Subject: OXY
I just bought a 1.5% stake in Occidental, at $61.08, along the following line of reasoning:

(i) I am bullish about the prospects for oil and gas;
(ii) OXY trades at 4 times last year's earnings; obviously, the market expects that current oil prices are not sustainable, but I think they might be;
(iii) Buffett obviously likes it;
but mostly
(iv) Buffett's stake has now risen to 22.2% of Occidental's 900m shares; if you include the 83.9m shares that Buffett can buy for $5b worth of warrants (at $59.86/share), that number would be 28.9%. Interestingly, Berkshire purchased BNSF after it had acquired a 22.6% stake, very close to Berkshire's current stake in Occidental, and much smaller, if one considers the warrants.

Buffett being a creature of habit, and having a fine sense of convention, for instance, how much of a stake can you buy before you are conventionally supposed to make an offer to buy the whole thing, I am guessing that there is a X% chance that that offer will be made in the next month or so. What is X? I don't know. My guess is that it is 30. If I am right, he is likely to offer a substantial premium; for BNSF, it was 31.5%. That would mean something like $61.08*131.5%= just over $80, or $56b for the OXY shares that Berkshire doesn't already own. He would likely sell the $29b Chevron stake as part of the funding, and another $27b in cash would take care of another 9 months' worth of Berkshire's operating cash flow.

If I'm wrong, it's something I'm happy to hold onto anyways; if I'm right, I get at 0.5% bump to my portfolio in a month or three.

Any other guesses about X, or thoughts about the details of an offer if it happens?

DTB