Gustavo Ballvé on February 26th, 2011
Food for thought, Home, Industries, Insurance, Investment Themes, Mental models, Portfolio Management

Here’s the link to Berkshire Hathaway’s 2010 annual report.

We set time aside one Saturday per year to read Warren Buffett’s letter (we’re still reading this one), and the one for 2010 is bound to be very interesting. The Wall Street Journal and the Financial Times both published stories about what to “expect” from the letter. The WSJ piece focuses on numbers and lists estimates by several analysts, but it ultimately highlights one of the biggest strengths of Berkshire’s unique business model: the “turbo power” of float.

The FT piece is written by Alice Schroeder, author of the great Buffett biography “Snowball”, and focuses on succession. We’ll certainly be interested to hear more about Todd Combs, for instance. That said, as much as we’ve disagreed with Ms. Schroeder “holier than thou” approach in a previous post, she does have a point: succession is on everybody’s mind. It’s just that Ms. Schroeder seems to sometimes try too hard to be the “Buffett skeptic” inside journalism. We definitely believe it’s wrong for reporters and analysts alike to idolize Mr. Buffett – or anyone, for that matter – to the point where the reporting or the analysis becomes murky. The other side is also true: it’s dangerous to always second-guess someone.

Besides, when it comes to Berkshire’s share price, is the succession issue an overhang or an opportunity?


Our post about last year’s letter to shareholders.

Walking the Talk: We look at Buffett’s letters since 1959 and find consistent behavior over time (with links to all the letters).

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