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Bruce Berkowitz Thanks Goldman And Government For Generating Market Beating Returns For His Fund

Tyler Durden's picture




 

Bruce Berkowitz, recently notorious for taking the other side of David Einhorn's St Joe short position, but also with long positions in such governmental recovery cases of bankrupt basket case firms such as AIG and MBIA, released his thank you letter, after generating a 25.5% return. His two top receipients of gratitude: the government and Goldman Sachs. Pretty much explains everything about whom to thank when you want to outperform the market. It should also explain which particular centrally planned regime and fixed income monopoly one must never raise their voice against, if one doesn't want to be 'GM senior bondholdered.'

In 2010, The Fairholme Fund earned 25.5% versus a gain of 15.1% for the S&P 500 Index. Since inception on December 29, 1999 and through December 31, 2010, The Fairholme Fund earned 342.9% versus a 5.0% gain for the S&P 500 Index. At last year’s end, The Fairholme Fund’s respective 5 and 10-year annualized returns are 10.0% and 11.5% versus 2.3% and 1.4% for the S&P 500 Index.

Since inception on December 31, 2009, The Fairholme Focused Income Fund (NASDAQ:FOCIX - News) earned 11.2% for the calendar 2010 year versus a 6.5% gain for the Barclays Capital U.S. Aggregate Bond Index.

The Fairholme Asset Allocation Fund (NASDAQ:FAAFX - News) started on January 3, 2011.

Over the past few years, Fairholme’s performance is due in large part to thousands of patriots in civil service who rescued the global financial system with much intelligence and hard work, demonstrating government at its best during a time of national crisis. On behalf of nearly 500,000 shareholders and clients, Semper Fi.

Charlie Fernandez and I remain grateful for the many professionals that directly and indirectly worked for our shareholders, with special thanks to the U.S. Treasury for equitable treatment at AIG, to Goldman Sachs for outstanding advice in Asia and to Brookfield Asset Management and Pershing Square for all stakeholders fully recovering in the restructure of General Growth Properties.

Government is doing its job. We’ll continue to do ours, looking forward to further potential recovery at AIG, MBIA and others, while helping to remove the financial roadblocks to our country’s economic growth.

Bruce R. Berkowitz

Managing Member

We can only hope the tongue in cheek factor of this letter is well over 100%.

h/t Adam

 

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Fri, 01/07/2011 - 15:56 | 857240 HarryWanger
HarryWanger's picture

And I bet they're out buying this dip again today. Like I keep saying when you see any dip, even this shallow (SPX -11 or so) jump in and buy. AAPL was a screaming buy on a $1.50 pull back today.

Fri, 01/07/2011 - 16:00 | 857257 Cognitive Dissonance
Cognitive Dissonance's picture

Harry,

Put the pompoms down and go back to sorting urinal cakes.

Fri, 01/07/2011 - 22:23 | 858040 Artful Dodger
Artful Dodger's picture

CD, you really lower yourself with comments like these. You have lots of great thoughts and I enjoyed your recent piece on silver. I basically understand why the talking mouths here keep trashing Harry: he expresses a different point of view, sometimes a pragmatic one, and one which usually seems to be the result of more independent thought than the me-too gang around here.

You, however, are better than that, an articulate, independent thinker, yet display the same childish gang-up response to Harry.

If you read this I hope you take it in the spirit it is intended. I hope you don't make comments like these just to ingratiate yourself with the me-too gang here. Your actual articles and substantive comments do that on their own.

Fri, 01/07/2011 - 16:09 | 857301 homersimpson
homersimpson's picture

Don't forget to pull the iPhone out of your arse as you try to do a backflip for the Fed.

Fri, 01/07/2011 - 16:16 | 857320 HarryWanger
HarryWanger's picture

You still have a chance to buy. It's going to 350 within the next two weeks and will be at 400+ EOY. 

Fri, 01/07/2011 - 16:19 | 857329 thepigman
thepigman's picture

But you'll still be a

douchbag.

Fri, 01/07/2011 - 17:45 | 857585 Hephasteus
Hephasteus's picture

Ya but he'll be a douchebag with a 50 percent inflation hedge. Gold owners ride 1st class. Stock maket participants are business class and everybody else freezes in the wheel well. All aboard the wealth stealing plane.

Fri, 01/07/2011 - 16:35 | 857393 Hephasteus
Hephasteus's picture

So what I here you saying is "Buy the fucking dip!!"

Fri, 01/07/2011 - 15:58 | 857245 AccreditedEYE
AccreditedEYE's picture

What complete crap... I'll give it to the Fund Mgr. of the Year that he could see where to allocate capital ahead of the U.S. Gov (sound like someone else we know?) but that takes real balls to say thanks to the "civil servants" that don't see a dime of his profit.

Fri, 01/07/2011 - 16:00 | 857262 Spalding_Smailes
Spalding_Smailes's picture

... of the decade.

Fri, 01/07/2011 - 16:05 | 857279 AccreditedEYE
AccreditedEYE's picture

thanks... so irritated, I'm not even thinking straight.

Fri, 01/07/2011 - 16:01 | 857250 Cognitive Dissonance
Cognitive Dissonance's picture

....if one doesn't want to be 'GM senior bondholdered.'

Wow, that phrase right these says a mouth full, doesn't it. And anyone in the business knows instantly what it means. No footnotes needed to understand the modern way one is separated from their ownership rights.

The mighty hand of God (the Fed) commands you.

Fri, 01/07/2011 - 17:21 | 857525 ZeroPower
ZeroPower's picture

Haha yes good phrase indeed.

Though i propose to you 'GM common shareholdered' would be perhaps even more fitting!

Fri, 01/07/2011 - 15:58 | 857255 Freddie
Freddie's picture

First - bitchez!  I think he is serious.  They have what $12 billion in assets in that fund?

Fri, 01/07/2011 - 16:05 | 857287 ReallySparky
ReallySparky's picture

Completely off topic:  This is the best year in review that I have read recently!  Well worth your time....

http://forums.wallstreetexaminer.com/topic/921049-2010-year-in-review/

Excellent, Excellent, Excellent.  Very funny too.

Original link was found on Martenson, link above has downloadable pdf and doc, file.  Very original.

Fri, 01/07/2011 - 16:07 | 857292 mtguy
mtguy's picture

So we have the Einhorn vs. Berkowitz battle for St. Joe supremecy. Einhorn's presentation on why he shorted Joe seemed complete. I'd like to see Berko's thesis. Even with Berko's great track record, I'm betting (paper $ only) on Einhorn (even though he looks like he's about 15 years old!)

Fri, 01/07/2011 - 16:12 | 857307 SpeakerFTD
SpeakerFTD's picture

Nice timing on the letter, Bruce.  Enjoy Black Monday!

Fri, 01/07/2011 - 16:20 | 857332 HarryWanger
HarryWanger's picture

Curious why you would think there would be a Black Monday? Big turnaround again today off the lows is a nice sign heading into next week. You have to look at the employment numbers today - perfect from a market sense. Retail guy is happy unemployment is going down and big guys hear Ben say we still have a long way to go, i.e more and more QE.

Won't be a Black Monday with that sort of bullishness.

Fri, 01/07/2011 - 16:53 | 857438 onlymyopinion
onlymyopinion's picture

What would a Black Monday look like?  SnP's down 5?  10? ROFL!  Based on todays strength we may have already seen the lows of the year on Monday (1257).  If today didn't make a believer that we're going much higher this year, I'm not sure what will.  POMO ROCKS!  LOL

Fri, 01/07/2011 - 17:03 | 857463 ExploitTheMarket
ExploitTheMarket's picture

Two more large POMO days on Monday & Tuesday, then a new POMO schedule comes out on Wednesday: http://www.newyorkfed.org/markets/tot_operation_schedule.html

Fri, 01/07/2011 - 16:18 | 857325 RobotTrader
RobotTrader's picture

Wanger...

No, AAPL is not a screaming buy.  That stock is way overextended, I wouldn't buy it here.

Other stocks with good breakouts today are RBN, LLL.  These stocks are just starting good moves....

Fri, 01/07/2011 - 16:20 | 857341 HarryWanger
HarryWanger's picture

Trading like value stock with a p/e around 15. This thing should be sporting a p/e in the mid 20's and I think it will very soon. Tell me; what does that do to the price??

Fri, 01/07/2011 - 16:27 | 857371 Internet Tough Guy
Internet Tough Guy's picture

Trolls trolling trolls. The circle is complete.

Fri, 01/07/2011 - 17:24 | 857527 ZeroPower
ZeroPower's picture

Trolls trolling trolls.

That was worth an lol

Sat, 01/08/2011 - 02:18 | 858332 Freddie
Freddie's picture

+2.5

Fri, 01/07/2011 - 16:43 | 857410 Hephasteus
Hephasteus's picture

Well see now you're using your whole brain. You've incorporated the shoulda's woulda's and coulda's that successfully muddy up your clear viewpoint of reality. You are now prepared to become a super star trader.

http://www.youtube.com/watch?v=gxfJw8LeSuY

Fri, 01/07/2011 - 19:02 | 857782 Jay Gould Esq.
Jay Gould Esq.'s picture

Only 120 seconds separate these two posts -- just about the requisite amount of time for Alias X to post a comment, then log off -- then log back on again, under Alias Y, and "respond" to Alias X's post.

Fri, 01/07/2011 - 20:58 | 857951 HarryWanger
HarryWanger's picture

Big move AH on AAPL Verizon announcement coming next week.

Fri, 01/07/2011 - 16:19 | 857334 onlymyopinion
onlymyopinion's picture

Been very pleased with FAS & SSO.  Actually bought more today.  But DON'T follow my advice (I'm a sheeple)-LOL

Fri, 01/07/2011 - 16:21 | 857336 Jerry Maguire
Jerry Maguire's picture

It's the inevitable result of central banking:  money gets doled out like a political favor, and as time goes on it's like there's no internal limit to it.  That's where we are now. 

The external limits tend to be violent, but they don't have to be. 

We can cancel debts and return to a gold standard through a constitutional amendment.  It would be a big change, but it could be done. 

I'd post a proposed amendment if anyone is interested:

http://strikelawyer/wordpress.com

Fri, 01/07/2011 - 16:28 | 857370 2446
2446's picture

Does anybody know what the consumer credit number is, excluding student loans?

Fri, 01/07/2011 - 16:30 | 857379 goldmiddelfinger
goldmiddelfinger's picture

I'd guess it's still too high.

Fri, 01/07/2011 - 17:24 | 857530 tmftdoyle
tmftdoyle's picture

what a pompous tool. next a shout-out to eddie lampert for completely manipulating trading in sears holdings.

Fri, 01/07/2011 - 18:23 | 857693 Art Vandelay
Art Vandelay's picture

Anyone else here creeped out by the "Semper Fi" reference? Was Berkowitz a Marine?

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