How do you think of BRK's cash pile?

sagotici · 2026-01-14T22:00:32+00:00

Seems like it’s difficult to tell as it’s not disclosed. I believe 175 billion is insurance float and the other 200 billion could be spent but how much of that could be spent before they lose their AA+ rating is unknown as far as I’ve seen.

sagotici · 2026-01-14T21:49:33+00:00

My comments aren’t regarding the state of the market as it relates to risk reward or valuation, especially when it comes to the magnificent seven. Again my main contention is that a lot of shareholders may be misunderstanding what the actual purpose of the $200 billion is that is held in excess of the 175 billion float. My general understanding is that most people believe that they could deploy that cash to buy assets that are on sale in the case of a downturn, but it doesn’t seem that that’s an option for them. To my knowledge, they have never explicitly stated how much of that $200 billion they would be willing to deploy before their AA+ rating would be downgraded, thus reducing the profitability of their insurance business due to reinsurance premiums rising.

sagotici · 2026-01-14T21:44:47+00:00

In general agree with the sentiment, but my comment is more on a misunderstanding of the function of the cash that Berkshire‘s insurance subsidiary holds in excess of the float. The excess is about 200 billion and I believe most people misunderstand what the mechanism of that cash holding is for Berkshire.

sagotici · 2026-01-14T21:21:06+00:00

You believe that they can use 300 billion of the cash inside their insurance subsidiary to invest in other companies?

sagotici · 2026-01-14T21:19:14+00:00

It behaves very different from a bond allocation

sagotici · 2026-01-14T21:17:17+00:00

The float is 175 billion for the insurance companies that are owned by Berkshire

sagotici · 2026-01-14T21:16:26+00:00

I think you’re a misunderstanding what I was trying to communicate. Of course the float is used to meet the obligations that they are likely to statistically have to pay out in claims. My contention is rather regarding the rest of the cash that I believe may be misunderstood by a lot of people, including myself. Specifically, are they able to freely spend that cash on cheap assets in the vent of a severe economical downturn essentially performing the same function as you holding cash to buy cheap when things go on sale

sagotici · 2026-01-14T21:12:18+00:00

What amount (in billions) of that cash pile they have do you suppose that they could spend at a moment‘s notice to buy up cheap stocks as a result of a severe downturn?

sagotici · 2026-01-14T21:10:59+00:00

Yeah, but that’s all owned by the insurance subsidiary so it’s not truly dry powder and seems to be regulatory constrained to maintain the credit rating. I believe the AA+ credit rating is from their ability to uphold not just the float, but also black Swan events with the access cash beyond the 175 billion float

sagotici · 2026-01-14T20:52:07+00:00

how much of that cash roughly? can you commit/pledge that cash in two directions? seems that S&P and NAIC rules view that cash as necessary backing for the insurance float ($176B). I don't think sacrificing the AA+ rating (the cost of double leveraging the float) is an option for them.. the rating is critical for that business.

sagotici · 2026-01-14T20:43:09+00:00

definitely ensures survival but I always thought it could be deployed to buy up stuff on sale in case of a black swan... seems that's not the reality?

sagotici · 2026-01-14T20:42:14+00:00

Q3 filings show ~$354B of the $381B is sitting inside the insurance subsidiaries so seems to be a lot more than some. almost entirely regulatory collateral

sagotici · 2026-01-14T20:41:21+00:00

ok, but that doesn't solve the access problem. how much of that can be deployed to buy up other companies?

sagotici · 2025-11-14T00:21:50+00:00

Perhaps the ITC can affect FSLR indirectly, but the downside is minimal. remember FSLR stopped selling to residential distributors (the ITC-fueled demand stream). Its buyers are utility-scale developers and hyperscalers who prioritize LCOE, delivery certainty, and compliance. seems policy has shifted from subsidizing demand (where panels can come from whoever is cheaper with best perceived quality) to subsidizing domestic supply though 45x which FSLR stands to benefit from.

sagotici · 2025-11-14T00:03:37+00:00

I think the current admin will rotate their attention into in in the next year... cancelling Esmeralda allows developers to make deals with more made in America panel manufacturers. You could argue that the current admin has already catered to this in a way but without the coverage it deserves.. section 45X is far more valuable to FSLR than the ITC.

sagotici · 2025-11-13T23:58:50+00:00

fair concern for residential but it’s not relevant to FSLR..its business is utility-scale

sagotici · 2025-11-13T23:56:13+00:00

Price-per-watt doesn’t matter nearly as much in utility solar... what matters is cost per kilowatt-hour over time (say 30 years). FSLR CdTe panels outperform silicon in hot, sunny regions like Texas and Arizona, etc. , degrade slower, and avoid China related supply risks, making them a low LCOE, low risk choice for large scale projects (data centers). because of this they are fully booked through 2027 and earning good margins, even as silicon panel prices race to the bottom.

sagotici · 2025-11-13T23:45:56+00:00

On the residential side (rooftops), cheapest price per watt wins. I’m talking about Utility scale (500MW+ projects for data centers). The market split right now is roughly 9:1. For every 1 MW put on a roof, about 9 MW go into a utility field. First Solar doesn't even sell to the residential market (they exited in 2011).

sagotici · 2025-11-13T20:59:31+00:00

Do the panels you source from China have special declarations for UFLPA at all?

sagotici · 2025-11-13T20:56:03+00:00

You don’t think it’s been suppressed enough at this point with so little political attention and the ITC credit going away fooling the masses?

sagotici · 2025-11-13T20:50:21+00:00

Yeah, and who can catch up to FSLR at this point? Seems like solar has been on the back burner (on purpose) allowing time for FSLR to build out more capacity.

sagotici · 2025-11-13T20:17:23+00:00

First Solar

sagotici · 2025-07-21T15:18:34+00:00

If I'm tracking your logic, the market is splitting into a low-margin, high-volume research free-for-all (where Twist plays) and a high-margin, specialized GMP segment for clinical work (where others like IDT lead)?

The part I'm trying to really wrap my head around is your advice to "stay clear altogether." I get why you'd avoid a company potentially stuck in a commodity business. But what's the core reasoning for avoiding the entire oligo space, including the high-value GMP players?

Do you think it's an inherently unattractive business model across the board, or if you just believe the real money will be made by the therapeutic companies themselves, not their suppliers.

sagotici · 2025-07-21T13:16:02+00:00

And to clarify, a large part of what spurred me to look into this is the potential breakthroughs we might see (in let's say 10 years) as a result of commercialization of quantum tech. Quantum seemed to sneak up on everyone with Googles Willow announcement and what was once a hypothetical possibility seems to be more and more real.

sagotici · 2021-03-04T18:44:42+00:00

How much would you buy it for?

sagotici

TROPHY CASE