Chungst

Doug Kass's Killer Shorts - Barron's

To paulmars, it's easy to be a critic isn't it? When you become the richest person in the world through your investment savvy, then you might have some credibility. Just like a PM who runs a $200MM short fund who "worships at Buffett's alter" but is now confused about the ongoing investment drift that has been the case since Buffett joined forces with Munger (Munger's detailed side of the story is clearly listed in "Poor Charlie's Alamanack").

Buffett's investment style has drifted and will continue to drift. So long as Buffett believes he can create value, he will retain the funds at Berkshire -- otherwise, he will dividend out the cash so shareholders themselves.

The most important point that paulmars misses is that Buffett continues to create vast billions in value OVER TIME despite the continues changes in the market place and increasing competition (especially from the so called smart investors like hedge funds). Berkshire CONTINUES to be the go-to place for financial deals that needs to get done. Buffett has paraphrased Grahm's wisdom: "Though the stock market functions as a voting machine in the short run, it acts as a weighing machine in the long run." Simply stated, Buffett's long term track record has never been equaled. Due to Berkshire's size, their performance will not match previous results, but it will still be better off than having the individual shareholders receive dividends and invest for themselves, respectively.

Cheers.

PS paulmars, do let us know when you made $62 billion from your investments.

Doug Kass's Killer Shorts - Barron's

Kass misunderstands Buffett, especially when Kass comments about Buffett's "investment style drift" in his articles on TheStreet.com. Both Buffett and (Charlie) Munger talks about being true to value investing AND being learning machines. Munger's book (Poor Charlie's Almanack) makes it clear Buffett would not have made the billions he has made if he had stuck to "cigar butt" investing. That is to say, Buffett's investment style has always changed, because it is an ongoing evolution, based on Buffett and Munger being continuous learning machines and adapting to the then current environment.

I don't understand why Mr. Kass didn't have a problem when had an investment style drift before (that led to billions of dollars in wealth creation), but now raises an issue. Me thinks Mr. Kass doth protest too much.