Buffett - evil genius, talks own book, in bed with capitalists/socialists...

[benhacker]

It was one of the KKR guys, as in his last name is one of the initials, don't remember which one.

 

Look, the nature of this board is that Buffett could commit some egregious crime and everyone on here would come up with a way to justify it.  I get that, this is his cheering section.  Whatever bad things he's done aren't really bad, if someone else did them they'd be terrible, but Buffett makes them good.

 

I spent maybe 30m trying to find the links I'd read without luck.  This was probably two years ago when I found this.  I seem to remember someone mentioned something in a comment on my blog that tipped me off.  At this point though I'm not going to trawl through a few thousand comments looking for it.

 

This is just a general comment (not directed at you Ben, but you mentioned this).  I've found in the investing world there is a lot of great information that is passed around via emails and phone calls that never makes it online.  Just because there isn't a link doesn't necessarily make something untrue.  In the situation I referenced above I read it online, so somewhere out there links exist.  But not all information is documented as such.

 

Thanks for the response Nate.  I understand your perspective on reactions to Buffett criticisms... I selfishly want to hear any and all bad stories I can so I can do more work to see if it changes my opinion on Buffett... hence my harassment. :)  Understand that others may reflexively attack negativity (or maybe I do too!).

 

Thanks for spending 30m trying to find, I have searched and found nothing as well... hard to find specific stuff on Buffett since he is so well covered.

[oddballstocks]

It was one of the KKR guys, as in his last name is one of the initials, don't remember which one.

 

Look, the nature of this board is that Buffett could commit some egregious crime and everyone on here would come up with a way to justify it.  I get that, this is his cheering section.  Whatever bad things he's done aren't really bad, if someone else did them they'd be terrible, but Buffett makes them good.

 

I spent maybe 30m trying to find the links I'd read without luck.  This was probably two years ago when I found this.  I seem to remember someone mentioned something in a comment on my blog that tipped me off.  At this point though I'm not going to trawl through a few thousand comments looking for it.

 

This is just a general comment (not directed at you Ben, but you mentioned this).  I've found in the investing world there is a lot of great information that is passed around via emails and phone calls that never makes it online.  Just because there isn't a link doesn't necessarily make something untrue.  In the situation I referenced above I read it online, so somewhere out there links exist.  But not all information is documented as such.

 

Thanks for the response Nate.  I understand your perspective on reactions to Buffett criticisms... I selfishly want to here any and all bad stories I can so I can do more work to see if it changes my opinion on Buffett... hence my harassment. :)  Understand that others may reflexively attack negativity (or maybe I do too!).

 

Thanks for spending 30m trying to find, I have searched and found nothing as well... hard to find specific stuff on Buffett since he is so well covered.

 

Yes, any search of Buffett and the word "tax" comes up with thousands of articles and articles referencing articles with his public statements on taxes. 

[Ham Hockers]

http://berkshirehathawayfraud.blogspot.com/2012/11/berkshire-hathaway-stock-fraudincome.html

 

[benhacker]

http://berkshirehathawayfraud.blogspot.com/2012/11/berkshire-hathaway-stock-fraudincome.html

 

Nate, is this the article you remember?

[Uccmal]

This discussion is ludicrous.  You dont get where Buffett has got without being ruthless (in business). 

 

He has certainly made hundreds of high powered enemies along the way.  Many of them would like to expose all his wrong doings if they could find them.  The fact there are so few reports of wrong doings or fraud tells me he runs a tight ship. 

 

Is he the nice grandfatherly type.  I doubt it. Does he exhibit symptoms of mild autism and insane focus on business and an obsession with making money - absolutely.  Does that make him evil or corrupt?  Not likely. 

 

Where there is smoke there is fire.  Where there is no smoke there is probably no fire. 

[mvalue]

http://berkshirehathawayfraud.blogspot.com/2012/11/berkshire-hathaway-stock-fraudincome.html

 

"When my grandfather died, they used a trust to transfer the shares to Bill Gates."

 

The human mind at work...

[Jurgis]

"When my grandfather died, they aliens used a trust to transfer the shares to Bill Gates."

 

Here. Fixed that.

[randomep]

Thanks LC for the info, helps me understand.

 

As for evil/morals about Buffett. Why should it matter? We are all here to get ideas on how to make money right? I personally feel he is hypocritical to tell the rich to all pay more taxes and he goes to such lengths to avoid it running Brk. He had a GF and a wife openly for much of his life. His son is going to be the chairman of the board when he passes also reeks of nepotism.  But hey all the power to him, in fact all these skills and privileges makes me envious.

 

I care about his ethics only to the extent of whether I can trust what he does (as an investor) and what he says (as a disciple). I feel he has a lot of integrity. I would give him my money to manage in his partenership at 25 because I know I can trust him. He won't run away with my money. And he will act as the best possible fiduciary for me.

 

He has brought the world of value investing to the masses. When he makes an opinion, I feel he mostly doesn't have an agenda, he is giving advice for the listener's own good. He is the antidote to Jim Cramer and the likes and CNBC. that's his greatest contribution to the world in my opinion.

 

 

[loganc]

http://berkshirehathawayfraud.blogspot.com/2012/11/berkshire-hathaway-stock-fraudincome.html

 

[LC]

 

As for evil/morals about Buffett. Why should it matter?

 

Honestly...I was (and still am) curious purely for the entertainment value. It's good drama! Everyone else in society has Kim Kardashian and Kanye West, or sports drama (come on pitchers & catchers already!), and I want some investing drama. And I love a good conspiracy theory on top of it!

[KinAlberta]

http://berkshirehathawayfraud.blogspot.com/2012/11/berkshire-hathaway-stock-fraudincome.html

 

"When my grandfather died, they used a trust to transfer the shares to Bill Gates."

 

The human mind at work...

 

 

And the movie... (via a link in the piece above)

 

[KinAlberta]

Thanks LC for the info, helps me understand.

 

As for evil/morals about Buffett. Why should it matter? We are all here to get ideas on how to make money right? I personally feel he is hypocritical to tell the rich to all pay more taxes and he goes to such lengths to avoid it running Brk. He had a GF and a wife openly for much of his life. His son is going to be the chairman of the board when he passes also reeks of nepotism.  But hey all the power to him, in fact all these skills and privileges makes me envious.

 

I care about his ethics only to the extent of whether I can trust what he does (as an investor) and what he says (as a disciple). I feel he has a lot of integrity. I would give him my money to manage in his partenership at 25 because I know I can trust him. He won't run away with my money. And he will act as the best possible fiduciary for me.

 

He has brought the world of value investing to the masses. When he makes an opinion, I feel he mostly doesn't have an agenda, he is giving advice for the listener's own good. He is the antidote to Jim Cramer and the likes and CNBC. that's his greatest contribution to the world in my opinion.

 

 

He frames things very well right here:

 

Warren Buffett - You've Only Got to Get Rich Once

https://www.youtube.com/watch?v=4qOJEQekcnU

 

[LC]

I'm really getting pulled into this one. Next I'll be believing in alien abductions. But boy, these guys are really weaving a tale if it's purely fiction. Are they that bored in Nebraska (probably). But it reads like a summer novel. Lance Munger is even involved! Judges being paid off! CPA licenses revoked! Someone needs to turn this story into a film.

[benhacker]

Someone found and forwarded me what I think is the original blog comments where Nate raised some of his points:

 

http://www.oddballstocks.com/2013/11/why-go-buffett.html

 

If interested.  I didn't see anything related to the lack of dividend or lawsuit reference, but there is a poster recounting the George Roberts quote about Buffett.  Just thought I would post for completeness

[Jurgis]

http://berkshirehathawayfraud.blogspot.com/2012/11/berkshire-hathaway-stock-fraudincome.html

 

"When my grandfather died, they used a trust to transfer the shares to Bill Gates."

 

The human mind at work...

 

 

And the movie... (via a link in the piece above)

 

 

:o

 

For people who want more drama and entertainment:

http://usatoday30.usatoday.com/money/2004-01-29-nebraska_x.htm - more about Nielsen family feud

http://dealbreaker.com/2010/04/warren-buffett-hit-with-lawsuit-by-rv-dealer/ - Buffett accused by a sub exec

http://www.moneynews.com/StreetTalk/buffett-tax-netjets/2012/03/27/id/433991/ - govt suit against NetJets

 

[kfh227]

I think that gives him too much credit, neither evil, nor a genius, just a chap pathologically obsessed with making money.

 

If Buffett doesn't qualify as genius to you, who does in the field of business/finance?

 

Genius is way to strong of a descriptor for anyone in business/finance.  He isn't exactly curing cancer or getting noble prices for mathematics.  Those people are geniouses and they have to think in new ways to do what they do.  Buffett is just using the knowledge built by others.  I'd be willing to use descriptors like disciplined and knowledgeable.  But not genius.

 

[Mephistopheles]

I think that gives him too much credit, neither evil, nor a genius, just a chap pathologically obsessed with making money.

 

If Buffett doesn't qualify as genius to you, who does in the field of business/finance?

 

Genius is way to strong of a descriptor for anyone in business/finance.  He isn't exactly curing cancer or getting noble prices for mathematics.  Those people are geniouses and they have to think in new ways to do what they do.  Buffett is just using the knowledge built by others.  I'd be willing to use descriptors like disciplined and knowledgeable.  But not genius.

 

 

I think it depends. He's not a genius because of his great returns, but because of the way he's built up the company to what it is now (which of course led to the returns). If someone beats the market year after year by cloning or investing in a systematic way (low P/B, for example), then I agree that's not genius.

 

You mentioned those curing cancer and noble prize winners thinking in new ways. But Buffett did get to where he is by coming up with his own model, and it was never done before. His sort of genius is also manifested in gathering information throughout the course of a lifetime and being able to see risks that aren't even accounted for before. For example, didn't he realize the risk of terrorism well before 9/11, and tried to get out of its insurance? In hindsight it seems easy but I would argue it comes from years of reading about and understanding business, geopolitics, etc.

 

On the flip side, for those who achieve medical innovations such as curing a disease, etc., well their research is an add on to all the research that has happened prior - they don't exactly get there on their own either. Not denigrating what they do, but just saying that nobody gets anywhere by themselves.

[merkhet]

I think that gives him too much credit, neither evil, nor a genius, just a chap pathologically obsessed with making money.

 

If Buffett doesn't qualify as genius to you, who does in the field of business/finance?

 

Genius is way to strong of a descriptor for anyone in business/finance.  He isn't exactly curing cancer or getting noble prices for mathematics.  Those people are geniouses and they have to think in new ways to do what they do.  Buffett is just using the knowledge built by others.  I'd be willing to use descriptors like disciplined and knowledgeable.  But not genius.

 

Yes, because no one in science uses the knowledge built by others...

[Otsog]

I think some of the folksy stories aren't that folksy.  I doubt he'd be doing handshake deals without a ridiculous margin of safety. The Nebraska Furniture Mart story is a classic, but he's not doing it on principle or some romantic notion of honest business. He's a genius at analyzing risk-adjusted returns in his head, he is an astute judge of character and figured out that operating without conventional DD can put him a step ahead in certain instances (NFM, financial crisis).  Us plebes will have to stick with Audited Financials, lawyers and the rest of the conventional DD process.  We couldn't give it up if we tried as the counter party would need to have faith in our reputation.

 

I don't find much to be cynical about in that approach though, and even though Buffett isn't operating that way because of principle I can understand how it becomes romanticized in the press. I believe Buffett/Munger prefer to be honest in their dealings, I don't think they are only honest because they figured out how to make money with it.  I think it's more likely they decided to be honest first and because they are so damn smart they figured out how to turn it into a huge competitive advantage.  They obviously are very different people now than 50 years ago so this process would have evolved over time.  Maybe they did sketchier (or just plain more conventional) stuff when they were younger; but, I find it telling the lack of incriminating evidence after all these decades.  The way humans love to simultaneously lionize/tear-down celebrities you'd almost expect there to be more click-baity press on how evil Buffett is. 

[cubsfan]

If Buffett qualifies as the best investor of all time, based on his incredible and lengthy record, I find it hard NOT to call him a genius.

 

There are some genius aspects to Buffett, like his incredible recall of facts and figures, his impressive mathematical skills, his reading skills, etc.

 

He's a genius on many levels, IMO.

 

 

[RichardGibbons]

Saying someone can't be a genius because of their occupation seems nuts to me.

[Guest longinvestor]

How about putting a giant question mark on the dominant thought of our times, the efficient market hypothesis? That is a nobel prize winning idea. What adjective does that deserve?

[clayroad]

How about putting a giant question mark on the dominant thought of our times, the efficient market hypothesis? That is a nobel prize winning idea. What adjective does that deserve?

 

So Benjamin Graham is a genius, as well as every other investor who tries to find undervalued securities.

 

[vinod1]

How about putting a giant question mark on the dominant thought of our times, the efficient market hypothesis? That is a nobel prize winning idea. What adjective does that deserve?

 

So Benjamin Graham is a genius, as well as every other investor who tries to find undervalued securities.

 

To think either Buffett or Graham are not genius's is to do violence to either English language or common sense or both.

 

1. Graham came up with the process of systematically analyzing companies.

 

2. He became the only person ever offered professorships from three different Columbia departments —math, English and the classics.

 

3. Widely credited to be the father of value investing.

 

4. Wrote two books on international economics despite having no formal study in economics. Keynes himself is said to be impressed by one of the books.

 

5. He had a show on Broadway at the same time that he is published "Security Analysis". Reading Security Analysis, you can see how accurately he identified, behavioral biases, management behaviour, Wall Street behaviour, investor behaviour and behaviour of corporate boards. It is eerily accurate and decades ahead of its time.

 

So yes, he is a bit more than an investor looking for undervalued securities.

 

Vinod

 

 

[oddballstocks]

benhacker,

 

Yes, that's the post. I believe the tax thing was in an email to me.  The link you posted didn't look familiar.

 

On Genius:

 

What is a genius?  I'd put this in the same category as "what is smart?"  How do you identify someone as "smart"?  There is no test for smartness, there's an IQ test, but people routinely will say someone is "smart" and listeners know what it means but there is no solid definition.

 

I think in many ways genius is similar.  We know it when we see it, but we can't quantify it.

 

Here's my take on it.  To me there's a difference in being successful and having drive and being a genius.  Someone who's successful and has that personality will do well in any field.  A guy like Jamie Dimon for example, I'm guessing if history took a different path and he got into landscaping he'd own the largest landscaping company in the country.  Things work like that.  I wouldn't say Sam Walton is a genius, or even Jeff Bezos.  They're in the Jamie Dimon camp, exceptional executors and gifted people, but not a genius in the field.

 

Buffett and Graham were groundbreakers.  They looked at things differently and acted on those views.  I'd put Steve Jobs or Bill Gates into the same category, they all looked at things differently and created something new.  Being a genius doesn't require 100% original thinking, at this point almost everything is built on something else.  But it's being able to step outside of the norm and blaze a new path.  The genius to all of these men is they were able to take a bunch of dots and connect them in a new way.

 

My suspicion is that Buffett knows this, but also knows that he is rarely talented.  Many people who discover a new path have a drive to tell the world and publish a book (Graham etc).  Buffett has said repeatedly he won't write a book, he'll let someone else tell the story.  I find that curious, but I think it's because he realizes he can't quite quantify himself what he has.  To use the well worn analogy it's like Michael Jordan trying to write a book on throwing free-throws.  He's gifted, he just aims and throws, how do you teach that?