Contrarian Value Ideas

[gfp927z]

Derf, >> BRK <<

I own some of the same stocks found in Berkshire, but don't actually own BRK itself. I always figured Buffett wouldn't be around too much longer, but here he is at 94 and still at it. I don't have as much confidence in the new guys yet (Weschler, Combs), and also wonder about potential tax problems there might be for Berkshire shareholders after Buffett is gone (?) There's also the possibility that as a conglomerate, Berkshire is broken up after Buffett is out of the picture. The conglomerate structure has worked well for Buffett, especially since the insurance side provides lots of 'float' cash to invest, but conglomerates can be unwieldy and are viewed as worth more when broken up.

Another reason I haven't owned BRK is that I don't understand the attraction of some of the holdings. The 'Oracle' obviously knows what he's doing, but some of the holdings aren't 'steady' enough looking (chart-wise). Owning a select group of his stocks, as I do, also has risks since he periodically trims positions or sells them outright, which can tank the stock when the stock sale is announced later. I decided to hold on to numerous of these anyway, even after he sells, since the long term chart is so great (AON, MMC, MCO, COST).



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