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Warren Buffett to Visit South Korea

Warren Buffett will visit South Korea later this month, according to a short news article reported by leading Korean newspaper The Chosun Ilbo.

It will be Warren Buffett’s first visit to the country. On the itinerary will be a tour of a Berkshire subsidiary in the city of Daegu, lunch with Korean business leaders and a news conference.

…Continue reading » Warren Buffett to Visit South Korea

Back in April 2003, Warren Buffett purchased about 10% of PetroChina for US$488 million at less than HK$1.70 a share. With the present share price above HK$11, this investment has turned out into a 6-bagger.

…Continue reading » Warren Buffett Sells Part of PetroChina Shares

Is Warren Buffett Buying Countrywide?

In an earlier interview with CNBC, Warren Buffett mentioned that the current crisis offers fine buying opportunities. Rumours have been flying that Warren Buffett is currently buying shares in distressed mortgage lenders, one of them Countrywide.

…Continue reading » Is Warren Buffett Buying Countrywide?

A Warren Buffett Special on U.S. News

The August 6, 2007 print edition of U.S. News & World Report had a 10-page special on Warren Buffett. Here are some snippets:

…Continue reading » A Warren Buffett Special on U.S. News

Recently, I wrote that Berkshire was purchasing shares in Burlington Northern Santa Fe Corp.

Apparently, Warren Buffett seems to be having a liking for railway companies now.

Last week, Berkshire Hathaway Inc. said it had acquired stakes in Norfolk Southern Corp. and Union Pacific Corp.

As of Dec 31 2006, Berkshire owned 3.95 million shares of Norfolk Southern valued at $198.9 million, and 8.21 million shares of Union Pacific valued at $755.6 million, according to a filing with the U.S. Securities and Exchange Commission.

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Buffett for President

After searching for a day, I still can’t find any other sources with news of Warren Buffett standing for President. I would have expected to find such an important news reported over all the major news broadcasters. It looks increasingly likely that the previous news might be a hoax.

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Breaking News

A local news source has reported that Warren Buffett will be running for the 2008 US Presidential Election. According to the source, Buffett will be using a $11 billion warchest to fund his election campaign.

At the present moment, I’m still trying to get confirmation of the news.

More details to follow.

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I came across an interesting article about not having to worry about market tops. It involves looking at a recent purchase of Warren Buffett.

One thing about Warren is that he will ignore the overall market sentiments. What he is really concerned about is

1) the economics of the underlying business;
2) the management; and
3) whether the current market price is a good buy.

Anyway, here is the article on Warren Buffett’s purchase for your reading pleasure.

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In Warren Buffett’s yearly letter to Berkshire shareholder, he always itemized the major shareholdings.

While I do not think a “buy what Warren Buffett is buying” strategy can be sustainable, here’s a comparison of the 2005 and 2006 letter which was just published on 1st March 2007 anyway.

A look at the major shareholdings (more than $700 million) at the end of 2005 and 2006 shows up these additional names:

1) Ameriprise Financial, Inc
2) Johnson & Johnson
4) Tesco
5) US Bancorp
6) USG Corp

This does not mean that the above six counters were bought in 2006. (They could have been bought before 2006.) It only meant that the value of Berkshire’s holdings in the 6 holdings had risen above $700 million at the end of 2006.

Of the six, POSCO is a korean steelmaker and at current market price, Berkshire’s stake is already worth 1.3 billion dollars; much more than the 572 million dollars that they paid.

There were also two additional counters with a market value of 1.9 billion that were not itemized in the letter. The reason given by Buffett was that it was because they were still in the process of buying more shares in them.

Buffett says , “I could of course, tell you their names. But then I would have to kill you“.

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Market Correction

Just as I was writing about market volatility and risks in my previous post, the markets received a severe correction.

Dow Jones suffered their biggest drop since the September-11 incident, and my local market at one point shed close to 9% over two days.

Sometimes, when I read news articles on market movements, I really can’t stop laughing.

“This time round, it is different.”
“Market drops on investor concerns over xxxx.”
“Market drops over rise in oil prices.”
“Market drops over fall in oil prices.”
“Market rises on technical rebound.”

I can probably pre-write hundreds of such articles and keep on rotating them for publication.

Which is the cause, and which is the effect?

Value investors, remember that market volatility is your friend. If stock prices track their business intrinsic value accurately, your returns are at best what the business provides.

On the other hand, if they don’t, you can obtain a higher return than what the business would have given you.

If Mr Market quotes you a ridiculously high price for a stock, you are free to ignore him.

If he quotes you a ridiculously low price for a stock, you can take advantage of him.

At the end of the day, know the value of what you are buying and provide for yourself a margin of safety.

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