klarmanite

Looks like most of the loss incurred in Q2 was related to writedowns on bond holdings due to rising rates as well as unrealized losses in Greece (I'm guessing here on this particular point). Not too worrying IMO. Looking forward to the conference call to get some more color on this.

You cannot take that last post of mine literallly, either.

Yeah, pretty damn strong at 89.13% on avg for 2008-2014. But Gayner doesn't work for Chubb and neither does Watsa :)

That's true.

Chubb taken out at 1.75x book. Any reason why MKL or FFH shouldn't trade at that valuation now...?

Looks like a maximum 5-7% hit to book values altoghether (if all positions go to zero, more like 7%). I think we can assume Eurobank is toast. The letter to shareholders spells out the exposure in detail, so unless new positions were made this year - let's hope not - stockholders should be fine. Maybe we can hope for an overreaction from Mr Market.

Hi I'm a little pressed for time right now but will try to give you an adequate answer (not sure I can) next week.

Unfortunately no more clarity yet on important issues here. I would mention though that Capital Stage, which is a German listed solar and wind park operator just bought nine Italian parks with a total capacity of 29.1 MW. In terms of pricing,the EV was EUR100m implying EUR3.44/MW in EV value. The average feed-in tariff for these parks are EUR0.284/Kwh. Since EAM Solar operates 27 MW in Italy at an average feed-in tariff rate of EUR0.31/kwh we can assume it would be valued higher, were it not for the current issues affecting the company. Not making this adjustment, EAM Parks should be valued at a EV of EUR92.8m based on this transaction comp, which implies a share price > 83 NOK. (The current EV is about EUR63m). So basically, there's 250% + upside here if the fraud / tariff issues are solved. I still believe they will be, hopefully by the end of the year.

What is the blue and what is the green line?

I agree Steph. It's one of the main reasons I bought the stock (yesterday). Low correlation to my other holdings Reasonable valuation Fairly low risk of large negative return over a multi-year horizon Great management with skin in the game All things considered an attractive bet. The most reasonable (and common) bearish argument is that it could be dead money for a while. But I'm fine with that.

Ok taking a crack at this. Might have some faulty assumptions, so feel free to correct me...numbers are in USD. Whether Fairfax is a good investment depends on how you see the normalized investment returns going forward, in my opinion. I'm making quite a few assumptions here that people may not agree on, e.g. that the cost of float is essentially zero going forward in perpetuity. I also assume that FFH will generate at least 6% over the long term, but over the next few years, wll that's anyone's guess. Hopefully this post can stimulate some discussion, I don't pretend to be an authority on FFH or on insurance companies generally. I will venture to say though that I think these valuation levels are attractive from a long term point of view.

Interesting to note that MArkel sold ALL of their shares in Fairfax in the last quarter, as you can see here: http://whalewisdom.com/stock/ffh

No. I would refer you to the annual report for 2014 and the Q1 report for details on the withheld subsidies and what plants are affected.

Ah. Thanks Gio.

EAM has now finally gotten court dates for treatment of their complaint against the GSE which is holding back their subsidies. The interesting thing is that the burden of proof is on GSE now: they must show that holding back the subsidy was justified. Which I don't think they can. However, they may cut it completely which starts new proceedings apparently. I don't know if that's better or worse. Also and more importantly, a fraud case is being built against the seller by the D.A. in milan who will hold a hearing on the matter in june (we'll see if they indict the seller finally). EAM is reviewing the D.A.'s evidence now to see if they will take civil legal action. Anyway, this story is still terrible with great uncertainty, but I expect it will ultimately be resolved since EAM is now formally defined as a victim of contractual fraud by the D.A. This should help if further legal action is taken against the seller. If the seller is convicted of fraud by an Italian criminal court, there's no way EAM will lose a civil suit. I thus expect them to settle with the seller at some point, but I have no idea when.