KIT

Citigroup and Berkshire Pricing Anomalies

Warren is protecting the shareholder from his eventual death were all his shares will be deemed sold. The resulting tax can only be met by a massive selloff, this selloff would decimate the current shareholders. This donation prevents a single day wipeout.

Ford foundation, Carnegy, and many others have done the same for the same reason


On Jul 06 04:33 PM U338129 wrote:

> If Buffett's gift is impacting the stock in a negative way then shame
> on him (I doubt the gift is what's causing the mediocre pricing of
> the stock). Philanthropy is great, and we should all be so lucky
> one day to partake in it, but if the CEO of a company is partaking
> in an action that is decreasing shareholder value (however short-term
> it may be) then he/she should be called out for it; regardless of
> who it is. We all know about his arrangement and it's very noble.
> However, he still owes it to his shareholders to increase shareholder
> value. He already forces shareholders to sit through these downturns
> without so much as a mild dividend to hold us over. We're also left
> in the dark about the transition plan (it is not unfair to ask for
> details when the man that holds the key to the kingdom is nearly
> 80 years old). I believe he's been one of the best at managing retained
> earnings; but, the stock sure isn't reflecting that greatness lately.
> Still holding on to the stock but I can't say that I'm ecstatic about
> its performance over the last 18 months.

The Berkshire Pricing Anomaly

Warren is converting his personal A class shares into B class before he gives them away to prevent the charity from getting control of Birkshire.

This action depletes total number of A shares and raises the price of them.