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Sokol interview


omagh
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The more I hear from Sokol over the last 3 - 5 years, the more I like him.  He seems like a perfect future Berkshire CEO...not promotional at all but still completely confident and yet humble.

 

I like these two comments as well:

 

"I could name to you two or three DOZEN world class CEO's in [berkshire]. I'd be thrilled to work with or for any of them."

 

"I'm not aware of a corporation in the world that has the depth of CEO leadership that Berkshire has."

 

Thanks for posting.

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Wonderful video clip on Sokol @ CNBC.

 

This fellow seems as sharp as they come.  As far as leadership is concerned, he mentioned that the bench-strength at Berkshire is far better than any other company he's aware of.

 

With Gates, Keough & Scott on the board, I don't know why shareholders anguish over succession. I think they really have the issue covered.

 

My thanks for posting.  Well done! 

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With Gates, Keough & Scott on the board, I don't know why shareholders anguish over succession. I think they really have the issue covered.

 

Well, I'm sure there's a secret fear of a sudden quotational paper loss in the event of Warren's inability to continue, which some people wouldn't handle with the serenity they profess in public. I think some of us are genuinely not wholeheartedly long-term owners or 'lifers'. The group of most pessimistic owners and the most optimistic potential buyers can be said to overlap at the price where trading volume is maximized, i.e. the current market price, in a rational market. Some BRK shareholders are keener on trading than they might admit and feel they ought to get out of a share that seems to possess sharp downward momentum in the hopes of buying back in later. That might even override rational capital gains tax considerations that encourage buy & hold. There may also be a proportion who might actually need to cash-in their shares rather soon, who might react more to short-term events than those who know it's going to remain invested for decades.

 

Among the group of shareholders as a whole, there are some that don't appreciate (or perhaps doubt) the true strengths of the Berkshire culture (and the conviction of successors to sustain it).

 

There are some who don't 'get' the advantage of decentralization, such that each constituent business is free to conduct its own business as well as possible as if independent and privately-owned, growing their competitive advantages and long term results without pressure to meet quarterly targets or even pressure to find good uses for their profits.

 

Sure, it's going to be terribly sad when Warren can't continue, and many of us have a strong emotional connection or love for the man and what he stands for, which would make an event such as his death or permanent incapacity far more sorrowful than for any other Chairman with whom we invest. Leaving aside the emotional aspect, I'm convinced Berkshire's culture is uniquely ingrained and strong and that the company will continue to prosper.

 

Doubtless some of the Buffett factor contributes to advantageous buying opportunities, especially when money is fleeing markets and Warren has the ability to commit large sums very quickly in good situations. Losing Warren could somewhat diminish those opportunities until a successor has established sufficient reputation over maybe a decade or two.

 

Thankfully the Board will help to protect us from wrong decisions caused by external pressure.  For example all those calling for dividends a couple of years back will be harder to resist if you don't have Warren's reputation and powers of persuasion and logical explanation, but having all that cash on hand is always vital for the value investor who seeks to make large bets on the rare occasions that the odds (prices) are firmly in their favour (usually in the event of a major financial shock to the system). When all the money was leaving the table last year, Goldman Sachs and GE offered excellent terms for substantial capital injections and knew that the cachet of Buffett's substantial backing for their fundamentally sound businesses would benefit their businesses when the public were starting to doubt the stability of even the finest companies, and indeed it could help them to gain a stronger relative market share amid the failure of some of their competitors.

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  • 2 weeks later...
.......far more sorrowful than for any other Chairman with whom we invest. Leaving aside the emotional aspect, I'm convinced Berkshire's culture is uniquely ingrained and strong and that the company will continue to prosper.

 

I couldn't agree more.

 

If Mr. Sokol becomes the CEO of Operations (which I feel is a high-probability) and Howard Buffett the Chairman,  it's interesting to think about the interaction between the two gentlemen regarding Berkshire and future business opportunities. 

 

I hope others will add their $0.02 to this line of thought.

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