GOLD VS OIL
ubuy2wron   2/3/2009   

Ericopoly you are right as usual a  taking out a 30 yea...

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Ericopoly you are right as usual a  taking out a 30 year fixed rate mortgage is an excellent inflation hedge . I am actively scouring foreclosed properties in AZ to do just that.

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GOLD VS OIL
ubuy2wron   2/3/2009   

The oil to gold ratio is what I was thinking about when I po...

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The oil to gold ratio is what I was thinking about when I posed the question, The ratio has ranged from a high of 36 to a low of approximately 7 over the last 30 something years. It is currently trading around 23 which is a relatively high ratio it has never traded consistently at a high ratio for a prolonged period of time. Gold is in great demand  currently as witnessed by the highest  cash premium paid for coins vs paper gold ,oil is trading in the strongest historical contango ( the futures prices are well above the cash price). I suspect that fears of future inflation is causing the brisk premium in spot gold and general fear (it is kinda scary out there if you are an investor) It seems prudent to model at least a greater chance for  inflation at some point in the not too far distant future. Inflation is a variable which can increase or decrease ones overall returns if one chooses vehicles correctly. I posit that half of the returns that rewarded equity investors from the mkt lows of Aug 82 to the peaks of 2000 were as result of the lower overall inflation and interest rates that occured during that era.  The multiple that Mr. Mkt. was willing to pay for $1.00 of earnings was much greater  and the end of the era than at the beginning. While every period of history is different there seems to be many similarities between 73- 74 and the present period.

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GOLD VS OIL
ubuy2wron   1/28/2009   

Gold is being rapidly accumulated by speculators currently w...

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Gold is being rapidly accumulated by speculators currently while oil is being dumped. What will provide a better inflation hedge lets say looking out 3-5 years from today. I am leaning towrds oil but any arguements pro or con would be appreciated.

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Canada is no longer a democracy
ubuy2wron   12/3/2008   

ANYTHING other than an election is a putsch. The opposition ...

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ANYTHING other than an election is a putsch. The opposition may run a coalition slate in a new election voters can decide I suspect the voters will punish the coalition plotters severely.

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Some new/old ideas
ubuy2wron   11/27/2008   

Aberhound, I like your TWF idea I have not bought i saw the ...

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Aberhound, I like your TWF idea I have not bought i saw the distribution cut comming and said I would purchase after. They will likely be offside on their covenants next year. Why has mgmt not done rights offering to give themselves breathing room 200 million in bank debt should just be made to go away

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SFK Pulp
ubuy2wron   10/28/2008   

Someone is unloading some sfk.db and the bonds are basically...

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Someone is unloading some sfk.db and the bonds are basically no bid. I suspect there is some convertible arbitrage positions being unwound here the bonds are currently trading with a 20% YTM

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US dollar rise built on shaky foundations
ubuy2wron   10/22/2008   

I have been busy converting U.S. to Cdn. I had earmarked a b...

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I have been busy converting U.S. to Cdn. I had earmarked a bunch of cash to purchase a US vacation home and converted the dough last Nov. I repatriated it back to Canada recently turns out to be the best trade I have made this year. Talk about uninteneded consequences.

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SEC is going to temporarily ban Short Selling
ubuy2wron   9/19/2008   

It appears that some of you are missing the advice of the sa...

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It appears that some of you are missing the advice of the sage of Omaha." I only buy companies that if the market shut down for 5 years I would not be concerned." I asked myself last Friday what companies would I buy today not knowing what the market would bring next week the simple answer was BRK and FFH. On another note it will be interesting to see what has the most effect on the short term mkt price for FFH, the banning of short sales or the reduction in value of the CDS positions. The last 2 weeks of Aug it appears that over 80% of all selling was short sales, with this source of supply removed what happens to the price.

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Whisper the Unthinkable
ubuy2wron   9/13/2008   

But no one can pull their deposits either. AIG has a problem...

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But no one can pull their deposits either. AIG has a problem that it will take 15 billion to fix unfortunatley for AIG shareholders it means massive dilution. I sold a call 2 hours after I bought the stock on Thursday sure glad I did.

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ORH to FFH
ubuy2wron   8/26/2008   

I think this has more to do with the large and growing short...

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I think this has more to do with the large and growing short position than anything else. It appears more than 1 million shares have been sold short recently. There have been large married put trades almost daily this gives the guys bullets to hit the bid to drive the price down this stock is easy to push around. A hurricane certainly does not hurt their cause however.

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Huge and growing put bet
ubuy2wron   8/19/2008   

Someone is making some pretty substantial bets that FFH is g...

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Someone is making some pretty substantial bets that FFH is going to trade lower. I estimate that well over 1 million shares have been sold short in the last 6 weeks form watching the synthetic shorts and the paired put trades being placed. Mr Munger always says invert, what is the compelling bear case for FFH.

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What's the Cheapest Canadian Stock?
ubuy2wron   8/15/2008   

PAP has been on value screens for 20 years. Always has been ...

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PAP has been on value screens for 20 years. Always has been cheap probably always will be until it is taken over sold or goes private very narrow moat with their business and impossible to get any real money into or out of stock. My pick would be VLN a hairs breadth away from being a net-net at current prices a decent moat in their business and you can actually buy a lot of stock here. I would not be at all surprised if the co. did a going private transaction I do not think the majority owners care much for the public co format especially since the mkt gives them such a lousy valuation. I think this is the kind of business that Warren would buy in a heart beat. The only complaint I have in how the business is run is that the ROE is a little low a problem that is not that difficult to fix if they were willing to implement a simple hedging policy.

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ORH to FFH
ubuy2wron   8/12/2008   

Cardboard the stock is weak because someone has created abou...

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Cardboard the stock is weak because someone has created about 1 million new shares and is aggressively selling them into the market. I agree with your take on the fundamentals there is no near term catalyst other than CDS issues which are going to drive reported earnings for the next few quarters. It seems perhaps the shorters stratedgy may be to take advantage of the lumpy earnings  model.  All I can hope for is that they get as aggressive as they were in the summer of 2006.

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ORH to FFH
ubuy2wron   8/12/2008   

I believe the cockroaches are pretty active these days in FF...

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I believe the cockroaches are pretty active these days in FFH. The Oct 300 put position is at 6700 contracts the short interest has just jumped some pretty large synthetic short positions have been just put on in the August expiry contracts. They are pounding the bid which is why the volume is up and the stock is down. I really do not know what they have up their sleeve but the negative bet has jumped by about 1 million shares I think we will discover soon enough as I expect that the usual suspects will start printing negative stories on FFH. I noticed today that the lawsuit is going to trial re the hedgies.

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Caltech Munger video
ubuy2wron   8/1/2008   

This is not supposed to be a trash Tilson thread but I watch...

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This is not supposed to be a trash Tilson thread but I watched him on CNBC last week. He is an owner of BRK and is a self described Buffet follower he did not think Buffet owned any AXP and did not think he would be interested in purchasing any . . It seems that he talks his book louder than any other manager out there and is a 24 hour 7 day a week self promotion machine tho I appreciate his kind words re FFH. I like to play a game with myself and that is try to guess what names Warren adds to his list and whatco,s he buys additional shares in. It seems to me that this is a pretty good test for how well you have learned the lessons of the master.

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Commodities are hot - but for how much longer?
ubuy2wron   7/11/2008   

The problem with your premise is the printing presses have n...

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The problem with your premise is the printing presses have not been running full blast. Both Europe and the Fed have quietly drained ALL of the liquidity they gave to the mkt in Feb, the loose monetary policy has been run in the BRIC economies and they have the inflation. Every energy bull references the insatiable demand from Chindia I wonder how much of that demand is local hoarding as prices are heavily subsidized in those economies and how much of the oil is quietly shipped across the borders to countries that are paying world prices for a little black mkt profit. It seems to me the the price elasticity for oil is greater in Chindia and the like than it is in developed economies there fore demand destruction should be more pronounced in those economies if and when world prices are paid by local consumers. The supply disuption premium is very real however "read war with IRAN" however in spite of that I am short oil right now and will add to my position if a disruption event occurs.

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