Almost everything? He used to avoid companies that needed lots of capx. Now that doesn't seem to matter. He used to buy companies and then let them continue running exactly the way they had been run before he bought them. Now, not so much. Used to see a BRK run company, and say that's ours. Now not sure if I could spot them all.Been a shareholder for a long, long time. Seeing the changes over the years has been interesting.Used to call him "Uncle Warren", at home. Now not so much.Not saying this to make people angry... Just trying to start a thread about how things have changed, and how being a huge conglomerate benefits shareholders. I read the comments in the AR about this path, but it would be good for a thorough discussion here.Is BRK a Peter Lynch "stalwart" or a Peter Lynch "slow grower"?Is being bigger better for shareholders?Please chime in.Sincerely,jan
Please chime in.OK, here are some of my thoughts...1) WEB has never said that he is trying to maximize shareholder value. Read the owner's manual - item 11 clearly says they will do things that reduce financial performance.2) WEB has referred to BRK as his Sistine Chapel. It is to be a shining work of art for the ages. This is very different from simply creating shareholder value.3) WEB and Charlie clearly believe they know how to make capitalism work properly and rationally, and want to prove it in a big way.4) 3G provides an interesting counterpoint, and an intriguing opportunity. Also when I read the WSJ article about them, the word that kept ringing in my head was oligarchy.5) Charlie told his heirs never to be so stupid as to sell the stock.Bottom line, there is a whole planet out there and I think I see the potential for a new world order. Which inning do you think we are in? I doubt we are past the 3rd.
Don't let him stop now, I have some small/mid caps I would like him to buy like BKE...just down the road in Kearney NE.sw :)
WuLong,The new world order thought is interesting, would you care to elaborate?Jan
Also, when I think of the term maximizing shareholder value I think of Icahn...esque buy and pillage routine, that destroys on going concerns. So I agree that is not what BRK sees as it mission.Now the mission seems to buy up everything it can, especially if someone else does the staff cutting.I do know what it is like to be cut and I also know what it is like to not be cut and end up with ridiculous amounts of work and stress.Hope 3G at least provides good support for those who will surely loose their jobs.Not fun.Jan:^\
The new world order thought is interesting, would you care to elaborate?The most successful oligarchy in history was probably the Most Serene Republic of Venice. It is probably useful to review its history.http://en.wikipedia.org/wiki/Republic_of_Venice#GovernmentThe histories of the Dutch East India Company, British East India Company, and British South Africa Company may also be of interest.VOC once owned Indonesia. EIC once owned India and China. Hawaii. Central America. Lot's of interesting places with interestingly tangled histories.Those companies focused primarily on extraction. They utilized military power and slavery. They (like many American corporate giants) focused on greed, self-aggrandizement, and indifference to the suffering of others. By focusing instead, hyper-rationally, on development and value realization, where might BRK/G3 end up? My point is that if the BRK model a) really is better and b) can be extended as a distributed network, then where does it stop? I don't necessarily see a limitation*. If we are in the 3rd inning, what do the 5th and 7th innings look like?And I suggest it would be really stupid to ever sell the stock of such an oligarchy. Why give up a birthright?----*OK, the speed of light is a bit of a limitation, but that's more of a 9th inning issue.
would you care to elaborate?Going further.Munger talks about multiple mental models. He keeps an inventory of these*.I think of these as boxes. When someone says "Let's think outside of the box", they are really saying, "We're trapped in a silo of insular thinking. Let's try applying the models of different disciplines and see if that can give us a fresh perspective".With that in mind, I like to apply the box of the historian rather often. As Twain said, history often rhymes. When you do this, it is easy to feel despair. Humanity has failed far more often than not. Yet its triumphs have been glorious.New things are very very hard. Take the example of the American Revolution. This has only happened once in all of history. Bolivar broke his heart trying it in South America. The French Revolution is a cautionary tale for the ages. The Arab Spring has harvested nothing but misery. Yet, because the American Revolution happened, the world knows it is possible. Because America continues to strive towards its ideals**, the world knows that it need not be tied to the wheel of history.Similarly with BRK. Just because the great companies of history were flawed does not mean capitalism itself is doomed, any more than America was doomed by the examples of Rome, Athens and Sparta***. I see what WEB and Charlie have been saying as the equivalent of the Scottish Enlightenment.http://en.wikipedia.org/wiki/Scottish_EnlightenmentI truly believe there is an opportunity to demonstrate something about value creation, with BRK as the shining example****. Now, consider the ovarian lottery. Merely by being born in the US, one gains tremendous advantage. What advantages might accrue to the owners of an evolution in business? I suspect they would amount to more than wealth. I expect that structurally it will be an oligarchy, and I want to be a part of it.Yet, history advises caution.I have a penchant for science fiction. One of my favorite authors is perhaps the most cynical. When you have a chance, you might read Resnick's Birthright: The Book of ManThe story is very obviously inspired by Resnick's personal interest in Africa. Humanity's behavior and motivation is a direct continuation of 16th to 19th century European colonialism and imperialism: ruthless exploitation and domination of other cultures, justified by an ideology of racial superiority. "Birthright" is based on the speculation that this behavior could be a fundamental trait of humanshttp://en.wikipedia.org/wiki/Birthright:_The_Book_of_Man-----*You’ve got to use those tools checklist-style, because you’ll miss a lot if you just hope that the right tool is going to pop up unaided whenever you need it. But if you’ve got a full list of tools, and go through them in your mind, checklist-style, you will find a lot of answers that you won’t find any other way.http://www.tilsonfunds.com/MungerUCSBspeech.pdf**The Civil War, Civil Rights, on and on. We are a flawed society, we recognize it, and we strive to do better.** For those who aren't aware, the US Constitution is based largely on the example of Sparta. The Founding Fathers were very frightened by the mob-rule aspect of the Athenian model.http://en.wikipedia.org/wiki/Spartan_Constitution****I once had a discussion with someone about the difference between task, craft and art, and when an action moves between those forms. I suggested that sport could also become art and gave the example of Michael Jordan. Similarly, I think that WEB and Charlie, if they are able to perpetuate their model, will have achieved art.
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