• American Express Co. (NYSE: AXP) over 151.6 million shares, looks same as before.
• Bank of America Corp. (NYSE: BAC) 5,000,000 shares; same as last quarter but lower than the 9.1 million shares reported in June.
• Burlington Northern Santa Fe (NYSE: BNI) 70.089 million shares, higher than the 63,785,418 shares reported previously but we already knew this one was higher from prior transactions.
• Carmax Inc. (NYSE: KMX) 17.63 million, down from 18.444 million last quarter.
• Coca Cola (NYSE: KO) right at 200,000,000 shares, same as before.
• Comcast (NASDAQ: CMCSA) 12 million shares, same as before.
• Comdisco Holdings (NASDAQ: CDCO) just over 1.5 million shares, same as before.
• ConocoPhillips (NYSE: COP) 79.896 million, above the 59.688 million in one unit, but was previously about 83.9 million total.  Hard to know if this is a real change or just more reporting or more/less units….
• Constellation Energy Group (NYSE: CEG) 19.897 million shares, but this may have already ended after the last merger.
• Costco Wholesale (NASDAQ: COST) 5.254 million shares, same as before.
• Gannett Co. (NYSE: GCI) 3.447 million shares, same as before.
• General Electric Corp. (NYSE: GE) 7.777 million shares, same as before but that does not include the 10% interest bought last year.
• GlaxoSmithkline (NYSE: GSK) 1.51 million shares, same as before.

BUFFETT HOLDINGS “H to R”

BUFFETT HOLDINGS “S to Z”

Jon C. Ogg
February 17, 2009

• Home Depot Inc. (NYSE: HD) 3.7 Million shares; same as before but down from June.
• Ingersoll-Rand (NYSE: IR) 7.78 million, above the 5.6366 million before.
• Iron Mountain (NYSE: IRM) 3.3722 million shares, same as last quarter.
• Johnson & Johnson (NYSE: JNJ) 28.6 million shares, down by more than half from about 62 million last quarter.
• Kraft Foods (NYSE: KFT) over 138 million.  We had 148 million last time but that could have been a carrying difference we didn’t catch.
• Lowes Companies (NYSE: LOW) 6.5 million shares, same as last quarter.
• M&T Bank Corp. (NYSE: MTB) 6.71 million shares, same as last quarter.
• Moody’s (NYSE: MCO) about 48 million shares, same as before but may actually be larger since the 12/31 reporting.
• Nalco Holding (NYSE: NLC) 8.730 million shares; NEW HOLDING from last quarter.
• Nike Inc. (NYSE: NKE) 7.641 million shares, same as last quarter.
• Norfolk Southern (NYSE: NSC) 1.933 million shares, still same.
• NRG Energy (NYSE: NRG) 7.2 million, up from 5 million last quarter.
• Procter & Gamble (NYSE: PG) 96.3 million, down from more than 105.8 million last quarter.

BUFFETT HOLDINGS “A to G”
BUFFETT HOLDINGS “S to Z”

Jon C. Ogg
February 17, 2009

• Sanofi Aventis (NYSE: SNY) more than 3.9 million shares, same as before.
• Sun Trust Bank (NYSE: STI) more than 3.2 million shares, same as before.
• Torchmark Corp. (NYSE: TMK) looks roughly the same at 2.82 million.
• US Bancorp (NYSE: USB) about 67.6 million shares, down from over 72.9 million last quarter.
• USG Corp. (NYSE: USG) 17.072 million shares, looks same as last quarter.
• Union Pacific Corp. (NYSE: UNP) 8.9 million shares, same as before.
• United Parcel Service (NYSE: UPS) 1.429 million shares, same as before.
• WABCO Holdings (NYSE: WBC) 2.7 million shares, same as before.
• Wal-Mart Stores Inc. (NYSE: WMT) over 19.9 million shares, same as before.
• Washington Post (NYSE: WPO) over 1.72 million shares, same as before.
• Wells Fargo (NYSE: WFC) roughly 290.4 million shares, looks same as before.
• Wellpoint Inc. (NYSE: WLP) 4.7773 million shares, same as before.
• Wesco Financial Corp. (NYSE: WSC) 5.7 million shares, same as before.

BUFFETT HOLDINGS “A to G”
BUFFETT HOLDINGS “H to R”

Jon C. Ogg
February 17, 2009

The SEC filing shows that the notes were issued Feb. 12, 2009 in the amount of $250 million of its 10.00% Series A-2009 and Series B-2009 Senior Notes to subsidiaries of Berkshire Hathaway Inc.

The transaction is also exempt from the registration requirements of the Securities Act of 1933.

The “Series A-2009 Notes” are $125 million and mature on February 13, 2017.   The Series B-2009 Notes are $125 million and mature on February 13, 2019.

The  proceeds are earmarked for the refinancing of existing debt and for general corporate  purposes.  These also require lump sum repayments at maturity and include specific financial covenants, ratios, and limit certain payments, investments, and debt.

Jon C. Ogg
February 13, 2009

These are senior notes set to mature in 2018, and are now convertible into USG common shares at the holders’ election.  In other words, at Buffett’s discretion.  These have an initial conversion price of $11.40 per share, and the notes will continue to bear an initial rate of 10% interest.

Back in November, we noted that Buffett was taking $300 million of the notes and Fairfax Financial Holdings Limited (NYSE: FFH) was taking $100 million.  This makes give Berkshire Hathaway the controlling stake.  Holders almost had to approve this if they wanted to get Buffett further on board.  If approval was not obtained before the 135th day after closing of the sale of the notes, then the rate on the notes would have come to 20% per year until after shareholder approval.

Shares got a big pop on the Buffett news in November and were up around $7.66 then.  Shares are up 2% here at $8.00 today.  The 52-week high is more than $100.00.

Jon C. Ogg
February 9, 2009

The businesses expect to reach a formal deal tomorrow. As part of thearrangement, Constellation will issue $1 billion of preferred equityyielding 8% to MidAmerican.  The deal has also been approved by theboards of directors of both companies.  Keep in mind that it is subjectto further due diligence as well as shareholder and regulatoryapprovals.  It is expected to close within 9 months.  MorganStanley and UBS acted as advisers in the transaction.

As to whether or not this deal gets done, that is another issue.Buffett could back out.  Shareholders  also mightnot go along.  The 52-week high for Constellation is more than $100.00. It lookslike another merger that is not good for existing shareholders.  Theother side of the argument is that Constellation has no choice but tomerge even if it is a "takeunder" type of transaction.

Constellation was up 25% last night north of $30.00 on reports that French partnerin the U.S. EDF might be interested in taking a higher stake or justacquiring it outright.  This stock is up only about 5% at $26.00 inpre-market trading.

Jon C. Ogg
September 18, 2008

Navigant Consulting, Inc. provides business, regulatory and financial advisory services and it has released a study showing that the number of subprime-related cases filed in federal courts is already out-pacing the S&L crisis litigation in the early 1990′s.  This study noted that that subprime cases in 2007 already equaled half of the total 559 S&L cases handled by the RTC over a multi-year period, although this is only measuring federal court cases filed.  This notes that of the 278 cases filed in 2007 some 43% came from borrower class action suits, 22% came from securities cases, and 22% came from commercial contract disputes.

247WallSt.com would note that these only represent the cases for 2007.  The cases in 2008 are likely to dwarf the 2007 cases since these take time to file and much of the pending damages have either not yet happened or have not been able to be quantified.  The real damages and issues in 2007 were also not until the second half of the year.

We haven’t even seen all of the counterparty blow-ups come to pass yet.  We have yet to see any of the major financial institutions fail, and all of the bond insurers are still surviving.  Warren Buffett will only save entities that make financial sense.  We believe that the headlines coming are only going to get worse before they get better.  Stocks will continue to act on their own, and when these financial stocks do ultimately turn it will be long before we start seeing actual good headlines.  There is a reason we noted that financial mergers may become mandated rather than preferred.

Ultimately things will get better.  But there is much more pain to come.

Jon C. Ogg
February 14, 2008

While we did not get a list of these, the two obvious ones are MBIA inc. (NYSE: MBI) and Ambac Financial Group, Inc. (NYSE: ABK).  Presumably the third one would be FGIC, or likely it could be Security Capital Assurance Ltd. (NYSE: SCA).  Most shares are higher after Buffett came on CNBC with his plan:
SCA +9% at $2.24; MBI +3% at $14.00; ABK +4.5% at $10.96.

• We previous noted, "Would Buffett Save The Insurers?"
• Berkshire Hathaway shares are also up about 3% since we noted that "The Barron’s Sell-Off Could Be Your Gain"

Mr. Buffett did note that this was initially a $5 Billion proposition and that he would keep all earnings inside the entities for a period of 10-years.  He also noted that one rebuffed his offer and two he has not heard back from.

What is important here is that this will at least take care of the municipal bond side even if those other bond insurance operations in mortgages, CDO’s, and CLO’s were to fail.  But Buffett is drawing his line in the sand on what risks he will take and which he will not take.  These plans would not include insuring mortgages, CDO’s and CLO’s.  That is why the bond insurers are not jumping at this offer.  They’d be giving away their top operations to feed their leeches.

He even made a note about how his new municipal bond insurance unit received a 2% premium merely to reinsure a muni that had already been insured so it could maintain its triple-A rating even if the bond insurer failed.  No wonder he’s willing to step up.  If you have a few billion dollars lying around and have a solid insurance holding company operations this sounds like a layup when you consider the fact that it takes the worst scenarios to cause municipal defaults.   

Perhaps the most important issue at hand is that this will at least put a floor on the blood-letting that has been seen in the municipal bond arena.  It won’t help the mortgage and CDO insurance operations, although there is an obvious tertiary benefit in that this at least in theory saves part of those businesses.

Jon C. Ogg
February 12, 2008

Barron’s noted roughly a 30% rise since August 1 and a pre-drop market cap of about $220 Billion as the sixth largest US company.  Barron’s noted:

• "Its stock now appears overpriced, reflecting a sizable premium for the skills of the 77-year-old Buffett. What’s Berkshire worth? Our estimate, based on several valuation measures, is around $130,000 a share – about 10% below the current quote."

We do agree with Barron’s that Wall Street (and us) would like to see his "whale of a deal" and we even went as far as to cover which stocks could fit the profile and take up some 75% of the cash positions at Berkshire Hathaway.   

The A-Shares closed down 4.6% at $136,400.00, and its 52-week trading range is $103,800.00 to $151,650.00.  The B-shares, the Baby-Buffetts, fell some 4.8% to $4,525.00.  The 52-week trading range is $3,460.00 to $5,059.00.  This now represents a 10% correction in Berkshire Hathaway stock from its yearly highs.

But where we disagree with Barron’s is that Berkshire Hathaway is done or overvalued.  Every time throughout Berkshire Hathaway’s history that shares have pulled back 10% it has represented a buying opportunity.  On days that the market rises, Berkshire Hathaway tends to rise.  On days the market is weak, traders tend to look to Berkshire Hathaway as a safe bet stock to hide money.  Even if Buffett is 77 years old and no heir has been declared, it’s just too hard to bet against the old guy.  He’s too down to earth and too forward about maintaining everything above the table.

Berkshire Hathaway has a lot riding on insurance and reinsurance, and Buffett makes no secret that the company has been lucky enough to avoid two straight hurricane seasons with any major US damage. 

The hit from Barron’s may have just opened up another opportunity for those whom have wanted to own Berkshire Hathaway stock.  Barron’s is right and we are wrong OR we’re right and Barron’s is wrong.  We’ll know down the road.

Jon C. Ogg
December 17, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he produces the SPECIAL SITUATION newsletter and he does not own securities in the companies he covers.

• Former FOMC Chief Alan Greenspan (CNBC report) today lifted his chances that the US will tip into recession at 50% rather than a prior 30% chance, He noted how the US economy will be in trouble and vulnerable to shocks for the next two quarters.
• John Bogle, the Vanguard founder, just put the chances at 75% that the U.S. is heading for recession during a CNBC interview.
• Goldman Sachs recently put the chance at 45%.
• Reuters reported that FITCH rating agency now has a 40% chance of a recession.
• Warren Buffett said on CNBC this week in his interview that the economy is very close.  He noted that if employment starts to snag then we’ll tip into recession.
• Morgan Stanley expects a recession now.
• Barclay’s speaks to FinancialWeek on their recession comments.
• CNBC reports market pundits saying that optimism about a central bank effort to ease the global credit crunch turned to skepticism.
• MarketWatch lists recession stories in its dailies.
• Bill Gross of PIMCO thinks 3 1/4% Fed Funds is the answer.

Here is our own list DEFENSIVE STOCKS where investors currently try to hide if they have to keep some money in stocks.

Jon C. Ogg
December 13, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.