Warren's workin' on the railroad

[HFWR]

http://www.cnbc.com/id/18020483

"Berkshire recently acquired a 10.9% stake in Burlington Northern Santa Fe BURLINGTON NORTHERN SANTA FE CORP (BNI) , becoming the railroad company's largest shareholder, Reuters reported over the weekend."

"He declined at the time to itemize two other companies in which Berkshire owned $1.9 billion of stock "because we continue to buy them. I could, of course, tell you their names. But then I would have to kill you."

[FinanceDude]

Hmmmmmmmmmm................what is Warren up to??

Only thing I can think of is that they have a lot of rail in the Midwest where most of the country's corn is grown. Maybe Warren thinks that a lot of corn will be shipped on rail for efficiency to the ethanol plants??

Just a thought.................

[al_bundy]

supposedly he is buying up stock in other railroads along with Bill Gates. I wouldn't be surprised at a super merger of railroads that will create an integrated transportation network. they are looking to build a huge rail line into Denver from Mexico to avoid the problems created by the LA dock workers unions a few years ago

[HFWR]

Gates already owns a nice chunk of Canadian National.

[Nords]

Originally Posted by FinanceDude

Hmmmmmmmmmm................what is Warren up to??

I hope this turns out better than his airline stocks, but he has been buying a lot of infrastructure & franchises lately.

I wonder if this is part of interviewing the crop of candidates to replace Lou...

[heyyou]

WB's investment is a play on future fuel prices. Railroads (RR) are probably value stocks now, but still are a cheap way to transport goods. As fuel prices go higher, Over-The-Road trucking (OTR) will stabilize or shrink to only valuable or time sensitive shipments. Trains will continue to carry high volume, lower cost goods. Those cargo containers have revolutionized how quickly stuff is handled. RRs will be more attractive as fuel costs escalate. RR workers tend to be unionized but automation has decimated their ranks such that the remaining high seniority workers want to preserve their careers instead of asking for more money.
John McPhee, a excellent writer focussed on geology across America along Interstate 80, has written about how Burlington Northern (BN) was resurrected by hauling cheap Wyoming coal to power plants throughout the country after nuke power became unacceptable. (Sorry, Nords) McPhee rode a BN coal train and even interviewed some train historians and train buffs. There are train buffs that watch trains instead of sports events.
I didn't intend to derail the topic.

[Nords]

Originally Posted by heyyou

John McPhee, a excellent writer focussed on geology across America along Interstate 80, has written about how Burlington Northern (BN) was resurrected by hauling cheap Wyoming coal to power plants throughout the country after nuke power became unacceptable. (Sorry, Nords)

Eh, Rickover would be the first to say they brought it on themselves.

Comparing naval nuclear propulsion plants to civilian nuclear utilities is like comparing the carbon in the Hope Diamond to the carbon in a pencil...