Comments on: What is Buffett’s Ideology?

By: Dividend Tree

Dividend Tree — Wed, 15 Apr 2009 17:37:21 +0000

JJ: Thanks for inputs. “lacking practical presentation…” can also be interpreted as business acumen.

Best Wishes,

By: Dividend Tree

Dividend Tree — Wed, 15 Apr 2009 17:35:34 +0000

Matt,
Too much money is what I was attempting to highlight indirectly. Can’t Buffett invest a billion or two in good start up companies in US? Just imagine how many small startup can be promoted by 2 billion dollars! He gave GS/GE a boat load of money, same folks who at first place brought their own company down. Can’t he follow his own advise of buy America? He could find a small battery company in China, but not in US?

My point is Buffett ideology is about ruthless business acumen on profitability! It is just not value alone.

Thanks for stopping by. That was good discussion point.

By: Dividend Tree

Dividend Tree — Wed, 15 Apr 2009 17:28:00 +0000

Robert,
I also do not like BH shares because they don’t have dividends. Its the halo effect that has been built around BH that I do not like. It is a great holding company, but what’s in for me?

On low risk speculation: If that’s the case then anything that is not sure (or has some risk) will be low risk speculation. Even the hard wall businesses are then low risk speculation. Isn’t it?

Dividends provide a sense of involvement with the company, a sense that management shares their bounty, a sense that you are getting something back for remaining invested.

Thank you for stopping by and leaving a thoughtful comment.

By: Robert C. Gray

Robert C. Gray — Mon, 13 Apr 2009 01:04:36 +0000

The much more interesting thing about Buffett is his out-integrity when it comes to providing investment returns. If you read his annual letters, they are filled with prideful statements about the returns the operating companies provide to BH. One the other hand, BH provides not one-cent of return/yield to its equity owners. Since, without a dividend, all that’s available is speculating on the BH stock. He like most of the financial world mis-uses the term investing/investor when the right term is speculating/speculation. And – by the way – Graham’s “value investing” is also spin for “low risk speculation.” I’m hoping that you bloggers who form DIV-net are the forum to begin to get the truth out. Without a dividend/yield return, a stock can ONLY be a speculation. The is NO investment.

By: Matt

Matt — Sun, 12 Apr 2009 13:19:23 +0000

Buffett’s problem is in some ways that he has too much money; that there simply aren’t enough great companies, trading at a discount, with wide competitive moats, for the amount of money he has to invest.

As far as his philosophy of stock estimation goes, though, remember what he said– the market is a voting machine in the short term but a weighing machine in the long term. He buys the companies that weigh the most when they’re voted for the least.