giofranchi

Ahahah!!!! ;) But no, I am not buying yet. I think it will take a while for my thesis about LMCA and LBRDA to play itself out… longer than I had thought... if it will ever play itself out!... Therefore, my money is still in LMCA and LBRDA. Gio

Realistically, I deem that to be a very unlikely scenario… A scenario in which the policies of all the central banks around the world basically fail… And after Japan, also Europe and the US slide into a prolonged deflationary environment… It is really difficult to believe such an utter failure might actually happen… The two most likely scenarios imo are: 1) Markets from now on drift almost aimlessly up and down for an extended period of time. 2) The Shiller P/E of the S&P500 reaches 29-30 (from almost 27 today) during the next few months, and then the bubble bursts. In scenario 1) I vote MKL, but FFH might do very well nonetheless. In scenario 2) I vote FFH, but MKL might do very well nonetheless. Cheers, Gio

Agreed...if international was separately listed it would trade at >2x bv imho and it's always worth adjusting FFH's equity for that. +1! ;) And that’s basically what I have been saying for some time now… But I am not voting: MKL and FFH are both great companies led by outstanding leaders imo, and great companies led by outstanding leaders tend to surprise, and surprises by definition are not predictable… I am just content thinking those surprises will mostly be on the upside! Gio

Nothing new... Anyway, here is the link to the latest article on Seeking Alpha: http://seekingalpha.com/article/2691685-altius-minerals-recent-sell-off-provides-an-exceptional-opportunity?uprof=25 Gio

You mean the whole VGQ?!... You have $50-$100M at your disposal?? ;D Cheers, Gio

+1! ;) Cheers, Gio

Wow!! ;) But why not concentrate their energies on private companies?... The health care private market is still huge, and given the recent ordeal with Allergan, it would be probably much easier to close 3 medium sized acquisitions of private companies, than one big deal with a public company… Do VRX shareholders really want another fight like the one just ended? ??? Gio

I have also read, I think in a book by Cialdini, that putting the face of the owner on the wall has a powerful psychological effect on employees that makes them behave more diligently… In alternative also a mirror might do the job, what matters is that the employee sees someone is watching over his/her work (even if the one watching is no other person but him or herself!)… Of course, cannot say how much effective such a strategy might turn out to actually be… But, if there is a place where it might work, I guess it is precisely the fast food industry, in which tons of very low skilled workers are still employed. ;) Gio

Well, I think next April Biglari has another chance of getting inside CBRL board. He has often repeated at these prices CBRL is no longer undervalued, but much value can be created going forward through the improvement of its operations. I think he is still after a seat on the board, because he has ideas about how to improve CBRL operations, and a larger stake in the company cannot but help. Gio

If he is buying, the stock price doesn’t seem to notice… I think, until a A/B share structure gets approved, he will continue devising strategies to protect his role inside the company… But I don’t see what rights offerings might have to do with that… Instead, I think he will keep doing rights offering whenever he sees good opportunities to deploy new capital… At least, that’s what I would be doing if I were in his shoes! ;) Gio

As much as I despised how they have behaved… I must admit in the end they succeeded in making their shareholders the most money possible… Therefore, my feelings about AGN management are mixed right now… ::) Gio

http://ir.valeant.com/investor-relations/news-releases/news-release-details/2014/Valeant-Comments-On-Allergan-Announcement/default.aspx Gio

Actually I am writing it... But no cash flowing from that endeavor until now... :( Gio How can I become a reader of this newsletter? Your first step should probably be to learn Italian. http://www.cornerofberkshireandfairfax.ca/forum/general-discussion/adding-a-new-business-investment-newsletter/msg137387/#msg137387 Brilliant! I always like challenges. ;D ;D Cheers! Gio

Actually I am writing it... But no cash flowing from that endeavor until now... :( Gio

Exactly! Imo debt is very useful, until it gets to be harmful… And those instances when debt gets harmful don’t happen very often, but when they do, they tend to be very detrimental to your net worth… Two such instances might be enough to mar a lifetime of successful investing… Therefore, either you partner with people who shun debt altogether, like Buffett and Watsa, or you partner with people who make use of debt, but have a long enough track record to show they had been able to weather comfortably enough hard times in the past. Liberty Media has returned 15% annual from 2002 to 2013 with 2008-2009 in between: volatility YES, overall bad results NO. Here is something important for me: I have not said “permanent loss of capital NO”, meaning that I am not only looking for evidence of an effective enough protection of capital, but that I want to see a track record of very satisfactory returns over a long period of time through good environments and bad. What you say about Transdigm might be very correct. So, let me clear this a bit: I suffer from a sort of inertia that makes me stay with or even add to businesses that I already own and know very well, instead of buying new businesses that I don’t know as well. Therefore, for me to make a new investment, it is not enough “a great entrepreneur, a good business, and a good price”… Probably I need “a great entrepreneur, a good business, and a great price”… Surely a far better price than the one a business I already own is offered for at the moment! And right now Transdigm seems to me more pricy than Liberty Media, not less… Therefore, I concentrate my funds in Liberty Media, instead of splitting them between Liberty and Transdigm. Maybe this has nothing to do with debt, but I wouldn’t be so sure: if Transdigm had less debt, I would feel more secure about investing in it… therefore, the price I’d require would probably be less “great”… Though I don’t know if this is clear or makes any sense at all… ??? Gio

I look at TDG almost the same way I look at VRX: usually, I go for a great entrepreneur in a good business at a good price… But, when I see lots of debt, I pause and demand much more conviction in the moat of the business and therefore in its ability to generate tons of free cash flow whatever happens to the economy in general. If I have doubts, I just watch from the sidelines, until those doubts are proven wrong. And this is exactly what I am doing with both TDG and VRX right now. Of course, by doing so I run the risk of missing both boats… Gio

Hey! I have realized only now Andy put me in the best of leagues! ;) I don't deserve it, but thank you very much anyway! And I look forward to reading your 1000th post! :) Cheers, Gio

On the other hand, the lower the stock price of Liberty Broadband, the smaller the cash it will receive in the rights offering. Right? Gio

Ok! Thank you very much for all the answers and the very interesting discussion. After reading all of your posts, this is what my course of action will be: I will listen to every quarterly conference call in which Malone speaks his thoughts. As long as he is upbeat about both LMCA and LBRDA, I will keep both. Instead, if he starts putting much more emphasis on one or the other, I will act accordingly. Once again my only plan is to stay with Malone for the next 10 years, and I don’t think I need to have a clear vision about the future of broadband to do so. ;) Gio

Wow!! Amazing!! Cheers, Gio

Yes, of course! Don’t you remember we had a discussion about his latest album “Popular Problems” just a few days ago? ;) Cheers, Gio

I have often repeated in this thread I far prefer the incentive fee structure to the typical hedge fund 2/20! ;) I like both and I hope to own both in the future. I am already much exposed to insurance through Fairfax and GreenlightRe, therefore fast food franchising right now seems a good way to diversify a bit. That's it! +1!! But I might say I am not very concerned about it. One of the reasons I like BH is that Biglari imo comunicates with shareholders very clearly. And usually you don't do that, if you have something to hide! ;) Gio

Ok! Thank you! :) Gio

Your track record is impressive! :) Cheers, Gio

Of course I cannot say why the stock price behaves like it does, nor for how long it will continue doing so. What I know instead is that in 2008 BH had $6.9 million in investments, while at the end of 2013 investments were worth $635.4 million (of which $89.6 million came from increase in debt, and $75.6 million came from equity offering). $463.3 million due to investment gains and net results of operating businesses. In the meantime the earning power of operating businesses has increased too. Now we are waiting for 2014 results next December. I think a lot of value has been created, without the share price reflecting it. Maybe Mr. Market simply doesn’t trust Biglari like the majority of people on the board… If Mr. Market and they are right, the amazing increase in value of BH’s investment will soon come to an end! We will see. Gio