By Paulo Santos:
The Bruce Berkowitz 2011 shareholders’ letter for Fairholme Funds ignited another spike for Sears’ (SHLD) stock. Granted, anything can start a short squeeze in today’s market, given how hot it is.
In this case, Bruce Berkowitz simply restated his confidence in Sears and Eddie Lampert:
Sears remains a large position in all of our funds, notwithstanding announcements in late December of falling sales and margins, rising expenses, and write-downs. Investors fled with this New Year’s greeting before Chairman Lampert purchased over $150 million of common for his personal account. For many reasons, including management, we continue to believe the assets of this iconic brand to be a multiple of values implied by its current stock market price and continue to see the beginning of a new Berkshire Hathaway.
This is not really surprising, because had Berkowitz sold, the short squeeze we saw in the start of the year would have