• Stock Strategies
  • Insights on Warren Buffett From His Friend and Editor

    by Charles Rotblut, CFA and Carol Loomis

    Carol Loomis is a senior editor-at-large for Fortune and author of “Tap Dancing to Work: Warren Buffett on Practically Everything, 1966-2012” (Portfolio Hardcover, 2012), published last November. I spoke to Carol recently about Buffett’s annual Berkshire Hathaway shareholder letter, which she edits, and about her sense of Buffett’s attitudes and methods.

    —Charles Rotblut

    Charles Rotblut (CR): Could you describe your relationship with Warren Buffett? I don’t think people realize that it goes beyond you being a senior editor at Fortune magazine who has written about him.

    Carol Loomis (CL): I’ve known Warren since 1967, when I met him through my husband, who was a securities salesman who had called on Warren. He, his wife, my husband and I became good friends from then on. He has a group of people that meets every couple of years, and we were invited into that group. So I’ve known Warren for a long time. My husband and I are also Berkshire Hathaway shareholders. And the final connection is that beginning in 1977, Warren revamped his annual chairman’s letter and he asked me to take a look at it. Since then—for the last 36 years—I have been his pro-bono editor. So those are my other Buffett connections: friend, shareholder and editor of his annual chairman’s letter.

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    Charles Rotblut, CFA is a vice president at AAII and editor of the AAII Journal. Follow him on Twitter at twitter.com/CharlesRAAII.
    Carol Loomis is a senior editor-at-large for Fortune and author of "Tap Dancing to Work: Warren Buffett on Practically Everything, 1966-2012" (Portfolio Hardcover, 2012) .


    Robert Carr from NY posted over 3 years ago:

    How about comparison of share price that is where stock holders get paid? Nice column though, enjoyed hearing from someone who knows.

    Steve from Penna. posted over 3 years ago:

    Warren Buffett is undoubtedly one of the greatest investors of all times, and appears to be a humane and ethical human being as well. That being said, for retired retail investors such as myself, my outlook on his
    investments, and my advice to others in my category: go elsewhere. Buffett stocks will never provide any dividends as long as he is in charge. His "A" stock is way beyond my free cash available, and his "B" stock's performance is nothing to write home about, compared to many other high quality stocks. Once he scooped up Heinz (one of my "core" holdings) recently, the dividend disappeared
    almost immediately. I have since sold my Heinz shares.

    Also, when Buffett retires, there is absolutely no guarantee that the performance of Berkshire holdings will continue to appreciate. Look what is happening to Apple since Steve Jobs left; there may be some real similarities here.

    gsturgis from ms posted over 3 years ago:

    My respect for Mr. B's consistency, patience, evaluations of managers, projections of business trends, and timing of investment commitments is greater as I follow his career. I do not understand his political postures on taxes, big government involvement in controlling the free- enterprise capitalistic economy, the encouragement of a welfare state.and the support of a socialist party and leader pursuing an agenda that has failed everywhere it is used! Ask him to stick to Mr. Graham's
    teachings and leave politics to the egomaniac idiots! Thanks for the lessons and investment leadership. gsturgis@comcast.net

    Craig from VA posted over 3 years ago:

    Say what you want......only two down years since 1965 pretty much sums it up.

    John from AZ posted over 3 years ago:

    The article compares Berkshire Book Value against SP 500 share price + dividends.
    Only 2 down years out of 45 years for Berkshire. This can explain good compounded annual gains for Berkshire. Bershire stock must have low turnover, so they don't have to sell assets in a down market.
    What are the other reasons for only 2 down years in 45 years?

    James Greenebaum from IL posted about 1 year ago:

    I bought Berkshire "B" when it was issued through the Omaha brokerage I used at the time, a predecessor to TD Ameritrade. I knew it would never pay a dividend, but as a security with constantly rising value to add to my portfolio it has done just what I wanted. If I ever need the money I can always sell. It' better than buying gold!

    JW from IA posted 9 months ago:

    Berkshire B as many have noted in comments is nothing to write home about. But if you want to be part of a status symbol and be a part of what most consider an elite group there is nothing wrong with that.

    History (02/29/2016)







    -4.76 17.56 32.17 26.64 -12.06 1.61

    Insurance - Diversified
    -18.32 26.88 38.93 15.04 -6.56 -3.28

    S&P 500 TR USD
    2.11 16.00 32.39 13.69 1.38 -5.09

    +/- Insurance - Diversified
    13.56 -9.32 -6.76 11.60 -5.50 4.89

    +/- S&P 500 TR USD
    -6.87 1.56 -0.21 12.96 -13.45 6.70

    Dividend Yield %
    — — — — — —

    Market Cap USD Mil
    188,119 220,052 290,965 368,186 323,837 329,074

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