Buffett Buffet

[lystgl]

I stand corrected! Giving "control" of his money to Bill Gates. I guess there is a subtle difference eh?

[arnyk]

Tab for Buffett lunch? $620,100 (U.S.)

[WishingWealth]

Not sure if this is a redux but there's a three part interview with WB on Charlie Rose (PBS) stations tonite and a repeat tomorrow pm.

Usually it's at 11.30 but this can vary from station to station.

Should be pretty good since Rose is a good interviewer - though sometimes you want to scream to the guy STFU.

WW

[Bylo Selhi]

Not sure if this is a redux but there's a three part interview with WB on Charlie Rose (PBS) stations tonite and a repeat tomorrow pm.

Also available online to those with a broadband connection.
Monday's show (via Google Video.)
Tuesday's show.
Wednesday's show.

[IdOp]

Sage of Omaha remarries:

Billionaire investor Warren Buffett married his long-time companion, Astrid Menks, in a private ceremony ...

The U.S. may have a residential real estate bubble, but from this item can we infer that farms are deeply under-valued?

[George$]

Also available online to those with a broadband connection.
Monday's show (via Google Video.)
Tuesday's show.
Wednesday's show.

I've just been watching/listening to these Charlie Rose interviews. Great stuff. Highly recommended. (but part III stops and asks you to buy the video - I wonder why this one.)

[NormR]

Also available online to those with a broadband connection.
Monday's show (via Google Video.)
Tuesday's show.
Wednesday's show.

I've just been watching/listening to these Charlie Rose interviews. Great stuff. Highly recommended. (but part III stops and asks you to buy the video - I wonder why this one.)

Try some of these Seminar(s) in value investing

[George$]

Thanks Norm. (More distractions that will keep me from doing what I don't want to do.)

[Taggart]

Buffett warns against improper dealing

Toronto Star

Oct. 11, 2006. 01:00 AM

[Taggart]

"It takes 20 years to build a reputation and five minutes to ruin it."

Warren Buffett


Times - UK

November 22, 2006

FSA fines Buffett insurance arm £1.2m

The reinsurance business run by Warren Buffett, the world's second richest man, has been hit with one of the Financial Services Authority’s highest ever penalties.

The City watchdog slapped General Reinsurance, the insurance arm of Mr Buffett's investment company Berkshire Hathaway, with a £1.2 million fine over two improper deals.

The fine is dwarfed by Mr Buffett's estimated £24 billion personal fortune, but the ruling comes at a sensitive time for GenRe, which is also being investigated in the US, Australia, Germany, Ireland and Canada.

[NormR]

Video: The billionaire next door

[WishingWealth]

Ben Stein (NYT) back with Buffet's: Who's winning the class warfare?

In Class Warfare, Guess Which Class Is Winning

...

Besides, if it doesn’t matter, why bother to even discuss balancing the budget? Why have taxes at all? Why not just print money the way Weimar Germany did? Why not abolish taxes and add trillions to the deficit each year? Why don’t we all just drop acid, turn on, tune in and drop out of responsibility in the fiscal area? If deficits don’t matter, why not spend as much as we want, on anything we want?

The final argument is the one I really love. People ask how I can be a conservative and still want higher taxes. It makes my head spin, and I guess it shows how old I am. But I thought that conservatives were supposed to like balanced budgets. I thought it was the conservative position to not leave heavy indebtedness to our grandchildren. I thought it was the conservative view that there should be some balance between income and outflow. When did this change?

Oh, now, now, now I recall. It changed when we figured that we could cut taxes and generate so much revenue that we would balance the budget. But isn’t that what doctors call magical thinking? Haven’t the facts proved that this theory, though charming and beguiling, was wrong?
THIS brings me back to Mr. Buffett. If, in fact, it’s all just a giveaway to the rich masquerading as a new way of stimulating the economy and balancing the budget, please, Mr. Bush, let’s rethink it. I don’t like paying $7 billion a week in interest on the debt. I don’t like the idea that Mr. Buffett pays a lot less in tax as a percentage of his income than my housekeeper does or than I do.

Can we really say that we’re showing fiscal prudence? Are we doing our best? If not, why not? I don’t want class warfare from any direction, through the tax system or any other way.

WW

[sbmfj]

good read

[Taggart]

I put this item here on Buffett because I didn't want to mess up George$'s thread on Swensen.

From the other thread regarding Yale, George posted:

"(It does not, however, approach the record of Berkshire Hathaway, the company run by the legendary investor Warren Buffett, in which a $10,000 investment would have grown to $413,721.)"

------------------------------------------

I find some similarities between Buffett and Swensen and to me, the most obvious is that they can buy into investments that the ordinary person has no access to.

I believe this interview with Burton Malkiel in 2003 says it well:

[url=http://www.pbs.org/wsw/tvprogram/malkiel_interview.html]MALKIEL: Okay, what about Warren Buffett? Let's talk about Warren Buffett. There is no question about the fact that when my book first came out, if instead of buying an index fund you bought Berkshire Hathaway, you would have done twice as well. So let me first of all admit Warren Buffett has had a superb, a superb record. But how did he get that record? It's actually, I think, very interesting.

At one point I had the pleasure of having a two-hour conversation with Katharine Graham, the head of the, the former head of The Washington Post. And I asked her about her experience with Warren Buffett, because that (The Washington Post)was one of his great successful investments. And she told me she was just scared to death when he first bought 10 percent of the company. She thought she was going to get kicked out. When she realized that Buffett really did buy it as an investment, she said to him, "Warren, please come and help me. We are going under. I know something about editorial work. I don't know how to run a paper. Come on my board and help me run this business." And she credits Warren Buffett for turning the Washington Post around and making it a successful investment.

It wasn't that he read Graham and Dodd and bought a value stock. He is a wonderful businessman. He has done that with the Washington Post, GEICO. He buys companies. He sets them up. He does a terrific job with it. Even his mistakes, (such as) Salomon Brothers, that got into trouble with a government bond rigging problem, he became chairman of the board and CEO of Salomon Brothers. So he is, there's no question he is a marvelous businessman. He knows how to run companies. He buys companies, not stocks, but I think his success was not through stock picking.[/url]

-------------------------------------------

This recent investment by Buffett explains a bit more what I'm referring to:

Warren Buffett rescues Lloyd's Names

The most important statement in the item, at least for Warren - "He thinks he can make money."

[Bylo Selhi]

So he is, there's no question he is a marvelous businessman. He knows how to run companies. He buys companies, not stocks, but I think his success was not through stock picking.

And in many cases he knows how to not run the companies he buys. Usually when he buys a company outright he does so on condition that the original owner remains to run the place. Then Buffett leaves him or her(*) alone to do whatever they did to attract Buffett to them in the first place.

From BRK's Owner's Manual

I think it's appropriate that I conclude with a discussion of Berkshire's management, today and in the future. As our first owner- related principle tells you, Charlie and I are the managing partners of Berkshire. But we subcontract all of the heavy lifting in this business to the managers of our subsidiaries. In fact, we delegate almost to the point of abdication: Though Berkshire has about 45,000 employees, only 12 of these are at headquarters.

Charlie and I mainly attend to capital allocation and the care and feeding of our key managers. Most of these managers are happiest when they are left alone to run their businesses, and that is customarily just how we leave them. That puts them in charge of all operating decisions and of dispatching the excess cash they generate to headquarters. By sending it to us, they don't get diverted by the various enticements that would come their way were they responsible for deploying the cash their businesses throw off. Furthermore, Charlie and I are exposed to a much wider range of possibilities for investing these funds than any of our managers could find in his or her own industry.

Most of our managers are independently wealthy, and it's therefore up to us to create a climate that encourages them to choose working with Berkshire over golfing or fishing. This leaves us needing to treat them fairly and in the manner that we would wish to be treated if our positions were reversed.

(*) I'm reminded of Rose Blumkin ("Nebraska Furniture Mart is a furniture company heaquartered in Omaha, Nebraska. It was founded by entrepreneur Rose Blumkin (nicknamed Mrs. B in store ads), in 1937. She worked in the business until age 103, even after selling it to investment guru Warren Buffett and his Berkshire Hathaway Corporation in the 1980s.")

[Bylo Selhi]

1. Permanent Value: The Teachings of Warren Buffett
2. Buffett Speaks
3. Shai Dardashti Letter to Warren Buffett

Bonus: check out the rest of gurufocus.com.

[Taggart]

College Investment Fund Prompts Buffett Invite

"It is often assumed that college students are more like to invest intuitively in speculative start-ups and unproven technologies. But the members of the GPS fund are as stodgy as a bunch of Omaha housewives when it comes to their investments. They throw around terms like "Lynchian fundamentals" and "buy-and-hold strategy," which is largely how Mr. Buffett started to take notice."

[Taggart]

It's a few weeks old, but this video clip shows a q&a session Buffett had with employees of R.C. Wiley, a home furnishings company he bought out.

[Taggart]

KETV 7

Omaha

Buffett Turns Down $2M Offer

New York Businessman Fails To Sign Up Buffett As Speaker

POSTED: 10:36 am CST February 14, 2007
UPDATED: 10:48 am CST February 14, 2007

[boib22]

This is a bit dated:

Buy and Hold Nonsense

Wall Street pretends that trading does not work. However, what they say and what they do is a different story. The truth is that no one really practices or uses buy and hold.

Joseph P. Kennedy, Bernard Baruch, Jesse Livermore, J.P. Morgan, John D. R Rockefeller and many more, from a previous era, George Soros, Paul Tudor Jones, Jimmy Rodgers, the Bass Brothers … and many more , from the present era, were market timers all. Either they buy stocks, currencies, bonds, commodities,, and gold when prices are depressed and sell them short when prices are high and buy them back after they decline.



Try to compile a similar list of successful buy and hold investors … perhaps the only name will be Warren Buffett …



Far from being a simple investor whom anyone can emulate … Warren made his first millions running private investment partnerships for wealthy investors. After making them huge gains in the mid-1960’s bull market, he demonstrated exquisite market timing at the bull market peak in early 1969 by withdrawing from the market entirely, liquidating the partnerships …



He began by purchasing small private companies … which were bought with the intention of operating them as subsidiaries, giving rise to the myth that Buffett buys and holds all investments for the long term.



However, that’s not close to true. When it comes to Berkshire Hathaway’s investments in publicly traded stocks … virtually none have remained in its portfolio from one bull market to the next. … Buffet just over the last few years, appears to have traded in and out of large positions in Solomon Bros., U.S. Air Group, McDonald’s, zero coupon bonds, and silver. He also apparently dumped significant holdings when the market began topping out in July 1998 since, by September, Berkshire Hathaway was holding a huge $9 billion in cash.



Source: Riding the Bull by Sy Hading

[Taggart]

Berkshire reports US Bancorp stake,cuts Ameriprise

Wed Feb 14, 2007 5:02PM EST

[Taggart]

Berkshire reports US Bancorp stake,cuts Ameriprise

Wed Feb 14, 2007 5:02PM EST

Taking a quick look this morning and I'm surprised Buffett is paying over 3 times price/book for US Bancorp. This is round about the price that an investor would have to pay for most of the big five Canadian banks, and I thought they were getting a little too expensive.

Here's a couple of articles comparing Canadian to U.S. Banks:

Bloomberg

Globe & Mail

[boib22]

Berkshire reports US Bancorp stake,cuts Ameriprise

Wed Feb 14, 2007 5:02PM EST

Taking a quick look this morning and I'm surprised Buffett is paying over 3 times price/book for US Bancorp. This is round about the price that an investor would have to pay for most of the big five Canadian banks, and I thought they were getting a little too expensive.

Here's a couple of articles comparing Canadian to U.S. Banks:

Bloomberg

Globe & Mail

He's been accumulating for a while. I'll bet his aveage cost is down around 30.

[Bylo Selhi]

BRK's 2006 annual report along with WEB's famous chairman's letter is now available here [PDF].

[uhoh]

from today's Toronto Star:

An Irreplacable Oracle


Despite Berkshire Hathaway's record profits, CEO Warren Buffett sounds more than a little glum. Could it be the realization the company's success depends on him?
Mar 04, 2007 04:30 AM
David Olive

How is it that in a year of record profits for Berkshire Hathaway Inc., its latest annual report, released last Thursday, makes such depressing reading?

Two reasons, principally. Warren Buffett's company is succumbing a bit more each year to "big company" disease. And because chairman and founder Buffett, 76, makes a pretty good case, reading between the lines, that he really is irreplaceable. And that without him the centre cannot hold at the world's biggest grab-bag conglomerate.

If not the most successful investor in U.S. history – that's a toss-up between Peter Minuit's acquisition of Manhattan for about $24 (all figures U.S.) and Thomas Jefferson's $27.3 million Louisiana Purchase – no contemporary stockpicker can match the Oracle of Omaha's record at Berkshire of a 361,156 per cent gain in per-share book value over the past 42 years, a period in which the Standard & Poors 500, with dividends included, managed a 6,479 per cent gain. A $1,000 investment in Berkshire shares in 1965, during the company's first full year under Buffett's control, was worth $2.4 million by 2005.

Problem is, with size comes complexity and complacency. We've seen it with the reversals of Gap Inc., Home Depot Inc., Dell Inc. and Starbucks Corp., companies grown too large to grasp market trends with the alacrity that once made their success appear unassailable.

In his latest letter to Berkshire shareholders, a perennial must-read for amateur and professional investors alike, Buffett writes of earlier days when he and long-time Berkshire partner Charles Munger, now 83, "both grew skeptical about the ability of big entities of any type to function well. Size seems to make many organizations slow-thinking, resistant to change and smug ... Here's a telling act: Of the 10 non-oil companies having the largest market capitalization in 1965 – titans such as General Motors, Sears, DuPont and Eastman Kodak – only one made the 2006 list."

<snip>

For several years now, it has been evident that Berkshire was getting bloated and sloppily managed. And this year's annual report casts the disappointments in sharp relief. Putting aside 2005's $3.4 billion of insurance payouts on hurricanes Katrina, Rita and Wilma – easily dismissed as an anomaly, although Buffett, a believer in climate change, warns of more such reversals to come – Berkshire's non-insurance businesses are a sore for clear-sighted eyes. Most of these are lumped under the heading "Manufacturing, Service and Retailing Operations" (MSR), a congeries of wildly diverse businesses Buffett himself describes as a "motley group" (see box, right).

<snip>

Yet heading into 2007, Buffett must reinvest profits from Berkshire's multitude of operating businesses plus a staggering $57 billion "float" – insurance-premium revenue that must be put to productive use to cover future policy payouts.

And this is where Berkshire is revealed as a one-man show.

Last year, two-thirds of Berkshire's net income was generated by insurance operations, derivatives trading and the sale of assets. (In 2005, for instance, Berkshire received billions of dollars in cash, and shares in Procter & Gamble Co. currently worth $6.4 billion, in selling its stake in Gillette Co. to P&G.)

<snip>

"Picking the right person(s) [to assess investment prospects] will not be an easy task," says Buffett. He allows that Berkshire might replace him as chief investor with several people – inviting the question of who then would be in charge. Buffett says he's looking for someone with that special "business gene" that he and Charlie possess. "Independent thinking, emotional stability, and a keen understanding of both human and institutional behaviour is vital ... I've see a lot of very smart people who have lacked these virtues."

Buffett has settled the most important unfinished business that confronted him as late as last year, having donated the bulk of his estate to the Bill and Melinda Gates Foundation. As to the lesser but more difficult task of recruiting a money manager in his own image – "someone genetically programmed to recognize and avoid serious risks, including those never before encountered" – well, that's going to have to wait because Buffett's in no hurry. (Berkshire will replace him as chief investor, he says, "when the need for someone to do that arises").

And because the search would be a fool's errand. Rather than attempt to manage his idiosyncratic legacy, Buffett's successors will sooner than later set about dismantling it

....

From: http://www.thestar.com/Business/article/187972