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Berkshire Hathaway Inc. Message Board

  • DynamicAssetAllocator DynamicAssetAllocator Nov 17, 1998 2:09 PM Flag

    Nebraska Cornhusker Football & BRK Corre

    I am writing a thesis paper on the corrleation
    between the success of the Nebraska football program and
    BRK's price appreciation. My preliminary findings
    indicate that in years that Nebraska has been national
    champs or has been rated in the top three in the year
    end AP poll, BRK's price appreciation accelerated in
    those years and the following year. Years in which Big
    Red lost a national championship or finished with two
    or greater losses BRK underperformed its historical
    growth rate. As we all know Nebraska has lost three
    games this year, and if the past is any indication of
    the future, expect sub-par performance from BRK for
    the remainder of this year and next year.

    retirement of John Osbourne very well may have grave
    implications for BRK holders going forward. All you BRK
    holders better hope that Big Red has a great recruiting
    season next year. Has the Nebraska dynasty ended, and
    will it signal the demise of BRK. These are the
    questions that I will address in my paper.

    anyone would like to share their views on this hotly
    debated topic, please let me know. Serious inquiries

    As always,


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    • That goes to further illistrate my point.

    • Here you go again. Do you understand that
      virtually ALL major capital allocation decisions are made
      by Buffett? Yes, day to day operations are left to
      the managers. From some things I have read, I get the
      impression that a small add-on acquisition that would
      complement an existing operation may be made with little or
      no input from Buffett. But again, these would be
      small. But I do believe that Warren Buffett spends
      considerable time thinking about what could be done at an
      enterprise level with all the various operations. In one way
      you may be correct. He may not have spent more than
      an hour thinking about geographic expansion plans
      for NFM because he has written before about the poor
      results of geographically diverse furniture retailing
      operations. So he may not be thinking about it because he
      knows that no matter what direction he approaches such
      a question, the answer will still be no.

      you suggest that if this made sense, the Blumkins
      would have done it. I can go along with that also. I
      think you may be almost but not quite right here.

      But having said all of this, why do YOU think that
      they should do it. You have agreed that the people,
      Buffett, Munger and the Blumkins, who understand this
      operation the best have decided not to expand
      geographically. So why do you think that THEY should substitute
      THEIR judgment for YOURS?

    • The toughest job for -- and the real test of -- a
      manager is, as Warren himself would agree, capital
      allocation. He has said that he begs our operations managers
      to think of ways to reinvest their own earnings. But
      Charlie and Warren do not meddle with them in their
      respectice businesses.

      Warren has never mentioned
      anything about meddling in these businesses' expansion
      plan. My own thinking is that Warren and Charlie gives
      100% freedom to them (recall Charlie's saying, during
      the 1998 AM weekend, that they "delegate to the point
      of ...?").

      In the case of NFM, I do not
      believe that Warren has spent more than an hour thinking
      about the possibility of expansion. Why? First, he
      believes in the Blumkins. If expansion is good, then the
      Blumkins would have done it. (So we are actually making
      this expansion proposal to the Blumkins and not
      Second, check out the numbers that NFM is bringing in,
      and compared that to the whole picture. Is it worth
      Warren's time?

    • <<The CEO just sold approx 150,000 of his
      approx 800,000 shares. Why would he do this if he were
      negotiating with WB>>

      If you are negotiating a
      merger you can not sell or buy per SEC rules....

    • Only a fool would put all his eggs in one basket. Why are you proud of this?

      A proud fool is a dangerous fool.

    • <<The only reason I can think of that NFM
      is not yet doing this is they are waiting for a
      recession or depression to do that.>>

      Tthis is
      the only reason that you can think of? And you claim
      to understand Buffett? Look at the way he allocates
      capital. Look at Sees Candies, a better operation than
      NFM. He has stated that he would love to expand Sees
      if they could do so in a way that meets his
      standards. You think that Buffett et. al. have not given the
      same consideration to the geographic expanision of NFM
      and not come up with the same conclusion?
      I do
      not understand why you go on for ages on the glories
      of Warren Buffett and then second quess him all the
      time. Especially when your second guessing is silly.

    • Yes, it is 500 not 50. My mistake.

    • No. It is 50 of the As. The Bs trade around 8k per day.

    • "........could NewBRK be considered for admission
      to the S&P 500 if the 1,000,000 shares of preferred
      stock were brought to market?...."

      BRK would
      still be highly illiquid for an S&P 500 company with a
      float of a little over 1 mil shares.

    • Sooner or later they HAVE to include us in. Why?
      We are too big to be ignored. But of course
      everybody from the "inside" of the industry wouldn't want
      to see us, and that's exactly why we have been

      Don't forget that to them, we are a whole bunch of
      cowboys and they are like English gentlemen.

      reason I like Warren is his no-nonsense way of doing
      things, and his "as long as my principles are right, you
      don't give a damn what you think" sort of

      We have our way of doing things, and we have again
      and again proven the pundits wrong. Good for BERK.
      Good for BERK owners. Good for our consumers. Bad for
      the politicians on the Capital Hill. And bad for
      politicians-in-disguise currently at the helm in public corporations in

      Other than Warren, I haven't seen anyone heading a
      listed American corporation who is more entrepreneur
      than politician in nature and in actions.

      explains my 99% (of net worth) tied up in

      Seem like most posters on this board also concurrently
      own other stocks. Any posters also having their 99%
      net worth all in BERK shares?

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