You know nothing about "Buffet."
He is known for just the opposite of what you present. He buys family businesses who will only sell to him because he DOESN'T restructure them and strip out the assets. He only shuts down businesses if there is no hope of at least breaking even in the future - which has happened very few times and was caused by factors other than poor management. He doesn't resell businesses he's bought either - which is the standard venture capital model. No hostile takeovers either.
He DOES buy stock on the open market in good companies selling at big discounts to their value. Was buying AAPL at 10X earnings unethical? He DOES run a tight ship - no wasting money at his businesses. He IS 100% trustworthy.
He does NO financial engineering. BRK's borrowing is often in their financing units to re-lend that money consumers to buy things like their homes. Very little leverage. Tons of cash. He doesn't give guidance, have quarterly conference calls or manipulate the financials to boost reported profits. He paints an unbiased view of the companies strengths and weaknesses and presents all the information an investor needs to value the business.
In an earlier post I stated that he does nothing that would give an opening to anyone for any kind of criticism. Even then, there are those who attack him for no other reason than his success.
My apologies if this upsets some of you; in my opinion, WB is still *just* guided by profits no matter how these are obtained, no matter if they hurt people taking in the larger view. Not denying he did some great investments and didn't do direct damage in GE's Jack Welch style, still doesn't address my point: he's just guided by profits and has little understanding or interest beyond profit numbers.
Too much work to document what pro traders know, but I'm listing below some not too great investments/ positions he took, all in the name of profits. With the same amount of capital to invest (wisely and profitably, as he knows how) he might have done much good, but nah, he just wanted profits looking at established businesses (well run, with a moat, etc). Imagine if he only had 1/10th of ARK's talented industry analysts!
Because our system is based on pure profits and the true nature of capitalism has been perverted by greedy CEO's corporate and corporations well shielded from responsibilities when found guilty of criminal acts (see below for references).
Alright, some tidbits on BRK's and WB I find problematic:
- his investment/ loan "saving Goldman Sachs" from possible bankruptcy(1) - OK, that was pure financial maneuvering, possibly knowing full well that the US Government (with leaders mostly ex GS and beholden to the status quo anyway) wouldn't let them fail.
- his investment in so many financial companies/ banks.
Seriously, what do these banks produce, besides profits when gambling (illegally, now legally thanks to the half baked repeal of Dodd-Frank) with depositors money, and getting their losses absorbed by the Fed (aka us the taxpayers) when their gambles don't work out. Arbitraging, for economic benefit ha hahhahaha see how HSBC et all colluded on exchange (or was it interest rates). Doesn't really matter: please just Google "wallstreetonparade goldman sachs" to get a list of little reported scandals, use Citibank or HSBC, or Wells Fargo instead to find the other ones.
Essentially whenever caught (and the SEC really tries hard not to), these financial institutions get a slap on the wrist, pay a token penalty, keep all their ill gained profits, AND continue on their brazen criminal behavior.
- his "genius" investment in Coca Cola. Or See's Candies, bof ... really ..how much did they contribute to US obesity and medical procedures and drugs (however "profitable) ?
Personally I much prefer companies like Vital Farms
Bringing Ethically Produced Food to the Table | Vital Farms which are very profitable ( great IPO too! ) and do the right thing for animals and small family farms. To me that's a better use of the capitalist system.
- finally his support for coal and gas companies, even tho climate change may be real, just because it makes business sense. Really?
Warren Buffett bets $9.7 billion on a long future for natural gas
Or " Buffett summed up his rejection of climate proposals succinctly at the 2014 Berkshire annual meeting: “I don’t think in making an investment decision on Berkshire Hathaway, or most companies — virtually all of the companies I can think of — that climate change should be a factor in the decision-making process.” from
Here's what Warren Buffett thinks about climate change
On
Goldman Sachs many scandals gone by with little real punishment, or if you prefer
Wells Fargo's scandals gone unpunished , same with
Citbank ... Would we have suffered if these banks had been allowed to fail and their executives sent to jail? .. Iceland did that
and came out well ahead while we are still kicking the can down the road with who knows what end in sight.
So, all in all, with more power comes bigger responsibilities - that the current financial system does not discourage destructive decisions for people and the environment doesn't mean we should just not care about how our financial decisions end up affecting the rest of us and the planet. Elon Musk truly is a hero for doing the right thing even if the odds are not in favor, because it is the right thing to do. Imagine ... (yes, also the Beatles) .. He didn't mind risking his entire fortune too BTW. Compare to old Warren Buffet.. meh..in so many dimensions!
(1)
Here’s how Warren Buffett made $3.1 billion on his crisis-era bet on Goldman Sachs
Does “We the People” Include Corporations?
Corporations now enjoy privileges of personhood, and at the same time shields executives from illegal /criminal acts.
