Parsad

Unless I misread the article, he says that for pretty much a third of the interview...starting on the 2nd page, 3rd paragraph on the right hand column. Cheers!

The good thing is that no one else has been dropped. While it's preferable to kill the body of the snake, chopping heads isn't bad either. Some of these guys are definitely guilty, and Fairfax is going to nail a few of them...progress! Cheers!

He also said that you could not have a good monetary system after leaving the gold standard, yet the United States continued to prosper for the next 70 years. As I said, he's the same as any other economist...right on some things, wrong on others. How do you know who is making the correct macro assessment, unless you are fortunate enough to view everything in hindsight. My point was that Ben Graham's theories do not rely on macro analysis, and they work as long as you remain disciplined. Cheers!

Google's purchase of ITA has lead to Google Flight Search. This thing is so easy to use. It's going to hurt other companies like Expedia, Priceline, etc. Unfortunately, it's only available in the U.S. right now. Cheers! http://www.google.com/flights/

Your responses are always so interesting and none partisan / ideological... No Myth, most of my responses on most things are pretty partisan, but not on economics. I've read so many things over the years and no one person has ever been right about everything. The only thing I know for sure, call it a cult-following or whatever, is that Ben Graham's theories work. It's the only thing in my life that has always worked. And I can't go listening to "possibilities" when I know about something that will ALWAYS work if I remain disciplined and true to it. Nothing in my entire life has made more sense and it's truly the gift that keeps on giving. Changed my whole life! Cheers!

All that interview tells me, is that like every other economist, Hayek can be just as wrong. The U.S. is better off today than they were in 1975, and they were better off in 1975 than they were in 1932. Any boom is always followed by a bust, and depending on the size of the boom, the duration of the bust is directly a result of that. Who knows how long this deleveraging process will take. Monetary policy could help or it could exacerbate...no one knows until we view it all in hindsight. Everyone I've listened to in the last few years has been right about some things and wrong about others. It truly is almost a toss-up on what happens because the macroeconomic environment is just so damn complex. As always, the only thing an investor has control over is the price they pay for securities...buy cheap, sell dear...so simple, so foolproof...yet we never listen. Instead we choose to listen to every other soothsayer...past, present and future! Cheers!

I agree. Steak'n Shake was just a few months away from going under when he began the proxy fight. Cracker Barrel is in no such shape. He's going to have to start pushing hard on how he can improve the company. So far, the only thing he has is compensation, share ownership and "inter alia" a purported allegation of insider trading. ;D Cheers!

Sardar published a letter to the shareholders of Cracker Barrel: http://finance.yahoo.com/news/Sardar-Biglari-Issues-Letter-prnews-708520119.html?x=0&.v=1 The first half sounds like he just changed the company name from the old Steak'n Shake letter to shareholders and published it verbatim. The second half is much more original and actually hits the Cracker Barrel board pretty hard. He also fired up the old proxy website: http://www.enhancecrackerbarrel.com/ Cheers!

I have several rules regarding Wall Street. One of them is, "If everyone on Wall Street is saying the same thing, it is either an error or a lie." This applies directly to the European situation and the contention and fear that it is a replay of the US collapse in 2008. The situations are only alike in that they involve debt. In this case, the total amount of Greek debt and the various bonds are known by Greece and the EU. Avoiding default simply requires paying the interest and principle on time. This will happen. In 2008, we had a huge amount of misrated debt instruments, insured only in name and secured by personal debt in the form of the thousands of mortgages -- a morass which could be tracked and analyzed only through the expenditure of great amounts of time and effort. In addition a large percentage of the mortgages were undergoing default in one form or another. In other words, nothing was transparent, except that the underlying assets were collapsing, and, in fact, the rating process appeared, let's say, dubious from a legal standpoint. I think you make some very good points here. The risks and many of the counterparty liabilities were completely unknown in 2008. Paulsen, Bernanke and Geithner found out about exposure, only as the losses mounted and the institutions had to seek assistance, thus the drastic action to have institutions merge. Financial Institution exposure to any of the European soverign nations is known. While there would be unheaval in any default, it would not be any different than Argentina in 2002 or Iceland in 2008. Cheers!

Greece is a whole different ball of wax. I think the other three nations are manageable if their governments do institute strict measures to control spending and liabilities...not unlike Ireland. But what that means is a long deleveraging process, contraction of their economies, higher taxes, reduced services and possibly a stagflationary type of environment for a period of time. It also means protests, pain, political suicide and not saving face. Finally having to make hard choices! Cheers!

Yes, I think that may be the correct outcome Packer. Just like capital flowed to the U.S. dollar as a flight to safety, I suspect as earnings in U.S. companies continues to progress, while the P/E multiple continues to contract, capital will eventually flow to U.S. equities. But it may move sideways with intermittent volatility for some time. Cheers!

Near Coal Harbour...on Pender between Thurlow and Bute. We are on the 16th floor and we could see our building swaying a bit relative to the building across from us. My brother felt it in his office building near Metrotown, but my Mom did not feel it at her clothing store in Surrey. I was actually surprised it was 6.4...it didn't feel that bad. I can only imagine what 7.4 must feel like at 32 times more force. Cheers!

If we have a sovereign default domino in Europe it may well harm even our beloved FFH. Greece should default. It would be the best thing for Europe. But when it happens, the ECB should step in and do the same thing that the U.S. did with banks here. Go to all of the exposed financial institutions and tell them they are going to take a haircut...enough to hurt and bleed, but not enough to kill. The ECB buys the Greek soverign debt from the banks at 50% of the price. Restructure Greece, collateralize their debts with State assets, and have them pay back the ECB. The debt is now 50% of what it was originally, the banks write it off but survive, and Greece pays back part of their obligations at the ECB's cost. Cheers!

Sanjeev - I want to take a moment to appreciate your attitude. It is the attitude that I aspire towards but have not yet achieved fully. I am currently reading "The Most Important Thing" by Howard Marks (excellent book) and he talks about the inevitability of all sorts of cycles in the market, and how basically you will never be able to predict the future, but you can be sure that the pendulum of the market is always in motion and that somewhere people are always overreacting to that natural motion, which is what creates the greatest opportunities for the investor who can truly keep his emotions in check. Over simple? Maybe, but there is an acorn of truth that is impossible to ignore. Hi Alpha, I haven't read that book, but I think that analogy of a pendulum is exactly correct. I would take it one step further: The tip of the pendulum swings back and forth, but you notice how the base at the end of the stem is always in the same place. In other words, market sentiment of intrinsic value is the tip (swinging wildly), but actual intrinsic value is the base (steady). Cheers!

No damage in Vancouver from what I know. Things might have been a little more shaken up on Vancouver Island which was closer to the epicentre. Cheers!

Yup, and they will uncoil dramatically regardless at some point when things stabilize. Cheers!

Alnesh and I were looking at something on his office computer right now, and the blinds started moving and hitting the glass. We looked up to see if the air conditioning was blowing fast or something, and then he realized it was an earthquake. We looked outside and the building was swaying. Everybody felt dizzy. Lasted at least 15 seconds. Apparently it was a 6.7 quake, 80 kilometres below the water off of Vancouver Island. Cheers!

A question for you though. Aside from your own ability to deal with extreme volatility (or a replay of 2008) what about your responsibility to your clients? Que sera sera is fine when you make that a conscious choice, but your investors may not be so sanguine. Not intended as a slight, or a critique of how you fulfill your fiduciary responsibilities to your investors, just curious about if/how your investors feel about the volatility and how that informs your decision making. The volatility comes with investing in equities. We have very good partners who almost all have long-term horizons. That's what happens when you pick individual partners rather than institutional partners. Also, this is nothing compared to 2008/2009, and we only had one redemption back then. And that was because one of our partners wanted to buy a home during a depressed real estate market. All of our partners handled volatility well during that crisis, and I don't expect their behavior to be any different this time around. Anyway you slice it, they were better off staying invested in our fund, than redeeming their capital. Those that invested $100K in May of 2006, had $185K at June 2011...compare that to the S&P500 or T-bills! And the markets were as rambunctious as they had been in 70 years. The friggin' credit markets had seized up and had maybe 10 days of liquidity left! Some of the largest financial institutions in the world went under. Panic was as swift and deadly as it has ever been. But I said the same thing then..."I don't care!" Cheers!

We are all buying individual businesses for the long-term, correct? Then any volatility is a good thing, regardless of how painful the short-term effects (1-4 years) may be. Mr. Market is having a tantrum and today's reason for the tantrum is "Will Greece default?" Do I care? Nope. I don't plan on investing my money for a few months or years. I plan on doing it until I die, and I'm not about to put it into 10 year treasuries yielding less than 2%, when Wells Fargo's annual dividend alone is going to be double or triple that in the next year or two. If the price of Wells falls to $9 like it did in 2008/2009, all I'll do is buy more. If the price stays down below $15 for two-three years...who cares...I'll buy more over two-three years. To put it as simply and succinctly as I can..."I don't care!" I live a frugal life and make more money than I spend. If my investments are undervalued for 2 years, 5 years, 10 years...I don't care. I'll just keep buying more and more over that time. The phrase for today, and really for all your days as a value investor, should be...yes, that's right..."I don't care!" Cheers!

I'm really starting to love this guy! For a company that was pretty screwed up, he's doing a heck of a job taking this thing back to basics. Cheers! http://www.bloomberg.com/news/2011-09-08/moynihan-says-bank-of-america-to-be-smaller-more-focused-after-review.html

Hey, ValueCarl's back! I thought you had enrolled in college or something too Carl! ;D Cheers!

Yeah, I agree. Put Buffett in a title right now, and you increase your readership five-fold probably. I should have called this message board...The Buffett of Buffett & Buffett! ;D Cheers!

While Android continues to eat up the smartphone market, Microsoft continues to negotiate Android patent agreements with phone makers. Now they've started to also add agreements related to Chrome. Kaching! Cheers! http://www.bizjournals.com/seattle/news/2011/09/08/microsoft-inks-two-more-android-patent.html?ana=yfcpc

Aram's festival details: Tomorrow is the Capitalist Collective Stock Picking Festival. It's where I will be announcing the winners of the Capitalist Collective Talent Search Grand Finale. There should be lots of drama as the two winners of the Talent Search will get a senior and junior analyst position at my firm, Fertilemind Capital. You can check out the agenda here. http://www.capitalistcollective.com/pg/cmspages/read/conference_overview If you can't attend you can just watch the webcast here: http://www.nyssa.org/CapitalistCollective.aspx Cheers!

Just thought it was kind of interesting and probably a good idea. As long as they're safe! Cheers! http://www.bloomberg.com/news/2011-09-08/london-entrepreneur-sees-a-gold-mine-in-developing-unused-subway-stations.html