises which one thinks one knows something about and in the management of which one thoroughly believes. It is a mistake to think that one limits one’s risk by spreading too much between enterprises about which one knows little and has no reason for special confidence.” - John Maynard Keynes

I have kept them. I think they are still cheap and a likely candidate to be bought out. Thank you very much for posting the link! giofranchi “As time goes on I get more and more convinced that the right method in investment is to put fairly large sums into enterprises which one thinks one knows something about and in the management of which one thoroughly believes. It is a mistake to think that one limits one’s risk by spreading too much between enterprises about which one knows little and has no reason for special confidence.” - John Maynard Keynes

Well, it is a even more fantastic reminder of why we should be slow to believe in OUR investment capabilities!! ;) It is easy to deceive ourselves into thinking that, just by emulating Mr. Buffett or Mr. Watsa, we will get outstanding investment results… when the truth is most probably we will never completely understand the true secret of their very personal success! Because every one of them is an original, even if they certainly share common beliefs and ideas. giofranchi “As time goes on I get more and more convinced that the right method in investment is to put fairly large sums into enterprises which one thinks one knows something about and in the management of which one thoroughly believes. It is a mistake to think that one limits one’s risk by spreading too much between enterprises about which one knows little and has no reason for special confidence.” - John Maynard Keynes

Thank you for posting the presentation. Much appreciated! giofranchi “As time goes on I get more and more convinced that the right method in investment is to put fairly large sums into enterprises which one thinks one knows something about and in the management of which one thoroughly believes. It is a mistake to think that one limits one’s risk by spreading too much between enterprises about which one knows little and has no reason for special confidence.” - John Maynard Keynes

New Gary Shilling Insight giofranchi “As time goes on I get more and more convinced that the right method in investment is to put fairly large sums into enterprises which one thinks one knows something about and in the management of which one thoroughly believes. It is a mistake to think that one limits one’s risk by spreading too much between enterprises about which one knows little and has no reason for special confidence.” - John Maynard Keynes insight-0213b.pdf

"UK sterling faces a long painful slide" Please, see the article in attachment by Matthew Lynn. twacowfca, do you think this might somehow be an issue for LRE's shareholders domiciled outside the UK? Thank you, giofranchi "As time goes on I get more and more convinced that the right method in investment is to put fairly large sums into enterprises which one thinks one knows something about and in the management of which one thoroughly believes. It is a mistake to think that one limits one’s risk by spreading too much between enterprises about which one knows little and has no reason for special confidence.” - John Maynard Keynes UKs_sterling_faces_a_long_painful_slide.pdf