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Strategies & Market Trends : Buffettology

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To: Shane M who wrote (2593)	7/9/2000 1:41:31 AM
From: James Clarke	Read Replies (1) of 4691

Berkshire itself looks very close to a buy price again. I have had a number in my mind ever since the annual report. We're close to where I would think of adding, though it is already my largest position. Since Berkshire hit its low in March a couple big things have changed. 1) Insurance prices in virtually all sectors, even auto, have bottomed and started to rise 2) Buffett himself put a floor on the stock by saying in the annual report that 45000/1500 represents a significant discount to intrinsic value. I think that means 30%. I have tried to value Berkshire and can only come up with wide ranges, but those ranges are in the 1500-2500 range on the B shares, so at the low end of that range I don't need precision. But I figure if anybody in the world knows how to value Berkshire, Warren Buffett does, and he showed his hand. Barring some major change (i.e. Warren's health), I can't see the stock breaking 1500 without a big fight. If there's another person in the world who knows how to value Berkshire, its Bill Miller at Legg Mason, and he owns the stock with an average cost probably in the 1700-2000 range. My price is 10% above that magic 1500 level. I'd be buying now if I didn't already own it.

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