calonego

I doubt there’s interest in Boeing - that’s a real schmozzle. Much of it self-inflicted too. Think of all the negatives of that business (foreign competition that’s highly political, incredible leverage, low ROA, highly political without the built in regulated margin of the political businesses BRK owns, etc). Oil? Maybe some, but I can’t see them buying a whole oil company. Who knows. Anything manufacturing they’ve bought has been highly specialized and with better embedded margins. A) Tie-in acquisitions? Always happening. More likely pop up (think Marmon and the Auto dealers). Doesn’t tie up lots of cash though. B) PIPE type deals (prefs/debt with a warrant, etc. Like ‘08). I would bet money the phone is ringing off the hook with deals like this. C) Big Game. A generational buy - like ties up additional capital for a decade. BNSF/Berkshire Energy style. I’d say 100% A happens (keeps happening, but doesn’t move the needle) and more volume than recently (less PE completion). B almost certainly happens, hopefully enough deals to move the needle. The government handouts are complicated - there were tons of government handouts in ‘08 and BRK still did phenomenal deals of this type. Fingers crossed they do a HUGE “C” type deal - I like DIS at some price. Almost too big - but rates are zero and maybe you can issue some stock for the best entertainment franchises on the planet. Stuck in a relative’s basement with Disney+ (National Geographic) on for the kids...

Warren and Charlie know the Permian. Very well. This is about swapping some regulatory capital Tbills into something with a yeild and then getting the kicker - the warrant exercised eventually once they're right about OXY/Permian. Charlie in particular knows it inside and out (I'm sure Warren does to...) - plus CM knows the engineering... and the pipeline changes coming online and OXY's unique ability to operate well in the basin. If you listened well to the interview on CNBC on Monday AM - Becky tried to get Charlie to speak about the Permian and what the future looks like down there and he wouldn't bite. They were speaking about this very thing on the weekend. He just didn't want to be on the record IMO.

I thought it was great as well - I used to work in a former USSR satellite state and had some near-dealings with Russian nationals and organizations. Although things have changed a lot - it's spot on. Charlie Munger read it last year and really enjoyed it too. ; )

"What rate does Buffett use" argument - not to beat a dead horse... but he's stated many times that he doesn't use one. I bet he spends more time learning about an industry and a business and where the competitive advantages are - where the one or two "secrets" to that business lie - and buys at a fair valuation according to that. Jim Pattison was at the BRK AGM and some of the ancillary events last year. I bet their relationship has more to do with buying Van Tuyl than a discount rate.

The book is interesting - he had a quick/intense career in the super-large macro HF world... Confessions of a Street Addict is better, but McCullough's book is a quick read and a more recent snap-shot of the non-value, take no prisoners, monthly performance, HF world. He also tried to buy an NHL team a year or two ago. I don't know him, but he's a Canadian and from my town... Must be an alright guy! ;)

I've been bugging Andrew about publishing it again for years... to no avail. :'( He's either started, or in the process of starting a fund.

Al - What blasphemy! Was The Brick not good enough???

For the Yanks here: Walmart came into Canada in '94. They expanded and concurred like mad during the late '90s... Zellers tried to compete by... buying K-Mart Canada! Walmart was just far, far better. I take it by the price that Target is really committing to this. Walmart is going to have a rude awakening in this country when Target gets to a full stride. Even Liquidation World did really well until Walmart, Dollarama and (Loblaws/Weston's) The SuperStore started eating their lunch 5-10yrs ago! The thing about this newer HBC guy is that he doesn't even care about this Zellers "morsel", if you will. Look at his Lord and Taylor!

I have 4 "go to retailers"... when I need something in the US. In order of preference: 1 - Trader Joe's (wow - just wow - their grocery and wine are phenomenal... Two-Buck Chuck anyone?!?) 2 - Costco (good quality and prices on food/consumer goods) 3 - Target (everything) 4 - Sak's off 5th (for work clothes) Target is similar to Walmart; they sell everything. That's about where the similarities end. It's just far, far cleaner, with much better products (Archer Mills products are a great value proposition). I grew up (and now live again) in what I like to call Canada's mid-west... spent much of my youth in Minneapolis/St Paul (if there are any members there, please send me a message, would be good to meet for coffee). Target is based in Minneapolis and I feel, as a retailer, the company exemplifies many of the mid-west qualities I admire. On a side note, I was in SoFlorida 2 weeks ago and had a long discussion with an HBC exec's 30yr old son (father was a former CFO as well as some other positions, but didn't want to talk shop, the son did). I was a shareholder a while back (had a $600mln market cap, $500mln or so in debt... and some really choice assets), so I was familiar with him and the company... told him that it would be a great day when Target finally swooped in and saved them from Zellers - he just looked at me weird.

Good articles, thanks guys! XYZ is best found by looking up Robert J Morrison on Sedi.ca. He's listed on 2 boards, one is a data company, the other was sold in Q1 2010 and in a manufacturing biz.

TWA, I subscribe to a trade rag on underwriting and for a little extra they send an annual industry table edition. It had profitability by type and line, volumes, etc. I just assumed it was the same thing in other underwriting locales as LRE has many of these lines.

TWA, Thanks for the reply. I missed the direct vs Re pie in the Q3 slideshow, thanks! That's about where I was expecting it to be, but I seem to forget where they hide this stuff every 6-8 mths!

TWA, I've owned this for a while, great organization... I can't get a clean breakdown of totals for direct, Re and retro... Am I missing something?? I'm guess there isn't like over 50% of the biz in Re or retro because the Re liabilities are 1/10th the Re receivable asset... Any help is appreciated.

NetNet, Please check your "My Messages".

My best idea/investment in 2010 was either marrying up... Or an 8 acre piece of highway front land in a $90k income/household community in Ontario (purchased at $7k/acre). It's about the 2nd or 3rd best piece in the area and I'm not using it for it's highest utility, but it's still a 20-40 bagger. And very low risk. I got back 25% of my capital in 2 days work selling top soil from it to contractors. The land is money in the bank... Worst was a company that I won't mention (out of embarrassment) that's business continued to crater and their debt load is coming home to roost. I was lucky to get out at a 20% loss when I realized the '07-'08 period wasn't going to come back for them, even though they're in food and it should have! Best idea for 2011? Haven't had it yet! Truthfully I have three but they hardly trade and I'm the bid! One is semi-private (sort of trades) and at 1x aftertax income, no debt.