Comments on: Buffett’s Buy Metric

By: gfeirman

gfeirman — Fri, 06 Feb 2009 22:44:28 +0000

In The NY Times article from 10/17, he was talking about moving his PERSONAL ACCOUNT, which at the time was 100% in treasuries, into stocks. So the buys you mention don’t really apply because they were all Berkshire buys before the Op-Ed. The market isn’t lower now then it was back when Buffett was buying and many stocks are higher so it’s very possible that Buffett is up, even a good amount, in his personal portfolio on his October buys.

By: mudpuppy

mudpuppy — Fri, 06 Feb 2009 21:24:10 +0000

Karen, yes I know about his Cal homes. What does that have to do with anything?
And just what are his tactics for acquiring his % ownership in publicly traded companies?
He takes advantage of the opportunities afforded him, which is his responsibility as CEO of Berkshire.
I don’t have blinders on because what he does or doesn’t do doesn’t affect me.
Is he a Saint? No. Are you? He just has happened to have made many individuals millionairs. Have you?

By: royrogers

royrogers — Fri, 06 Feb 2009 03:05:04 +0000

we must be in a deppression, only a few, like BR can escape the
wealth destruction.

By: karen

karen — Fri, 06 Feb 2009 01:58:31 +0000

mudpuppy, i have never heard such cr*p in my entire life. you didn’t know about his california homes? his and hers by the way… and he didn’t sell his at the right time… you obviously don’t know his tactics for acquiring his % ownership in publicly traded companies, either… enuf… keep your blinders on if it helps you.

By: mudpuppy

mudpuppy — Fri, 06 Feb 2009 01:44:40 +0000

It’s obvious that most of the people here have no idea how Buffett invests.
First, any company he invests in he has studied for years. He know it inside and out. He followed silver for 20 years before he bought it. When he bought coke he followed it for 25 years. He can tell you the cost of each ingrediant in a can of coke as well as the cost of ingrediant in every one of cokes competitors. When he bought petrochina he knew the cost of their reserves ($6.00/barrel) and the cot of reserves of each of their competitors reserves. He made 600% on that investment. But it didn’t happen in a week. It happened in 5 years.
Second, he invests. He doesn’t trade. His time frame isn’t tomorrow, or next week or even next year. It’s 5 or 10 years from now. When he began buying The wasington Post in 1973 he figured its value at $400 million. It was selling for$80million. He bought all he could get his hands on. It took 10 years before he broke even.
Like him or hate him, he is not your everyday investor. He is a financial genius who could care less what others think. His salary from Berkshire is $100,000 a year. Not 1 million, not 10 million, but 100,000.
He is honest. He has given nearly all his money to charity. He’s lived in the same modest house for 55 year. He doesn’t believe his children should get all his money and be deprived of the value of working for a living. If we all lived like him the world would be a better place.

By: bobc7i

bobc7i — Fri, 06 Feb 2009 01:21:07 +0000

So the rising trendline from the lows of the 1940s to the lows of the early 1980s points to a Buffet buy-point around 70% of GNP. Is the rising trendline perhaps taking globalization into account?

By: Steve Barry

Steve Barry — Fri, 06 Feb 2009 00:33:07 +0000

Buffet has always said that he likes to buy at a discount…that means about 50% on that chart…also, since we are now much more socialist than ever before, I’d cut the buy point to 40%

By: Andy Tabbo

Andy Tabbo — Fri, 06 Feb 2009 00:32:47 +0000

amannamedbob:

You’re point is well taken and acknowledged. I agree he’s obviously been a hugely successful manager and investor through many different markets and there’s a reason he’s the richest man in the world.

I would say though that he has been treated like a media darling for many, many years. Everyone in the world cites Buffetisms. His annual meetings draw huge crazy crowds to hear the “words of the Oracle.” I think it’s safe to say he is seen as THE big hero of the “investing class.”

And, hey, it’ll probably all work out OK for him someday…if you have deep enough pockets I guess you can ride out anything….but he has definitely been a little “early.”

By: AGG

AGG — Thu, 05 Feb 2009 23:26:47 +0000

I saw Buffett on TV the other day. He looks like a truck ran over him. I don’t think things are working out too well for him. He knows this is 1966 on steroids. He just doesn’t want to come out and say it.
Follow him and you are just another lemming going off the cliff.

By: Blissex

Blissex — Thu, 05 Feb 2009 22:03:18 +0000

That graph contains a big mistake: the mean is way lower than 70%, because that 70% line is skewed by the extraordinary values in the 1995-2010 period, values greatly distorted by the enormous rise in stocks purchased on margin thanks to the yen and dollar carry trades.

The long term mean is around 50-60% as that’s the reasonable level considering the rate of growth of GNP and stocks returns…