4.	Investments in Associated Companies

A summary of investments in associated companies at March 31, 2012 and December 31, 2011 is as follows:


	March 31,		December 31,
	2012		2011
	(In thousands)
Investments in associated companies accounted for
under the equity method of accounting:
Jefferies High Yield Holdings, LLC ("JHYH")	$	332,956	$	323,262
Berkadia Commercial Mortgage LLC ("Berkadia")		206,144		193,496
Garcadia		75,318		72,303
Linkem S.p.A. ("Linkem")		79,188		86,332
HomeFed Corporation ("HomeFed")		47,378		47,493
Brooklyn Renaissance Plaza		32,372		31,931
Other		36,792		38,949
Total accounted for under the equity method of accounting		810,148		793,766

Investments in associated companies carried at fair value:
Jefferies Group, Inc. ("Jefferies")		1,092,834		797,583
Mueller Industries, Inc. ("Mueller")		473,719		400,446
Total accounted for at fair value		1,566,553		1,198,029

Total investments in associated companies	$	2,376,701	$	1,991,795

Income (losses) related to associated companies includes the following for the three month periods ended March 31, 2012 and 2011:


	2012			2011
	(In thousands)

Jefferies	$	299,601		$	(79,702	)
Mueller		74,315			–
JHYH		9,694			14,928
Berkadia		11,820			14,659
Garcadia		8,094			4,295
Linkem		(4,190	)		–
HomeFed		(115	)		(18	)
Brooklyn Renaissance Plaza		441			643
Other		2,248			1,023
Income (losses) related to associated companies
before income taxes		401,908			(44,172	)
Income tax provision (benefit)		139,369			(16,124	)
Income (losses) related to associated companies,
net of taxes	$	262,539		$	(28,048	)

Investments accounted for under the equity method of accounting are initially recorded at their original cost and subsequently increased for the Company's share of the investees' earnings, decreased for the Company's share of the investees' losses, reduced for dividends received and impairment charges recorded, if any, and increased for any additional investment of capital.

In accordance with GAAP, the Company is allowed to choose, at specified election dates, to measure many financial instruments and certain other items at fair value (the "fair value option") that would not otherwise be required to be measured at fair value. If the fair value option is elected for a particular financial instrument or other item, the Company is required to report unrealized gains and losses on those items in earnings. The Company's investments Jefferies and Mueller are the only eligible items for which the fair value option was elected, commencing on the date the investments became subject to the equity method of accounting. The Company believes accounting for these investments at fair value better reflects the economics of these investments, and quoted market prices for these investments provide an objectively determined fair value at each balance sheet date. In addition, electing the fair value option eliminates the uncertainty involved with impairment considerations. The Company's investment in HomeFed is the only other investment in an associated company that is also a publicly traded company but for which the Company did not elect the fair value option. HomeFed's common stock is not listed on any stock exchange, and price information for the common stock is not regularly quoted on any automated quotation system. It is traded in the over-the-counter market with high and low bid prices published by the National Association of Securities Dealers OTC Bulletin Board Service; however, trading volume is minimal. For these reasons the Company did not elect the fair value option for HomeFed.

As of March 31, 2012, the Company owns 58,006,024 common shares of Jefferies representing approximately 28.2% of the outstanding common shares of Jefferies. Jefferies, a company listed on the New York Stock Exchange ("NYSE") (Symbol: JEF), is a full-service global investment bank and institutional securities firm serving companies and their investors.

As of March 31, 2012, the Company owns 10,422,859 common shares of Mueller, representing approximately 27.3% of the outstanding common shares of Mueller, a company listed on the NYSE (Symbol: MLI). Mueller is a leading manufacturer of copper, brass, plastic, and aluminum products.

As more fully discussed in the 2011 10-K, the Company has agreed to reimburse Berkshire Hathaway Inc. for up to one-half of any losses incurred under a $2,500,000,000 surety policy securing outstanding commercial paper issued by an affiliate of Berkadia. As of March 31, 2012, the aggregate amount of commercial paper outstanding was $2,470,000,000.

The following tables provide summarized data with respect to significant investments in associated companies. The information is provided for those investments whose current relative significance to the Company could result in the Company including separate audited financial statements for such investments in its Annual Report on Form 10-K for the year ended December 31, 2012. The information for Jefferies is for the three month periods ended February 29, 2012 and February 28, 2011.


	2012		2011
	(In thousands)

Jefferies:
Total revenues	$	1,006,800	$	966,700
Income from continuing operations before extraordinary items		77,100		87,300
Net income		77,100		87,300

JHYH:
Total revenues	$	56,900	$	73,000
Income from continuing operations before extraordinary items		36,400		47,800
Net income		36,400		47,800

Berkadia:
Total revenues	$	95,800	$	85,600
Income from continuing operations before extraordinary items		25,900		19,200
Net income		25,900		19,200

Under GAAP, JHYH is considered a variable interest entity that is consolidated by Jefferies, since Jefferies is the primary beneficiary. The Company owns less than half of JHYH's capital, including its indirect interest through its investment in Jefferies and will not absorb a majority of its expected losses or receive a majority of its expected residual returns. The Company has not provided any guarantees, nor is it contingently liable for any of JHYH's liabilities, all of which are non-recourse to the Company. The Company's maximum exposure to loss as a result of its investment in JHYH is limited to the book value of its investment plus any additional capital it decides to invest.