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Stocks B / Berkshire Hathaway


Subject:  Re: A Little Munger Color Date:  3/24/2013  2:06 PM
Author:  Charliedealraker Number:  200397 of 235736

I remember all so well back in 2001 I think having this discussion about the valuation of Cisco with a very popular poster on the old yahoo board. It was my view that it was plum dang crazy, and that this one decision to "hold" Cisco would out-importance all the other portfolio decisions this poster would make for the next 10 years. The poster had sold a little Cisco but kept the rest and the justification was that John Chambers was THE smartest guy in the entire world.

Well that poster still holds the Cisco that wasn't sold in 2001 just after (memory may be challenged here) the world's greatest CEO's company earned 50 cents and the stock was selling for $80. Of course it was only a few months later that the CEO bailed on $150 million of stock and a few months later the company had what was then the largest invenstory write-off in US history. I called it silliness to hold that stock and the poster's rescuers came flogging me to oblivion. Of course it was an older more experienced man seeing what was perfectly obvious- yes yet another man held on a pedestal created by the times and all the value investing rules were being slaughtered to death propping him up.

Now the page view tabloid journalism model is flourishing and gotcha headlines real in the same so-called value investors that the Internet charmed 10-15 years ago.

We can defend the young writers not practicing sound financial journalism or usher them in to the real world. Back in the 1990's early 2000's it was the different story with the same characteristics- people caught up in the moment looking for something to have it all make sense. Reeling them in was impossible.

The product being sold on seekingalpha is you when you click on the catchy headline. That's why you get it free.
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