In the Chairman’s Letter of 1992 from Warren Buffet I found this small excerpt on his view about value, growth and using discounted cash-flow analysis. I felt like the writing must have light shed on it and be shared with others as it resinated with me, as does most of Buffett’s writings and insight. I […]
Warren Buffett: Quantitative vs Qualitative Investing
In Buffett Partnership Letter October 9, 1967, Buffett said, “The evaluation of securities and businesses for investment purposes has always involved a mixture of qualitative and quantitative factors. At the one extreme, the analyst exclusively oriented to qualitative factors would say, “Buy the right company (with the right prospects, inherent industry conditions, management, etc..) and […]
What is Economic Franchise
Economic franchise is one of the most important investing concepts used by Warren Buffett. Companies with economic franchise are rare in the business world. They are great businesses which enjoy pricing power and could stand incapable management. In his 1991 letter to Berkshire Hathaway shareholders, Warren Buffett explained the concept of economic franchise: “An economic […]
Warren Buffett Explains the Washington Post Investment
Warren Buffett is obviously an incredible investor with a track record across many decades. And although he has made countless good investments, that track record is largely due to several great investments such as Coca Cola, American Express and Washington Post. Value investing however, is not easy. Did you know that Buffett was down 25% […]
Buffett on Stocks, Bonds, Commodities and Gold
JOE: Here’s, you know, listening to you talk, though, Warren, when you say with your comments about bonds, that makes me think of financial assets in general, which includes stocks. And I think about the printing presses not only in this country, but around the world. You’ve seen the commercial, cha-chung, cha-chung, cha-chung, with the […]
Warren Buffett on Stock Repurchase
One usage of retained earnings we often greet with special enthusiasm when practiced by companies in which we have an investment interest is repurchase of their own shares. The reasoning is simple: if a fine business is selling in the marketplace for far less than intrinsic value, what more certain or more profitable utilization of […]
Buffett on World Herald and Newspaper Economics
BECKY: We should point out that we’re here at the Omaha World-Herald because this is Berkshire’s most recent acquisition. Earlier— or last year, I should say— last year you went ahead and you stepped in. And I guess one of the key questions I have is why did you do that? Why don’t we start […]
Buffett Has No Financial Interest in J.C. Penney
BECKY: —way to go. Hey, very quickly, before we go to a break Warren, I wanted to ask you about J.C. Penney. We’ve been watching this story very closely. There was a story recently about how I think Goldman Sachs had been potentially lining up— a line of credit for them. It’s got to be […]
Buffett: Content vs Distribution
BECKY: You have bought more IBM shares though, right? BUFFETT: Yeah, we bought a few, yeah. JOE: I was just getting back to this media, ’cause I’m trying to understand, I don’t know what the landscape looks like. And Warren probably— doesn’t necessarily.Does it look like the pipes, Warren, eventually become more commoditized, you know, […]
Why Buffett Hates the Airline Business
BECKY: Okay. In terms of other things that came up this weekend— Andrew touched before on the question that Bill Miller asked— of Legg Mason. His question was again related to the airlines. He’s been on Squawk and talked about his investment thesis. He has bought into a lot of these airlines. And he points […]
Why Warren Buffett Bought IBM
BECKY: Wait. Wait a second, IBM is a tech company, and you don’t buy tech companies. Why have you been buying IBM? BUFFETT: Well, I didn’t buy railroad companies for a long time either. I—it’s interesting. I have probably—I’ve had two interesting incidents in my life connected with IBM, but I’ve probably read the annual […]
On Subprime Mortgage Industry
– There are similarities between subprime and manufactured housing financing – The most important factor for the subprime industry is the health of the economy, which has been good of late – Securitization moves the ultimate lender farther away from borrower, which is what causes problems – A shock will probably not occur unless we […]