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I was deeply disappointed by the May 25^th <st1:state w:st="on"><st1:place w:st="on">New York</st1:place></st1:state> Times article on Fairfax Financial (NYSE: FFH) by the Pulitzer Prize-winning business columnist, Gretchen Morgenson, Gauging the Big Bets of a Hot Hand.  We usually enjoy her work, but this story on <st1:city w:st="on"><st1:place w:st="on">Fairfax</st1:place></st1:city> is certainly an anomaly: it’s a smear and a hatchet job, filled with innuendo, inaccuracies, and misleading statements.

In a recent edition of Value Investor Insight, Whitney Tilson and Glenn Tongue reiterated their thesis from last August that Fairfax Financial (FFH) is one of the best ways to play the subprime train wreck.

Few firms were as well-positioned to benefit from the credit crisis as Canadian insurer Fairfax Financial. Primarily due to its giant credit-default-swap [CDS] portfolio on companies exposed to the subprime debacle, Fairfax has feasted on others’ misfortune: earnings are up sharply and the shares have risen 40% since we touted them last summer (VII, August 31, 2007).

Technically starting to move forward with growing on balance volume, it's an easy pick once overall market sentiment becomes less volatile, which will be near when VIX confidently passes 32.

Angela Barnes of the Globe and Mail reports on Fairfax Financial (FFH/NYSE) potentially booking big gains on its holdings of credit default swaps (CDS):

In May I posted about Prem Watsa positioning Fairfax Financial's (FFH/NYSE) investment portfolio for a "hundred year storm" in the markets. This weekend, James Daw of the Toronto Star reports on Watsa's comments during the Fairfax recent conference call:

But Watsa and his team are looking smarter or luckier, in a morbid way, that they bought investment protection when it was still available and when prices were cheaper.

Reading VInvesting, I see this Globe and Mail piece on veteran money managers buying forestry stocks. The sector is battered. And that's why you'll see that many of the "usual suspects" of value investing are mentioned in the article, among them Cundill and Third Avenue.

Regular readers of Controlled Greed.com know that I don't own any of these stocks directly -- and I might be making a mistake in not doing so. I do have indirect (and I'd imagine tiny) exposure through owning Fairfax Financial (FFH/NYSE):