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Strategies & Market Trends : MDA - Market Direction Analysis -- Ignore unavailable to you. Want to Upgrade?

To: bobby beara who wrote (29263)	10/12/1999 10:03:00 PM
From: Benkea	Read Replies (1) \| Respond to of 99985

bobby: "but i think you should look at the Coke display in technically speaking on the IS site" While I think KO is a terrific business (partially owing to its' #1 global brand earned over a century), I have no fantasies about its' current valuation (even after the fall). BRK's after tax (which is how it is carried on the books) KO represents a mere 12% of BRK NET equity. Thus, even if KO fell ANOTHER 50%, it would decrease book by less than 6% since 35% of everything over $6.50 per share belongs to Uncle Sam anyway. "a break of a long term trendline (in this case 17 years) is nothing to take lightly." And I don't which is why I take great solace in the knowledge that $20k of every $58k BRK share is in cash and bonds awaiting deployment by the world's most successful investor ever. "There was a lot of publicity on TV about the buffet shareholder meeting in July 98 and so far that has been an excellent contrary indicator for BH." There is always a lot of coverage since more shareholders attend this meeting than those of ANY other publically traded company. This is the case whether in number or % terms. Further, the 33% additional shares issued to the largely institutional shareholder base in the GRN acquisition is a much better cause for the stock performance since than is a little publicity. Also the overhang from the Othmer estate (the couple who quietly died with $800 mil from their original $50k investment) which is no doubt being liquidated by the recepients who view BRK as a "mutual fund" and therefore think they need to diversify. "why are you handing your investments over to someone else?" A common misperception is that BRK is a closed-end mutual fund. Not only is it the #4 insurer in the world, the #2 largest capitalized company in the world (after Royal Dutch Shell), and the #1 capitalized insurance company but: A) Berkshire Hathaway employess 45,000 (despite their being only 12 1/2 in corportate) B) 1997 OPERATING revenues would rank it 75th in the Fortune 500 and 54th based on operating earnings (this is before the $22 bil acquisition of GRN and $750 mil acquisition of Executive Jet) C) 79% of its' $18.6 bil in revenues and $1.5 bil in operating earnings comes from its' insurance OPERATIONS D) BRK's insurance opps alone would rank it 100th in the Fortune 500 and 243rd based on the earnings from those opps alone. E) BRK's non-insurance opps ALONE would rank 391st in revs in the F500 and 243rd based on earnings! ** These numbers are not misrepresented owing to "one-time charges" or options as neither exist at BRK. Incidentally, Bill Ruane has a 45 year record that ranks him up there with the best investors of all time and as of 6/30/99 75% of his equity position and 30% of the entire fund are in Berkshire Hathaway. biz.yahoo.com The point of this rant is to make clear that my investment in BRK is a very well thought out investment in a company - not a manager of investments.