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

To: Shane M who wrote (640)	12/7/1998 12:26:00 AM
From: cfimx	Read Replies (1) \| Respond to of 4691

Shane, I appreciate your inputs. We are ALL learning here. If I seem kind of direct about this stuff, its because I believe that on the only real Buffet forum here on SI, we need to be extra vigilant about what Buffet's thinking really is. The Buffetology book is a good starting off point. The annual is much better. I have also had the good fortune to have read (and reread) copies of a number of recaps of Buffet/Munger at the annual meetings, as well as some separate Munger stuff, courtesy of the Outstanding Investor Digest Newsletter ( I don't subscribe). Morningstar is also starting to do a good summary. There is a lot of stuff straight from the "horse's mouth" that contradicts what's in the "book." And I think its worth discussing. The OVERRIDING POINT is you have to UNDERSTAND THE BUSINESS and that means not using the USUAL NUMBERS as a crutch, as b schools train us to do. In that light, I bet you'd be surprised to know ( as I was) that BA was exceeding the five year return of the S & P 500 until only a FEW months ago and it has DEMOLISHED it over the last 15 to 20 years (this courtesy of MY CRUTCH, Yahoo <g>. Now Shane, do THOSE FACTS mesh at all with your statement that "Boeing management has failed miserably in delivering value to the shareholders?" No. But your "database" <g> told you some things that made you only conclude results have been "miserable." The truth seems to be that BA has had an OUTSTANDING LONG TERM RECORD, but has recently stumbled. Sounds like James is on to something.

To: Shane M who wrote (640)	12/7/1998 7:50:00 PM
From: James Clarke	Respond to of 4691

Coke was a mid-teens ROE company until about 1985. Buffett surely saw all along that "Damn, this business will someday make a lot more money," but it was horribly mismanged. He waited until everything was in place for perfection, but nobody really noticed yet. He sacrificed the first double to be sure that "someday" was very near. (Or maybe you can believe his modest story that he somehow didn't look at Coke for 40 years, and then just happened to catch it at exactly the right time - I don't). And by the way, that is an argument NOT to buy Boeing now. JJC