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No. of Recommendations: 8

I'd love to comment further, but I can't comment at length on the topic. I would say this -- focus on what Buffett said in the annual report on how Gen Re people are going to be compensated. I strongly believe that people will do what they are motivated to do. In other words, if your compensation depends on EPS growth, you'll get EPS growth by hook or crook. If if depends on profit margins, you'll get profit margins even if it means additions to invested capital strip away the benfit of higher margins. So just listen to what Buffett says on that -- absent a mega-catastrophe, he expects cost of float to fall this year and he says Gen Re has the tools to become the world's most profitable reinsurance company. That doesn't look like a loss of faith to me at all. I expect Berkshire will gladly reward very handsomely those people that can deliver on these goals.
Dale
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