Marc Gerstein

Sokol Imposing Budget Discipline and Culture Change at Berkshire-Owned NetJets

On Dec 07 06:07 AM Skysailor wrote:


> Sokol has probably been given little. Mr. Sokol gets his marching
> orders from his master and he has accepted that position which requires
> him to do what he is doing. Otherwise, Mr. Buffet would have to dirty
> his hands (and reputation). Mr. Sokol can always be replaced and
> when the "transition" is complete and the bruises begin to heal he
> will be replaced by someone perceived as a kinder gentler person.
> There will always be a Mr. Sokol to protect the Mr. Buffet's.

Undoubtedly, there's a mess here. I'm not a fly on the wall in BRK's Omaha HQ, so I can't comment on why Sokol rather than Buffett is doing the dirty work, But based on precedent, I seriously doubt it has anything to do with Buffett's needing Sokol or anybody else to protect him from a corporate mess. Recall the Salomon Brothers disaster in the '90s, when Buffett actually had to relocate for a while to NYC to serve day-to-day as Salomon's CEO to fix the mess left by former CEO John Gutfreund (who had once been praised by Buffett).

You can like Buffett. You can dislike Buffett. But either way, suggesting that Buffett needs to send anybody out into the world to take heat for him is an ill-informed cheap shot.

Even Buffett Makes Mistakes

What is this article supposed to be telling us?

Everyone who has looked into BRK knows full well that Buffett makes mistakes, and he's often been the first one to announce call attention to the errors, and to do so sans the usual corporate spin. (The incident that most sticks in my mind, after many years, is his having described his decision to have BRK invest in USAir as "a case of sloppy analysis."

As to NetJet, in the grand scheme of things, it's a gnat on an elephant's you-know-what. It';s not even the first time Buffett has had to step in and address management problems at a unit. Remember Salomon Brothers. . . Buffett even had to move to NY for a while and serve as CEO until that former brokerage firm was able to fully address a vintage-1990s set of Wall Street scandals.

If the aim, here, is simply a finger-pointing exercise directed at Warren Buffett, well, that's your prerogative. But as a reader who has been looking, sometimes closely and sometimes less closely at BRK for nearly 20 years, I have to tell you I'm not impressed by the critique.

Warren Buffett Portfolio: Going Beyond the Folksy Stereotypes to Find All-Star Stocks

I saw Winkler's article and I don;t buy his premise. I can just as easily argue that everybody was bailed out by the taxpayers, you, me, everyone because who knows what the heck would have happened to the financial system had the bailouts not occurred. Maybe you agree. Maybe you don't. That's a political debate, not an assessment of Warren Buffett.

And speaking of Warren Buffett, as good as he's been over how many years, 2008 was a nightmare for him and his shareholders (one of who is me), so I don;t see that he got a free ride. If he has the wherewithal to dive into disaster and probably come out smelling like a rose later on, that would be the due to the accumulation of all the success he had going in, and assuming that's how it turns out, more power to him. In every walk of life, long-term winners can get away with things most people can't. Suppose Bill Bellicheck didn't win all those super bowls in New England. with a personality like his, do you think he'd ever be able to hold a job? Of course not! Winning has many reward, for Bellicheck, for Buffett, for everyone. That's life.


On Aug 06 11:38 AM swaps wrote:

> Good article, but you should also check out Rolfe Winkler's Seeking
> Alpha article today on Buffet.
> Warren Buffet too would have evaporated into oblivion last Septmeber
> if the disappearing American middle class had not bailed him out
> along with the rest of the banking system with massive fiat money
> creation to offset the derivatives black hole.
> i know, the middle class did not really bail out Buffet - but their
> remaining imaginary equity was the only asset the elites had left
> to forcibly borrow against , with interest charges to accrue.
> Winkler details accurately the Buffet hypocrisy.