Referring generally to the broad portfolio, “We've had two years of improving businesses,” Berkowitz tells us, “with most companies improving book values.” Despite the fund's impressive performance this year, he believes the holdings are still selling at very attractive discounts to their respective liquidation values and so he is “waiting right now for others to agree.” While he says that his companies' share prices had a horrible year in 2011, “If you look at the fundamental business statistics of our companies, they improved dramatically,” he tells us.
AIG, the fund's largest holding, is a good example of this. In 2011, AIG was a major detractor from the fund's performance, as the stock declined nearly 60%. However, for this year through August, this stock has gained nearly 50%. Despite the massive stock price volatility, the company's tangible book value grew more than 30% year-over-year (as of 6/30/12) and Berkowitz notes that all of AIG's businesses are making money.
Link to entire article which includes updated comments from Berkowitz: