Parsad

Seth Jayson, also known as TMFBent and writes for the Motley Fool, posted this rant on Patrick Byrne and Judd Bagley to his TMFCaps profile, which somehow got picked up by various news networks and legitimized as some sort of article. http://caps.fool.com/Blogs/ViewPost.aspx?bpid=310832&t=01000000000103882559 I'm not sure how this crap can float along in cyberspace and be picked up by various market news services, including Google Finance, but it apparently did. Cheers!

Nobel Laureate Paul Samuleson passed away at the age of 94. Cheers! http://finance.yahoo.com/news/Economist-Samuelson-Nobel-apf-529071038.html?x=0&sec=topStories&pos=5&asset=&ccode=

Article in the NY Times about Jesus Leonardo who is a stooper...picks up discarded horse racing tickets and seeks out unclaimed prizes...he's found about $500K over the last ten years. Not entirely different than a deep-discount value investor. ;D Cheers! http://www.nytimes.com/2009/12/08/sports/08otb.html

Good article on KKR, with praise for Berkshire from Henry Kravis, and how KKR will change its operations going forward. Cheers! http://www.businessweek.com/magazine/content/09_51/b4160038935523.htm

FFH shareholders and option holders may want to read the CBOE bulletin on Fairfax options. Cheers! https://www.cboe.org/publish/RegCir/RG09-142.pdf

Sorry Bargainman, you're right. It's not a done deal. Cheers!

Well, it's about time! The U.S. will be taxing fund managers and private equity managers at the 35% tax rate, rather than the lower capital gains rate of 15% some of them were paying. We've been paying the full 35% at MPIC from day one, and treated it as ordinary income. No more loophole for some of these guys! Cheers! http://www.reuters.com/article/idUSN0923425920091209

So Byrne rolled over. I wonder whether he spent more than $5m on legal fees or less. Good chance he lost money on this one. Byrne didn't roll over. His entire effort was just to be proven right and for the miscreants to admit they did unethical acts. This was never about money for him. Wonder what Prem has spent. Well, you don't have to worry here. Prem also is doing this solely to prove that there was a coordinated attack against Fairfax. But Prem isn't going to let this happen again...the delisting from the NYSE should have told people that...Fairfax has the resources to litigate this until these guys pay through the nose and they will! Cheers!

Well actually Darth turned on the Emperor, so can we expect Cohen to spill all the beans on Milken, or whoever the Emperor is, if he's charged or indicted for anything? ;D Cheers!

Finally after 2 years, the SEC has charged 3 former executives at New Century with fraud. http://finance.yahoo.com/news/SEC-accuses-3-exNew-Century-apf-2981651593.html?x=0&sec=topStories&pos=8&asset=&ccode= In the past, I've had numerous exchanges with Herb Greenberg about why he was ignoring New Century, while writting crap on Fairfax & Overstock.com. The past exchange below was written back in 2007 before NEW even filed bankruptcy. David Einhorn was a director of the company and on the audit committee I believe at the time. Cheers! 6:10 pm March 2, 2007 Sanjeev Parsad wrote: Herb, you keep covering Novastar, yet you’ve virtually ignored New Century. The company has been cut further into junk territory by S&P today…they’ve laid off 4.4% of their employees…they have 23 class-action lawsuits against them…and their stock is down 47% in the first two months of 2007! David Einhorn, who is a director at the company, and demands accountability from the companies he invests in, was apparently complacent here. Why isn’t Mr. Einhorn held up to the same level of accountability that he inures upon others? Are you planning on writing anything about this? If not, why are you not asking such an important question that is directly related to the subprime industry, and thousands of shareholders in NEW? Sincerely, Sanjeev Parsad 10:36 am March 5, 2007 Sanjeev Parsad wrote: Herb, For three weeks now, I’ve asked you why you haven’t done a story on New Century? During that period the stock has fallen 75%, the company is under criminal investigation and it has defaulted on a number of its debt covenants. I have not received a single response on why you have not had the time, nor inclination to examine the subject. Would you care to comment if your relationship with David Einhorn, who is a director at NEW, is hindering your investigation of the company? The same David Einhorn that has requested the dismissal of a number of corporate boards in which he was an investor for transgressions not even remotely close to what has occurred at NEW. Sincerely, Sanjeev Parsad 10:43 am March 5, 2007 herb greenberg wrote: Sanjeev, I didn’t write about New Century for the same reason I didn’t write about IndyMac, Fremont, Impac and every other subprimer out there: Can only do so much and NovaStar represented among the worst risks in subprime land. As for Einhorn: No relationship whatsoever, other than I’ve quoted him in the past and his phone records were stolen — as were mine! If you’re looking for conspiracies, I suggest you check with the folks over at Overstock. They claim to have it all figured out! Cheers. Herb 12:11 pm March 5, 2007 Sanjeev Parsad wrote: Hi Herb, Thank you for your response. I understand that you have time restrictions. Looking at some of the subprime lenders you’ve mentioned…Fremont is down 70% from its 52-week highs…Indymac is down 42%…Impac is down 59%…Novastar is down 86.5%. New Century is down 88.2%! While Novastar deserved your scorn, I still don’t see how you presumed that it was the most fertile ground. Especially if you examine market losses for just the last three weeks, where no subprime lender has lost anything near New Century. I’m also not sure what Overstock has to do with the subject. I spoke to you at the first VIC in New York in November 2005. Both you and Jim Chanos had spent virtually your entire presentations on why “Fairfax was a zero.” I approached you after your presentation and asked you exactly how you went about your research on Fairfax Financial. Your response was that you had two very good sources. I then asked you if you had read the annual reports and investigated the financials of the company. You said that you didn’t, but that your two sources were very reliable. I was flabbergasted with that answer! While I don’t believe you are corrupt in any manner, I certainly question how you go about your research and reporting. I think you’ve spent more time marketing yourself, rather than spending that time on your actual investigations. Especially the trust you’ve endowed some of your sources. The reason I asked you the question on New Century, is that I’m asking you if your relationship with sources is compromising the integrity of your investigations and reporting? That perhaps more due diligence in investigating financials is a better route than relying on sources for information. I would have no problem with you asking questions about any company…as long as they are corroborated with significant due diligence on your part. David Einhorn had presented at that VIC conference with you. You presented right after Mr. Einhorn. You’ve done stories on other companies that Mr. Einhorn was engaging as an activist investor. Yet, you seem to indicate that you don’t know Mr. Eihnorn. I find these answers very questionable! Sincerely, Sanjeev Parsad 12:23 pm March 5, 2007 herb greenberg wrote: 1. You’re confusing the stock price with the underlying issues. (Overstock has to do with conspiracies.) 2. Fairfax was and is a complicated, tangled ball of string. I spent at least a month trying to figure it out and focused largely on the Luxembourg entity, which the company had declined to comment about after more than a week of having my questions. (When I’m surrounded by a dozen people asking me questions I’m not going to go into a great discourse about how I do my job.) 3. I never said I didn’t know David Einhorn. Is there a problem knowing David Einhorn. I know a lot of people! What’s your point? (Which gets us back to Overstock: In the case of Overstock, conspiracy theorists tried to paint a picture of corruption because reporters talked to short-sellers; note they never do when reporters write positive stories! I’m a reporter. I talk to people. I don’t make stock calls; I raise the red flags. Ignore them or use them for further research to give you comfort in your opinions.) Cheers. 12:55 pm March 5, 2007 Sanjeev Parsad wrote: Hi Herb, 1) Overstock was irrelevant to the discussion. My question was on the subprime industry, and your decision to exclude New Century from your coverage. 2) I agree that Fairfax was very complicated, yet some of the individuals involved with providing source material to a number of journalists, including yourself, had a vested interest in their opinion. That should have raised a red flag with you and forced you to provide a more balanced view of the company, like many other journalists chose to do, who had equally valid questions for the company. Part of accurate reporting is picking and choosing the information you base the article on. Noise and distraction is not a suitable answer. A company refusing to comment, especially when that was a historical precedent for the company’s management, clearly is not indicative of anything nefarious. Leucadia National chooses to not discuss issues with the media, yet no one has ever questioned their integrity. Nor does anyone have reason to. 3) The point with knowing David Einhorn, is that did your friendship with him prevent you from investigating the company for your readers? I don’t think Mr. Einhorn is anything but a legitimate and honest investment manager. But I do think it is highly hypocritical, that the same standards he sets as an investor in other companies, is not the same standard he holds himself up to in this situation. It is questionable, and i’m wondering why you haven’t asked this question? Sincerely, Sanjeev Parsad 2:48 pm March 5, 2007 herb greenberg wrote: Sanjeev, 1. My mention of Overstock was tied to the implication from your questions that there is something nafarious going on becuase I didn’t write about New Century. 2. As was the case with Overstock, there were those who tried to create an issue of reporters talking to people who have vested interests. That’s what we do. Would you be raising the same question if I were talking to big holders of the stock? My guess is you wouldn’t. Beyond that, while tips may come from shorts/longs and others, my own research determines whether I decide a story is worthy of being written. That’s my decision and mine (and, in some cases, my editors’) only. Key is the quality of the information, which is often contained in public filings. Smart people slice-and-dice the same set of numbers of public disclosures different ways. 3. As to whether I will or won’t write about a company, positively or negatively, based on whether my sources are long or short: As most will tell you, they only wish that were the case! Cheers. Herb 3:49 pm March 5, 2007 Sanjeev Parsad wrote: Hi Herb, 1) Most of what happened at Overstock is Overstock’s own making. At the same time, there is no doubt that there is some collusion in the activity around Overstock. Simply the fail to delivers and scope of shorting that occurred earlier last year was indicative of that. I’m not saying you had anything to do with it. I’m saying that some of your sources may have had something to do with it, and utilized your media exposure. 2) Which leads me to the point regarding Fairfax. Again, I think you were the patsy in a game played by a number of organized shorts. One of your former cohorts from the Street.com wrote some 48 articles on Fairfax in a six month period, often quoting the same sources, irregardless of what was occurring in the underlying financials of the business. For a journalist, this is very irregular behaviour. You write often, but i’ve never seen you write anything close to that many articles on one company. On your comment regarding my reaction if you had spoken to some big shareholders, I would have actually preferred if you had done that while writing your articles. That way you would have provided a balanced view…good or bad from either stakeholder…short or long. In Fairfax’s case, you could have spoken to a litany of highly-regarded investment managers who were large stakeholders from Peter Cundill, Mason Hawkins, Mohnish Pabrai, Markel, Sir John Templeton and the investment managers at Letko Brosseau. This was never done…not by you or anyone else! Why? 3) It doesn’t really matter to me if you write on NEW or not. The whole point of my argument was that scrutiny by journalists should be unbiased and balanced. That the flame should be held to everyone’s butts equally! I know you have great regard for David Einhorn…that doesn’t mean the same questions should not have been asked. Sincerely, Sanjeev Parsad

I think Patrick believes Cohen is Darth Vader and Michael Milken is the Emperor! ;D I would not be surprised. Cheers! http://www.deepcapture.com/michael-milken-60000-deaths-and-the-story-of-dendreon-chapter-4-of-15/ As mentioned, Carl Icahn, who would later owe his status as a billionaire to Michael Milken, founded the options department at Gruntal & Company, which owed its existence to Michael Milken. When Icahn left Gruntal, he was replaced by Milken crony Ron Aizer, who proceeded to hire two traders who are cronies of Michael Milken. The first trader hired at Gruntal by Aizer was a man named Steve Cohen, who later founded a hedge fund called SAC Capital. Cohen has been described (by BusinessWeek magazine and others) as “the most powerful trader on Wall Street.”

Thanks Prevalou! I was just repeating what the article stated. Cheers!

Bloomberg article on regional banks and their CRE loan portfolios. Of the 35 largest regional banks that retain TARP funds, CRE loans account for 30% of their portfolio on average, compared to 9.5% for large national lenders like Citi or Wells! Cheers! http://www.bloomberg.com/apps/news?pid=20601109&sid=aaoaOoxV9AmU&pos=10

My mentor is a family friend from Ireland (where I live). He started off smaller than 100k, withdrew profits as he went along, so he hasn't got anywhere near the figures you're all quoting. There's no point me mentioning his name because he's never done anything in the media and only ran money for family. He was probably lucky to have been investing during the historic 90's bull market, but then again, Buffett was also investing in a similar bull market at the start of his career. Buffett's withdrawn a signficant amount of capital over the years that could have remained in the businesses...especially during his partnership days. He's taken a meagre (relative to his wealth and what he could have received) $100K a year salary. Yet Buffett is one of the richest men in the world. I'm actually surprised by how much Buffett used to hand over to his wife and children over the years. He's got a reputation as a cheapskate, yet I don't personally know anyone who was giving each of their three children $1M a year since their 30th birthdays or so, as well as their own personal foundation to do with as they wish, not to mention Berkshire shares. And he built it with $100 of his own money. I'm sure your mentor has done very well and has a great track record, but it isn't public or audited, so we can pretty much lump it with other unconfirmed accounts of investors who've done better than Buffett. I'm sure there are plenty of people out there who no one has ever heard of who have even better records. Perhaps, but I've yet to hear or see one that has done it over fifty plus years. I hope someone does it...perhaps my mentor - Prem...but it's quite unlikely. Cheers!

Terrific little article on Rodriguez. Cheers! http://www.bloomberg.com/apps/news?pid=20603037&sid=arQR.jbVgmFE

If they take SAC down, they will take down a whole host of others...perhaps even the Sith Lord(s). Cheers!

What did you learn from the Crash and rebound? Have the right mentors, otherwise one mistake can wipe out years and years of success. I'm eternally grateful that I have the likes of Prem & Francis as my mentors. Not only are they great businessmen and investors, but they are exceptional human beings. It certainly helped form the correct framework (both intellectually and culturally) when Alnesh and I started our own firm. There is no other way we will now behave for the rest of our lives after experiencing this period. Cheers!

Wealth and fame seems to be the most effective aphrodisiac available for the female half of our species. Its easy to be moralistic however as us mere mortals do not have any moral dilemas to deal with in those matters as we are completely ignored by the fairer sex. Speak for yourself! They never ignore me...they just turn around and walk away once I open my mouth! ;D I suspect that deep down that behind many of our efforts to attain material wealth is a secret desire to have Tigers problems. No doubt and I don't say that he can't eat his cake...just that he can't have it as well! Whether you have Tiger's problems or our mere mortal problems, that rule never changes. I just think that if a man or woman wants to sample the wares outside of his/her marriage, then be up front about it, seperate, get divorced and be on your way. It's the behind the back stuff that bothers me...no different than a CEO betraying the trust of his/her shareholders by padding their expense account and compensation package while the company goes under. Cheers!

And the biggest thing that pisses me off about what Tiger did, is how all those hoser Mickelson fans are going to be gloating all the way to next year's Masters! I won't be able to watch a golf tournament, with Tiger and Mickelson, without wanting to wipe that goofy grin off of Mickelson's face. It was so annoying before, it's going to drive me crazy now! ;D Cheers!

Tiger would prefer to move to Canada right now. I don't want Tiger in Canada. Keep him there! I'm so disappointed...first Letterman and now Tiger. Two guys I always loved to watch and thought they were moral stalwarts. Why can't these guys just get a divorce or breakup with their girlfriend and then go do whatever the hell they want? Wouldn't that be much easier for everyone involved? Just plain stupid. I can't look at either right now...especially Tiger...his wife is something to look at and he traded down to those wenches. If I hear anything about Peyton Manning, then I'm finished watching television for good! Cheers!

Hi Arbitragr, I'm still very, very bearish on commercial real estate. This isn't for us. A client of Quantum's is interested in setting up such a structure to purchase residential real estate in Las Vegas. I'm not against that idea per se, as I think residential real estate has come down alot and will take time to recover, but the simplicity of the structure they are seeking becomes complicated, as it's deficient in many areas such as liability and tax efficiency. Cheers!

Broxburn, I think most boardmembers are ready to hurl a frozen deep-dish pizza at your head! ;D Enjoy the weather. Cheers!

Value, do you really like the deep-dish stuff? I went to a well-known place downtown called Giordanos. It was good, but I like my pie flat and with a nice soft, chewy blistered crust...Brooklyn style! Cheers!

Al, You're going to have to take me to some comparable burger joint in April then. Otherwise you guys lose to Chicago. There is a pizza joint in Toronto I'd like to try next time...Pizza Liberetto I think it's called. I just read about it on the weekend. Cheers!

Hi Crip, I agree with you. Everyone is always saying Toronto is a New York wannabe, but I really think it's alot more like Chicago with the lake and slightly smaller downtown area. I've got to say though that downtown Chicago is beautiful...it's a hell of alot nicer than downtown Toronto and I actually prefer it to Manhattan. The whole Millenium Park area and the views of the Chicago skyline from there are absolutely stunning! Plus you have Steak'n Shakes! I think the only thing Chicago loses out on is their deep-dish pizza. I much prefer New York style pizza over Chicago deep-dish. ;D Cheers!