Warren Buffett: Out Of Proportion To Reality? [View article]
There is an important thing to notice about Berkshire. An increasing amount of its value comes from using its own purchasing power to vindicate the value of the portfolio, from large percentage buying of the stock they own to outright acquisitions. Indeed it looks messy and much of the "value" is suspect as they get into financials and insurance.
Indeed, Buffet is right not to get into anything you can't understand. This is a thesis as to why he's not heavily into tech, but also should have been a reason not to get into financials and insurance.
As for me, I ascribe to Graham and Dodd and feel Berkshire has long strayed from the value investing that made it such a success in the past.
Respectfully Disagreeing With Buffett's Recent Views On Gold [View article]
In many ways buffet attempts to discredit gold for the same reason one may try to discredit the concept of holding any money save the fact it doesn't have a bank system to accrue interest by loaning it. Certainly if we were on a gold standard or allowed gold to be a tier one asset then interest in loaning gold would be regular and usual and its investment asset more secure.
The reason gold is arguably a bad currency is that its actual production dies not increase with a massive rise in goods and services. However, arguably though fiat currency does it has a nasty side effect of requiring the indebtedness of others to come into existence. This is tolerable as long as much of it is collective debt (government) however, as we can see the true cost still falls on us eventually. They hope one doesn't notice, but in this time and age it is apparent that the citizens are impoverished by debt driven from the government because they are the ultimate ones who will inevitably have to pay or suffer under a national default.
There are better alternatives, such as Lincoln's greenbacking (printing government paper with no debt. However, there is no proof that long term the government won't misuse it), adding other commodities besides gold and silver to a commodities backed currency, a hybrid system, issuing debtless currency equally to everyone at roughly the speed of economic increases of goods and services, etc. In reality Buffet's argument doesn't serve to help in developing a sustainable currency regime, it just clouds it with useless objections.
Greenlight Capital: The Next Berkshire Hathaway? [View article]
I wonder how much counter-party risk they have on their CDS portfolio. The reason to stay away from TBTF banks is the same reason why this trades at a discount: exposure to CDS and other potential illiquid derivatives with poor accounting rules. Other than that this is worth watching but I don't see the spark of genius or clarity of methodology that Buffet had and has now lost. Owning Microsoft sort of blows a hole out of his tech savvyness.
Why Won't Warren Buffett Give Us Our Money Back? [View article]
Good call. LOL especially when the Berkshire team skims profits off of deals before they get bought out by Berkshire. Buffer is not on the ball at all. Even when this was pointed out he was not astute enough even to look into the facts and defended him until it became very evident that the guy traded in front of Berkshire.
Why Berkshire Is An Even Better Deal Than Buffett's Buyback Suggests [View article]
Berkshire is operating like an investment bank or high risk AIG like insurance company thanks to investment in isurers and banks. Book value is squishy on these because pinning down all liabilities and the real value of assets is an accounting game more than hard fact. Buffet has deviated from Graham and Dodd strict fundamental value investing a long time ago and it shows. It is also why people are irate at him trying to profit off of the government bank bailouts and getting high payout special treatment for investing in banks that destroy everyone else's wealth.
Why Berkshire Hathaway Will Underperform In The Long Run [View article]
Buffet and Berkshire have not been investing fundamentally from my perspective for a long time. Banks, financial, and insurers are all questionable fundamental investments with banks being nontransparent, highly levered, and cyclical. Graham and Dodd would turn their nose up at BAC investment even with sweeteners simply because it's not value investment preached by Buffet for so long which is sad. Berkshire trades at a discount because it no longer has a fundamental value investment portfolio.
Buffett's Deal With Bank Of America Is Absolutely Terrible... [View article]
Couched in the terms it says Buffet can choose to withdraw his stake at anytime and book a 5% gain. That is not much risk and something no other creditor has.
Why To Consider Buying BofA Like Buffett [View article]
Don't be a sheeple and buy BAC because Buffet did unless you get exactly the same deal he does. BAC will not allow it because if they did they'd be bankrupt in a day showing just how bad Buffet's deal was for them and current shareholders. Bank of America is still a very dangerous trade.
Sell The Pop - Bank Of America's Deal Reeks Of Desperation [View article]
It doesn't take a brain scientist to know that Buffet got a sweet deal and shareholders got shafted (providing that their stock wouldn't go to nothing without this). Most people could sign this deal blind. It proves nothing about his astuteness. Only that he is offered deals you and I can't get. Today buying Bank of America is a worse deal for you than yesterday save his paid endorsement.
Buffett's Stake In BofA: What Does Warren Know? [View article]
Warren knows he got a very sweet deal that is making him over $700 million off the bat at current prices on the warrants alone. Whether or not that evaporates later has yet to be seen. Anyway that's all creme. He takes almost no risk and I am sure the Treasury and Federal Reserve are in on it too somehow invisibly backstopping a measly $5 billion.
Expect Bank of America's management that insisted it needed no more capital to dilute their poor deluded shareholders some more this year. You should be able to sue Bank of America's management for blatant lying.
Buffett's Deal With Bank Of America Is Absolutely Terrible... [View article]
I thought Bank of America didn't need to dilute its stock with more stock? Apparently it does and apparently it needs it badly given the terrible price its paying. It will also be interesting to see if or when it needs more capital. I have a feeling it is paying for a Buffet like endorsement so it can try to raise billions more. Don't be a sucker and buy on to more capital raising thinking Buffet made sure Bank of America's assets are golden. He is just in this to skim money off of Bank of America.
This shows just how bad Bank of America's management is. #1 they just proved they are liars. #2 The author is right this is a lousy deal. #3 They clearly don't know the concept of the time value of money. #4 The warrant deal is suck a raw deal for shareholders I hope the stock sinks back down and never rises above the dilutionary level of the warrants. You pretty much can't give a worse dilution deal. And yet Wall Street is cheering this which makes me wonder, just how bad off is Bank of America that its willing to give up $1 billion off the bat for $5 billion and throw in mass warrants for even more dilution? A lot of people looked over the books before and turned their noses up. I wonder what they think of this deal?
Warren Buffett's High Conviction Investments [View article]
If he sells his stake he will tank the stock even further. Perhaps he can get parity. The point is, he is going well off the beaten path of what he knows well.
Warren Buffett's High Conviction Investments [View article]
"Buffet only picks businesses he knows very well". Do you mean like BYD, Moody's, Lubrizol, Goldman Sacs, and railroads? Buffet has diverged from his own game plan a long time ago and is now in leauge with the scammers (BDY), the market manipulators and insiders Goldman Sacs and Moody's, and is looking for whatever deals he can make with the taxpayers as a backstop like Goldman Sacs. The fact his staff could pull the wool over his eyes on Lubrizol and BDY shows he is far from top form. If you want fundamental investment don't cut corners and follow someone blindly. Do it yourself after reading Graham and Dodd's security analysis.
S&P Downgrades U.S. to AA+ - We're Tied With Belgium! [View article]
Yes, printing money is a kind of economic cheat. It really shows up when you print more money in excess of real growth in goods and services. We are seeing that now and that increasing government spending adds little to nothing to growth in goods and services. In fact, often it ends up slowing it even further as the private sector gets bureaucratized.
S&P Downgrades U.S. to AA+ - We're Tied With Belgium! [View article]
Yes, money printing leads to debasement and higher rates demanded eventually along with rising inflation. Right now we are exporting the inflation to China who is pseudo-pegged to us right now. In that regards we are lucky and unlucky. We export our inflation but keep hemorrhaging money to them as they keep their already very low costs even lower.
Warren Buffett: Out Of Proportion To Reality? [View article]
Indeed, Buffet is right not to get into anything you can't understand. This is a thesis as to why he's not heavily into tech, but also should have been a reason not to get into financials and insurance.
As for me, I ascribe to Graham and Dodd and feel Berkshire has long strayed from the value investing that made it such a success in the past.
Respectfully Disagreeing With Buffett's Recent Views On Gold [View article]
The reason gold is arguably a bad currency is that its actual production dies not increase with a massive rise in goods and services. However, arguably though fiat currency does it has a nasty side effect of requiring the indebtedness of others to come into existence. This is tolerable as long as much of it is collective debt (government) however, as we can see the true cost still falls on us eventually. They hope one doesn't notice, but in this time and age it is apparent that the citizens are impoverished by debt driven from the government because they are the ultimate ones who will inevitably have to pay or suffer under a national default.
There are better alternatives, such as Lincoln's greenbacking (printing government paper with no debt. However, there is no proof that long term the government won't misuse it), adding other commodities besides gold and silver to a commodities backed currency, a hybrid system, issuing debtless currency equally to everyone at roughly the speed of economic increases of goods and services, etc. In reality Buffet's argument doesn't serve to help in developing a sustainable currency regime, it just clouds it with useless objections.
Greenlight Capital: The Next Berkshire Hathaway? [View article]
Why Won't Warren Buffett Give Us Our Money Back? [View article]
Why Berkshire Is An Even Better Deal Than Buffett's Buyback Suggests [View article]
Why Berkshire Hathaway Will Underperform In The Long Run [View article]
Buffett's Deal With Bank Of America Is Absolutely Terrible... [View article]
Why To Consider Buying BofA Like Buffett [View article]
Sell The Pop - Bank Of America's Deal Reeks Of Desperation [View article]
Buffett's Stake In BofA: What Does Warren Know? [View article]
Expect Bank of America's management that insisted it needed no more capital to dilute their poor deluded shareholders some more this year. You should be able to sue Bank of America's management for blatant lying.
Buffett's Deal With Bank Of America Is Absolutely Terrible... [View article]
This shows just how bad Bank of America's management is. #1 they just proved they are liars. #2 The author is right this is a lousy deal. #3 They clearly don't know the concept of the time value of money. #4 The warrant deal is suck a raw deal for shareholders I hope the stock sinks back down and never rises above the dilutionary level of the warrants. You pretty much can't give a worse dilution deal. And yet Wall Street is cheering this which makes me wonder, just how bad off is Bank of America that its willing to give up $1 billion off the bat for $5 billion and throw in mass warrants for even more dilution? A lot of people looked over the books before and turned their noses up. I wonder what they think of this deal?
Warren Buffett's High Conviction Investments [View article]
Warren Buffett's High Conviction Investments [View article]
S&P Downgrades U.S. to AA+ - We're Tied With Belgium! [View article]
S&P Downgrades U.S. to AA+ - We're Tied With Belgium! [View article]