Warren Buffett interview, Financial Post, February 7, 2008

[Meadbh]

No economic bailout necessary, says Buffett

WORDS OF WISDOM FROM OUR EXCLUSIVE INTERVIEW

I am a political bigamist at the moment
-- on backing both Democratic candidates, Barak Obama and Hillary Clinton
It's part of a capitalist society when you are going to get ahead of yourself, but we always come out at the other end
--on the current credit crunch
In this case, Wall Street drank its own Kool-Aid
--on the current credit crunch
It would not be a pretty sight if some of the big derivative dealers would not be able to perform
--on the current credit crunch
The Canadian dollar is likely to be worth more in five to 10 years than it is now
--on the rise of the loonie
I am a huge bull on the American economy

 

[Nords]

WORDS OF WISDOM FROM OUR EXCLUSIVE INTERVIEW

He's certainly not behaving like an out-of-touch technophobe who's a fading giant past his prime and unable to even prepare for the inevitability of his own demise. He'll be 78 years old this August.

Of course the only reason these remarks were public in the first place was their being made on the occasion of opening a new branch of BusinessWire, a recent Berkshire acquisition dedicated to proselytizing through press releases. Or while discussing reports of being asked by national regulators to set up a new bond-insurance business. Or because Berkshire's annual report is due out by the end of the month...

I think I'll wait for the word to keep spreading while I keep [-]selling[/-] rebalancing a few more shares each week!

 

[free4now]

Nords I'm in the same boat. I just placed a ladder of limit sell orders for my BRKB stock. If it gets back up to the high water mark again I'll have divested about 30% of my position so that I'm rebalanced.

Buffet himself has said he likes to keep the market value of BRKB close to the intrinsic value, and there's no way the intrinsic value could have risen as much recently as the market value has.

 

[Nords]

I had a $4600/share limit order in on Friday that got snapped up near the end of the day before sagging back down to $4592. In a few more weeks we'll have liquidated the kid's college fund and piled up some rebalancing cash.

Buffet himself has said he likes to keep the market value of BRKB close to the intrinsic value, and there's no way the intrinsic value could have risen as much recently as the market value has.

When an 800-pound gorilla gets national encouragement to open bond-insurance businesses in a regulatory climate known for being discouraging, I suspect people are forecasting a rise in the intrinsic value.

Another possibility is that the defense has rested in the trial of the Gen Re former execs without Buffett being called to testify. When that trial got underway the share price was dropping for 3-4 days.

I also wonder if publicity (as the annual report approaches) and flight-to-quality concerns are bidding things up...

 

[clifp]

True but the stock was undervalued now it is closer to being fairly valued.
I don't really think it is overvalued, there is stilll a number of penalties built into the stock price.

• Warren might die tomorrow and will die soon (the fact this he is likely to spend as much time as CEO of Berkshire as the typical CEO of a Fortune 500 is overlooked)
• It is a conglomerate
• Even the B shares are too expensive not enough liquidity
• Bricks, carpets, candy, jewelry, Dairy Queen etc how old fashion and boring

All that said I actually have a limit sell orders for the first time ever starting at 5K for the Bs and 156,000 for the A.

 

[Nords]

All that said I actually have a limit sell orders for the first time ever starting at 5K for the Bs and 156,000 for the A.

It'd be a whole different ballgame if there was enough volume/liquidity for options trading or inclusion in the S&P500.

But then the stock would be owned by traders, not shareholders...