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Bruce Berkowitz On Value Investing, Investment Philosophy And Valuation

An interview and Q&A with Fairholme Capital’s Bruce Berkowitz. In this interview, Bruce discusses his approach to investing and how he values a company. Bruce also talks about sectors he is focusing on and value investing.

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Fairholme Capital's Bruce Berkowitz

Fairholme Capital's Bruce Berkowitz: Value Investing, Investment Philosophy And Valuation

Transcript

At Fairholme we tend not to think too much about the macro picture but it's it's clear we're recovering. Things are getting better and maybe slower than you'd expect.

But you see it in Miami and they'll continue to get better and as the employee becomes hopefully we'll all feel a little better off to the races.

So we've been in a recovery. Companies have been mending individuals companies country individual companies have say sort of solidified their balance sheets. Now eventually the United States is going to have to do the same thing. And I feel very good about the future. Very excited about the future.

Did the results of the election make any sectors pique your interest or any companies your interests or move you away from me.

No we know. I think that country the industries and sectors are bigger than the president and a president can make.

The great thing about our country is it can make things go faster a little bit slower.

But we're in the recovery we we're in the recovery when Whoever became president will get all the credit for it.

That's true. Timing is everything.

We know that in the investment business as I look through what's on the website the main percentage holdings in Fairholme. There is a large concentration in the insurance industry. And then also in real estate wondering you comment a little bit about your thoughts on those specific sectors or on the main companies that you hold in those sectors.

We are company specific. So we'll look at security specific and we're concentration insurances based on very large investments in AIG the largest donor of AIG after the United States government and hopefully within the next week or two we will be the largest donor after the US government sells.

Are less law.

And you know AIG is one of those investments which I consider to be revenge for getting older and that growing up in the business of AIG was was the great example of our country and how we could compete on a global basis.

And it was run by a brilliant guy and then this tragic confluence of events happened that that that almost tanked the company had to be resuscitated by the U.S. government.

And and that's what we do. We buy that which is hated and AIG was hated. And that's one reason insurance. I mean the way we work is we try and buy something we understand and then you try and see if it's cheap and when it's hated it's usually cheap no guarantee that it's cheap.

But the more you hate something better we like it and then we try and kill it and if we can't kill it we think maybe got a good investment here and we invest them.

We usually are too early. We suffer from premature accumulation. And I haven't figured out a way to secure that stand up and usually buy and buy more and that's so so of us seven plus billion in one fund we have three billion dollars in AIG. And the reason we bought it was because I know the industry I grew up in the industry I've been on boards of insurance companies and so hated. We bought it for less.