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Berkshire Hathaway Inc. Message Board

  • alwaysbuycheap alwaysbuycheap Aug 28, 2003 10:17 AM Flag

    How much cash?

    Just wondering, but how much cash are people keeping in their portfolios now? Maybe that's the most attractive "asset" right now? Yuck.

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    • <<Move to a non-community property state before getting divorced! >>

      or as Munger teaches us...Invert!

      try to marry someone (you love and find attractive) who also earns more than you?

    • "the horror would be seperating the life we built with the spouse"

      Yep, it was pretty darn horrible, and i'd certainly recommend doing whatever is humanly possible to avoid the experience, which affects a lot of lives, not simply the couple in question. Sucks, but sometime there's no other option.

    • Luckily, I don't have that experience, but I thought the horror would be seperating the life we built with the spouse.


    • "Everybody says you just split the assets acquired during the marriage 50/50"

      When I got divorced, we split things 50/50. It's just that for some reason, her 50% was bigger than mine : > )

      Move to a non-community property state before getting divorced!

    • Everybody says you just split the assets acquired during the marriage 50/50. They forget the endentured servitude, I mean alimony & support, during the divorce process and afterward. They also forget about the legal fees, which the wife can incur but make the husband pay, resulting in pure blackmail. If your wife chooses to be a hand grenade, the split is 50/50, plus or minus $250,000.

      The horror... the horror... It can be far worse than anything you've ever dreamed of or heard about. Marriage without a prenup should be illegal.

    • you guys split retirement accounts? I dont think I have ever heard of that being done.(granted not heard a lot about this topic).

      My Uncle split everything marrily asset(debt) 50/50. They had lawyers b/c she want to take the house(it was his before the marriage). She had to take a hike. Of course she came out alright b/c I am pretty sure he was making more than her.


    • Directly from the doom and gloom scenero dept, I bring you the following:

      Marriage is supposed to be `forever'. But many or even most of them fail. In Kansas, all one partner has to claim is `incompatibility' to file for divorce. The other partner can be completely guiltless. If one hires a lawyer (hired gun) then the other is in for a fight and will almost certainly have to hire one too. All assets acquired during marriage are `on the table'. This includes IRA's and 401k's. Assets purchased in `wife's name' will almost certainly be lost. Marriage is a contract where the lower earning partner has nothing to loose, and can exit on a whim. Marriage is like a HUGE deferred tax liability, that if you're LUCKY (or perhaps very very good) you just might not have to pay.

      Personally, I think this is very wrong. Talk about weapon of financial distruction lol.

      There is a way around this, and that is to accumulate debt instead of assets. Then they would all be `on the table' regardless of who caused them, just like the assets are. But what kind of answer is that ?


    • Please share what you find.


      remember guys that Ben Graham was in favor of saving bonds for bond investments. You can usually get around part of the 30K deal, in some cases. You buy 30K, your wife buys 30K, you kid buys 30K.


    • <<Of course the real return on my 3% I Bonds will be lower after tax as well, but probably will still yield about 2% on a real basis. >>

      Do you think I-Bonds are a good alternateive to moneymarket funds, especially if you can ladder them so that you minimize the three month penalty for selling before the fifth year? I'm thinking that $1,250 invested every twice a month for a year will have the effect of a money market fund but with better returns, even with the three month penalty. If I'm doing the math right, an I-Bond currently yielding 4.66% will offer an after penalty return of 3.5% if sold after a twelve month holding period. That's twice the rate of maney market funds.

      Any thoughts?

    • <Three questions: (1) how do you find liquidations and workouts? (2) Do you have a recent example of one that worked for you (and maybe one that didn't). (3) How do you get in before the big arb firms have closed the spread?>

      1) I try to read as much business news as possible. It's a constant search, like the terminator in T1, while he was driving around side streets, eyes darting left and right, I'm skimming news stories and darting from web site to web site.

      2) Recently I've been in NETP and TSTN. My NETP basis is around 1.57-1.58, holding period 1.5 months, I'm still holding it. TSTN my basis
      averaged 2.51, and my holding period is about 3 months. I'm almost done selling TSTN, should average out around $2.85. Both deals look like they will turn out pretty good.

      The only deal I've ever lost money on is NewPower in 2002. It was a merger arb, and I had made easy money on those before because they never blew up. It blew up and I lost 50%, fortunately it was as small position (due to chance, not my brilliance, I was lucky to have cash in other deals at the time). I am now reluctant to do merger arbs as I don't think the spreads compensate for the risk.

      3) Real Arbs don't play in my deals because they are too small and illiquid (as you pointed out about BNSXA). It's the benefit of being small. WEB once said he could guarantee 50% returns if he was only investing $1M. I'm not WEB but my returns are paying my rent and then some this year.

      Don't the the "arb" in arbofvalue fool you. When I started I thought I'd be doing all these professional arb deals like mergers. Then I learned those deals are pretty well wired by the professionals. I should probably change my moniker:)

      Lastly, though my returns have been good, it is a bunch of work and you end up paying short term capital gains most times. I'd love to find 4 or 5 heavily moated long term investments that offered similar returns that I could just hold, but I don't even have time to do the research. I would need to completely stop all the arb activity, but to be honest I'm getting a little addicted to the action. It's boring work for a month, then one day you come back from the gym and you just made five grand. It's real fun then...

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