Re:Warren Buffett editorial in NYT: Buy American. I Am.
by dmv on Friday October 17, 2008 @06:27PM
(#336069)
Keep meaning to make it to an annual meeting. I'm not sure if this year's circus will be better or worse.
Thank you for elaborating on the dividend comment. I certainly was not trying to imply that it was a negative. It just emphasizes that while Mr. Buffett may have as much money as anyone in the world, he does not have it in a private or liquid form outside of his role at Berkshire Hathaway. Like many growth of company-based Billionares (Gates, Bezos, etc), there is a great deal of transparency (an annual report!) in investment philosophy. Contrast with someone like Stephen Schwarzman.
"We feel noble intentions should be checked periodically against results. We test the wisdom of retaining earnings by assessing whether retention, over time, delivers shareholders at least $1 of market value for each $1 retained. To date, this test has been met. We will continue to apply it on a five-year rolling basis. As our net worth grows, it is more difficult to use retained earnings wisely." Source: Berkshire Hathaway's Owner's Manual
Mr. Buffett:: "We will either pay large dividends or none at all if we can't obtain more money through re-investment (of those funds). There is no logic to regularly paying out 10% or 20% of earnings as dividends every year."
Charles Munger: "If you went to the leading schools, they wouldn't teach dividend policy this way." Source: My notes from the 2000 Berkshire Hathaway annual meeting