maz

Has Buffett Lost His Mind?

Duude,

Cap & Trade would benefit BNI far more than its likely loss of coal traffic - which in any case would not be disastrous - you can't switch electricity generating coal power plants overnight and they are around 50% of total.

OTOH cap & trade puts rail at enormous advantages over trucks so bring it on I say

Long term this looks good but I reckon Greenwald is right in the next 5 or even 10 years - BNI will not improve Berkshire's results much (except you could say that earning a pittance on billions in cash is a poor alternative) & you'd have to adjust Berkshire's valuation downward if that's all you considered. But this is still a long term triple play imo

1. Oil prices go up long term because of excess demand over supply - regardless of currency
2. Oil prices go up as the US$ devalues because they are quoted in US$.
3. Rail stands to benefit from any cap & trade or other climate change legislation.

#3 might end up being the biggest benefit. In Europe rail is used on much shorter distances than in the US because of much higher (2x) gas prices, congestion and a much stronger environmental lobby & we can expect these trends to eventually hit the US imo

So I'd agree short term he's outta his mind but long term he's got it right & the trouble is that investors don't want to look one year ahead never mind 10 :-)

Q4 Holdings of Bruce Berkowitz, Robert Rodriguez and Mohnish Pabrai

Sorry he holds Sears but didn't add - my mistake

Q4 Holdings of Bruce Berkowitz, Robert Rodriguez and Mohnish Pabrai

How can you say that selling out of Berkshire does not indicate a stand on the stock? At the end of June Berkshire was 10.67% of Fairholme's portfolio & the largest holding and today it is virtually nothing - Berkowitz was very specific as to his reasons

"We made this move because we cannot see how the company can replicate its past stellar performance given its current size and the age of its key personnel."

In the meantime Pfizer has gone from 10.26% to 18.73% so you could say he was selling Berkshire to buy Pfizer and other healthcare companies.

He also added to Leucadia, Sears and Canadian Natural Resources - companies run by very able capital allocators. So may be he's switching to younger & smaller :-)