Bob,
<<It's an insurance company - a no-no in my book>>Why so?
I do not know how to figure out if an insurance
company is "buying losses". As Buffett said, it
is easy in insurance business to get immediate
profit by selling policies cheaply. However, this
leads to long-term losses, when the claims start piling in.
Another issue, of lesser importance, is that you
don't know what the company is doing with the float.
I assume that most of the companies buy treasuries,
so this may not be an issue, but it is possible that
they decide to buy HHH at the top...
I can believe in Buffett and his gang, so I could
buy BRK or Wesco. I have tough time believing
other insurance companies. Of course, it is possible
to look at the historical performance and buy AIG
or CB. The problem is still, that you have to
believe the management totally, perhaps more so
than in other businesses like AXP, G, KO, or MSFT.
Jurgis |
