Well, looky here...Warren Buffet apologizing..
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Buffett Apologizes for Poor Profits
By MARGERY BECK
Associated Press Writer
OMAHA, Neb. (AP)--Billionaire stock market guru Warren Buffett apologized Saturday for how his company's earnings and stock price plunged last year--when the boom on Wall Street turned even amateur investors into millionaires.
The earnings of Berkshire Hathaway, Buffett's Omaha-based holding company, dropped 42 percent in 1999, while the stock fell 20 percent.
``We had the worst absolute performance of my tenure and, compared to the S&P, the worst relative performance as well,' Buffett wrote in his company's annual report. ``Even Inspector Clouseau could find last year's guilty party: your chairman.'
Because of his consistently high returns, Buffett's portfolio is often mimicked by other investors. Last fall, Forbes magazine ranked him the third-richest American, with a net worth of $31 billion.
Last year, Berkshire Hathaway earned $1.6 billion, or $1,025 per share, compared with $2.8 billion, or $2,262 per share in 1998.
And the company's stock on Wall Street fell nearly $14,000 per share, to $56,100.
All that in a year when the Standard & Poor's 500 was up 19.5 percent, the Dow Jones industrial average was up 25.2 percent and the technology-driven Nasdaq soared 85.6 percent.
Berkshire stock has fallen even lower this year--it closed Friday at $41,300 per share, down 26 percent since January.
Buffett and partner Charlie Munger are known for investing in what they know--low-tech companies like furniture, publishing and insurance--and Buffett wrote in Saturday's report that he has no plans to change that strategy. Among Berkshire's core investments, Coca-Cola Co., Gillette Co. and Washington Post Co. all were down or flat for the year.
Buffett said the company has not lost faith in its long-term investments.
``Our problem--which we can't solve by studying up--is that we have no insights into which participants in the tech field possess a truly durable competitive advantage,' Buffett said.
Also among Berkshire's investments are substantial insurance holdings, including auto insurer GEICO and General Re Corp., one of the largest reinsurers in the world, which suffered significant underwriting losses of $897 million last year.
Buffett said he did not expect a dramatic improvement in underwriting earnings and expected that GEICO's underwriting performance would likely weaken this year. He also said he expected auto insurers as a group to do worse in 2000.
He also predicted slower growth in the market, with corporate profits rising at a rate of about 5 percent.
Buffett concluded his letter to stockholders by saying:
``Berkshire will someday have opportunities to deploy major amounts of cash in equity markets--we are confident of that. But, as the song goes, `Who knows where or when?' Meanwhile, if anyone starts explaining to you what is going on in the truly manic portions of this `enchanted' market, you might remember still another line of song: `Fools give you reasons, wise men never try.'
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