locke

Yet Another Reason Not To Sell Your Berkshire Hathaway Shares

I have a screenshot on my home computer (sorry, I'm traveling so I can't post it now) from Scottrade of someone buying a LARGE number of BRK.B shares after-hours at HALF the value they trade while the markets are open.

I could not believe it when I saw this. This was back in January. I've been puzzling about this for a while.

Is Berkshire Hathaway Now a Bargain?

Doug Kass has no idea what he is talking about in this case. For example, he criticized Berkshire for calling derivatives WMD (due to the consequences of counter-party risk) then selling derivatives itself.

If Kass had actually read the letter to shareholders, he would know that Berkshire merely SOLD options. It has ZERO counter-party risk for this contract.

If Kass can't even do this simple research, his opinion shouldn't count for much.

Berkshire Hathaway's Derivative Play

He mentioned this in his 2007 letter to shareholders. He said there is no counter-party risk because he sold them, he didn't buy them. I'm not sure selling puts is properly referred to as "buying" derivatives.