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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Roy Glen who wrote (10116)	3/4/2000 9:22:00 AM
From: Freedom Fighter	Read Replies (2) \| Respond to of 78748

Roy, You brought up a lot of good issues. Here's my thoughts. If global warming and other changes in weather patterns become an issue because of poor insurance statistics, my guess is that the PC business will have a few rotten years. Then it will adjust. I'm not too worried about the super cat business though. When people first hear that BRK is insuring against big catastrophes it can be a bit frightening. But most of the losses are capped at a level that would easily be absorbed by BRK because it is so over capitalized. It won't be fun, but I don't think there will be any disasters. Another thing working in our favor is that BRK usually turns away marginable business and prefers to write insurance at a profit. It takes greater risks on the investment side of the business by focusing on equities. So if we are bleeding on our insurance business everyone else is dying. That can be a long term plus. Management succession is a problem for every corporation. There's a plus side to the current situation though. Warren is less critical now that BRK is mostly a group of operating companies than he was when it was mostly an investment vehicle. Let's hope Warren will continue to attract and keep the best in the business on the management side. I don't think Warren will spin anything off even if it creates value. He's made comments in the past about not selling certain securities because of the relationships he develops with people - even if it hurts performance. I would say that's more of a factor in the 100% owned businesses. Personally I love value creation and making a few extra bucks, but I have no problem with Warren putting people he admires and cares about above a few extra dollars in my pocket. In fact, in the current environment, it's a welcome relief. Wayne