Parsad

Great addition if he joins! Will also liven up our dinner panel again. Cheers!

Read the deposition yourself...page 27 on. Cohodes admits to the existence of "naked short-selling". He also even admits that his partner Rocker was getting information he should not have been getting, and somehow Cohodes was completely unaware of it all. http://www.nytimes.com/interactive/2012/03/26/business/20120326Goldman-Documents.html?ref=business&_r=0 Patrick as unconventional and unpredictable as he is, is ultimately a nice person. He's put it behind him, because he was vindicated by Copper Partners $5M settlement. Doesn't mean he's forgotten everything he went through or what they tried to do him. And they tried to do this with Fairfax as well! Fool me once, shame on you. Fool me twice, shame on me! Cheers!

Cohodes still seems like an ass! Cheers! Well Parsad, since you always say 'No man is a failure who has friends', and Cohodes has become friends with one of the people he attacked, and in general has a pretty good record of attacking real corporate villains, and not legitimate companies, his Fairfax mistake notwithstanding, who is it that seems like an ass for being so unforgiving? So a guy takes advantage of the system and tries to drive a number of companies into the ground using naked short-selling, and you're telling me I'm the one that seems like an ass? Patrick isn't friends with Cohodes...he feels sympathy for Cohodes. If Cohodes showed remarkable change, that might be something, but these guys don't change. You can hear it in his language in that article. He's still speaking with bravado and that there are those that should fear him. He's still blaming Rocker, but accepts some of the blame. This guy will still tread the line, or perhaps go over it, if he gets stuck on a crusade. He's done it before and will do it again. Cheers!

Cohodes still seems like an ass! Cheers!

Nope! Wasn't Prem. Good luck to Milos at Wimbledon! Cheers!

Was watching the French Open right now with Milos Raonic...was that Prem sitting behind Milos' father courtside? Tough five-setter for Milos...over 4 hours and 15 minutes. Cheers!

Hope it doesn't turn into a PDH holding. While on the surface it looks like a clever idea, the chance of being run out of business via the lottery commission (in a particular state) is very high. Several states already allow you to purchase lottery tickets online directly from the lottery state. Unless maybe the angle is to sell the software to the lottery state that allows all the numbers and payouts to work seemlessly. doing that would probably cut down on the development time/expense for a system to be built from the ground up. LOL! Don't worry, it has nothing to do with PDH, nor are we looking at investing or acquiring it. It is one of Alnesh's clients through his firm Quantum Advisory Partners LLP. The lottery business in my opinion, not unlike Buffett's past comments, is one of the biggest scams the government pulls on its own citizens. Cheers!

I thought I would never buy online produce as well, but the staff at Save-on Foods pick exactly the same quality stuff I would. You can also tell them how you would like any specific item...ripeness, thin cuts of deli meats, substitutions are ok, meat butchered a certain way, etc. Delivered right to your front door or kitchen! No lugging heavy bags to the car, home and up the stairs, or time wasted selecting everything. I can work or play while they pack and deliver my groceries. Cheers!

I used to think this way too, until this happened. I bought a noise cancelling headphone from Amazon. About a year after I bought it, the headphone jack broke by an accident (one could say it was my fault). I emailed Amazon to let them know what happened and see what were my options. Amazon immediately shipped the replacement product that arrived at my place the next day. I'm not sure this level of customer service is available to all Amazon customers (I'm a prime member). One could also argue that this kind of over-the-top customer service is actually a money-losing tactic. But at that moment I figured I'm willing to pay premiums (both prime membership and higher cost) to buy even expensive stuff on Amazon because I get peace-of-mind in case anything wrong goes with my purchase / product. By the way, I think the extremely lenient return policy at Costco (and not just the cheap prices) also helped them retain loyal members in the similar way. You're probably correct. Alot of stuff at Costco is actually more expensive than Walmart. But Costco's return policy and unique offerings, while knowing you are getting incredibly competitive pricing, justifies people paying for their memberships. Can't be because Costco is less busy, as parking lots are as full as Walmart and their cashier lineups are longer. People will pay for the Amazon Prime memberships because of the service, convenience and competitive pricing. Cheers!

Vinod, Here is something to think about, WMT's distribution centers are/were their competitive advantage with respect to other retailers. The era they have grown in and the model they followed caused them to strategically locate their distribution centers such that they could most efficiently service their customers (the big box retail stores around them). It was perfect as long as customers went to the store to shop. Enter Amzn - their distribution centers (called fulfillment centers) were built and located strategically in this era. They located them such that they could efficiently service their customers (not retail stores but direct customers). The location of distribution centers is key in retail as it influences what inventory you carry, how much you carry and by when you can restock if necessary. Your suppliers are plugged into these systems and for both WMT and AMZN it works perfectly given their model. Now if WMT has to replicate AMZN locations, it would clearly be very expensive. Not only that, it would be disruptive to their existing business model with suppliers- it is a classic problem incumbents face in business. That is also why you see an effort from WMT to use their retail locations as part distribution centers for their online model.(pick up from store model) They will have to do something like MSFT did - scrap the old unwieldy internet explorer and build a totally new browser for the new gen. This is difficult to do, but certainly possible. It would take a lot of investment and patience from investors. My difficulty with WMT is - do you think the current management is not entrenched enough to overhaul the internet strategy? I would think you need new blood to come in to make such big changes (again like MSFT) rpadebet, I do understand the key role of distribution centers and its historical importance in Walmart's growth and competitive advantage. But that is only part of the story. It has also cut a lot of waste in the whole distribution system. Retailers have historically added a multitude of additional costs and charged these to suppliers. These take the form of display fees, rebates, handling charges, damage allowances, etc. These additional costs have been passed on to the consumers and the resulting revenue allowed retailers to ignore inefficient processes. Walmart has a one price policy that cuts all incentives for wastage in the supply chain. Walmart partners with its suppliers to cut out many inefficiencies in this process - this is an ongoing cycle. Sort of like say 3G. Walmart already has relationships with suppliers and their business processes are intertwined to reduce costs. Granted this is optimized for brick and mortar. But it does have scale and it is frequently the largest buyer of many of these suppliers so it gives them a leg up over competitors when it needs them to make changes. Why is Walmart disadvantaged in building separate fulfillment centers to ship directly to customers if the economics made sense rather than using its stores? How is this going to be disruptive to suppliers? They would just ship both to existing warehouses and to these new warehouses (fulfillment centers) as well. It is using current B&M stores as it might be cost effective/competitive for all we know. If it makes sense to use fulfillment centers and they confer some competitive advantage to those using them, what would stop Walmart from building them? I am trying to understand if Amazon has some real advantages in building these that Walmart might not be able to replicate? Expensive is not really an issue with Walmart's resources. They seem to be now focusing on eCommerce finally as they seem to have woken up to the risk from Amazon. Vinod Well here we are, 2 years later. Today I picked up my first grocery order-online-pickup-at store. First experience was very good. The ordering, pick up scheduling, notifying that I was there, loading the car by the Walmart attendant were all professional and no surprises. The delighters, - Literally no wait time. I had notified them on the phone 15 minutes before reaching and as I pulled up to the numbered space, they came out. - A mental barrier I (surely others have) had ordering online: Buying Bananas, tomatoes, bread and eggs. The m.o is that they show you these items before loading in the car. They apparently looked for the same things I would. They even mentioned that I could let them know if I wanted the bananas greener or riper. - They substituted some items for larger or smaller sizes. Ex. 7.5 Oz Coke versus 12 Oz. They don't charge more. 4 items on my list were substituted and I got more than I paid for. - I do not like paper or plastic (or worse, cardboard that comes with Amazon orders). This time I let them do plastic but they told me that they would fill up my own cloth bags the next time at the car and recycle the plastic they do use to transfer to the car. I am somewhat Ok with this, but would really like them to keep returnable bags/ containers and eliminate all plastic. "They are thinking about that". I sense they like that the lower overall costs is shared by both! - $30 is all that's needed for this service to be free. This is a huge delighter for us as we plan to order more frequently than we do now. We do frequently throw away stuff from the fridge. Big cause for this is that we have too much in the fridge, some things get tucked away in the back. Freshness is very likely to go up in our kitchen. Cannot beat this value and this could well be a game changer. - How this is all going to work is that, I will plan my pick up time while returning from work or some other planned travel(no incremental gas expense); I plan to fill up gas each time at Sam's club gas, which is in the parking lot. Sam's club gas is significantly cheaper than gas stations around me. Plus I get 5% off for using their credit. Finally, the attendant was super nice. I asked him about tips and they do have a no tip policy. All they want is for me to spread the word:-) There is a $10 reward for referrals. ($10 each). I like cheap and nobody beats Walmart for cheap. Cheap and convenient! I'm in. Will post any + or - experiences in the future. Any one else try this? In Vancouver, I use the online order and delivery service of Save-on Foods, owned by Jimmy Pattison's company...roughly for the last 2 years. They deliver right to the door, during a 2-hr time slot I select on any given day. We also use it for all food/kitchen delivery for Premier's office. Excellent service, delivery and rarely a problem...which is corrected right away. Walmart is a bit cheaper, so if they started to provide pick-up service here, I would probably also use it. The problem is that the parking lot for Walmart, and it's primary competitor Loblaw's Real Canadian Superstore, is always jam-packed. So I don't mind paying a little bit more and a small delivery fee to have it brought right to our kitchen. I only go to the grocery store now if I'm doing something like barbecuing or something, or if guests are coming over, and I need to grab a few last minute items. Never thought I would use online grocery delivery 3-5 years ago. Cheers!

Am I missing something? Looks like he is paying over 2.5 times book with $25M cash, $175M at 6% over 10 years, and a balloon payment upon owner's death (or 10 years) of $100M to Notre Dame's endowment? Cheers!

There is a ton that goes into real estate development. So much so, that we actually partnered with a team with tremendous experience in the area. Buying a property and selling it are the two easiest parts of real estate...all of the work that goes into licensing, regulations, etc, combined with being incredibly efficient in contracting, building and managing the service providers is essential in deciding what is a decent profit or a loss. Add in normal delays by municipal bureaucracy and contractors, and you end up reducing your projected returns on what is almost always a leveraged investment. But if you get it right, and you can survive the downcycles, it is the fastest way to creating substantial wealth. Cheers!

My point wasn't simply averaging in, but that the best managers can and will have periods (sometimes long periods) of underperformance. From 1971 to 1975, over a 5-year period, the brilliant Charlie Munger underperformed the market: http://awealthofcommonsense.com/2014/09/charlies-munger-becoming-better-investor/ If Charlie Munger can underperform for 5 years, would it not make sense that merely very good investors might underperform for periods longer than 5 years? If you had stayed with Munger from beginning to end, you would have done extremely well, even with that poor 5-year period. For most investors, it's difficult to stay with a manager during challenging periods. Indirect has been a Pabrai Funds client from shortly after the 1st year. He has stuck with Mohnish through good and bad times, and thus has finished ahead of the index. He was also smart enough to buy when Mohnish was down and add to his account...thus he is miles ahead of the index, even though Mohnish is modestly ahead of the index over the life of PIF2. Cheers!

Fairfax is nearly at the same price today, as it was 18 years ago when I first bought a share in Berkshire. It was at 5 times book then and it is at 1.25 times book today. I would say that investing in Fairfax only once in 1998/1999 was probably a bad idea at that valuation. But imagine what your portfolio looks like if you bought a little Fairfax every year over those 18 years. What type of investment results do you get then, when compared to simply buying a stock and holding it? I'm not trying to defend Francis or any other manager that has struggled over the last decade. What I'm trying to point out is that even very good, intelligent investors can underperform for long-periods of time. It could be due to mistakes, concentration in specific mistakes, distortions in valuations, influence of monetary or fiscal policies, black swan events or changes in circumstances that affect the original thesis. What I will defend is that there are a handful of managers I know that are ethically beyond reproach...I consider them friends and mentors...Prem Watsa, Francis Chou, Tim McElvaine, Mohnish Pabrai, Jeff Stacey, Allan Mecham, etc...I would be comfortable with my family investing with any of them. And yes, many of them have struggled on and off over the last decade versus one of the largest corrections and then one of the hottest bull markets, including underperforming their respective indices. But I suspect that if investors averaged their investments into their funds over the same period, the results look markedly different...just like I hope more of our partners average into our fund over time, or into PDH shares...just like I do! Cheers!

CoBF is the reason we have no market crash in last 7 years! 8) Sanjeev did it. You're welcome! Actually if Mobius is saying that, then do the frickin' opposite! One of the highest profile and worst investment managers of all time! Cheers!

Ah, I never took down any posts in the last 48 hours, only closed three boards because I was getting complaints of too much politics on the board again. If anything was deleted, it was deleted by the writer. Cheers!

Well, I could just delete them altogether, but then how would anyone know you existed? I'm still allowing you to exercise your 1st Amendment rights, but simply telling you that there have been a number of complaints from other boardmembers on how you may be infringing on their rights. Cheers!

It's really become ugly. In all my 50+ years I've never aligned myself to a party as I am now. Maybe that's because I've voted Dem more than twice. But all this disrespect and fake grandstanding generated from your side has really got me infuriated, to the point where I swear I'll never vote democrat again. Pelosi, Waters, and their miserable flock of sheep are doing great disservice to this country (see your comment: 'Russian connections') and I'll never forget it. Oh, they've got their faults...no doubt. But both sides have their flocks of sheep. No one in their right mind would back this orange, glowing monkey of a man. But people aren't in their right state of mind...they were so disillusioned and put off by many of the Democrats, that they simply voted for whatever was available and would take a bat to the other party or even his own party. Now we have something no one really wanted, but his supporters stubbornly stick by him. Clinton & Obama pissed off alot of people, but you've got the saddest state of affairs that could have existed now in place. Fortunately the country is greater and stronger than him! Cheers!

Fake news! Cheers!

A smug looking Ted Cruz gets his teeth knocked in by Yates. He thought he was going to take her to task! And why the hell did the Dems pick Hillary, when you have such intelligent, strong, ethical leaders like Yates? Cheers! https://finance.yahoo.com/news/sally-yates-ted-cruz-heated-214622346.html

Yes, he is confusing short-term with long-term. In the short-term, the net interest margin should shrink as deposit rates rise and mortgage rates on existing mortgages/loans stay the same...with 9-1, 10-1 leverage that will hurt equity short-term. But what happens as those loans, mortgages renew and new ones are added. The net interest margin widens dramatically at 9-1, 10-1 leverage. So as long as rates aren't constantly rising, but rise and plateau for a few years, it proves to be quite beneficial to banks with large deposit bases and decent, but manageable leverage. Cheers!

I thought it was a pretty good article. Cheers!

Oh, I agree it's not a fad. It makes long-term sense. But you have a congregation of capital of enormous size going into them. When a correction happens it will be bigger and faster. The recovery will also be quicker. Cheers! Bogle talks about what happens if everyone starts indexing: https://finance.yahoo.com/news/jack-bogle-envisions-chaos-catastrophe-markets-everyone-indexed-194610197.html As he states, the likelihood of 75% of investors indexing is almost impossible. But I would imagine that at even 25-50% of investors indexing, you are going to get compressions in cycles and greater volatility as investors exploit inefficiencies and opportunities. That doesn't even include what the psychological effect of a large correction would do as lemmings flee markets! Great for the value investor when corrections happen, but difficult for them to keep up when markets are bullish. Cheers!

When your mechanic and plumber start investing and touting the wonders of cryptocurrency, you should start to get concerned! Both have tried to arrange meetings with me recently on how amazing and hot Bitcoin is, as well as they want to introduce me to their Bitcoin guys. Also, the fact that Patrick Byrne is now spending Overstock.com money on this, should also concern people! Cryptocurrency is the future, but the winners will be few and far between, like how Amazon presently leads the internet wars with the dead carcasses of its competitors littering the street or barely surviving. Cheers!

I think most people are watching, so that's probably why it's a bit quiet. They will all chime in later after the meeting. Also, alot of people are actually in Omaha, so that might also be it. Cheers!