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   Strategies & Market TrendsBuffettology


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To: Freedom Fighter who wrote (2289)3/9/2000 7:01:00 PM
From: Michael Burry
   of 4661
 
What I hear from both you and Jim is that you are playing the annual report to a degree - maybe more so in Jim's case. Is that how Buffett would want you to think? You're counting on him saying something and you're counting on Wall Street to pay attention.

How about GATX and Dun & Bradstreet - both companies that he's bought and now I've bought and I think I understand. Both haven't moved at all since his stakes were revealed. And judging from the charts chances are he bought at these prices.

Mike

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To: Michael Burry who wrote (2293)3/9/2000 7:18:00 PM
From: Freedom Fighter
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Mike,

>>What I hear from both you and Jim is that you are playing the annual report to a degree<<

Yes and no in my case. I'm learning some market tricks from a friend of mine who is a rapidly improving value guy. He's new to investing, but already very good. He times his value purchases to coincide with some potential "market" positives. I always buy them when they were cheap regardless.

1. He buys stocks he likes during December if they were beaten down by tax selling. He has some technical ways of determining if it was tax selling or not.

2. He buys stock he likes after the company just announced a new share repurchase program.

3. He buys stocks he likes if they declined sharply on a low volume day.

There are others.

I like BRK a lot at this price. I can't see the annual report being a negative for the market price of the stock, but I can see it signaling the bottom and being a plus.

I came real close to buying Dun and Bradstreet a few months ago before Buffett announced. I missed it. I have no problem with buying it now, but I passed it up cheaper.

Wayne


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To: Freedom Fighter who wrote (2294)3/10/2000 12:17:00 AM
From: Michael Burry
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You really think Buffett bought it cheaper? By how much? Couldn't have been more than 10% - and that's if he caught the absolute bottom. In any case the Fitch acquisition of DCR validates his (and my) logic, while the market price of DNB hasn't moved to reflect this. So there's less risk in 26 and change now than 23 and change then IMO.

Mike

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To: Michael Burry who wrote (2293)3/10/2000 12:19:00 AM
From: James Clarke
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I'm not counting on anything. Its a stock I want to accumulate (I bought at 2000, 1800, 1500 and now 1400)and the probability that something might happen in two days tells me that now is a good time to buy a little more than I otherwise might have, thats all. I intend to hold BRK shares through a bear market. My speculative side tells me that yes, the market allows you to sell BRK too as countless others seem to have figured out over the last twelve months. So I just ask myself is there some probability of a 25% spike in the stock if the annual report does contain something, shall we say, promotional? Which is why I'm buying a few extra. We'll see how it plays out soon.

Forget its Berkshire. A stock testing a low with a potential catalyst two days away is a trading buy for me every time. Especially one that I'm happy to own at this price anyway.

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To: James Clarke who wrote (2296)3/10/2000 12:25:00 AM
From: Michael Burry
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This isn't a test. This is the real thing. New low. And you, Wayne, and Wayne's friend are just guessing on the catalyst. You're right in that it's just a timing issue for a long-term hold. But if the pitcher is getting tired and his fastballs are getting slower, why try to just punch it through the infield? If you've bought I'm not saying sell. But I don't understand buying today.

Mike

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To: Michael Burry who wrote (2297)3/10/2000 1:33:00 AM
From: cfimx
   of 4661
 
Strange to be talking "catalysts" on the Buffettology thread. Save for his arbitrage situations, catalysts are the antithesis of his approach. He ALWAYS either scales down, or in the case of Coke, up, down, and sideways <g>. And he certainly is not afraid of a new low; he LIVES for that. He salivates over a new low in a stock he wants to own.

He just swings when its in his "hitting" zone and doesn't much care about anything else. He's buying a business for less than its worth.

You know this already but he cringes at ANY kind of technical analysis. And I'm not saying your way is wrong or his is right. But when you see us scaling into Brk, we are emulating HIM.

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To: jhg_in_kc who wrote (2271)3/10/2000 5:03:00 AM
From: Moominoid
   of 4661
 
Yes but they don't count as income in the national accounts. This boosts spending above income and pushes down measured saving. Hence inflation. Dr Ed is right - productivity gains can't increase inflation, though these productivity gains are output per worker and not pure productivity gains as economists normally think of them. Output per worker can increase either through real technological improvements or using more capital and materials per worker. Pure productivity gains can be defined as reductions in cost per unit output holding all prices constant - these can either reduce output prices or increase profits.

The expectation of future growth in productivity being higher than previously thought would rationally raise asset prices and could cause inflation through the wealth effect.

David

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To: Michael Burry who wrote (2295)3/10/2000 8:58:00 AM
From: Freedom Fighter
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Mike,

>>You really think Buffett bought it cheaper? By how much? <<

No the other way around. I was looking at it a few months ago and was getting ready to pull the trigger. That morning the company made a restructuring announcement and the stock popped $3 or so. That was before Buffett disclosed his stake. It's still higher now than when I was ready to buy it, but I think it is below Buffett's price. I need to revisit it because when I was ready to buy it, it was more or less a borderline decision. I may (must) be underestimating the value.

Wayne

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To: Michael Burry who wrote (2297)3/10/2000 9:55:00 AM
From: sjemmeri
   of 4661
 
Mike,
On the new low thing, I'm not going to try to talk you out of something that works for you. But don't you think, maybe, one should look at that issue differently for a deep Graham value stock (one with lots of warts that is maybe heading close to 0) vs. a Buffet great-business stock? That's based on mainly gut feel with a bit of first-hand observation.

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To: sjemmeri who wrote (2301)3/10/2000 11:21:00 AM
From: David Bogdanoff
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To all;
Many sectors have really declined in this technology driven market, and WEB is known to be sitting on a wad of cash. Why has he not moved more aggressively to put that money to work, or has he and its not been made public yet?

Comments anyone?

David

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