|Fairfax's stealth rally
|"I'm long shares for more than just the recent investment performance. Fairfax has been steadily improving its insurance operations and this is far more important to the investment thesis long term. But I wouldn't be surprised if the narrative on Fairfax's investment side becomes much more positive and quickly, pushing shares higher."
|Notes from the FFH AGM
|"Fairfax's meeting day is a miniature version of Berkshire's, with better food."
|Prem Watsa tells his Horatio Alger story
|"You know why I got that job? Because I got a call for a second interview, and the other three didn't show up."
|What would you do?
|"Every investor has held his hand out in the dark and blindly touched the fine line between being very early and very wrong"
|"In this environment, with zero interest rates and high debt levels prevailing in most developed countries, giving them limited flexibility to react to unintended consequences, we think it is prudent to have a very strong balance sheet with a large cash position and to be protected on the downside. When problems hit, only those with cash and very liquid assets can take advantage of them. While it is very painful and costly waiting, we think your (and our!) patience will be rewarded."
|Prem Watsa opens up about BlackBerry
|"Bets on debt-ravaged Greece or ailing phone maker BlackBerry would make many investors flee, but for Prem Watsa both are part of a 'cautious' strategy he employs to manage Fairfax Financial's US$23.3 billion portfolio. Indian-born Watsa, 63, often compared to U.S. investor Warren Buffett, another self-made man, prides himself on a strategy of investing in stocks and markets others avoid."
|Fairfax meeting slides
|A few of their reasons for hedging...
|Watsa no stranger to value
|"For someone who built an empire while dodging the media's spotlight, Prem Watsa is taking an unusually public role by positioning himself at the heart of Research In Motion's attempted revival."
|Fairfax contrarian cashes in mightily
|"Prem Watsa and his investment team have earned bragging rights for the next 100 years. They sidestepped most of a 50 per cent stock market crash. They bagged big profits by betting years in advance that stock prices would fall and companies would go broke. Meanwhile, their Toronto-based company clawed its way back from junk bond status to investment grade, and its share prices rose last year while most others fell."
|The $2-Billion Man
|"Prem Watsa is the richest, savviest guy you've never heard of. He predicted the crash of '87, the Japanese collapse of 1990 and last year's meltdown, which he parlayed into a huge payoff. Now he's gobbling up shares at rock-bottom prices."
|Fairfax Financial's 2008 coup
|"The year 2008 will go down as one of history's worst, but it was the best year in the history of Canada's Fairfax Financial Holdings Limited. Its Chair and CEO, Prem Watsa, and his team, were among the few money managers who forecasted, and profited, from the economic catastrophe. As a result, Fairfax has become one of North America's 10 largest property and casualty companies."
|Buffett of Canada buying stocks again
|"A famed Canadian investor dubbed the "Buffett of the North" for calling several crashes and booms over the decades is dipping his toe into the stock market again."
|Biggest meltdown winner
|"The danger signs are if any of the three disastrous policies from the 1930s rear their ugly heads again: tariff barriers; higher taxes to balance budgets or higher interest rates to support currencies."
|Wall Street winner: buy now
|"With the S&P drop year-to-date of 50% -- not seen since 1931 -- and how worried the investment community is, it just seemed to us a lot of fear may already be discounted in the stock markets. You can't say this is the bottom, markets are a discounting mechanism and certainly still can go down some; however, we thought it was an appropriate time to close our equity index hedges."
|The reluctant CEO of the year
|"Only a handful of financial companies worldwide are in better shape now than before this crisis started. Fairfax Financial is one of them. CEO Prem Watsa managed to make $2 billion and thumb his nose at his opponents at the same time"
|The man who beat the shorts
|"Born in India, Watsa graduated from the prestigious Indian Institute of Technology and moved to western Ontario in 1972 at age 22. Penniless, he lived with relatives while getting his M.B.A. from the University of Western Ontario and moonlighting at night selling air conditioners and furnaces. After taking over, and renaming, an underwriter of trucking policies called Markel, he added a dozen property and casualty insurers, among them the well-known New Jersey firm Crum & Forster and TIG Holdings, once part of San Francisco's Transamerica. Taking over management of the investments, Watsa produced (according to Fairfax) a compound annual return from 1993 to 2007 on its stock portfolio of 19.5% (versus 10.4% for the S&P 500) and on its bond portfolio of 10.1% (versus 6.6% for a Merrill Lynch bond index). One of his earliest backers--and later a friend--was famed investor Sir John Templeton, who died this year at age 95."
|The economic skies might be falling
|"Investors around world saw sunny skies yesterday, but Prem Watsa is still prepared for a hard rain. The chair of Fairfax Financial Holdings Ltd. boasts that Canada's top-performing financial-services company of the past year is sitting on a billion-dollar life raft of cash and marketable securities - in case North America has the perfect economic storm."