Berkshire
A LEX column reminds us that Buffett runs Berkshire and for over 50 years has taken calculated risks better than most; he has avoided and profited from most crises including the last one; and he has written and talked extensively about excessive risk-taking, the dangers of leverage and spendthrift economic policies and etc.. And yet he has been soundly ignored by most investors, CEOs, regulators and policy makers.
A Moody’s study shows that bank Boards have seen some shuffling and that more “financial expertise” was added. The FT argues that some banks with the “worst” boards in terms of financial experience actually did pretty well, and notes other apparently strange occurrences – for instance, Goldman Sachs has a CEO who’s also chairman and yet the bank has done pretty well in the crisis… We’ll never get tired of saying this: dump the checklist approach to CG. Actually, dump the checklist approach to anything.
OK, funny things first: Buffett playing Axl Rose is awesome. Less impressive is him playing a hip-hop artist, but it’s alright (both videos embedded inside). Viral videos can be a smart marketing tool, and these work. Back to seriousness: Business Week had a cover article by Alice “Snowball” Schroeder interviewing CEOs who have had Buffett in their boards. Interesting read.
A rare but always welcome interview by Charlie Munger embedded inside, courtesy of an attentive reader and the Stanford Law School. Some highlights inside as well. The main theme is the economic/ financial crisis (what else?).
God has spoken, go out and read it. The core is dedicated to welcoming and explaining BRK to its new shareholders acquired through BNSF, so no big news. Buffett complains more about the media and investments analysts, on how they distort things, causing losses to the less diligent and recommends that everybody form their own knowledge base and opinion. Hope he lives to see that happening, but we sincerely doubt it.
Buffett used the Thriftsville vs. Squanderville metaphor in this brilliant article back in 2003. Now it’s Charlie Munger’s turn with a parable on the wealth of a nation and how to lose it. It’s a fun read.
Buffett was particularly expansive regarding his processes and methods, and this alone makes this video worth the time (some 90 minutes). The fact that it was October 1998, a pivotal time in the dot-com boom and just after the LTCM imbroglio makes it even more interesting.
We’ve recently had the opportunity to do research on Buffett’s letters to shareholders beginning in 1959 (when Buffett managed Partnerships and Berkshire Hathaway was not even in his sights). His consistency and transparency are always impressive – especially in times like these and since we’re talking about more than 50 years of Buffett clearly practicing what he preaches.
There is an increasing amount of BRK shares sold short and people seem quick enough to point to the Burlington deal as the culprit, for many reasons (listed inside). They may be missing the number one reason, and it’s one that merits attention.
They took questions from Columbia grad students and the event was broadcast live by CNBC. It has an eerie feel to it – with the whole “must keep spirits high” approach. That said, both men think in the long term (15+ years) and it’s always interesting to be reminded of some basic concepts.
