Investment Strategies / Falling Knives
No. of Recommendations: 4
So given the dominance of one, just one, and the complete subservience to such? Maybe this is what anyone needing participation on the forum has to promote in order to sustain the platform. But the real, if anyone wanted to actually get real, admission would go like this:
Interviewer: "So over the last few years one thing has gone well for you but three others seem to have not been pretty to watch."
Mr. Dominant: "That is correct."
Interviewer: "You've been very helpful...particularly as to when to buy Berkshire."
Mr. Dominant: "Yes...absolutely yes."
Interviewer: "But then, well...there's your calls on Carmax, Dollar General, and Apple."
Mr. Dominant: "Yea...I missed those by miles and miles."
Interviewer: "Wrong is wrong, and really wrong is really wrong."
Mr. Dominant: "You got it!"
Interviewer: "Any chance we can get you to...well maybe bend you some as to always speaking in the parent ego state to your children?"
Mr. Dominant: "Probably not, my followers love it."
No. of Recommendations: 0
" Mr. Dominant: "Probably not, my followers love it."
Hopefully no one, overwrote calls when brk was, " fully priced" at 400,410,420,440,etc. Hopefully Americans didn't write, in the money calls in a taxable account. Same concept with overpriced apple, I guess. Tuff game.
No. of Recommendations: 10
Warren Buffett: “if you have an IQ of 150 sell 25 points you don’t need them. You need to be a little smarter than average but not brilliant. Super High IQs can even sometimes subtract from results..”
As a footnote. In this present environment here’s the profit center of major firms like Fidelity (shamelessly shaving 42 bps on MMs!), Schwab, etc….
1.) Holding your cash (I calculated about 1/3 of Fido’s income from all sources!)
2.) Margin interest lending
3.) Options commissions.
They PROFIT massively on THEIR side of the above transactions. Something to consider with “why risk capital when piles of cash plus smart opportunistic strategizing can do the trick?”
That’s why we intuitively reject Warren & Charlie’s: “its simple but it not easy”..
And instead do “it’s complicated and extremely difficult. And that EARNS REWARD”.
Warren Buffett “there are no bonus points for degree of difficulty”.
Our brains are wired to simply reject this thinking. There MUST be a reward for brilliance, right? There IS in almost all other walks of life, right?
No. of Recommendations: 5
Interviewer: “So you had one really smart person who generously shared his views on investing , generally, and on individual stocks that he liked (or disliked). Why did you cherry pick what sounded to you like ‘the best ideas’?
Mr.Copycat: “He sounded smart”.
Interviewer: “Did you mimic said investors entire portfolio so that said stock pick would incur the risk said smart investor assumed in relation to that sector, that asset category, and that overall asset mix?”
Mr. Copycat: “No. Smart investors are usually right”.
Interviewer: “you mean like Warren Buffett, with the most significant investment ever, the one he named his company after: Berkshire Hathaway? The textile business? Would you have followed Buffett. Into Berkshire, or—more safely—into a US textiles Mutual Fund?”
Mr. Copycat: No.
Interviewer: “Would you have invested in US Air? Then after Warren said “please give me a support help line to call if I ever get tempted to buy an airline” Buffett later loaded up on multiple airlines including one that needed to sell 3 weeks of full seats a month just to fund its debt? Would you have followed him?”
Mr. Copycat: “Again. Obviously not, I know good Buffett from bad Buffett. Those who copy smart copy well”.
No. of Recommendations: 30
"....you're so vain, you prob'ly think this song is about you...."If folks were as subservient as accused, they would heed my insistence that I haven't claimed Apple is overvalued! I merely value Berkshire's Apple holding it based on a multiple of the look-through earnings rather than on current market price, as explained for example here
https://www.shrewdm.com/MB?pid=104357813As I've noted any number of times, I certainly *hope* Apple is worth more than the number I pencil in, I'm merely unwilling to *assume* that that's the case just because Mr Market is in a buoyant mood.
When the market multiple is higher than the multiple I use, I ignore the price and just keep on tracking the earning power value, which sometimes leads to using a lower valuation than the market price. That's not the same as bearishness. True, P/E is pretty rough as way of valuing a firm, but I think it's way better than market price in this case: the stock price has risen about 10%/year faster than the earnings in the last decade. Not 10% total, 10% a year.
Besides, the rather arbitrary multiple I use (21) is considerably higher than what Apple stock got in the market at any time in the decade 2011-2020--hardly a permabear level.
One flaw in my approach did show up this past quarter, though: I didn't expect Berkshire to actually *realize* the high price for half the shares : )
Even after tax, Berkshire realized 24.7 times earnings.
(average cost basis $34.26, average sale price $196.27 in Q2 which was most of it, gross profit per share $162.01, 21% tax on gross profit $34.02, so net profit per share 196.27-34.02= $162.25, versus EPS of $6.57)
Jim
No. of Recommendations: 0
(average cost basis $34.26, average sale price $196.27 in Q2 which was most of it,
Curious how you arrived at the average sale price of $196.27 in Q2?
No. of Recommendations: 3
No. of Recommendations: 2
Curious how you arrived at the average sale price of $196.27 in Q2?
It's only an estimate.
The reasoning is outlined here
https://www.shrewdm.com/MB?pid=-2&previousPostID=5...
JimThanks for the reply / explanation.
FWIW, I believe the Q2 AAPL sales were at an average price per share of approximately $188.75 /sh. (that is the data I have for 89% of the shares sold during Q2)
No. of Recommendations: 3
FWIW, I believe the Q2 AAPL sales were at an average price per share of approximately $188.75 /sh. (that is the data I have for 89% of the shares sold during Q2)
That number seems reasonable, but how did you calculate it?
Note that my post was just an estimate, and started off with the comment "Somebody check my math..."
Jim
No. of Recommendations: 9
FWIW, I believe the Q2 AAPL sales were at an average price per share of approximately $188.75 /sh. (that is the data I have for 89% of the shares sold during Q2)
That number seems reasonable, but how did you calculate it?
Note that my post was just an estimate, and started off with the comment "Somebody check my math..."
JimIt's just from the insurance filings with NAIC. I only pulled the National Indemnity and Columbia Insurance files, which covered around 89% of the Apple shares sold in Q2. I can't upload the pdf or screenshots to this forum but here is the data for Q2:
National Indemnity sold 338,780,839 shares for proceeds of $63,825,930,938, actual cost $13,031,368,336 ($188.40/sh, CB $38.465 / sh.)
Columbia Insurance sold 6,375,472 shares for proceeds of $1,323,821,745, actual cost $363,011,140 ($207.64/sh, CB $56.9387 / sh.)
Average is about $188.75/sh. sale price for 345.156311m shares which is around 89% of the shares sold by BRK during Q2.
You can see that he sold higher cost basis shares later in the quarter at higher prices - suggesting he didn't start with the highest basis shares and current tax rates are indeed part of his rationale.
No. of Recommendations: 1
It's just from the insurance filings with NAIC.
Nice sleuthing, better than mine!
Jim
No. of Recommendations: 63
So given the dominance of one, just one, and the complete subservience to such? Maybe this is what anyone needing participation on the forum has to promote in order to sustain the platform.
What about your posts last year badmouthing Brookfield (BN) and CEO Bruce Flatt. BN is up 20% YTD and up more than 50% since Q4 of last year when your negative commentary was at its peak. I don't hold this against you because even though I appreciated you posting, I did not agree or act on your posts. I held on and in fact added to my BN.
Rec doesn't imply agreement and it certainly doesn't mean reader is pulling the trigger on an investment decision. Rec is simply appreciation from the reader to the poster for taking the time and putting the effort to post something thoughtful and insightful. It highlights to other readers that the post is worth reading. It could even be just a brownie point to encourage posting. I rec all posts on the Brookfield board to encourage posting including your posts.
It's no mystery why Jim is the dominant poster in terms of recs. He is a prolific poster of high quality posts. Naturally he gets the most recs, which again doesn't necessarily imply agreement. I don't see a problem here. Readers are not dumb and stupid as you seem to think they are. Please give them more credit.
Back to your question of what it takes to sustain this platform, the answer is simple: a constant flow of new posts! New content will keep readers coming back which in turn will churn out even more content thus creating a virtuous cycle. If we want this platform to thrive, we should all avoid acrimony which discourages posting. It's fine to point out that someone's call did not work as expected, but there is no need to do it in a contentious and condescending way.
No. of Recommendations: 25
As Charlie Munger has long noted, envy is the worst and saddest of the 7 deadly sins. At least all of the other sins you get to enjoy yourself while participating in them.
No. of Recommendations: 1
" If we want this platform to thrive, we should all avoid acrimony which discourages posting. It's fine to point out that someone's call did not work as expected, but there is no need to do it in a contentious and condescending way."
Which helps to explain why so many old-time posters left the message boards. BTW, I know for a fact that in the old days several posters used multiple IDs. Fools who can thumbs down or thumbs up 5-10 posts all day long, sick puppies. The current brk yahoo board has a few such idiots. Who knows if anyone here uses several Ids?
No. of Recommendations: 3
I find the posts of said poster, educational. Most people here are pretty educated about investing, and are able to choose to follow or not follow any recommendations.
No. of Recommendations: 37
"So given the dominance of one, just one, and the complete subservience to such? Maybe this is what anyone needing participation on the forum has to promote in order to sustain the platform. But the real, if anyone wanted to actually get real, admission would go like this:"
Please don't turn this into a Yahoo message board. The gentleman shares his thoughts which many of us find valuable. If you don't like his musings then can you please try to rebut without devolving into child like antics. That's all we ask. Please, anything but a Yahoo message board!
No. of Recommendations: 20
Dear dealraker,
Mr. Dominant is like an adult beverage. Adults may or may not partake as they please, but its at their own risk. Sort of a lot like real life, for adults, anyway. Mr. Dominant costs nothing, asks for nothing, and STILL caveats his musings fairly comprehensively.
As someone who accepts the responsibilities of Adult discussions without necessarily always comporting himself to the highest standards of that, I hope Mr. Dominant does not feel inhibited one iota by your response to him.
R:
No. of Recommendations: 17
Hey dealraker I just wanted to let you know that I really appreciate you and your posts and I suspect I’m not the only one. I don’t mind your style and in fact I find it refreshing. We need you on this board to make sure it doesn’t become too one-sided in its thinking. Self selection is a problem for any discussion forum as minority opinion can get pushed out. I’ve seen it happen to two other posters. It’s death by a thousand cuts with subtle derogatory comments. Please don’t pay any attention to it. Take care.
No. of Recommendations: 11
Two things I've always loved about chompin' Charlie (dealraker) is that 1.) he almost never sells a position and 2.) his stock market investments go up a lot.
