I think that's a reasonable outcome based upon a return to normal valuations. Fortunately, that would also imply much better returns in future decades. I probably have 49 years before I retire and I imagine holding equities through my entire retirement so I have a couple of options. 1: Stay Invested, knowing that there is a pretty decent chance that valuations will return to more historically normal levels and you could have a lost decade for equities knowing that I'll still do well enough in the next 30 years to reach my goals. Or 2: Stay out of the market waiting for historically normal levels to occur, risking that a period of overvaluation lasts a long time.
Bought in at 15.13. It bothers me that they made this kind of error, but I think the current valuation will produce decent long-term returns. That's a lot better than what most companies are being priced to deliver.
I like BAC despite the fact that they cant do math. Expenses will continue to decline. They are still reducing debt to some extent which is important because of the effect it has on the Liquidity coverage ratio. I think if you look at a normal provision level over an entire cycle (probably 1% of loans) that BAC trades at a fair to attractive valuation which is hard to find in this market.
you think voters in 2016 care what the market did in April of 2014? People tend to have shorter memories than that.
Pick your time frame since 2003, it tells the same story. The last 10 years has turned 10k into less than 9k. A hedged strategy should be able to at least earn the risk free rate. Would have been better off in cash.
Hussman entered today with about a 0.7% lead over the S&P500 since inception. Very likely he'll hold that lead. 10k since inception has turned into $16844 vs $16722 for SP500. Not too bad overall, although at the end of february 2009 those numbers were $20,557 vs $5864.
I dont get why. As much as he has emphasized that Midamerican's Debt (as well as BNSF's) is not guaranteed by Berkshire, now the name is attached? confusing to me.
carloads up 10% this week and 8% for the month of april. Big difference compared to the numbers we were seeing in the first quarter which was less than 1%. Unfortunately, a major oil train crash today. Stricter regulations will definitely be coming but that much was already clear.
Strong payroll isnt necessarily good for the stock market. High margins are probably easier to maintain with a slack labor market.
just the Morningstar site. I don't see this fund going anywhere unless it was only a tenth of its current size. I think theres less justification for the operation of some of his other funds, where hes already way behind the comparison index such as HSIEX and HSDVX. HSDVX is supposedly only 50% hedged(although he has a 33% cash position, so its really more hedged than that) but has only managed an 8% gain since inception vs 47% for the index as of quarter end. A lot of that is because the options are somewhat a bet against the market that exceeds their notional value.
Yes operating earnings dropped somewhat fueled by a weak quarter at BNSF, its already clear that will be better next quarter as Aprils Volumes were up more than 8%. The dividend increase at wells fargo will help reported earnings somewhat as well.
if you have a market collapse, you will have a compression of book value to some extent. I think in 2008 it dropped about 10%.
Agreed that its fully valued but id rather own berkshire at 15x earnings than the index at its current multiple.
It looks good to me. This company should easily be able to earn close to $20 billion even in more normal provision environments. That's still a PE of only about 10 and about 25% above tangible book value. There are risks but the valuation is compelling.
careful bob, dont play with fire. There's some significant downside here. Balance speculation with safety. Some convertibles do a pretty decent job with that but of course nothing is immune to a market drop.
really to keep a less than 6.5% yield? There's a reason this thing was trading at 20-21 before it became clear a change in control was possible.
Yeah i think that ones pointed at you. I think you hurt his feelings.