captkerosene

I would say that innovation is very dead at BRK. WEB targets industries that don't change. GE makes locomotive engines ... not BNSF.

My absolute first choice would be Bruce Flatt for both CEO and COB. It would cost billions to get him but he'd make it back the first quarter. Think about it, he spends his time managing 80K people and allocating capital. Looks at hundreds of deals every year and has a record that just about equals WEB. Still in his early fifties and looks like he lives on lettuce sandwiches. Eight hour long CC today for BAM's annual investor day. Think about all they've done this year while WEB was snoozing.

I'd rather have Bezos than Gates as Chairman. (You don't know until you ask.) Prem is currently out of favor but I think he'd do a good job too.

I'm a believer that there can be only one person in charge. Buffett has never consulted the BOD regarding an acquisition as far as I know. The BRK BOD is mostly a ceremonial position. Gates is a great resource, but the CEO should be the COB.

Did anyone else notice that WEB doesn't seem to be interested in Gates's opinions on investing in individual companies. Did he even ask Gates about Apple? I don't think so. On CNBC recently someone was asking WEB about Apple and WEB looked over at CM for an opinion on something. Gates was sitting right there and being ignored. Leads me to believe WEB might think of BG as a one trick pony.

Had dinner with a friend last night who is acting as a surrogate mother. The adoptive parents chose an Indian engineer/Chinese mother donor combination for their child. They also can choose the sex of the child ahead of time. The fertility doc said that designer babies are on the way as more and more traits can be selected.

Charlie also said that the adopted babies were better than if the parents had had their own children. He wasn't talking about crack babies. He also wasn't just praising to gain favor with his audience. He brought up the gambling stereotype which was not intended to be complimentary. Charlie is at a point where he can say what he thinks ... as am I.

You raise controversial questions similar to what is discussed in "The Bell Curve". It really seems that Mr. Munger believes in "their innate quality". There's also the additional dimension of jumping from individual IQs to the "intelligence" of a nation as a whole. Hard to say what the future holds and Mr. Munger has mentioned that it does not hurt to try to learn from history. In the last years, during free time, I've spend time reading on the introduction of the Industrial Revolution and how it caught on (and did not) in various regions of the globe. Another controversial question. Any relevance to today's challenges? The Chinese edited the genes of an embryo last week (for the first time) to cure an inherited disease. Eventually, ALL children will be edited to improve intelligence, health and appearance. (We're just a software program.) How's that for an industrial revolution? The gold ring will go to those countries that win the technology race. Even last place will benefit tremendously though.

The original question I posed was: Should you include the intelligence of a nation as a whole in the variables you're looking at when making INVESTMENT decisions? Clearly, Munger and probably Buffett have. They have chosen China as an area to focus on because of their high regard for the Chinese intellect. Partially unleashed from communism they are moving towards world domination. (Still a long, long way to go.) In contrast, Prem has not. If Prem was Chinese I suspect he would be investing in China and if Li Lu was Indian I suspect he would be investing in India. Too many benefits of being familiar with a culture and its people to not focus on that market. If I was buying an index though, I'd choose China over India for the reasons Charley stated. (All else being equal.) With that said, I think Prem will do very well in India and I am a happy owner of FFH. Prem hasn't always been right, but, he could have been and Fairfax fits in very nicely with other more aggressive stocks I own. An interesting thing I learned recently was posed as a question: Would you rather get a few extra IQ points yourself or give them all to your countrymen? The surprising answer is that it's better to give them to your neighbors. Giving them to your neighbors improves your standard of living five times as much as if you're smarter yourself. If you want to learn about IQ, best to read The Bell Curve first. IQ has been studied and studied for decades.

By adopting poor Chinese girls "they got better babies." His comments start 18 minutes in and leave no doubt about the genetic origin of the differences.

Charley prefers to invest in China over other markets because of the natural intelligence of the Chinese. Isn't anybody going to bash him like you did me?

I consider my portfolio to be very anti-fragile. The four largest positions in my stock portfolio: BRK BAM Russian stock index XON (synthetic biology company.) I sleep very well at night. I would welcome a 50% correction in U.S. stock prices. Inflation, no big deal. Technological change, bring it on. Western economies crumble under expanding social programs, sad but I'll be Ok. No debt.

I wish them well trying to fill WB's and CM's shoes. I'd rather see BRK buy BAM, put Flatt in as new CEO and put their team to work investing our excess cash.

Is it just me or does WEB look a little Chinese on the can?

<i>I was about to go to sleep tonight, but decided to come downstairs and post this on the message board because I'm quite f**king pissed off!</i> There's two good reasons for the drop off: 1) Poor performance. Nothing to celebrate. 2) Voting rights. Left a bad taste in my mouth. I've always wanted to come but now I've moved most of my FFH investment into BAM.

KO has done poorly since Winters started his jawboning. Roughly flat vs up 30% for the S&P 500. Maybe Winters was more right than wrong in his complaints about KO management? (I am not referring to his idiotic statements about WEB.) CM made it clear that KO management wasn't the A team at the DJCO meeting. We all accept that WEB doesn't do hostile but there is also a downside to that policy.

Better to own vultures like FFH or BRK or BAM than to sit in cash. Each of those companies eventually prosper from the disruption and give you a nice return when the world isn't blowing up.

In Russia, a Big Mac is $1.53 verses about $5 in the US.

I would agree that he isn't perfect, but to say he's just another guy ...

The environment is currently fertile but it's also unstable and eventually it will self destruct ... again. In time, each of the carriers we bought will go bankrupt. It may take 20 years but we know how the story ends. Remember who really owns the airlines - the unions.

What's really changed is labor. The NLRB puts you on ice if you don't negotiate fairly. For example: your company is in bad financial shape or coming out of bankruptcy. The pilots want a 100% raise or they threaten to strike. The NLRB won't release them to "self help" so years go by ... and more years go by. Finally the pilots figure out that they can get a cost of living raise if they settle. The unions don't have the ability to shut down the companies anymore. When was the last airline strike? When was the last railroad strike? Labor was always the big problem at airlines. The unions haven't gotten nicer, they've just lost much of their power.

Thanks all.

Any ideas on why the stock price is tanking? What'd I miss?

It would be as a partner with 3G.

<i>captkerosene: Still having trouble following your logic. So you would focus your investments within countries with higher IQ averages. Countries such as Spain, Mongolia, Andorra, Estonia and Latvia - all with equal or higher IQ rates than the US.</i> That is but one variable. <i>So how are those investments working out?</i> Very well. I'm heavily into Russia. Lots of scientists and mathematicians. 99% literacy rate. Cheapest market in the world with everything else I care about moving in the right direction. (Ease of doing business index just improved eleven places to #40 - even with sanctions in place.) <i>I see the Mongolian Stock Market (who knew?) is down 50% in the past five years and I don’t think the IBEX (Spain) has done so well either.</i> Commodity prices and rampant socialism are other variables. <i>Since you say you don’t mean to insult anyone, I have to assume that you are truly ignorant of IQ and IQ testing results and would suggest you might do some more research on the subject.</i> Thank you for your suggestion. <i>You remind me of the teacher who gave his class IQ tests and then graded the students, 1st, 2nd, 3rd, etc and then posted the results. He got fired for that.</i> I'm an investor, not a teacher. <i>IQ testing is notoriously unreliable and I could go on if I thought you were really serious.</i> This isn't a joke to me. I'm not trying to agitate. I brought it up because I thought it was an important consideration that few (due to PC concerns) were aware of. If you feel that IQ tests are too unreliable to use then I'm fine with your decision to ignore them. <i>We probably all know guys who are dumb as dirt yet became self made millionaires and also know geniuses who don’t have a pot to piss in.</i> I actually don't know anybody that's dumb as dirt that's made millions. But if I did, what would that prove? The answer is: Nothing. The sample size is too small and there is likely significant selection bias. Also, there are clearly other variables that come into play. Do you really want to stand by an assertion that IQ and success aren't correlated? And if you'll accept that intelligence is an important variable for an individual then isn't it also important for a country? Buffett's criterea when hiring someone: <i>Intelligence</i>, energy and integrity. (Emphasis mine.)