Warren Buffett isn't Swiss, but he oughtta be.
The Oracle of Omaha, the worlds most successful and admired investor, eschews glitzy Manhattan to live in his modest house in Omaha. That he lives below his means is an understatement. We penurious Schweitzers take a lot of heat for that philosophy, but we can't help it - it's in our genes. Profligate Schweitzers in the resource-poor "old country" never survived to reproduce their own kind.
As holder of a few "B shares," the cheaper - er, lower cost - ones of Buffett's Berkshire-Hathaway, I received the credentials to attend the annual shareholders' meeting. Unlike ordinary shareholder meetings, Berkshire's meetings attract thousands from the four corners of the earth to listen to Buffett and his chief henchman, Charlie Munger.
It was a gorgeous spring day as I trekked across Iowa. I crossed the Missouri River into Omaha, checked into my motel, and headed for the evening shareholders' reception.
It's not just Wisconsin Schweitzers - in my experience, it doesn't matter whether it's Latin America, Europe, Africa, Asia, the Middle East or Berkshire-Hathaway shareholders in Omaha. People the world over will endure jostling crowds, noise and stand in line long enough to read "War and Peace" if there's gratuitous food and drink at the end of that line. Hors d'oeuvres, sandwiches and beer courtesy of Warren Buffett? Can't knock it.
Saturday morning, I drove over to Omaha's Qwest convention center, parked, donned my credentials tags and wandered around Berkshire's displays. Time to find a seat for the Warren and Charlie show - almost too late. The place was packed with some 37,000 fans. I found a seat in the nosebleed section and listened to Warren and Charlie answer unrehearsed questions and wax eloquent on the principles that brought fame, respect and admiration that so few in the world of business and finance manage to attain.
On investment philosophy, go for value over the long haul. Warren admits that he can't predict short-run market fluctuations. And why bother? The savvy investor goes for value - stuff that is most likely to grow over time, thereby strengthening your balance sheet and providing a future income stream.
On management style, select the best people and give them authority along with responsibility to manage and take initiative. Will he intervene if he sees one of his CEO's going down the wrong path? Probably not if it's purely financial. Better to allow error than to hover over them and stifle initiative and creativity.
But if it's legal or ethical, it's another story. He will tolerate a bad business decision - everyone makes them now and then - but if it's ethical, "I will be ruthless."
On the economy, he credited the Bush and Obama Administrations for taking action to prevent total collapse of the economy, and believes any responsible administration would do so again, if necessary. He observed that "Big [federal] spending brought on by the economic crisis might be the right thing to do ..." but he worries about future inflation. "As long as the U.S. borrows money in its own currency, there will be no default, but having countries buy U.S. debt is another question."
Buffett believes that derivatives for hedging on grain, fuel and other commodities "are fine," but he would be OK if other derivatives vanished as they have little to do with allocation of money toward productive enterprise. Furthermore, Charlie added, they allow "casino like" investing on Wall Street.
Referring to former Fed Chair Paul Volker, known for favoring regulation and tough economic policies, Charlie said he would "make Paul Volker look like a sissy."
It was a fascinating day. The convention info listed some of Warren's favorite Omaha steakhouses. I figured they would be too crowded. As far as I'm concerned, there is only one way to have a thick steak - charred on the outside to seal in the juices, and bloody on the inside, with a glass of pinot noir. On my next junket to New Mexico, I'll detour through Omaha and check out one of those steakhouses.
I opted for the picnic for shareholders, and another long wait in line. As the crowd chatted in the pleasant spring evening air, Buffett provided free Cokes. He is a major shareholder of Coca Cola.
Next morning I climbed into my GMC, crossed the Missouri River, and headed north and east on roads less traveled. I stopped for lunch in Dennison, Iowa, a town we read about in our Green County Leaders class. Dennison, slightly smaller than Monroe, is going through the same changes as many Midwest towns. I had lunch in a Mexican restaurant, symbolic of small town change. The huevos rancheros were good, but no match for those of the Pow Wow Inn of Tucumcari, New Mexico, the joint I hit on my periodic junkets.
As I headed east across Iowa through picturesque small towns amid gentle rain showers, I reflected on the wisdom of Warren and Charlie. I didn't agree with everything they said. I thought they could have come down harder on Goldman Sachs and hit some other points harder.
But all told, Wall Street and the world of finance would be better if we had more people like Warren Buffett around. However, we can't depend on that. Wall street and the big banks have proved time and again that they can't be trusted with carte blanche.
As Warren and Charlie favor intelligent regulation, how do they lean politically? Who knows and who cares? I see them as the ultimate pragmatists. Go with what works.
Regulation won't work? It worked for over 50 years - until we forgot lessons learned from the Great Depression. Let's regulate the myopic, greedy scions of Wall Street in order to give them a sportin' chance to be responsible. Otherwise, it won't happen.
- Monroe native and resident John Waelti is former professor of Applied Economics, University of Minnesota; and former head of the Department of Agricultural Economics at New Mexico State University. He can be reached at jjwaelti1@tds.net.
The Oracle of Omaha, the worlds most successful and admired investor, eschews glitzy Manhattan to live in his modest house in Omaha. That he lives below his means is an understatement. We penurious Schweitzers take a lot of heat for that philosophy, but we can't help it - it's in our genes. Profligate Schweitzers in the resource-poor "old country" never survived to reproduce their own kind.
As holder of a few "B shares," the cheaper - er, lower cost - ones of Buffett's Berkshire-Hathaway, I received the credentials to attend the annual shareholders' meeting. Unlike ordinary shareholder meetings, Berkshire's meetings attract thousands from the four corners of the earth to listen to Buffett and his chief henchman, Charlie Munger.
It was a gorgeous spring day as I trekked across Iowa. I crossed the Missouri River into Omaha, checked into my motel, and headed for the evening shareholders' reception.
It's not just Wisconsin Schweitzers - in my experience, it doesn't matter whether it's Latin America, Europe, Africa, Asia, the Middle East or Berkshire-Hathaway shareholders in Omaha. People the world over will endure jostling crowds, noise and stand in line long enough to read "War and Peace" if there's gratuitous food and drink at the end of that line. Hors d'oeuvres, sandwiches and beer courtesy of Warren Buffett? Can't knock it.
Saturday morning, I drove over to Omaha's Qwest convention center, parked, donned my credentials tags and wandered around Berkshire's displays. Time to find a seat for the Warren and Charlie show - almost too late. The place was packed with some 37,000 fans. I found a seat in the nosebleed section and listened to Warren and Charlie answer unrehearsed questions and wax eloquent on the principles that brought fame, respect and admiration that so few in the world of business and finance manage to attain.
On investment philosophy, go for value over the long haul. Warren admits that he can't predict short-run market fluctuations. And why bother? The savvy investor goes for value - stuff that is most likely to grow over time, thereby strengthening your balance sheet and providing a future income stream.
On management style, select the best people and give them authority along with responsibility to manage and take initiative. Will he intervene if he sees one of his CEO's going down the wrong path? Probably not if it's purely financial. Better to allow error than to hover over them and stifle initiative and creativity.
But if it's legal or ethical, it's another story. He will tolerate a bad business decision - everyone makes them now and then - but if it's ethical, "I will be ruthless."
On the economy, he credited the Bush and Obama Administrations for taking action to prevent total collapse of the economy, and believes any responsible administration would do so again, if necessary. He observed that "Big [federal] spending brought on by the economic crisis might be the right thing to do ..." but he worries about future inflation. "As long as the U.S. borrows money in its own currency, there will be no default, but having countries buy U.S. debt is another question."
Buffett believes that derivatives for hedging on grain, fuel and other commodities "are fine," but he would be OK if other derivatives vanished as they have little to do with allocation of money toward productive enterprise. Furthermore, Charlie added, they allow "casino like" investing on Wall Street.
Referring to former Fed Chair Paul Volker, known for favoring regulation and tough economic policies, Charlie said he would "make Paul Volker look like a sissy."
It was a fascinating day. The convention info listed some of Warren's favorite Omaha steakhouses. I figured they would be too crowded. As far as I'm concerned, there is only one way to have a thick steak - charred on the outside to seal in the juices, and bloody on the inside, with a glass of pinot noir. On my next junket to New Mexico, I'll detour through Omaha and check out one of those steakhouses.
I opted for the picnic for shareholders, and another long wait in line. As the crowd chatted in the pleasant spring evening air, Buffett provided free Cokes. He is a major shareholder of Coca Cola.
Next morning I climbed into my GMC, crossed the Missouri River, and headed north and east on roads less traveled. I stopped for lunch in Dennison, Iowa, a town we read about in our Green County Leaders class. Dennison, slightly smaller than Monroe, is going through the same changes as many Midwest towns. I had lunch in a Mexican restaurant, symbolic of small town change. The huevos rancheros were good, but no match for those of the Pow Wow Inn of Tucumcari, New Mexico, the joint I hit on my periodic junkets.
As I headed east across Iowa through picturesque small towns amid gentle rain showers, I reflected on the wisdom of Warren and Charlie. I didn't agree with everything they said. I thought they could have come down harder on Goldman Sachs and hit some other points harder.
But all told, Wall Street and the world of finance would be better if we had more people like Warren Buffett around. However, we can't depend on that. Wall street and the big banks have proved time and again that they can't be trusted with carte blanche.
As Warren and Charlie favor intelligent regulation, how do they lean politically? Who knows and who cares? I see them as the ultimate pragmatists. Go with what works.
Regulation won't work? It worked for over 50 years - until we forgot lessons learned from the Great Depression. Let's regulate the myopic, greedy scions of Wall Street in order to give them a sportin' chance to be responsible. Otherwise, it won't happen.
- Monroe native and resident John Waelti is former professor of Applied Economics, University of Minnesota; and former head of the Department of Agricultural Economics at New Mexico State University. He can be reached at jjwaelti1@tds.net.
