Buffett/Berkshire - general news

[gfp]

https://fortune.com/article/who-is-greg-abel-berkshire-hathaway-stock-warren-buffett-management-style/

 

This article reminds me of Abel & Sokol's deal for Constellation Energy.  A lot of people forget that one since it didn't end with Berkshire owning all of Constellation but it was the first time I heard Abel said that the important part was having a model and value in mind for every major target so that you are ready to act in a few hours over a weekend if necessary.  By "losing" in this deal, Berkshire made Billions of dollars for nothing.  It was great and it was basically all Greg Abel.

 

 

[Eldad]

The Van Tuyl car dealerships have likely been a recent home run from 2015. 4.1 Billion Paid. BHAutomotive is like 70% of retail which runs at about 1.5 billion a year average Pre-tax earnings the last 5 years. Might get a chance to roll up some more of those here shortly. 
 

I sold my BRK down from 20% to 10% last year. I’m not touching the remaining. I am starting the think the float and not doing stupid stuff can actually win in the end even with its size. 

Edited May 7, 2025 by Eldad

[Spooky]

2 hours ago, Blake Hampton said:

 

Prepare for both long-term, serious inflation as well as a severe credit crisis.

 

I'm more worried about a deflationary world.

[Spooky]

58 minutes ago, gfp said:

Before John comes over and yells at us for messing up the Berkshire thread we better stop here - you know he's gonna wake up and be unhappy

 

[gfp]

2 hours ago, rogermunibond said:

If you're really concerned about the US dollar, open a Swiss CHF or Japanese yen bank or brokerage account and transfer xx% of your net worth.

 

One could also open a forex account and trade currencies as many a Mrs. Yamamoto did in Japan.

 

And while you are loading up on Swiss Franc CHF, make sure to ask the Swiss Central Bank if they have any interest (pun?!) at all in their currency strengthening further!  It's almost like no country wants their currency to strengthen... hmmmm

 

https://tradingeconomics.com/switzerland/interest-rate

Edited May 7, 2025 by gfp

[gfp]

WSJ with an article on Greg Abel's portfolio of homes (short article, only a couple places)

 

https://www.mansionglobal.com/articles/like-warren-buffett-successor-greg-abel-keeps-a-surprisingly-modest-home-portfolio-7cf638da

[John Hjorth]

16 minutes ago, gfp said:

WSJ with an article on Greg Abel's portfolio of homes (short article, only a couple places)

 

https://www.mansionglobal.com/articles/like-warren-buffett-successor-greg-abel-keeps-a-surprisingly-modest-home-portfolio-7cf638da

 

@gfp,

 

Good with some doxxing gossip about Mr. Abels houses, and good to know. That will do for him, he doesen't need more. I mean, with his salary compared to Buffetts, I expect him to work day in and day out, for us, not spending time in Salisbury Heights, Des Moine, or Lake Tahoe, California.

Edited May 7, 2025 by John Hjorth

[gfp]

3 minutes ago, John Hjorth said:

 

@gfp,

 

Good with some doxxing gossip about Mr. Abels houses, and good to know. That will do for him, he doesen't need more. I mean, with his salary compared to Buffetts, I expect him to work day in and day out, for us!

 

I hope he voluntarily takes a $100k salary once Warren is no longer with us.  I also support unlimited use of the NetJets fleet to ferry him from Des Moines to wherever the heck he wants to go every day (and home in time for hockey practice).  Long live the Indefensible!

[Munger_Disciple]

2 hours ago, gfp said:

https://fortune.com/article/who-is-greg-abel-berkshire-hathaway-stock-warren-buffett-management-style/

 

This article reminds me of Abel & Sokol's deal for Constellation Energy.  A lot of people forget that one since it didn't end with Berkshire owning all of Constellation but it was the first time I heard Abel said that the important part was having a model and value in mind for every major target so that you are ready to act in a few hours over a weekend if necessary.  By "losing" in this deal, Berkshire made Billions of dollars for nothing.  It was great and it was basically all Greg Abel.

 

 

 

Excellent article. Thanks for sharing!

[John Hjorth]

15 minutes ago, gfp said:

I hope he voluntarily takes a $100k salary once Warren is no longer with us.  I also support unlimited use of the NetJets fleet to ferry him from Des Moines to wherever the heck he wants to go every day (and home in time for hockey practice).  Long live the Indefensible!

 

Hah, @gfp,

 

Great post! All jokes and 'smart' comments from me aside, I think what we experienced in last weekend was a good start on a transition, that simply has to become a success - failure is just not an option. Personally, I feel confident about it.

[Hektor]

2 hours ago, gfp said:

 

I hope he voluntarily takes a $100k salary once Warren is no longer with us.  I also support unlimited use of the NetJets fleet to ferry him from Des Moines to wherever the heck he wants to go every day (and home in time for hockey practice).  Long live the Indefensible!

+1. Unlimited NetJets if he takes the 100k.

[ratiman]

Here is what I would do in Abel's position. First, sell off some of the smaller businesses that don't contribute to BRK, like  BusinessWire and Pampered Chef. It's not worth management time to deal with companies that small. Then I would consolidate the jewelry business under one brand and the furniture under one brand. I would pick a handful of businesses that had been underinvested during the WB years, such as Sees and DQ, and increase investment. Then I would take all the money away from Ted and Todd walk them out of the building like they were being arrested by the FBI. Finally I would change the name of Berkshire Hathaway RE to Hathaway Homes because it's not as much of a mouthful and you don't want to name a subsidiary after the holding company.

[Eldad]

2 hours ago, ratiman said:

Here is what I would do in Abel's position. First, sell off some of the smaller businesses that don't contribute to BRK, like  BusinessWire and Pampered Chef. It's not worth management time to deal with companies that small. Then I would consolidate the jewelry business under one brand and the furniture under one brand. I would pick a handful of businesses that had been underinvested during the WB years, such as Sees and DQ, and increase investment. Then I would take all the money away from Ted and Todd walk them out of the building like they were being arrested by the FBI. Finally I would change the name of Berkshire Hathaway RE to Hathaway Homes because it's not as much of a mouthful and you don't want to name a subsidiary after the holding company.

Greg is looking better all the time. 

[Paulene]

As Ajit said at last week's meeting, "We are not early adopters."

 

Know what your circle of competence is and step out of it at your own peril.

Edited May 8, 2025 by Paulene
left off a word

[LC]

3 hours ago, ratiman said:

Then I would take all the money away from Ted and Todd walk them out of the building like they were being arrested by the FBI.

 

Why? Wasn't Ajit just claiming the work Todd did at Geico was extraordinary?

 

And I would keep the smaller subsidiaries as long as they are still profitable and 'hands-off'

My understanding is tiny/legacy stuff like Pampered Chef, etc...they all self manage and just send cash up to HQ.

[copelandlewis]

Todd Combs could be to Greg Abel what Charlie was to Warren.

[John Hjorth]

On 5/7/2025 at 10:06 PM, gfp said:

Yes - that's why he wants to be short the USD by being long Oil.

 

The rest of us are short the USD via being long actual good investments and debt-financed (read: short the dollar) productive real estate that dumps those dreaded dog shit dollar bills into our bank accounts on the first of every month.

 

Before John comes over and yells at us for messing up the Berkshire thread we better stop here - you know he's gonna wake up and be unhappy

 

Haha!  Man, it's just great! 

[sleepydragon]

Can someone explain why Buffett issue yen based bond while investing in Japanese stock?

I see the point that he can hedge the currency risk by financing his stock purchase with Japanese yen borrowings.

but isn't the point of buying Japanese stocks is because he want to diversify a bit from USD? So , shouldn't he just exchange some USD into JPN, and use the JPN to buy stock? Sure, the yield of the bond is very low, but still he is taking currency risk.

 

I am asking this because I am thinking to buy some foreign stocks in IBKR, but I am not sure if I shall just borrow in margin in the foreign currency (thus currency hedged), or exchange USD to fully pay for it.

 

 

[mistakenpoint]

Buffett thinks the 5 trading houses were and are cheap and should grow at reasonable rate. His thesis probably does not involve any currency views. Oh, and he can borrow at very very cheap rate. The dividend from these investments more than covers the cost of borrowing. What's your foreign currency margin rate? 

[Malmqky]

9 hours ago, mistakenpoint said:

Buffett thinks the 5 trading houses were and are cheap and should grow at reasonable rate. His thesis probably does not involve any currency views. Oh, and he can borrow at very very cheap rate. The dividend from these investments more than covers the cost of borrowing. What's your foreign currency margin rate? 

Sub 2% for yen.
 

Would be nice to get a flat 1% though

[hasilp89]

12 hours ago, Malmqky said:

Sub 2% for yen.
 

Would be nice to get a flat 1% though

I imagine you (and the rest of us mortals) could get margin called by our broker tomorrow though. Buffett’s got the capital for decades. Only something he could do. 

[Munger_Disciple]

27 minutes ago, hasilp89 said:

I imagine you (and the rest of us mortals) could get margin called by our broker tomorrow though. Buffett’s got the capital for decades. Only something he could do. 

 

[Munger_Disciple]

https://finance.yahoo.com/news/nrg-energy-acquire-ls-power-160819382.html

 

This could be the $10B deal Warren & Greg referred to in the annual meeting that they presumably were outbid. 

[ValueMaven]

@Munger_Disciple yea that would have been amazing for BHE!

[ValueMaven]

https://www.japantimes.co.jp/commentary/2025/05/13/japan/buffetts-little-japan-handbook/