RogerScott

Alternate Business Models that Drive Retail Brand Value

Closing on Sunday is an indication that the manager/owner has values other than greed which is appreciated by non Christians and Christians. Also, employees appreciate knowing that one day will always be a no work day. This is bound to have a marginal effect on employee quality.

Why I'm Shorting Moody's

McDonald's has done quite well.


On Oct 16 06:35 PM Angry Banker wrote:

> And the most compelling reason to short Moody's.... Warren Buffett
> has been selling his stake, meaning the company has no future (just
> take a look at the current state of most other companies that Berkshire
> has bailed on in the past....)

BYD: Risky Now, Value Later

BYD is not the first foreign purchase. There is POSCO, Tesco and Iscar. BRK use to own a large share of Petro China.

Einhorn vs. Buffett on Moody's

Buffett's non use of ratings is not relevant. He would not depend on any outsider even if they were excellent. He has the skills to do his own analysis which is going to be the same or better than the best analyst for any business in his circle of competence. If Einhorn made a big deal about Buffett, he misunderstands him or perhaps he is abusing his name.

Burlington Northern: Then and Now

BNI is not a near term investment, nor will you make a huge return because of large capital investments. BNI's long term attraction is based on:
1. Taxpayers will be less willing to subsidize the trucking industry through highway maintaince and increasing capacity of highways for trucks.
2. BNI is well managed.
3. Higher fuel prices caused by reaching peak oil will give BNI a competitive advantage over trucking.
4. BNI is a strong franchise. It cannot be duplicated. There is no substitute for railroads (shipping heavy loads over land) based on known technology.
5 Trade over long distances will increase only constrained by fuel costs.

Two Mortgage Markets Emerging from the Crisis

thanks. quite helpful.

It's Not So Easy to Know What Buffett Is Buying

Also, Berkshire sometimes asks SEC to defer the required notice of holdings and sometimes SEC consents. Therefore, watchers of SEC filings sometimes assume BRK has sold a holding when actually it is buying more.
A likely signal that Simpson is behind a holding is to look at which subisidiary owns the stock. Simpson manages the GEICO portfolio.
Sometimes BRK buys a stock because of opportunities caused by a pending spin off. Do your independent research.
Simpson in the past decade or so has been a better stock picker than Buffett, according to Buffett.

Buffett Serving Free Lunch? (Part II)

Any risk on 2019 stock market can be covered by investing the premiums in government securities. The amount of the bet will be tiny compared to the 2019 market size. You have not provided evidence that the BRK bet will affect the 2019 stock market.

Share Buybacks: The Anti-Buffett

Buffett, as a board member, has encouraged several corporations to buy back shares, including Washington Post and CocaCola. It should only be done when the price is well below intrinsic value and there is still plenty of cash available to weather a downturn. Of course, many companies have violated both rules.

Some Consequences if Oil Prices Stay High

The market is already reacting. PCAR is down about 30% and BNI is up about 10% YTD.

Tempting Buffett

I think he is buying more of 2 or 3 of his big four. I think AXP is one of them. We will know soon.

Is Warren Buffett Missing Something?

The last I read was that the price BRK was to buy Wrigley was less than that paid by Mars and the BRK was not disclosed. Also, I have no news about the interest rate BRK is receiving. So, I think the deal needs to be considered as a package. Since we know neither the price of the debt nor the equity, I don't know enough to make a judgment. I don't know how someone else can unless he know the terms.
Wrigleys is an excellent company and is probably worth 30P/E.

Why I am Selling Thornburg Mortgage

I sold for two reasons.
1. Management was not giving the public enough information to make a fair estimate of what the balance sheet looked like after selling assets at a discount, e.g. they did not tell me how much discount from their basis they sold assets.
2. After the big fall last summer, TMA increased repos instead of substituting long term liabilities. Contrast TMA with Redwood Trust which has almost no short term debt and has deleveraged for the last several years.
Looks like poor management.
Roger Scott

Berkshire Hathaway Appears Undervalued

I think Philip is missing an important point. Buffett is giving only B shares to the Gates foundation. He converts his A shares to B shares before gifting. I only logical explanation for this practice is that he wants to not dilute family and close friend voting powers. While the economic value of a B share is 1/30 of an A share, the voting power is 1/200 of an A share. See note 17 in the 2006 annual report.