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Barron's Forum, Jim Puplava Interviewed on King World News

Eric King continues his run of top-notch interviews on his site, King World News. This weekend included talks with a Barron's Forum -- including Tom Donlan, Randall Forsyth and Gene Epstein. Another interview was yet another discussion with Jim Puplava.

Part II of the Barron's Forum is scheduled for this coming weekend.

Southeastern Asset Management Loses in Attempt to Replace NipponKoa Insurance Chief Executive

I should have posted this at the end of last week, but time got away from me.

Southeastern Asset Management, famous for its Longleaf Partners family of funds, owns 17% of NipponKoa Insurance. This is the second year running that Mason Hawkins and gang have been unsuccessful in replacing the CEO. I doubt they thought they had a shot -- more likely just registering disapproval on direction.

After their first attempt last year, NipponKoa announced plans to merge with Sompo Insurance Japan, a move which Southeastern Asset Management supports.

Everything You Ever Wanted to Know About Gold -- and More

If you've got some time on your hands and looking for some interesting reading on this Monday, check out The Privateer Gold Pages.

They're written by Bill Buckler, publisher of The Privateer market letter based in Queensland, Australia. You'll read some fascinating stuff about gold, the history of gold, money and a whole lot more.

My hunch is that you'll find this worthwhile -- even if you don't share Buckler's views on gold or believe gold is the only honest money.

This is every bit as long as it is interesting, though. So you might want to bookmark the site for later reference if you've got things filling up your time right now.

Five for the Weekend #47

If you live in the US, you're probably amazed -- but not surprised, certainly -- how our three 24-hour so-called news channels can instantly turn themselves into the E! Channel. Oh well. In the meantime here are five items for your review this weekend.

• China reiterates its call for a new world reserve currency: “Zhou Xiaochuan sees the current international financial system is flawed, putting too much emphasis on the dollar as a reserve currency,” said Kevin Lai, an economist with Daiwa Institute of Research in Hong Kong. I'm not a gold bug, but I do believe gold is the honest form of money. But Central Bankers and governments will fight it to the death.

• The Lex Column in the Financial Times points out the the King of Pop was also a King of Debt. In some ways, Michael Jackson's death reminds me of Elvis' in 1977. Both in poor health at relatively young ages, finances in poor shape, hangers-on existing like leeches on their host and abuse of pain medications. Back to Lex: "They say the rich are different, but it is the famous who are really different. The merely wealthy would have gone bankrupt long ago. Even faded stars such as Jackson can stay afloat with the promise of income from comebacks like his now-aborted concert series." The Elvis estate made a spectacular financial comeback, and look for Jackson's to do the same. R.I.P. Mr. Jackson.

• At the risk of sounding crass, while on the subject of painkillers, portfolio holding King Pharmaceuticals (KG) this week announced it expects regulators to delay sales of the first short-acting oxycodone pill designed to deter abuse. The stock fell on the news, but its only a few cents below my entry price. So I'm not in any pain...yet.

• Africa-Asia Confidential runs an in-depth profile of China's role in the power-sharing negotiations inside Zimbabwe. China's increasing bilateral trade with African countries is one of the most interesting -- and unreported, at least here in the US -- stories in our time.

• Free Money Finance, a great personal finance blog, has an interesting post on whether women should marry for money. FMF links to a WSJ.com blog post. Good link, good FMF post, and I enjoyed reading the commenters on FMF. Maybe you will, too.

Have a wonderful weekend, folks!

Fairfax Financial Twofer Thursday

Two items of note regarding portfolio holding Fairfax Financial (FFH) today.

First is news that the SEC has completed its investigation, with no action being taken:

Fairfax was subpoenaed in 2005 and 2006 by the SEC regarding its non-traditional insurance or reinsurance transactions and comments Watsa made in response to a question during an investor conference call.

Second is this Globe and Mail blog piece including Fairfax in its list of stocks on the Toronto Stock Exchange with "wads of cash in their back pockets." This was actually posted last night, but what the heck, I saw it today:

The “net cash per share” screen is just one tool used by value investors looking for investment opportunities in companies whose shares have sometimes been under sustained selling pressure.

The formula for net cash per share is the total value of all cash and equivalents less the total of the short- and long-term liabilities divided by the shares outstanding. The net cash per share is then expressed as a percentage of the current price.

Interesting article -- interesting list of companies.

Warren Buffett Wednesday

The big news on Warren Buffett today was the interview he gave to CNBC on the lousy state of the economy. His statements echo those of the Barron's Roundtable participants a couple of weeks ago, who were downright, well, down on business conditions.

And when the CEO of Verizon appeared on Charlie Rose the other night, they spent most of the time talking about communications. Towards the end Rose asked about the overall state of the economy, and the CEO (name escapes me) seemed to be bending over backwards not to be too negative. Yet maybe that's just what I sensed and reading the transcript would give a different impression.

More interesting is this WSJ.com piece on Warren Buffett's portfolio holdings being cheap.

My take is that it might be better to just buy Berkshire Hathaway. BUT I wouldn't pay any "Buffett premium" -- and may only buy if Berkshire traded at a nice discount to NAV. Perhaps I'm being too greedy in that view. I just like it when I can buy big conglomerates like I bought Cheung Kong Holdings earlier this year -- at a 70% discount to book. I know. I know. Not exactly an apples-to-apples comparison.

Will Berkshire ever trade that cheaply? Doubtful. And I'm not holding my breath.

Japanese Retail Investors Turning on Managements?

According to Bloomberg, 78% of all retail investors in Japan who are planning on voting are prepared to cast ballots against managements.

This section in particular catches my eye:

Southeastern will vote against the re-election of NipponKoa Insurance Co. President Makoto Hyodo at the insurer’s shareholder meeting scheduled for June 25, the fund said in a statement in March.

It would be the Memphis, Tennessee-based fund’s second attempt to oust Hyodo. Southeastern, which has about 17 percent of the casualty insurer, has cited his failure to raise shareholder value. Nipponkoa shares have slumped 19 percent this year, compared with a 6.7 percent decline by the nine-member Topix Insurance Index during the same period.

Southeastern’s unsuccessful bid last year contributed to Nipponkoa announcing cost cuts and a plan to merge with Sompo Japan Insurance Co. amid declines in premium income.

You'll recall I mentioned NipponKoa earlier this month. The company is a legacy holding of mine, since I purchased Koa Fire & Marine Insurance back in 1998.

Breakingviews: Market Turning, Green Shoots Mowed Down

Regular Controlled Greed readers know I respect the editors of Breakingviews.com immensely. The top guy, Hugo Dixon, oversaw the Lex Column at the Financial Times before launching BV some years ago.

So when they put out a piece like this one, I sit up and pay attention:

Falling copper prices, a World Bank report questioning global growth, talk of currency trouble out east in Belarus were all possible triggers. But the results were plain to see. Equities, oil and other commodities were hit brutally, as well as recent market darlings such as the Australian dollar and the Brazilian real. The US dollar muscled in like a new enforcer.

Further down:

But now the hopes and the stimulus are being questioned. Wednesday will be important. The US Federal Reserve is expected to confirm the markets' broad expectation that it does not plan to print yet more money. There may even be Fed intimations of an 'exit strategy' from stimulus. Less money printing should be good for the dollar - but is potentially very bad for commodities, currencies and equities that have scampered ahead on pumped cash, a frail dollar and reflationary hopes.

And finally:

Meanwhile, central bankers are warning governments about fiscal stimulus, which has gone over its limit in the US and UK. That leaves the markets to reassess a world showing only meagre signs of economic recovery but with prices that have leaped ahead in just months. The risk is that Monday's shoot-out is the first of many until more rational levels are reached. After the merry months, the forensics could be kept busy for a while.

Hate to say "everyone knows." Yet everyone should have known this has been a bear market rally. The question is now: did it end Monday?

Looming Energy Plays?

John Dorfman expects energy stocks to surge when the recession ends:

Energy stocks may be especially timely now. They usually do quite well after the end of a recession.

No one knows when the current recession will end. A few months ago, most economists were guessing 2010 or 2011. Today, many are predicting it will end this year -- a view I share.

I examined the performance of three energy indexes after the end of the past five recessions. By my calculation, oil drilling stocks rose 22 percent on average over the ensuing 12 months. Oil exploration and production companies gained 13 percent, and integrated oil companies 9 percent.

By comparison, he reports the S&P 500 averaged a gain of 8%.

I've actually been thinking of some energy stocks -- particularly oil and gas related companies. But I've got to do a lot more research before putting any money to work there.

Eric King Interview with Jim Grant

Jim Grant of Grant's Interest Rate Observer was interviewed by Eric King on King World News.

Grant discusses the economic mess and a host of other things, including his fondness for the classic gold standard the world was on from around 1880 to 1914. And no, he's not thinking we'll get back to that anytime soon.

Controlled Greed has fawned over Grant so much and so often since launching this blog in 2005 that we're unable to be objective. But like anything we've ever seen written by or said by Grant, the interview is highly recommended and should prove well worth your time.

And here's a heads up: King World News is scheduled to interview some folks from Barron's, including Thomas Donlan.