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  • Since extending the Bush tax cuts would add trillions to the total debt, Simon Johnson believes letting them expire would be "the single biggest step our government could take" toward achieving the goal deficit hawks say they want: "a credible commitment to long-term fiscal sustainability [that] should reduce interest rates today, helping to stimulate the economy."  [View news story]
    No, the single biggest step our government could take would be to stop spending... today.
    Aug 12 06:14 PM | 11 Likes Like |Link to Comment
  • "Jobs now, deficits later" is the way to lift the economy, Paul Krugman writes, but it's not what the "serious" people in D.C. pursue: "Self-styled deficit hawks want to punish the unemployed even as they oppose any action that would address our long-run budget problems. And here’s what we know from experience abroad: The confidence fairy won’t save us from the consequences of our folly."  [View news story]
    How does paying the unemployed encourage them to get a job? He's a parody of a parody of himself at this point.
    Mar 25 05:17 PM | 10 Likes Like |Link to Comment
  • Why I Sold Out of China Media Express [View article]
    Hey guys,

    One, thanks for the personal comments. I knew they would come, so thanks for not letting me down. The one about me being bald was the best, btw.

    Two, I'll reiterate that I don't doubt at all that CCME exists, have a business, have some write-ups in Chinese, etc. What I'm saying is that I'm not comfortable with the level of media attention for a company with their growth. During my holding period I've also become skeptical of their figures and discovered some potential ways that they could inflate the figures. Auditors can be fooled, even from the big four, and it happens more often than anyone would like in China.

    Three, I am aware of the things people have found about Citron. I don't care, though. The questions raised in their report have been questions myself and others have been discussing for months. So whoever this guy is or whatever he's done in the past really doesn't have anything to do with the questions about the company. Some people, like rfredd, have found some answers to the questions raised. I encourage that, but those answers aren't robust enough for me.

    Four, I'll reiterate that I won't be buying the stock back if it drops more, and I won't short it. For the fund I run, my custodian doesn't even allow me to short, so it's a moot point. I'm not even entirely convinced that over the next six months the stock won't rise. Other Chinese stocks that have been proven to be frauds have actually gone up substantially after the proof has been presented! That's one of the points of my story. If someone wants to believe something so badly, some good questions that may challenge their thesis aren't going to get in the way.

    And for the record, I have a full head of hair. No offense to those who don't...
    Feb 1 09:08 AM | 9 Likes Like |Link to Comment
  • "Jobs now, deficits later" is the way to lift the economy, Paul Krugman writes, but it's not what the "serious" people in D.C. pursue: "Self-styled deficit hawks want to punish the unemployed even as they oppose any action that would address our long-run budget problems. And here’s what we know from experience abroad: The confidence fairy won’t save us from the consequences of our folly."  [View news story]
    Give me a break, Moose. The biggest problem for poor people is obesity, not hunger. Your compassion is noble, but misplaced. People who have been in my situation, growing up poor, know that nobody benefits from incentivizing laziness. Food stamps, Sec. 8, extended unemployment benefits, etc. destroy your work ethic. These programs don't help the poor. They hurt them.
    Mar 25 07:03 PM | 7 Likes Like |Link to Comment
  • "Jobs now, deficits later" is the way to lift the economy, Paul Krugman writes, but it's not what the "serious" people in D.C. pursue: "Self-styled deficit hawks want to punish the unemployed even as they oppose any action that would address our long-run budget problems. And here’s what we know from experience abroad: The confidence fairy won’t save us from the consequences of our folly."  [View news story]
    Sorry, but when you can get a hamburger at McDonald's for $1, no one is starving to death in this country. Krugman's policies would leave 10% of America paying for the other 90%. It's not an idealogical disagreement, it's simply applying logic to human nature.
    Mar 25 06:00 PM | 7 Likes Like |Link to Comment
  • 11 Stock Picks for 2011: My Top (Relatively Safe) Holdings [View article]
    Value investors in general are very open to sharing their holdings because they constantly want to test their theses. It's the Charlie Munger approach of turning things around and being able to defend your position in your own mind. It's a very healthy exercise and constructive criticism is welcome.

    Typically value investors like me are buying stocks that are out of favor, so by sharing our ideas, we're not worrying about being front-run by others. Most people don't like our picks, and that's okay. In fact, being naturally a contrarian, it's actually preferred.

    I buy and sell based on price and try to take the emotion out of it as much as possible. If a stock falls below the level that I think has a sufficient margin of safety, I'll start to open a position. If it goes down, I'll potentially add to it. Conversely, if the stock gets close to what I consider its fair value, I'll sell. I very much doubt an article like this would create enough "hoopla" to drive the price of, say, SuperValu to $18, which is the price I would sell it at.

    Look, I don't believe in beta. Volatility is good for investors like me. If a stock falls in price, and I believe that price drop isn't justified, I'll buy it. I think that makes the stock less risky, not more. In my opinion, risk is buying a stock at full price.

    My advice for you, mrgrbabu, is to use these articles for the ideas and to check your own research. I wouldn't simply copy the holdings. It should be a starting point. And, if I'm researching a company and am working through the facts, risks, etc, then sometimes these articles help to clarify a question.

    There's nothing sinister about it. We don't have anything to hide. In fact, I'll share my entire portfolio via e-mail. Just shoot me a line. That doesn't mean someone can successfully copy it since I adjust the allocations occasionally and since my brokerage costs are much lower than an individual's costs would be.

    Sorry about the length of this comment, but the point I want to make is that portfolio managers like me share ideas in order to make better decisions.
    Jan 19 08:19 PM | 7 Likes Like |Link to Comment
  • Why I Sold Out of China Media Express [View article]
    Yeah, I went through the lifecycle of it. True believer, some questions, nervousness, re-evaluation, etc. Just a lot more skeptical than I was in the beginning. If all is well with the company, it'll pop back up soon enough, but I think there are legitimate questions to be answered in order for there to be an acceptable comfort level knowing what I do now about possibilities of how to fudge the numbers and fool auditors.
    Feb 1 09:57 AM | 5 Likes Like |Link to Comment
  • High Conviction: The Buffett of Burgers [View article]
    MBKelly- I agree and would call it about fairly valued right now. This only goes into one part of the portfolio for us. Normally, I wouldn't buy into a fairly valued stock. Here, the value is in the management, which has the potential to create value where none exists right now, i.e. buying into a an insurance company.

    Hammer- It is a risk.

    John Galt- Love it

    Alex Morris- It is anecdotal, but reflects what the company has been telling us. It shows that capital spend alone doesn't improve a company. I think they now have customer service standards that weren't there in the past. That goes a long way towards more repeat customers. I mean, if the wait is long, you just can't go there for lunch repeatedly, ya know?

    Dr. Poly- I don't think Biglari should be managing Steak n Shake. His highest and best use is capital allocation.
    Apr 15 10:13 AM | 5 Likes Like |Link to Comment
  • Is Now the Time to Buy Hartford Financial? [View article]
    Hey Think-Speak: For the price range, what are you referring to that is already agreed upon to be incorrect? I used the historical P/E and low range of the historical P/B. Those aren't incorrect.

    Are you an EMT guy? The reason why the whole sector is cheap is because it's out of favor. There may be good reasons for it being out of favor, there may be bad reasons. There's a debate to be had regarding that, but Tom's comments above are a good start to the explanation.

    If you think the article needs to be rewritten, why don't you write it and post something rather than poking holes unnecessarily? I don't recall you giving me this assignment. If I wanted to discuss Allianz, I would have.
    Feb 4 11:38 PM | 4 Likes Like |Link to Comment
  • Hudson City Hits New Lows: Wait to See How Government Deals With GSEs Before Buying [View article]
    Good comment, gmen07. I don't disagree, but I'm always skittish when the government is involved. They can make things unpredictable. I just can't tell if the bad news is all baked into the stock price or not.
    Jan 24 12:25 PM | 4 Likes Like |Link to Comment
  • Weekend Research: 17 Stocks Hitting New Lows on January 21, 2011 [View article]
    Yeah, not sure why we don't move more in that direction. Ethanol use is such a bad idea, but we're increasing that, and not seriously looking at nat gas, especially for long-haul truckers.

    My guess is that Israel will be doing this, though, with their big gas find and need to get away from oil.
    Jan 22 10:23 PM | 4 Likes Like |Link to Comment
  • Hedge Fund Manager Chris Shumway to Hang It Up: Here Are His Top Holdings [View article]
    I count at least 11 different industries in those seven stocks. That's plenty diversified. Just owning more stocks doesn't make a portfolio diversified and doesn't mean it's less risky. You still have market risk. If he's done very deep research on his holdings, he's dramatically reduced market risk since he feels he knows the companies very well.

    It would be more risky to own 100 stocks that a portfolio manager doesn't know deeply (and isn't able to follow closely) than for him to own these 17.
    Feb 10 04:11 PM | 3 Likes Like |Link to Comment
  • Is Now the Time to Buy Hartford Financial? [View article]
    Tom: You're not the only one who is haunted by that memory. I think the recent history plays a role in depressed valuations. Time just needs to keep going by.

    Think-Speak: Hmmm, I certainly misspoke on Ace, but not HCC. Not sure why it was in my head that Ace was smaller when I was writing this. I suppose I was focusing on the U.S., but whatever. I was wrong. The fact that Hartford is a hybrid is why I'd be more interested in Ace or TRV. This column isn't a research report. You can find that elsewhere. Maybe I should have been more clear about their combined ratio. When I said it's not good, I meant compared to their competitors. Perhaps I'm misunderstanding you, but do we both not agree that it's cheap? When you say would Paulson unload at $39, are you being sarcastic? It seems reasonable that he would unload at $56, which is 1.2X.
    Feb 4 10:05 PM | 3 Likes Like |Link to Comment
  • Why I Sold Out of China Media Express [View article]
    Okay guys, this thread has gone off the deep end, so I'm going to check out. Send me a message if you have any specific questions.

    If you'd like to learn more about me, just Google my name.
    Feb 1 09:38 PM | 3 Likes Like |Link to Comment
  • Why I Sold Out of China Media Express [View article]
    No one in their right mind would short CCME. Even if your thesis was right, there's a huge chance the stock still goes up. It would just be stupid.
    Feb 1 09:16 PM | 3 Likes Like |Link to Comment
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