Subject: Re: Dear Mr Buffett, and your letter next week.
"So you are against CEOs having quarterly conference calls with stock brokers and holders? You are against CEOs or board members participating in interviews in print or audio or TV?" - Ralph

Depending what they say.... Of course I am not against any of that. That would be silly.

"Or do you somehow think they are doing this for some reason other than increasing the value of their stock? Please note, if your answer is "well its their job to keep stockholder's informed about how the business is doing, they don't do it to keep the stock price up" then please think: why is that their job? Does it somehow improve the return on their stock holder's investments? And if that is why it is their job, then isn't it ultimately that they are supposed to keep us informed so people don't dump their stock because they don't understand why they should keep it?" - Ralph

That is utterly silly. Do you think Buffett sits on stage for hours on end in early spring in JUST to influence the price of the stock? No. Of course not.

"It is not at all clear to me that ANYTHING that influences the price of the stock is not also about the business. Either it is keeping the stock high enough to reflect the actual value of the stock, and thus fulfilling their requirement to maximize shareholder's return, or they are flogging the stock so that people are tricked into paying too much for the stock, in which case they risk having a lower stock price in the future because nobody believes them anymore." - Ralph

Then you haven't actually read this thread all the way through.

Harold (his real name is Harvey, but his "friends" call him Harold), wants Berkshire to pay an extremely small dividend solely because he thinks it will influence the price of the stock. He has admitted it doesn't matter from a business sense.

Obviously then can be business reasons to pay a dividend. The company can determine it has capital in excess of its investment opportunities and want to return some of it to shareholders. Great. But if the dividend is only being done to influence the stock price (as Harvey clearly suggested) then it is a not a good idea and should raise a red flag among investors. Same for buybacks. If the company (CEO and BoD) determines that buying back its stock is a good investment to make with its capital, then that is great and I have no problem with it. However if they are buying back stock JUST to boost the price of the stock, then that should be a huge red flag.

"Do you think Buffett's amazing annual meetings are BAD for the stock price?" - Ralph

Now you are just being dumb and creating strawmen. Come on. I know you and that is not normally you. What's up with this?

I will make it as simple as I can make it:

If management is doing things SOLELY/PURELY/JUST to influence the price of the stock, then it should raise a huge red flag for investors because it means that they are focused on the wrong thing and it could have very dangerous consequences.

I will fully recognize that most actions can fall into a grey area in that they can be done for business reasons or to influence the price of the stock. A vast majority of actions (99.9% or more) fall into this area and it might be reasonable to give management the benefit of the doubt in these cases, but in the rare cases where the motivation is clear (such as being verbalized as somehow being beneficial) then it should be a clear red flag that management is focused on the wrong thing.

Management should be focused on running the business. If they run the business well then a high stock price will eventually naturally follow.