Monty should have been hoarding cash rather than buying back your stock.
Now Monty will need that cash to pay claims.
You don't see Omaha foolishly buying back stock.
No thanks. Chances are you would do much better if you put the capital that you wasted on new shares of MRH to work investing in Apple. Apple a FAR better investment. The stupidity of some investors is imply stunning.
Since 1986, Berkshire has been my largest position. It's got the most to lose. I'm estimating 2-3 months of earnings may be lost. On the other hand, rates will rise dramatically as a result of this EQ, as well as other devastating EQs around the Pacific rim the last few years.
BRK also owns businesses that will benefit from the rebuilding of Japan but I'm not real sure how much businesses these U.S. based companies do overseas. I'll have to research it.
I'm still of the opinion that MRH will lose the first quarter's earnings due to the recent devastation that took place in Japan. If MRH should drop a few more dollars I'll just consider my recent investment as my contribution to help it rebuild. And I still intend to buy more as it drops and I certainly don't consider it even close to gambling.
If you're so certain the stock is dead money for a year you should reconsider your position on buying puts or shorting the stock. Plus, we could see another EQ strike in the near future that's even more destructive.
This report should make you LOAD the boat !!!
At a minimum, MRH is dead money for many quarters to come (but likely a declining investment). They better stop buying back shares and cancel the dividend in preparation for significant liabilities being realized. They may even have to issue new stock/debt diluting your current position.
Sounds like a reason to add to my position (in 5 separate accounts)? Boy... you do like to roll the dice !!!
Here are some facts to help sort through the speculation.
I don't bet against stocks because in theory your loss potential is unlimited. However, I sell them after I profit handsomely. Buying more when you have ZERO idea what Monty's risk exposure is you are simply GAMBLING and not investing. Smart money weighs the risk/reward. Looking at this stocks price history over the last three/four years and balancing with the biggest natural disaster in Japans history in 150 years. RISK clearly outweighs the REWARD. Only fools are buying on hope instead of information. Good Luck... you will need it !!!
Bought shares in 5 different accounts priced between 18.2 and 18.4 per share. Last night I caught the news and lowered my buy price on all these orders by about 3%. I thought I had an order in just under 18 but I didn't.
I have orders to buy more.
This hit could also adversely effect their share repurchase program. But their decescion to write less insurance and buy back their shares was the right decision as this event demonstrates.