Ethan

Arbitrage Opportunity: Western Sizzlin/Steak 'n Shake Pair Trade

re: Jayhead: "Do you have a link to where Buffett talks of the mistake of issuing shares to expand?"

From the 2007 AR: "Finally, I made an even worse mistake when I said “yes” to Dexter, a shoe business I bought in 1993 for $433 million in Berkshire stock (25,203 shares of A). What I had assessed as durable competitive advantage vanished within a few years. But that’s just the beginning: By using Berkshire stock, I compounded this error hugely. That move made the cost to Berkshire shareholders not $400 million, but rather $3.5 billion. In essence, I gave away 1.6% of a wonderful business – one now valued at $220 billion
– to buy a worthless business."

Re: Siglari, I'm still not sure what to make of him. I don't know anything about the performance of the Lion fund. He did a good job with Friendly's, but that's just one data point. The options thing is a sign of either excessive risk-taking or immaturity.

And if you'll allow a pet peeve, he is a crappy writer but fancies himself a great one. A lot of ten cent words and dimestore Buffetisms.

Generally, he seems intelligent but also overconfident, and that can be a very, very dangerous combo for an investor.