Larry Bradley's Weekly Ezine # 52 Thoughts on Buffett's Letter
1. Thoughts on Buffett’s 2009 Letter to Stockholders
2. Gary Wood on the Limbaugh Controversy
1. Thoughts on Buffett’s Letter to Stockholders
Warren Buffett’s summary letter to Berkshire Hathaway stockholders for 2008 sparked a number of reflective thoughts on our current situation economically and politically. Those of you who’ve been reading what’s presented here know I like to compare what happens in other fields to what’s happening politically.
In fact, lately I’ve been having this thought (just for fun). What if political talk radio shows were conducted with the same format as Dr. Laura? I haven’t figured that one out completely yet, but it will be fun when I do. (Dr. Laura, I can’t believe I’m talking to you. My Congressman says he’s for fiscal responsibility, but he keeps voting for bailouts. What should I do?) But I digress. . .
Point Number 1: I mentioned a couple of columns before organizations are more likely to thrive when managed with a consistent philosophy maintained over years. You would be hard pressed to find a better example than Berkshire Hathaway. One important difference between Berkshire Hathaway and our government can be noted. If people don’t like what the leadership of the company is doing, then people can take money elsewhere. If people do like what’s going on, then they keep their relationship going. Mr. Buffett and company therefore have an incentive to do well. By contrast, our country amended our Constitution so we can’t keep a President who performs well for more than two terms.
Point Number 2: On the other hand, getting rid of a President who is clearly overmatched by the job is nigh impossible. I had the privilege of listening to one of our community’s more successful entrepreneurs last Friday. He told the story of his involvement in the buyout of a mismanaged bank. The Bank’s president had a special elevator leading just to his "office" with "special" (my word, not his) accommodations for female guests. "Where," the entrepreneur asked. . .
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"I've never seen the consumer or the Americans just generally more fearful than this. And they're also confused. And you can get fearful very quickly, but you don't get confident, you know, in five minutes. You can get fearful in five minutes, but you won't get confident for some time. And government is going to play an enormous factor in how fast it comes back. And if you're confused and fearful, you don't get over being fearful till you aren't confused. I mean, the message has to be very, very clear as to what government will be doing. And I think we've had--and it's the nature of the political process, somewhat, but we've had muddled messages, and the American public does not know what--they feel that they don't know what's going on and their reaction, then, is to absolutely pull back." Warren Buffett on CNBC.
The people who have money to invest, and to create jobs, are indeed fearful of the present and the future. I wonder why anyone with resources would risk what they have when there is such uncertainty and, yes, hostility toward them.
Maybe I'm just projecting my own sense of fearfulness and alarm with current Washington politics and policies.
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Jim,
Good quote from Warren.
In fact, my Ezine this coming Friday will be about fear.
Larry
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