Parsad

Or you could say..."I'm thankful for not being Al Franken...Sad! Cheers!

I just sold half of my shares last week so I expect the stock to at least triple from here. If there is one thing I do consistently it is sell way too early. Explain to me why you two are crying over this...after making such wonderful investments and enjoying terrific returns? The glass is half-full, not half-empty. Sell if you can't sleep...hold if you can sleep. Cheers!

I think the founder / CEO's instilled culture is the key for any successful conglomerates, as evidenced by your examples. I don't know it very well, but I suppose GE under Jack Welch (and his culture) was in a much better shape than now. I respectfully disagree. I see the current situation as the culmination/end result of a culture that Jack Welch put in place and then continued. When you bill the company for your toilet paper and lightbulbs, that's a pretty f**ked up culture! Immelt was the scape goat in this...Welch for all of his success was really the culprit. Kind of like Sandy Weill back at Citigroup in it's heyday after the Traveller's acquisition. Although Weill wasn't nearly as bad as Welch in terms of padding the personal coffer with entitlements. Cheers!

Cannot comment on the company...investors will have to be patient and hold, or sell if they so desire. We're in this for the long haul...not 2, 5 or 10 years. Neither Alnesh, myself, nor Andrew Cooke have sold a single share. The sales you see are related to any redemptions in either of our funds...redeeming partners received their pro-rata share in PDH, so that we do not jeopardize our fund liquidity at all. Corner Market Capital has to file whenever this happens. Cheers!

Hey Guys, Specifically Cardboard and Liberty...feel free to debate and make generalizations about broad groups...but don't target each other in your posts. I also recommend that to all participants...feel free to rant and rave...but other than a quote embedded in your reply...don't take shots at specific posters. Thanks everyone! Cheers!

With low interest rates and rising home equity, North American's have been buying alot of new cars, and I've found that alot of really, good used cars are available...both at dealerships and private sellers. I've almost always bought from the dealer, but other than my Mini when I bought it, I have never bought new. My latest replacement is a 2012 BMW X1 that had only 47,000km on it and was less than half the price of a new X1. It was in really fantastic shape, mint interior, all the features I wanted, looks and runs terrific! It also had 1.5 years left on an extended bumper to bumper warranty, so if I find anything wrong I can get them to fix it. I've always followed the manufacturers recommendations for service, and have never had a problem with any of my vehicles by doing so. Yes, I may have paid an extra $300-500 a year more in maintenance, but I've never been stuck on the side of the road and my car has always run incredibly well. I also buy only used cars that have been serviced according to the maintenance schedule. In terms of pricing, you have to do your research and know what you are looking for and what is a reasonable price for the year, make, model, condition, packages, etc. You might save a couple of thousand buying from a private seller, but at least with a dealer you do have some recourse and rules on canceling a sale and returning the vehicle. You also can get accurate service records and many dealers provide free Carfax on the vehicles they are selling. In Canada, you are also required to disclose any accidents or repairs over $2,000 or $2,500...can't remember exactly which...but reputable dealers won't risk their reputation or business by not disclosing, whereas a private seller has every incentive to do so, as they are disposing of a single vehicle. I think the best way to view your car purchase is if you are driving your vehicle 3 hours a day, 5-6 days a week, thorough rural roads, mountain highways, and lousy weather conditions, etc, how important is it that you save that $2-3K when you weigh it against 5-6 years of ownership?! Most people spend more on Starbucks coffee annually! I'm ok paying that much more by buying a great used car from a dealership rather than a private seller. Cheers!

How did he get caught? It says virtually the same thing after the update!

I think Mohnish attributing it to smear driven by envy instead of just taking blame himself is disappointing. There was no reason to attack along with it. It is classless and arrogant, and reveals much about him. Oscar is not an ass, he is right on. I for one don't envy Mohnish, or Buffett. Never have. Never will. He was damned if he did and damned if he didn't. If he had taken the gracious approach, I think some would have suggested he got caught. He took the approach to point out that he didn't post it, but when he heard about it he fixed it. He then said that regardless of what he does, there will always be a certain amount of envy and resentment...I don't believe that to be untrue at all, especially from what I hear some of you say about him or others for that matter. The gracious act would be to let it go after he responded on how the whole thing happened. Oscar could have taken it at face value as well...he chose not to, and his response could be viewed as being prickly. Ironically, Mohnish's post was exactly how he would have responded in person. Should he have been disingenuous to appease the horde? Cheers!

Here are two ways that one could have responded to this thread: 1) I posted on my LinkedIn profile that I have a Harvard MBA and people pointed out that I do not have that degree. I attended a program at HBS for many years that I believe is similar in scope to the MBA program, but I do not have that degree. It was an honest mistake and I have corrected it. Thanks to those who pointed it out, as it potentially saved me future embarrassment.” 2) I posted on my LinkedIn profile that I have a Harvard MBA and people pointed out that I do not have that degree. I actually attended program that is BETTER than a Harvard MBA. I merely wrote “Harvard MBA” to be humble. People who pointed out that I do not have a Harvard MBA are full of envy, taking potshots, and smearing me. Anyone who disagrees with me is irrational. I will now throw in a gratuitous self-reference to Warren Buffett for kicks. The decision to respond in the spirit of #2 instead of #1 perhaps explains why people pointed out the misrepresentation. It is not a gracious response, and it displays a large ego that is resistant to feedback or criticism, even when justified. Mohnish had never minced words and he's not about to. Would you ask Munger to be more gracious in his choice of words? I think you are just being an ass...I don't mince my words either. Cheers!

I get that people like the guy and are invested in his funds. But lying on your resume isn't ok. You don't just say "oh whoops, I guess he typed that in wrong on LinkedIn." My dad used to say "Don't trust anyone who takes a mulligan" because if someone is willing to lie on something small and meaningless like a golf hole then they're willing to lie on bigger things as well. It's a character issue. I recognize we all have flaws and are all flawed, but people need to decide what is acceptable to themselves. Seems most in this thread are ok with a manager who is willing to lie to make themselves look better. It isn't a character trait I'd be ok with, but I'm also not an investor in his funds. Do you think he really lied, or do you think it was an oversight on how clear he should be about how the status was granted? The original Linkedin said "Harvard Masters of Business Administration/Business/Commerce/General". You look at the list of ways and programs Harvard grants the alumnus status and tell me what he should have put on there. It's a confusing mess isn't it? He didn't say solely "Harvard Masters of Business Administration". I think you hit it on the head with your comment...something small and meaningless...I believe it was to Pabrai until everyone stirred up the hornets nest on here. Also, the comment that "most in this thread are ok with a manager who is willing to lie to make themselves look better" is really just silly! Suggesting that some of us are ok with it...kind of a low blow. A few weeks ago, it was Allan Mecham, then Mohnish...next week will it be Francis again? There are alot of bad guys out there managing money...both in performance and ethically...yet I keep finding so many going after some of the actual good guys in the business. So many of you send me your letters monthly, quarterly, etc. I bet I could tear each one apart and find something..from big omission or error, to small oversight. People make errors...they aren't always trying to deceive people through those errors. Cheers!

I think you are splitting hairs. He essentially has the same thing he had posted on there before, except he's clarified how it was granted. Cheers!

+1! Maybe you guys owe him an apology. Many of you are students of Munger and his belief on incentives. Ask yourself what incentive there is for a man who is worth $80M, spends only about $250-300K a year, whose hedge fund is not open to new investors and is already asked to speak and attend all sorts of prestigious conferences? What incentive does he have to lie about a Harvard MBA and risk all of that? This reminds me of when he bought the lunch with Buffett, but paid for it through the foundation he set up. I remember people skewering him over that. He gave the f**king money away...does it matter if he got a lunch out of it? You guys really need to spend more time on your investments and less time worrying about other people! Cheers!

New report out. About C$0.037/share left. Disappointed that management doesn't say when to distribute the rest of capital. They are working on it. We had a meeting to push forward with the final stages of Russell and coordinate the steps necessary. Please watch for any updates in press releases. Cheers!

Yeah, in my opinion, this should be illegal. Pensions should be first in line creditors, alongside banks, etc. Spend 20 years working for a company and they keep your pension underfunded for half of that time and then seek creditor protection! The executives should have to eat the losses on their bonuses as well! Cheers!

I absolutely agree Cardboard! I'm not saying that Sears in it's current form was salvageable. But there were alot of mistakes made by Lampert, including siphoning off most of the cash, that lead to Sears Canada's demise. Sears was not going to become Nordstroms...but it certainly could have taken a page and learned to evolve. It certainly could have morphed into Target after selling off the appliance, hardware and furniture businesses and focusing on housewares, apparel and common goods. Or focused on the mid-market regions where they were the primary department store. They chose to do neither! They could have certainly taken a page from Nordstroms and leased off much of the space, while downsizing the retail portion. Again, they didn't do any of that until they had no choice. And by that point, Lampert had been buying back the U.S. stock from $200 down! Cheers!

Yeah, that's kind of a bullshit letter. We all know how much money was pulled out of Sears Canada and distributed to shareholders...ESL being the largest shareholder. I live in Canada and watched Sears Canada collapse. It wasn't because of management, but because ownership (primarily ESL through their stake) decided not to put any money into modernizing and updating Sears Canada. Three perfect examples are the core locations around Vancouver and its suburbs...Downtown (Pacific Centre), Metrotown and Brentwood Mall. All three disintegrated with barely any money put into Brentwood and Metrotown, while nominal upgrades were put into the Pacific Centre location. Take a look at what Sears Pacific Centre looked like and what the new Nordstrom's in the exact same location looks like: Sears Pacific Centre https://static1.squarespace.com/static/529fc0c0e4b088b079c3fb6d/t/5977d9bc15d5db539c9f9aa9/1501026842305/Screen+Shot+2017-07-25+at+7.52.00+PM.png Nordstroms - exact same location https://imageserver-bisnow1.netdna-ssl.com/8G8ZBOGLXPmvZzL8xIUiVCPgUvg=/0x0/publisher/78504_1442848564_Nordstrom_Pacific-Centre-large.jpg Nordstroms spent over $100M renovating the exterior and interior. Added a white-linen restaurant, mid-level bar and lobby level cafe/bistro. They also used only three floors of 8, and leased out the top 5 floors to Amazon, Microsoft and 2 of the 5 floors to a large law firm. That Nordstroms is busy, all day, every day! If people aren't shopping, they are eating there. Eddie is a smart investor, but he may arguably be the worst retailer in history! Cheers!

Because the financial business was spewing cash in the past. The business has been shrunk dramatically and you can see this in the revenues and profit margins. Not the same business it was in the past...has to get cheaper and the dividend presently is not sustainable. Cheers!

Seems like he is telegraphing that he has been successful re: his concerns http://www.fairholmefundsinc.com/Bulletin/SHLDstatement20171017.pdf "... I believe that I have achieved that objective, and was pleased to have the opportunity to assist in developing the company’s strategic restructuring program, which was announced earlier this year." You guys are correct. You guys really think that in this retail environment, and at this place in time, somehow Berkowitz and Lampert have fixed Sears and stemmed its burn rate? You guys know that Sears Canada just went under, right? Is there anything that springs to mind on why or how Sears U.S. is going to incur a different fate? This thing has been a black hole for well over a decade now. There is no end in sight where it doesn't continue sucking all of the money in the universe! Cheers!

How many case studies could do that or provide such detail! That's why I created these for each idea or stock. Cheers!

In my opinion the whole real estate thing is a mirage and the possibly the next shoe to drop. These retailers occupy huge swaths of real estate. These retailers are going out. Plus they're going out at the same time. Who's gonna come in their place and absorb that huge supply? Definitely nobody that's gonna pay current market prices for it. The real estate's a dud. Depends on the real estate...Sears had already distributed their better quality properties into Seritage. They were stuck with lesser quality properties...thus they had to sell their brands. The problem wasn't that Lampert invested in Sears. The problem was that he sold off assets at a snail's pace, until he had to sell off assets to stem huge losses at a business that he didn't want to put any more capital into and it was dying. It was bad execution, not a bad idea. Cheers!

As per the title of REM's song: Everybody hurts sometimes! Cheers!

Francis has been looking to buy a private business for many years, but could not find what he wanted. I have no idea if this is in line with that objective, but from what I understood, the intention was never to take the business public if acquired. He planned on using it to acquire other businesses over time...more like a personal holding company...his own personal Fairfax Financial. If he ever does go public, this would be one guy people should definitely invest into as a shareholder. If he does not go public...well, then you are out of luck! Cheers!

Thanks to Rahul for the notes! Cheers! Sept 16 2017. PIF2 => 18.5 years $100K => $1.2M (rolled up). As of June 30 2017. Including recent months it is probably near $1.4M First 8 years => 30% annualized after fees (outperformance of about 27%). 2008 => 44% drawdown for SP and 65% drawdown for PF Next 8 years => 19% annualized. $1 is now anbout $13.6 to about $14+ PIF2 has earned no fees since 2007 10.25 years with NO fees Longest of any fund he is aware of Carried about $500K+ per year for 10 years ($5M) All three funds are now in fee earning territory $18.5 NAV in 2009 => Now it is $94. PIF3 every dollar from 2002 is now about $4 12.5% annualized Vs 9.2% annualized for the NASDAQ PIF4 => started in 2003 (every dollar is now worth about $3 (and now close to $3.6). Life of the fund is about 8.4% vs. best index is about 10.7% PIF3 is up about 48% till end of August 28% for first two funds vs. 20% for PIF4 GM, Google, Southwest GM is sold out! As of last Friday Google and Southwest combined is about 12% of the pie $680M in AUM 28% of the fund is now in India 4000 companies have market caps over (most are under $1B) $1.3B 8% annual GDP Growth 2% India are credit card holders and own a car Only 6% of people hav private health insurance India's mortgage 8% of GDP Ultra low expense => 6 basis points Amongst the lowest across the entire fund industry $580M July 1 => and now near $680M ALL funds are closed (no new capital) 85% of mutual funds law SP 0.5% of mutual funds beat the S&P by over 3% If 2 and 20 Then $12M a year Pabrai is the largest investor High Water Marks No Leverage, No margin loans, no short positions Stable group of 365 families WORLDWIDE Seritage Growth Properties Sears Bankruptcy within 3 years could be a problem Had a better idea for capital in India Made the swap at a slight realized gain. $70M info FIAT 2012 => 13.8M shares at $5 If they had done nothing would be worth $387M 1M shares of Ferrari to meet the $100M in 2016 Sold some to buy Southwest Airlines and Indian Those have done well but Ferrari has done better PIF2 has 150K shares and 250K shares 10% of each fund (not a bad stake) Ferrari is a very united asset with incredible MOAT No plans to sell another share for several years => Sergio is likely to increase intrinsic value over decades 50% in fcau 50% in obscure Indian company GM Warrants $33M realized gains. Nothing like Fiat Chrysler Unrealized gains of $14M => but looks like Pabrai exited this past week Dhando Holdings $10 NAV (current NAV) Starting Dhando Holdings was a mistake If he new in 2013 what he knows in 2017 => I would not have created it Horsehead + Stonetrust + other losses Now back at breakeven. STONE TRUST => $33.5M Purchase Price PLUS $30M capital Total cost $63.5M => Decided to sell it (last stages of deal) Hope to get back what we invested into StoneTrust => will make about 5% gain SOme Seller Financing warranties 87% of purchase price by q2 in 2018 Will then receive 3% per year for the next 4 years. Basically selling at a loss (95 cents on the dollar) New StoneTrust CEO => Mike Dileo => Doing a great job. Running the business as if no sale. Investment Portfolio $23M in gains on $50M of book value Underwriting and new business is very competitive Electing to shrink business vs. adding marginal business. SAYS IT WAS A BIG MISTAKE Investors will be left with ownership stake and Dhando Funds Junoon and India Zero Fee Funds Upside without downside Those who want to complete exit andludding an exit from stake in Dhando funds LLC (will likely be able to do as well). India Zero Fee Funds Oct 1 Launch $1M minimum $10M initial commitment Funds managed by Pabrai 2/3 of assets in Indian stocks and 1/3 other Dhando Junoon up about 15.6% while SP is at 17.4% Fahad - Analyst (Junoon Algorothim) ============== Q&A Why was Dhando a mistake -> hard to compete against large PE Firms and Succesful large scale insurance companies Company has to maintain strong financial strength Insurance is a VERY tough business! Doesn't want to get back into this space. $1B fund => CostCo AMZN Berkshire Assume the company never grows (wants to keep them) and could do an DCF. VERY few people comparison shop How much could he raise the price (probably 20%) VERY few people have used Google Express NO competition for AMZN => worth Billions of dollars if he wanted to raise price. According to Nick Sleep => amzn is SUPER cheap. Don't sell the compounders when they are overpriced (only when it its Crazy Priced). AERCAP is a aircraft leasing business => airlines (running them is a hard business). Cost of Capital is VERY expensive. They play middle man to help airlines get better deals on licensing and leasing deals. StoneTrust 85% combined ratio 95% is the best you can get and try to make profits on the float 5 or 6 year period (Workers Comp is a great business). Competition builds up the margins get to fat.

Terrific interview as always! Thanks!

Mine is $7something with tax (Just went up from $6.50 to $6.80 plus tax if I remember right). Yes, if you order it with chips and a soda its not much of a value and not healthy. Tortilla is something like 300 calories with no nutritional value. With the bowl and brown rice or lettuce it becomes about as healthy of any non-salad meal as you can find at a restaurant. Sodium is definitely high but that's true of basically anything not cooked at home. Hi Jay, Where do you live? If you order a bowl with brown rice and chicken and add guacamole here, it's like almost $12 CDN. You get the same thing at two other franchises (Chopped Leaf and Freshii) here for like $8-$9.50 CDN. That being said, you go to Chipotle and the line-up is non-stop...food poisoning issues or not! Cheers!