Rabbitisrich

Oy, actually section 355 requires 5 years of active business prior to the spin off to be accorded tax-free status.

It should be a tax free spin-off unless the IRS somehow rules that it was part of a plan equivalent to a sale or a merger.

As I understand, Citi experienced a run on the bank first (according to the recent SIGTARP report) especially in the GTS segment, and then counterparties began to refuse intermediate and longer term exposures. So while its true that they've cut down on short-term debt reliance, they haven't addressed the issue of deposit quality. Management has addressed deposit composition in reiterating the intent to go after HNW segments spearheaded by card marketing campaigns, rather than 1st mortgage issuances, which leads me to believe that C is still an asset focused player. I would like to see the Latin American and Asian retail banking revenues catch up to the growth in the card services businesses, to avoid looking like the NA segment circa 2007. It will be difficult to live up to the promise of longer duration liabilities when your expansion plans center around credit cards.

Starbucks management was smart enough to note that their trenta offerings will contain less than 230 calories. They get a heck of a lot of great advertising for the price of rolling out a new cup!

The government had a greater right and responsibility to step into the credit crisis than would be the case in the beverage industry. From NRSRO ratings requirements, to GSEs, ERISA, FDIC insurance, and primary dealers, the government is a huge participant in American finance. Who is to say that super-size purchasers are not pacing their coffee throughout the day, or making a rational trade off between health and productivity?

Did Gross purchase at a discount to NAV? The fund has a large exposure to short and intermediate term callable issues. Perhaps he made a bet on large triggers due to refinancings rather than a duration/yield/spread bet.

Yeah, I'd like to see it too. After using the Kindle, I'm more open to the idea of a 7-inch tablet.

If MBI wins its suit against BofA/Countrywide, will MBI simply regain the insurance paid out + damages, or is the entire transaction reversed? Will MBI have to pay back unearned premiums on rescinded claims? Thanks for the link Alertmeipp. I'm getting very tempted to open a position based upon Scenario 2 from the link, wherein MBIA Corp. goes to $0, and National is cheap on a runoff basis. Unlike Third Avenue, who noted that future policyholders will be skeptical of management character post-split, I don't think that muni buyers give a hoot about management character. All the incentives to fulfill contractual obligations are in the cash cow, which is the muni insurer. You get the going-concern value as a free option.

Someone removed the video.

There will be a new verse on "How to Rob".

Congratulations ValueCFA... this latest move appears to take out a large part of the uncertainty in the company. In fact, I'm surprised that the stock didn't move up more aggressively. Reading the majority's decision demonstrates the huge hurdles, ex-post of course, faced by the plaintiffs. The plaintiffs had to allege specific monetary damages or to otherwise demonstrate a default in order to pursue the case, which wholly sidesteps the allegation of insolvency. If the court hearing the Article 78 suit requires the same evidence of fraudulent conveyance, then the plaintiffs are likely out of luck. I thought that the minority presented a more compelling argument, and hewed more closely to the standard of giving the plaintiffs the benefit of the doubt regarding plaintiff inference of the superintendent's reliance upon company estimates. Interesting case nonetheless. Are you buying more here ValueCFA?

The funds don't seem to be highly comparable. Sprott Canadian Equity always held a commodities bias at 40%+ of assets, and it is a Canadian small/midcap fund. It seems to embrace a higher risk profile.

Why would it hurt their BV? I tough their bond portfolio is not marked to market unless categorized as held for trading. BeerBaron Most of the bonds are held as available for sale, so they flow through the comprehensive income statement.

Andrew Gelman recently provided a list of recommended readings: http://thebrowser.com/interviews/andrew-gelman-on-statistics

Awesome Johnson. I love the fact that they even provide exams!

Can you run through your estimates of cash and EBIT? My estimate isn't intended to be precise: I took the last 10-Q and netted $13.4B cash and short-term investments against $4.9B debt. For EBIT, I simply applied 4X to $1B, for a valuation of <5X operating income net cash before the Compellent acquisition. I use the entirety of the cash position because I'm looking at it as part of a going concern and assuming the stability of the negative cash conversion at 36 days.

Txlaw, thanks for those links. Handicapping judicial processes is way out of my league. ValueCfa, I think we are talking about the same case. From the linked decision, I don't think that MBIA has established that article 78 forces the banks to prove that the regulator acted capriciously or arbitrarily. As I understand, the judge put the onus on MBIA to prove that the regulating agencies determined the fairness and equitableness of the transaction, rather than acted as a simple problem solver. Do you view the company as a safe buy on a consolidated basis? I haven't done the runoff math on MBIA Corp. but I'm not a fan of moves like deducting projected legal winnings from loss reserves.

Right, in fact Michael Dell takes a lot of crap for being so late to the cloud and data organization party but he suffered through the 1994 experience and doesn't want to be caught in a liquidity trap again. I am not long being a tech neophyte, but Dell has a very clean, underleveraged balance sheet with plenty of room to ramp up spending where appropriate.

I am looking at MBIA because of this thread and so far it's a doozy to figure out. ValueCFA, are you sure that the banks can only proceed by attacking the regulators' actions? According to this ruling from Feb. 17 2010, http://www.courts.state.ny.us/REPORTER/3dseries/2010/2010_50238.htm, the company tried to dismiss the fraudulent conveyance and self-enrichment motions by claiming that such issues fell under the purview of the regulators. But the judge found that MBIA could not establish, at that time, that the plaintiffs could only pursue litigation against the authority and discretion of the regulating agencies. From the paragraph above Part C in the document: Based only on the February 17th approval letter, the scope of the Superintendent's approval is not clear enough for the Court to hold that plaintiffs' claims fail as a matter of law. It may [*16]well be, following limited discovery that DOI's review can be shown to be co-extensive with and preemptive of plaintiffs' claims. However, at this stage of the proceedings, that determination cannot be made without further discovery and affirmation.

If you include the cash hoard before the Compellent acquisition, Dell is trading at < 5x operating income.

http://www.youtube.com/watch?v=jllJ-HeErjU

I don't think that the examples provided in the essay demonstrated discipline. Especially in the Cap Cities deal, Buffett underestimated the importance of Tom Murphy's participation. That is a mistake because he misunderstood the dynamics of the bet; likewise, he probably isn't biting his lip over missing out on the Netflix run.

Those issues would have been pertinent in 2002, but Biglari now has a decade of experience under his belt. You can see his thinking process laid out in a few of his very public activist investments. What additional information does his academic career provide? Richard Feynman eventually stopped responding to prospective employers of his former students saying, "You have now employed him longer than he had been my student!" Rranjan cuts to the heart of the disappointment with Biglari. From his use of key phrases, the new acronym of the business, the web page design, and the structure of the annual letters, it's pretty clear that Biglari invited comparisons to a certain billionaire. I'm still not convinced that he is a sly manipulator as opposed to a young businessman with a clumsy public message. His public bidding style strikes me as a somewhat clumsy. Perhaps he is still locked in hedge fund mode and simply underestimates the importance of a good business reputation.

But at least you played, and there is a huge jump between high school and collegiate wrestling. I can better understand why Schroeder focused on Buffett's psychological vulnerabilities. She might have heard stories in the same vein as Osberg's and been fascinated that such a man became a business titan.

Vancouver is probably in the midst of the most self-aware bubble I've ever seen. I know Vancouverites, and recent home purchasers, who cheerfully acknowledge that they over paid for their homes. One family spent $1100 per square foot for a fairly modest home in pleasant neighborhood. You pay megabucks just to live in a clean location!