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To: Bruce Brown who wrote (42357)	5/3/2001 9:26:05 AM
From: Mike Buckley	Respond to of 54805

Bruce, growth rates have nothing to do with valuation except to the extent they provide clues to the amount and timing of cash flows into and from the business. That's almost tantamount to saying that Michael Jordan had nothing to do with winning basketball games except to the extent that he put the ball in the hoop. I think Buffet was probably trying to emphasize that cash flow is what business is all about (which is true). What scares me is that, for investors who don't grasp what he was trying to say, is that his phraseology accidentally made the traditional factors investors use for valuation appear to be separate and not linked to cash flow (which is not true.) Hopefully my impression of his comment would change if I saw it in context. --Mike Buckley

To: Bruce Brown who wrote (42357)	5/3/2001 9:54:00 AM
From: hueyone	Respond to of 54805

Thanks for the Buffet snip. I certainly can't speak for "the great one", but I believe he is merely pointing out the limitations of commonly used valuation tools. Buffet is indeed very interested in valuation. I believe he tries to project "owner earnings" (close to free cash flow) for his companies over a long period of time and then tries to buy these companies when they are selling at discount to his model of discounted future owner earnings from the company. He also says there isn't much catching his eye as a good value in the public markets today even at these "corrected" levels. Best, Huey