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Semper Augustus letter

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crocodon:
Interesting and extensive discussion on valuing BRK: http://www.semperaugustus.com/2016BRK.aspx

Libs:
Thanks for posting - I thoroughly enjoyed it, especially the 1999 reprise.

John Hjorth:
crocodon,

Thank you very much for sharing this piece on BRK valuation. It is - by far - and so far - the best piece I have ever read about BRK valuation. H/T for this work of Christopher P. Bloomstran.

I started reading it yesterday at about 10:00 PM, and got "sucked into it" - like was it a black hole - and stopped reading at about 5:00 AM [this morning], without finishing it in full.

To me especially the sections in the piece about:

* The BRK/General Re merger
* Deferred taxes related to the regulated & capital intensive businesses
* Riskare worth the read.

Again, thank you for sharing.

longinvestor:
Awesome. Thanks for posting.

FANG & LEMMINGS commentary captures very well where BRK was in 1999 and is right now. Perhaps will be in 2030...it's deja vu all over again!

longinvestor:

--- Quote from: John Hjorth on April 08, 2016, 10:05:07 AM ---crocodon,

Thank you very much for sharing this piece on BRK valuation. It is - by far - and so far - the best piece I have ever read about BRK valuation. H/T for this work of Christopher P. Bloomstran.

I started reading it yesterday at about 10:00 PM, and got "sucked into it" - like was it a black hole - and stopped reading at about 5:00 AM [this morning], without finishing it in full.

To me especially the sections in the piece about:

* The BRK/General Re merger
* Deferred taxes related to the regulated & capital intensive businesses
* Riskare worth the read.

Again, thank you for sharing.

--- End quote ---

Yes, this piece has been "sucking me in" to read again and again. It's a keeper!

The section on risks is very good. If I worry about anything relating to my large holding of BRK, the "kill me slowly" scenario captures it. Specifically, increasing mediocrity at the subs as leadership transitions happen in the future. Will try to understand as time goes on. Hope this is 30-50 years out. Will be quite old to dead and would be time to go all-in to index funds then, ha!

In the mean time, the "kill me fast" scenario playing out really soon will separate BRK away from the crowd once and for all; the perfect storm mega cat insurance event year, another big one like 2008 etc. happens soon at a time when BRK is sitting on $100B of liquidity. While the world fixates on Buffett's age or the next CEO or BRK's size, the prospects for the BRK shareholder is going to be all about what happens to the other guy, whether in reinsurance or the other utility or railroad etc. in either the "kill me fast or slow" scenarios. Not so much @ BRK. We will take the 1% return on equity over what happens to the other guy, won't we?

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