Subject: Re: Brkb was downgraded to sell
Again, I appreciate the kind words from TexIrish. I may have owned the stock longer but he’s a little older —and a lot wiser. And I’ll concede there are personal biases in my relationships in this topic.

I guess where I differ is—I see opportunity where you’ve clearly and eloquently identified risk. We concur, I think, at the end of the day this is a collection of operating companies. THAT is what will move the needle, likely increasing so, going forward.

So we have a group of large op cos I believe we all conceed and the market overwhelming concurs (and that is SIGNIFICANT in this discussion) —underperforming collectively. We also sit on $340 Billion cash (maybe 28% of the company).

Key point: The marketplace..and posters here..value Berkshire on PRESENT cash flows, earnings, and Book. It values its “loved” stocks on future hope. It values Berkshire only on its underinvested present.

We’ve seen strong progress in fixing GEICO & its technology issues…it’s been a remarkable turnaround . We’ve seen incremental progress at Burlington Northern. We have other subs that just need TLC and a little macro tail wind. We have precisely the guy for THAT an OPERATING GUY who logically will——you fear culturally/I love fundamentally —be more “hands on” at the major op cos. Right guy..right time.

So, with all due respect, I see a business valuation and census analysis that reflects most of your concerns. There’s a lot to worry about. Those concerns are real and you are spot on and thorough in your analysis. Agree!

But I try to skate to where I think the puck is going…am I too optimistic thinking:

a.) some of these operating companies will do better..1 or 2 a lot better…over time. They’re collectively solid businesses in need of tune-ups. And yes there are headwinds on the regulatory and competitive fronts.

b.) more significantly we are valuing a business that has probably $250 Billion (accessible immediately) and growing each week to put to work. I’m not a wild optimist I think saying 1/4 to 1/3 company can’t be invested at better than 4%. Going forward. I suggest it will be deployed at rates comfortably topping that modest bar. And that’s NOT in this stock.

So..maybe it’s sanguine for me to conclude: op cos won’t be as bad, cash will some day be put to work, and culture will not be destroyed.

But that’s all you need for this to WORK. We love 2 foot high hurdles to clear in the jump competition and we LOVE low expectations. This is Buffett text book and I love the risk/reward here. It’s modestly attractive at PRESENT cash flows and PRESENT P/B. What if we put some money to work or fix a couple things??

This has been fun. And you know I respect and admire you as much as anyone. And the Apple News tip is great, too. Thanks for your shared wisdom. As always. And Exxon is on my radar screen! :)