Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Buffettology -- Ignore unavailable to you. Want to Upgrade?

To: jhg_in_kc who wrote (1471)	5/19/1999 6:15:00 PM
From: cfimx	Respond to of 4690

>>. I am getting too old to settle for less than a 50% return a year. << you think you're too old...I think you're too young

To: jhg_in_kc who wrote (1471)	5/19/1999 7:30:00 PM
From: James Clarke	Read Replies (1) \| Respond to of 4690

<<Berkshire's hey day was in the 70s when a calm, mathematically inclined 'margin of safety" man could find amazing bargains by looking at the fundamentals and ignoring the horrible news about the highest interest rates since the civil war and the oil embargo, etc. But now the news is that of a "new era" of long term growth with minimal inflation.>> I promised never to respond to anything jhg wrote again, and something tells me he just posted this to tempt me. And he did. While I could go on and on about this post, I will stick to this one part. jhg, I would ask you what you would have been thinking if you were investing in the 70s. Would you have invested based on what everybody else believed, as you do today? That was an extreme, and everybody believed it would continue indefinitely. Inflation is going to be 15% and accelerating - sell everything and buy gold at $700 an ounce. (and if you read your history that is precisely what those who extrapolate from recent history were doing in the late 70s - and they got murdered.) That is WHY Buffett was able to buy some great companies at half what they're worth. Now we are at another extreme based on historical data, this time on the opposite end, and you have bought into it 150%. This is going to continue as far as the eye can see, right? Mr. Buffett is holding $15 billion in cash. You think you're a better investor this old has-been who has created $30 billion of wealth over his lifetime by compounding at 20% a year? I would just ask you to think about that for a few days. This is not a flame - I could have made it one if I wanted to - believe me it would not have been hard. JJC

To: jhg_in_kc who wrote (1471)	5/19/1999 8:15:00 PM
From: Art Vandelay	Read Replies (1) \| Respond to of 4690

You are losing money by investing in this behemoth run by two brilliant men who appear to have lost it. Lost it! Boy I hope I am as rich as them when I lose it. Their problem is that they are sitting on billions of dollars, it is hard to earn a great return when you are starting with a base of billions Not to mention their universe of stocks from which to pick from because of the large mass they have attained. Think about it they could purchase an entire $300 million dollar company have it double in a year to $600 million and it would only add a 1% gain on a base of $30 billion. I believe there is much the average investor can learn for Buffett and we can even out Buffett him because we can invest in those $300 million dollar companies.

To: jhg_in_kc who wrote (1471)	5/20/1999 12:19:00 AM
From: Michael Burry	Respond to of 4690

THis could even marginalize Dell and reduce it to a build to order internet supplier of commodity like items in a range of low end contraptions. You're basically proving Buffett's point that no one can see what technology will bring 10 years from now. Wasn't Dell supposed to be your long-term Buffett stock? I still tout RMBS (to great hoots from BUffettologists) I think it will be a toll bridge. RMBS has moved up 20 from 60 to 80 in the last 30 days. RMBS sits where it was in late 97. Funny that you criticize BRK's twelve months of stagnation and tout RMBS's 20 months of stagnation. I'm not against tech. American Power, Apple, and Oracle are three of my holdings that I consider Buffett in spirit. But making money after buying at >100 times earnings for anything is just being lucky to find the greater fool. Mike

To: jhg_in_kc who wrote (1471)	5/20/1999 9:21:00 AM
From: LauA	Read Replies (1) \| Respond to of 4690

RMBS - could be a toll booth if it isn't simply another of Intel's "silver bullets". At present it's only toll gate is on the Nintendo, which is seguing to PPC architecture. I'm willing to bet that the Intel server farms get stocked with DDR memory, not RMBS. And I fear that there are real technical issues surrounding the timing of its rollout and performance of other, cheaper solutions. I might suggest that you look at DTM (Dataram) which is a small aftermarket memory producer from Princeton, NJ. They started as a board producer of core memory for DEC. Now they produce industry standard, technology agnostic boards for all the major brands. (Since their forte is board solutions, both RMBS and DDR will win for them.) Their ROE has been 22-25% for the last couple of years. No longterm debt. Volume of product shipped has been rising at 70-80% year over year. Revenue has been flat because raw memory chip prices have fallen so much. They reported a quarter today with a 20% jump in revenue, 30% increase in profit, and a 33% increase in profit per share, while SGA dropped 19%. PSR is .6, PE is 10, management owns lots of shares. They bought in over 5% of their shares last year, and are continuing to buy. Stock price is $8.50 with cash of $1.31 and the company owns a 90 acre corn field on Rt 1 in Princeton (which is for sale) that should be worth $1 1/2 to $3/share. They're looking more and more like a Kingston Technology (in fact Kingston points to them as their major competitor). Lau Lau