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

To: bobby beara who wrote (47380)	4/19/2000 9:59:00 PM
From: Benkea	Read Replies (1) \| Respond to of 99985

bobby: "however i liked WB at book value, but in a bear market i think i'll take a page from graham and dodd and would love to own WB at a discount to book value, which is where i believe you will be able to buy him." Yea, you and me both. Here are a couple of words from the 1999 annual report (reprinted with permission from the man himself if you can believe it!): "Though we can't give you a precise figure for Berkshire's intrinsic value, or even an approximation, Charlie and I can assure you that it far exceeds our $57.8 billion book value. Businesses such as See's and Buffalo News are now worth fifteen to twenty times the value at which they are carried on our books. Our goal is to continually widen this spread at all subsidiaries." "You should be aware that one item regularly working to widen the amount by which intrinsic value exceeds book value is the annual charge against income we take for amortization of goodwill -- an amount now running about $500 million. This charge reduces the amount of goodwill we show as an asset and likewise the amount that is included in our book value. This is an accounting matter having nothing to do with true economic goodwill, which increases in most years. But even if economic goodwill were to remain constant, the annual amortization charge would persistently widen the gap between intrinsic value and book value." Do you really think it is going too far below $45K with the offer put forth in the annual this year? Incidentally, this is the first time BRK has ever bought back shares! "Recently, when the A shares fell below $45,000, we considered making repurchases. We decided, however, to delay buying, if indeed we elect to do any, until shareholders have had the chance to review this report. If we do find that repurchases make sense, we will only rarely place bids on the New York Stock Exchange ("NYSE"). Instead, we will respond to offers made directly to us at or below the NYSE bid. If you wish to offer stock, have your broker call Mark Millard at 402-346-1400." berkshirehathaway.com