Subject: Re: Other than Berkshire...
Fairfax Financial would be my pick (and is also my largest single position)

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Hmmm, I've never felt entirely comfortable with them. A bit too close to financial engineering, and a bit to keen on large macro bets, leading to multi-year stretches that look great or terrible. More hat than horse.


Fairfax is also my largest position, by far. They have made a lot of macro bets in the past, most of them good, but I can understand how you wouldn't want to count on these. But in recent years, they also have very strong underwriting results, get a ton of leverage from their float, and they also have some of the favourable management practices we like with Berkshire, like low CEO pay, no use of stock options (although they have some stock incentive plans), and a long-term view. It seems to be like it has the kind of potential that Berkshire had 30 years ago, before its size ruled out most stock investments and the advancing age of its CEO made it hard to believe the stellar past results could continue for much longer.

What are you refering to with respect to financial engineering? This has been a frequent accusation by some analysts (most recently by Muddy Waters), but I can't really see any sign of it.

dtb