Liberty

Thanks! I knew a little bit about that, but definitely sounds worth digging deeper (not that it's something we have any control over, but interesting nonetheless...).

Can you elaborate on what you mean here?

One more Nike guy. They're building quite a stable: http://9to5mac.com/2013/09/27/apple-hires-one-of-nikes-top-fuel-band-designers-to-work-on-wearable-devices/

The always excellent Brooklyn Investor on tapering, Schiller's P/E, market overvaluation, etc: http://brooklyninvestor.blogspot.ca/2013/09/tapering-market-overvaluation-etc.html

http://www.bloomberg.com/news/2013-09-25/malone-says-reaching-time-warner-cable-deal-still-makes-sense.html

Thanks, subscribed to both. That'll be a change from tech podcasts :)

Thanks!

Hey Muscle, My cost average is about 20. I could've brought it down by buying more, but I felt I had put enough money into the idea. Basically everything that could go wrong went wrong, delay after delay, DP prices going down, the Euro driving up the Swiss Franc and eating Landquart's margins, etc... Only Dresden stayed a rockstar through the years. For most of these, I'm not blaming management (at least not entirely -- I've written about that previously), which is why I still have enough confidence in them to hold. Maybe that's a mistake? Thesis at this point is to be patient and wait for Thurso to be ramped up with cogen running. No sense in even considering doing anything before then. I still believe that with a fully ramped up Thurso and slightly more rational DP prices (where a big chunk of the industry isn't losing money), this could be worth multiples of what the market is pricing it at right now. I see the downside as quite limited now that they have lots of cash on the balance sheet (from the sale of Dresden) and that Landquart is close to break even. All that's left is to finally get Thurso going for real (and LSQ is an option at this point, they might never do anything with it, or partner up with someone else, we'll see). I certainly don't have the confidence in the business that I used to have because of all that's happened since, but then, the question always is, is that more than priced in? The problems we've seen would've been a lot more worrying at $40 than at $7. So I try not to anchor on my average cost and just look at what's the best decision going forward. Right now, I believe it's to be patient; I don't want to be the guy who held for years and then sold right before operations reach escape velocity.

Both debentures have been moving up, now trading at $81 and $76, with some relatively high volume days lately. The more I'm thinking about it and the more I believe that management has decided to start the buyback there. They probably feel it's more prudent because it immediately reduces their interest expenses, and if things work out well, it'll be the equivalent of having bought back shares (since the debentures are convertible into equity, though at prices much higher than today's). I wish they would buy back the common too, though.

I saw that. I think it's just a question of time now. If I had to guess, I'd say they'll try to time it so they can announce it at the iPad event in October. But that's just a guess.

Thanks Jeff! I didn't know they were publishing the raw interview. Much better! The one with Cook is good too: http://www.businessweek.com/printer/articles/154256-tim-cook-the-complete-interview Also: iOS adoption is ridiculously fast: http://appleinsider.com/articles/13/09/25/chitika-ios-7-passes-52-percent-of-devices-one-week-after-launch Edit: Also, the "junk" comment reads differently with the extra paragraph He was specifically talking about $69 tablets that don't work worth a damn (and equivalent cheap POSes), not the whole android market as some here assumed.

I agree that nobody is better positioned than Apple in mobile. But with the cards it had to play, Google is also doing well.

Functionally, what's the difference between a defensive and offensive move, though? Say you make $100/year, and then something happens that would make you lose $10 a year. You figure out a "defensive" move that counters it and you stay at $100. Have you made $10 more than you would have otherwise ($10 profit?), or are you still in the same place? Would you see it differently if you had fallen to $90/year and then made an "offensive" move that brought you back to $100? I see them as the same. Not losing money you would otherwise lose is a win in my book, same as making money you wouldn't otherwise make. And it all depends on how you look at it. Android certainly could be seen as an "offensive" move that preempted a lot of competitors and hurt them, which made Google stronger.

There is no doubt that there is strategic value in Android, and I think it has been a great decision to create Android for Google. But the question is particularly aimed at Wellmont who has repeatedly been touting Android and it's marketshare. And the silence is deafening. The reason why I say that even Google probably can't know is because even if they have a way to track how many times people click on ads just on mobile Android, and say that number is $5 billion, that still doesn't tell you the value of Android. In a world without Android, that 5 billion might go away, but maybe they'd lose a lot more than that 5 billion by not controlling the OS. What if Windows was the most popular mobile OS and everybody got used to Bing and depended on fewer Google Apps, making them less likely to also search on Google on both mobile and desktops? What if Bing built a critical mass of advertisers thanks to mobile OS control? That could be costly. What if RIM was tops and wanted a share of all ad revenue from its devices? If they were the most popular, they'd have a pretty good bargaining position to force them to do that. So even if Google has some internal number, I think it would only partially state the value of Android for their business. They could disclose that number, but it wouldn't tell the whole story IMO. The important of things isn't always proportional with the ease of measuring them.

Could you give me a number instead of "a lot"? If it is "a lot", how much is it specifically? Or you could just say "I don't know". I don't think it's something we can know precisely (even Google probably can't be sure), but there are two things to consider IMO: 1) Imagine a world in which Android doesn't exist, or exists but isn't controlled by Google. iOS would still be huge at the top, and either Windows and/or RIM would fill the rest, or some Google-less Android. In any case, I can't imagine any of those scenarios that are better for Google than controlling (mostly) the most popular mobile OS. Fewer people would have the Google search right on their home screen, fewer would use Google apps by default, and maybe those who control whatever OS would be popular would try to keep Google services out or make them pay for inclusion. Doesn't mean Google wouldn't be popular on mobile, but it wouldn't have nearly the favored position that it has now by influencing the OS directly. So that counter-factual tells us that Android is quite valuable to Google. 2) The transition from desktop internet usage to mobile internet usage is challenging for Google. Hence the decline in CPC. That's definitely a big challenge for them. But the way I see it, in no ways would the situation be better if they didn't have Android. It's a challenge, but it would be even more challenging without Android. That's value right there, and even if I can't tell you how much the man weighs, I can tell you he's pretty fat.

Android's overall growth certainly is good for Google, but I expect that they would also like to see Motorola become a top tier player with lots of units sold and good margins. Everybody's becoming more integrated (Google + Moto, MSFT + Nokia), and we can assume that they want to stand out and not be just one more generic smartphone. Maybe they'll get there in a few more iterations...

well it's a niche product and reflective of apple and samung marketing power more than anything. it was priced to be a niche product. and verizon sells almost the same phone under the droid brand. so moto x gets no traction at the largest carrier in usa. they did offer colors! before apple did. :) I don't know, it says that the Moto X launch was backed by a $500 million ad campaign, on top of all the free publicity that Google is giving it through it's PR channels... That's not small.

Yeah, it's evolutionary psychology 101. Won't change any time soon, though on the individual level it's possible to become conscious of these traits and try to reign them in. Also, some people are more 'tone deaf' to these things than others (ie. I tend not to give a crap about all that signalling stuff, but who knows if that's just a contrarian type of signalling, showing that I'm above all that, so I must be cool, right?). Heh.

Ok, thanks. The "...future nobody wanted" part made it sound a bit too Michael Moore-ish for my taste :)

The title makes it sound highly critical and kind of anti-business. Is it just the title, or is that the overall tone of the book?

http://mashable.com/2013/09/11/moto-x-shipments/ 100k/week. Kind of slow, if accurate.

Sure, but keep in mind that I just invest as a hobby. Basically it is a story stock. You have a CEO who is very aggressive and yet very disciplined from a capital allocation perspective. When he first came in he got rid of all businesses where he did not see a competitive advantage or room to build scale. He started acquiring companies and lopping operational expenses down aggressively. He merged with biovail (while maintaining his role as CEO) and as a result now has a 5% tax rate. With the Bausch & Lomb transaction he bought a company with $700M EBITDA and has plans to "bump" that up to $1.5B with cost-cutting over the next year and a half. There is also decentralized operations, a focus on avoiding competitive areas, geographical diversity, focus on businesses not subject to government regulations (e.g. the bausch purchase), non-traditional accounting (you need to focus on cash EPS), willingness to walk from deals (they walked from a huge one earlier this year), his compensation agreement, more that I just can't think of right now. If you read the outsiders and then start to study this company, it's like you're reading another chapter in the book. The CEO is not that old either, there could be quite a future ahead. As for the pesky details of what you are paying, I go out on a limb and trust the cash eps forecasts that management puts out. You guys are probably trying to figure it out from the traditional statements and I commend you, but I didn't do that. With their cash EPS they add back amortizations, stock-expenses and one-time costs. It is a similar concept to owner earnings but probably a bit more aggressive than buffet would like. Anyways, they are forecasting ~$2.05 for Q4 of this year. However, the cost-cutting for bausch and lomb, plus other acquisitions will not be done by q4 of this year. I crudely estimated that with their total announced cost-cuts they will probably be looking at $2.3-$2.4 per quarter by Q4 of next year, that will be their rough run-rate. So around $9.5 per share cash earnings run rate in 15 months. So you are getting them for around 11x cash earnings once the cost-cuts are in effect. That is assuming that they stand still for 2014 and just cost-cut/pay down debt. I doubt they will do that. There will be more acquisitions / stock repurchases / a merger but something else will happen. IV is a tough one. I think it's more than you are paying now but probably not that much. Some of the other major pharma companies are around 13-14 times earnings. I think valeant deserves a bit more, maybe 14x. I actually think my 14 multiplier is probably too low, should be more like 16-18 given what he has done and the businesses he is in but you also have to consider how lean they run R&D and that their are concerns about organic growth. For that reason I pull it back to 14 as they will always need acquisitions. So if they get to $9.5 that is only $133 and that's not for 15 months or so. So I am buying a dollar a year from now for $.75. Not a great bargain but not overly expensive either. My view is that in a year they will be talking about 2015 earnings at $11-12 and the stock could be at $150. You really need to get comfortable with the CEO to buy into it. It's not a huge bargain unless you believe he can continue to work his magic. Thanks No Free Lunch! (Copied from other thread because this makes more sense here)

It's not politically correct and it's in bad taste (and I think a bad decision). But if you read the actual interview -- his point was that politicians were trying to put the blame AIG -- and led AIG employees to be unfairly targeted by the public. He was referring to AIG employees getting death threats and in one case he told the story of how a moronic teacher attempted to shame a little girl in front of her peers by saying her father worked at AIG. Yes it's in poor taste. Indeed, two wrongs don't make a right. 99% of the employees at the company probably had ziltch to do with the financial products unit, and certainly didn't deserve to be treated like criminals for doing their vanilla insurance jobs.

I think you might be interested. They basically do what valeant does, except with aerospace parts.