Buffett/Berkshire - general news

[DooDiligence]

Cherry Coke launches in china with Warren Buffett on the label -

 

http://www.cnbc.com/2017/04/03/cherry-coke-launches-in-china-with-cans-featuring-likeness-of-warren-buffett.html

 

Chinese love of old, wise and rich men!

WEB is sort of the 21st century Buddha.

 

Ayup...

[alpha]

Berkshire Hathaway Home Services announced a partnership with Juwai.com:

 

http://www.bnn.ca/berkshire-hathaway-partners-with-chinese-real-estate-site-juwai-com-1.726283

[fareastwarriors]

cash - usual deal spec

 

https://www.bloomberg.com/news/articles/2017-05-01/buffett-s-86-billion-cash-pile-has-some-dreaming-of-a-huge-deal

[gfp]

QSR did a bond issue with the stated intention to redeem BRK's 9% preferred:

https://www.sec.gov/Archives/edgar/data/1618755/000119312517156640/d390898dex991.htm

 

 

from the original securities purchase agreement - looks like they will redeem in full or in part before October, no redemption premium:

"Optional Redemption

The Issuers may redeem some or all of the Notes at any time prior to October 1, 2017 at a price equal to 100% of the principal amount of the Notes redeemed plus a “make whole” premium and, at any time on or after October 1, 2017, at the redemption prices set forth in the Indenture. In addition, at any time prior to October 1, 2017, up to 40% of the aggregate principal amount of the Notes may be redeemed with the net proceeds of certain equity offerings, at the redemption price specified in the Indenture."

[gfp]

http://www.cnbc.com/2017/05/04/warren-buffett-has-revalued-ibm-downward-cites-big-strong-competitors.html

[Txvestor]

I had wondered how long it would take for him to finally throw in the towel. This last Q of declining revenues was what did it for me. Management has zero credibility left. They have misread the trends and underestimated the new entrants and I fear permanently impaired their competitive position. They have further compounded their woes by weakening their balance sheet with recent stock buybacks and dividend hikes. All of this can only work when you later find the growth and increased profitability. All their financial shenenigans are now coming home to roost.

[sleepydragon]

I had wondered how long it would take for him to finally throw in the towel. This last Q of declining revenues was what did it for me. Management has zero credibility left. They have misread the trends and underestimated the new entrants and I fear permanently impaired their competitive position. They have further compounded their woes by weakening their balance sheet with recent stock buybacks and dividend hikes. All of this can only work when you later find the growth and increased profitability. All their financial shenenigans are now coming home to roost.

 

Plus the excessive CEO compensation.

[John Hjorth]

"Ordinary" AGM Press Release of yesterday, including streaming info.

[gfp]

In case anyone else is curious about the shareholder intelligence firms Buffett referred to in his CNBC interview, here is an example of one -

 

http://www.shareintel.com/howitworks.cfm

 

Here is the interview in the Kiewit plaza lobby in its entirety from Becky Quick.  She was kind of surprised to receive the scoop / breaking news.  "Why are you telling us this?"

 

http://video.cnbc.com/gallery/?video=3000616150

[John Hjorth]

Awesome interview! - Mr. Buffett is now at the age of 86 - still sharp as a razor - even in situations with headwinds. [i wonder if we will see Amazon in the Berkshire portfolio in due course?]

 

- - - o 0 o - - -

 

Kicking in a footnote here:

 

globalfinancepartners,

 

You are doing a great job for us all here at CoBF taking the time to guide other board members to interesting things! - Tirelessly and consistently - It is very much appreciated!

 

Thank you!, - and have a nice weekend.

[DooDiligence]

In case anyone else is curious about the shareholder intelligence firms Buffett referred to in his CNBC interview, here is an example of one -

 

http://www.shareintel.com/howitworks.cfm

 

Here is the interview in the Kiewit plaza lobby in its entirety from Becky Quick.  She was kind of surprised to receive the scoop / breaking news.  "Why are you telling us this?"

 

http://video.cnbc.com/gallery/?video=3000616150

 

WEB hates cash!

 

At Geico "you can almost hear the checks hitting the mailbox..."

 

Housing strong but people holding off on furniture.

 

Apple borrowing $ from US to buy back shares (until repatriation - my words not his)

 

Modest hiring of RR employees.

 

Disclosed the IBM sale (good call doing it before 13F & the meeting) & said he should've bought the S & P instead of IBM.

 

Picking losses for future harvest.

 

Still uses a flip phone.

[gfp]

DD, I believe the comment about people holding off on purchases from his sources at the Furniture Mart was in reference to the iPhone, not furniture.  NFM has a large electronics business as well.

[Charlie]

As a warm-up for the annual meeting. Here is the transcript of the Becky Quick interview:

 

http://www.cnbc.com/2017/05/05/cnbc-excerpts-billionaire-investor-warren-buffett-speaks-with-cnbcs-becky-quick-ahead-of-the-berkshire-hathaway-annual-meeting.html

 

 

Cheers!

[DooDiligence]

DD, I believe the comment about people holding off on purchases from his sources at the Furniture Mart was in reference to the iPhone, not furniture.  NFM has a large electronics business as well.

 

I read that wrong - thanks...

[sleepydragon]

In case anyone else is curious about the shareholder intelligence firms Buffett referred to in his CNBC interview, here is an example of one -

 

http://www.shareintel.com/howitworks.cfm

 

Here is the interview in the Kiewit plaza lobby in its entirety from Becky Quick.  She was kind of surprised to receive the scoop / breaking news.  "Why are you telling us this?"

 

http://video.cnbc.com/gallery/?video=3000616150

 

I wondering if company like this is legal? Effective the CEO and certain executives can have access to information that's never available to  public investors. SEC shall ask such information be published with delays (same as 13F) and watch for anybody who get access to this information and trade on it.

 

[gfp]

Berkshire applying to the Federal Reserve to continue to hold an ever-increasing percentage of Amex, due to AXP's share repurchases.  Same deal as Well's, hopefully with a better outcome for BRK ->

https://www.bloomberg.com/news/articles/2017-05-19/berkshire-asks-fed-to-boost-cap-on-amex-ownership-to-almost-25

 

oops - I see this was already mentioned on the AXP thread - my apologies

[sleepydragon]

Berkshire applying to the Federal Reserve to continue to hold an ever-increasing percentage of Amex, due to AXP's share repurchases.  Same deal as Well's, hopefully with a better outcome for BRK ->

https://www.bloomberg.com/news/articles/2017-05-19/berkshire-asks-fed-to-boost-cap-on-amex-ownership-to-almost-25

 

oops - I see this was already mentioned on the AXP thread - my apologies

 

So what Feds can come up with now. Berkshire not allowed to use AXP cards? lol

[gfp]

It's funny - Berkshire was required to run a tiny ad in a newspaper in NYC to publicly announce this -

https://www.bloombergquint.com/markets/2017/05/22/buffett-plan-revealed-amid-ads-for-co-op-strippers-old-honda

[gfp]

I noticed something today for the first time while re-reading Berkshire's most recent 10Q (while stuck at the Social Security office waiting room for 2 hours..)

 

On page 39 of the PDF 10-Q from Berkshire's own website, the company notes that starting in 2018 they will adopt a new accounting standard that will reclassify the net unrealized gains for investments (presently reflected in accumulated other comprehensive income) to retained earnings instead.

 

The important part of this, as I understand it, is that going forward the changes in both realized AND unrealized gains in equity securities and certain other investments will be included in the periodic Consolidated Statements of Earnings.

 

Berkshire notes, "We do not expect the adoption of this standard will affect our total consolidated shareholders' equity.  However, it will likely produce a very significant increase in the volatility our periodic net earnings given the magnitude of our existing equity securities portfolio and the inherent volatility of equity securities prices."

 

So - economically, zero change.  But the headline earnings reporting is going to be a mess some quarters.  Too bad.

[rb]

There will probably be a line on the P&L for gains/losses in securities. So you should be able to easily back those out to get to "normalized earnings".

 

Aside note: Why do you guys have social security offices?

[Guest longinvestor]

I noticed something today for the first time while re-reading Berkshire's most recent 10Q (while stuck at the Social Security office waiting room for 2 hours..)

 

On page 39 of the PDF 10-Q from Berkshire's own website, the company notes that starting in 2018 they will adopt a new accounting standard that will reclassify the net unrealized gains for investments (presently reflected in accumulated other comprehensive income) to retained earnings instead.

 

The important part of this, as I understand it, is that going forward the changes in both realized AND unrealized gains in equity securities and certain other investments will be included in the periodic Consolidated Statements of Earnings.

 

Berkshire notes, "We do not expect the adoption of this standard will affect our total consolidated shareholders' equity.  However, it will likely produce a very significant increase in the volatility our periodic net earnings given the magnitude of our existing equity securities portfolio and the inherent volatility of equity securities prices."

 

So - economically, zero change.  But the headline earnings reporting is going to be a mess some quarters.  Too bad.

A question regarding this was batted away by Buffett and Munger as not material.

 

But who knows, some robo-ai algorithm could drive stock down to1.3x for me and 1.2x for the buyback.Make that happen, ha.

[Jurgis]

Aside note: Why do you guys have social security offices?

 

OT.

 

Why not?

My relative needs to do file a form because their spouse died. They'll probably go to the SS office. It's possible to do via phone, but likely then they would need to send in docs anyway. Which is a hassle and will take ages. Not sure if it can be done over Internetz. I think not especially since spouse died abroad, so good luck getting foreign death cert into Internetz.

 

Closer to topic: they went through this issue with BAC. It took almost a year of sending paper forms through letters. The positive side is that BAC seems to finally done everything right. I have a friend whose parent died and BAC screwed up the whole thing royally. Not that this would affect investment into BAC... other banks have similar issues regardless of size. Actually sometimes smaller banks screw up even more.

 

Anyway, we shouldn't hog the thread. Move to general for more discussion if you want.  8)

[gfp]

"Aside note: Why do you guys have social security offices?"

 

Most people are applying to receive benefits, either retirement or disability benefits.  It is a mix of homeless people, disabled people and the elderly.  I was there with an adopted child who obtained U.S. citizenship last week and is required to appear in person to receive a social security number/card for the first time.  Two days in a row, the answer was "no".  Today's gem from the supervisor was, "a US passport is not proof of US citizenship."  Oy.

[alpha]

BRK buys a stake in Lanxess

 

https://www.bloomberg.com//news/articles/2017-05-29/buffett-buys-stake-in-german-specialty-chemicals-maker-lanxess

[KinAlberta]

I noticed something today for the first time while re-reading Berkshire's most recent 10Q (while stuck at the Social Security office waiting room for 2 hours..)

 

On page 39 of the PDF 10-Q from Berkshire's own website, the company notes that starting in 2018 they will adopt a new accounting standard that will reclassify the net unrealized gains for investments (presently reflected in accumulated other comprehensive income) to retained earnings instead.

 

The important part of this, as I understand it, is that going forward the changes in both realized AND unrealized gains in equity securities and certain other investments will be included in the periodic Consolidated Statements of Earnings.

 

Berkshire notes, "We do not expect the adoption of this standard will affect our total consolidated shareholders' equity.  However, it will likely produce a very significant increase in the volatility our periodic net earnings given the magnitude of our existing equity securities portfolio and the inherent volatility of equity securities prices."

 

So - economically, zero change.  But the headline earnings reporting is going to be a mess some quarters.  Too bad.

 

 

Smells like an opportunity generator.  :-)