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Berkshire Hathaway Inc. Message Board

  • ignoramus_ ignoramus_ Oct 2, 1998 1:22 PM Flag

    GOLD investment

    There is an awful low of smart ppl over here, so
    I thought
    that some may have fun solving a
    little problem while our BRK is tanking. I did solve
    it.

    Problem:

    You have 12 gold coins.
    One and only one of them
    is counterfeit.
    You do NOT know whether the
    counterfeit one is heavier or lighter.
    You only have
    balance scales.

    Find the counterfeit one, in no
    more than THREE weightings.

    How do you do it?

    SortNewest  |  Oldest  |  Most Replied Expand all replies
    • Only in America!

    • I think it smells like the early 70's again
      except without the high inflation.(Does the word
      impeachment sound familiar..??) Who knows what the market
      will do an year, a month, even a damn hour from now.
      As Buffett says, just keep your eye on a great
      business and buy it at a reasonable price and you can't go
      wrong. I don't think there's a better business on earth
      than this baby! let's hope the market drives BRK down
      to 5 cents a share then we can all go
      shopping!!!
      I love this quote from Ben Graham;" What investors
      need is first rasonably good intelligence; second,
      sound principles of operation; and third, and most
      important, firmness of character."

      Best of
      luck....and hang in there!

    • value investing really is
      stabilizing.

      momentum investing is the opposite.


      Junk bonds
      look extraordinarily cheap right now. I made 5
      fold
      on my money in Junk bonds in the eighties. Looks
      like a great
      buying opportunity in the next six
      months.

      I have a research assistant right now! An injured
      NFL running back that is recovering here in
      Charleston. Fifteen years of
      martial arts. He makes 450
      thousand a year while he is mending!

      Thought I
      would teach him how to play with the big boys so he can
      have his own team like Magic Johnson.

    • .............your valuation of NewBRK looks good
      to me and I think others are doing the same thing
      which is why IMHO present BRK seems to be builting a
      base at the $60,000 level. I see more and more
      analysts talking about "safe hiding places" and "flight to
      quality".........perhaps there's panic buying of BRK going on......best of
      luck...

    • yes, only one trader is needed. Anymore than that is terribly excessive.

    • <<Now interplanetary risk!!>>

      Are you Charleston Heston?

    • GRN _BRK merger value per share. How's
      this..?

      Going by last year's annual report, GRN had approx $24
      billion in assets, $16 billion of which were in
      bonds.
      Let's say approx 33% of that $24 billion is in equities
      (Although I believe it's a little lower than that as some
      of that money is in S/T cash, "other" etc.That's
      about $8 billion

      Now, let's allow for a
      correction, say a drop of 30% in the value of those equities
      since that report was printed. $8b- 30% =
      $5.6b.

      Add that 5.6B back to the bonds and that gives you an
      asset amount of approx 21.6b (Assuming GRN still has
      all those bonds)
      Or a total correction of approx
      10%

      In the report GRN stated an asset value of approx
      $317 per share. I'll use $300 to be safe. Allowing for
      that 10% correction as mentioned above that should
      bring the value of GRN's assets to around $270 per
      share.I believe Buffett paid about $276 per GRN share
      (Correct me if I'm wrong)

      Now, using the BRKb's as
      an example, it takes 30 GRN shares to recieve 3.15
      shares of BRKb.

      30 x $270 = $8000.

      $8000/
      3.15 = $2539 in BRKb value or around $76,170 per BRKa
      share.

      Of course this is only based on last year's annual
      report and you can bet the asset values have changed
      since then, especially on the BRK side but I believe
      this is quite a conservative estimation and does not
      take into account the obvious synergies that will come
      about once the BRK/GRNmarriage is
      consumated.;

      Any comments...???

    • There are great synergies between BRK and Merrill
      Lynch, if BRK could buy MER outright.

      Since
      Buffett knows everything about stocks, except some
      little
      areas like technology or ethical drugs, MER would be
      able to fire almost all their stock analysts and MER
      could simply publish WEB's opinions.

      That will
      lead to substantial cost savings.

      Then, most
      investment bankers will go because MER will teach their
      clients how to do M&As by themselves, like WB
      does.

      Investment bankers are very expensive and firing them will
      save even more money.

      Investment advisors will
      be replaced by tape recorded readings from Berkshire
      annual reports.

      The next people to go will be
      traders, because BRK has 40 billion worth of investments,
      yet gets by with one trader. So WEB could teach MER's
      clients how to to that, too.

      Then, MER will become
      a lean, mean, fighting machine. Perhaps they will
      move out from their WTC location to a warehouse in
      Georgia or Nebraska, and save some lease money too.

    • Two more mentions on CNBC this evening at 5:30 by
      Maria. Said again that WEB is rumored to be buying MER.
      Also, on the newswires. See below.....

      Activity
      in Merrill Lynch (NYSE:MER - news) options was
      featured as talk that legendary investor Warren Buffett
      was buying the underlying stock, traders
      said.

      ``That helped,'' said one analyst of the speculation.
      ``But in general, people seem to think that the worst
      is over for the financials.''

      Officials at
      Buffett's investment vehicle Berkshire Hathaway Inc.
      (NYSE:BRKa - news) had no comment on the rumors, in keeping
      with company policy.

    • Guess what, I am from a town 10 miles west of
      Gainesville--Muenster and know the area very well. Name one insurance
      company based in Gainesville!! Please.

      And
      apparently you don't know that not everything is in "the
      books".

      If Gainvesville, TX politicians scare you, then you
      are as paranoid as H. Ross Perot!!

    • View More Messages
 
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