Is Berkshire Built to Last?

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It's been long accepted by the investing community and the value investing community in particular that Warren Buffett's Berkshire Hathaway (NYSE: BRK-A  ) (NYSE: BRK-B  ) is near infallible -- and an ideal long-term core holding. But that sentiment has been rattled by last week's revelation that David Sokol, operations guru and heir apparent to Buffett as CEO, bought shares of Lubrizol (NYSE: LZ  ) before Berkshire's bid to acquire the company -- in strict violation of Berkshire's trading policy and Sokol's own published guidance on business ethics.

Sokol has resigned, and the question of succession at Berkshire is up in the air. Considering that most public companies get succession horribly wrong, this is an issue that should be at the forefront of any Berkshire investor's mind and one that should come up at Berkshire's annual meeting later this month.

So is Berkshire built to last and will it succeed even after Buffett's gone? Motley Fool co-founder Tom Gardner, Inside Value advisor Joe Magyer, and Global Gains advisor Tim Hanson weigh in below.

Tom Gardner: Buffett has delivered the greatest investment returns over the longest periods of time of any investor in American history. It could be true that Buffett and Benjamin Franklin belong in the same category, which is why I wish Buffett would write his own book of investment advice. But while serious investors would do well to study Buffett every single day, I have a concern with Berkshire. I don't see enough indication that there is a system of internal learning in the culture. My fear is that Buffett truly is a complete master, and as with Howard Schultz at Starbucks (Nasdaq: SBUX  ) and Steve Jobs at Apple, there is a relatively big gap between the passion, mastery, and financial stake he has and the reputational risk he has vis-a-vis that of his potential successors.

Tim Hanson: Starbucks is a clear example of a company where succession failed and shareholders paid the price as the result. Schultz did not prepare former CEO Jim Donald to succeed and really never gave him the chance to do so either -- and Donald didn't bring the same passion or skill to the business.

Another example in that regard is Michael Dell. Dell (Nasdaq: DELL  ) went off the rails after Michael Dell handed over the CEO position to COO Kevin Rollins, particularly with regards to customer service, and Dell still hasn't recovered. Frankly, I do think the same will happen at Berkshire. Although the company's myriad operating assets are strong enough to keep it treading water, this is such a Buffett-centric company -- regardless of what he writes in his annual letters. Buffett writes the letters, Buffett goes on TV, Buffett negotiates the high-profile deals, and Buffett even hawks the company's products. Further, Buffett tends to get a free pass on a lot of issues -- such as paying a dividend or being more transparent about succession planning -- because he's Buffett and his reputation has earned him the benefit of the doubt. The next CEO won't get those benefits and is likely unprepared to fill all of Buffett's roles -- and Berkshire will be worse off for it.

Joe Magyer: No doubt, Berkshire loses a little magic when Buffett and Vice Chairman Charlie Munger walk out the door. They're every bit as irreplaceable to Berkshire as Jobs is to Apple. That said, and despite the Sokol flap, I think Buffett has done a solid job on the succession planning front against the backdrop of the impossibility of finding an equal successor.

Buffett has done a tremendous amount of succession planning via Berkshire's checkbook. His major investments in wide-moat, long-lived businesses like railroads and regulated utilities have cemented Berkshire's staying power. Another wrinkle is that his recent purchases have all been capital-hungry businesses, which means Buffett essentially just made his successors' capital allocation decisions for them. Buffett has also bolstered Berkshire's board of directors with longtime confidants like Donald Keough, Bill Gates, and his son, Howie Buffett, all of whom know and revere Berkshire's culture and have more than a financial interest in preserving Buffett's legacy.

Berkshire investors will never earn the kinds of returns Buffett was able to deliver, but he's done an admirable job of positioning the company for success for decades to come.

Gardner: But should we just assume Buffett has judged all of these people accurately and set up a first-rate succession plan just because he's brilliant? The Sokol matter, in my opinion, raises fewer questions about ethics than it does about the quality of Berkshire's internal systems -- including succession planning. Owing to recent events, I genuinely only give it a 50/50 chance at this point that Berkshire is built to become greater still over the next 25 to 50 years.

What say you, Fools? Is Berkshire built to last? Weigh in with your comments below.

Joe and Tim own shares of Berkshire. Berkshire, Starbucks, and Apple are Stock Advisor recommendations. Berkshire is also an Inside Value pick. The Fool has written puts on Apple. Motley Fool Options has recommended a bull call spread position on Apple. The Fool owns shares of Apple, Berkshire Hathaway, and Starbucks. Here is our disclosure policy

Read/Post Comments (41) | Recommend This Article (49)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On April 07, 2011, at 4:09 PM, texirish wrote:

    Gardner builds a lot of his position around the assumption that Sokol was the heir apparent. That only exists in the minds of the public because of the media's assumptions. With Sokol having long expressed his desire to leave Berkshire, I think the assumption of his being the heir apparent is highly questionable. Plus there are other solid reasons for Sokol not being the next CEO - his abrasive management style, his lack of knowledge of insurance being two.

    Which tears apart a lot of basis for the above speculations. This article doesn't reflect solid reasoning in my opinion, just another example of making headlines using Buffett's name.

    Most of the analysis published by the Fool is shallow.

  • Report this Comment On April 07, 2011, at 5:07 PM, tshk1221 wrote:

    BRK has been engineered to be built to last. Some of the reasons are as follows:

    1. Buffett prefers investment in businesses that can self-operate that do not need a mountain of human input. In other words, he prefers businesses that do not need a Harvard MBA graduate's super brain.

    2. Buffet prefers businesses that do not require huge reinvestment of earnings made.

    3. Buffett's investments have been focused on toll gate businesses such as banks, supermarket, beverage company, utilities company and what not.

    4. Dividends will not be paid. BRK will continue to

    generate strong yields using the excess capital under the investment leadership of the new, young gun, Todd Combs through continuous acquisitions of high-yield, low cost businesses.

    5. BRK brims with a countless number of employees who have the unshakable commitment to the company they work for.

    However, the one paradox I encountered was that BRK itself needs a very high and complicated level of human input from a CEO who is as bright as James Dimon of JP Morgan Chase or John Stumpf of Wells Fargo, the ones with very strong and extensive knowledge and experience in the financial industry, who can make your 50:50 chance of BRK built to become greater 90% or more.

  • Report this Comment On April 07, 2011, at 5:42 PM, DoctorLewis4 wrote:

    Sokol was never going to be the guy. He was great at being a fixer, but always left a mess left behind because of his personality. Warren has a strategy in place here, if you look closely. If you want to bet against him great! I'll be playing the other side.

  • Report this Comment On April 07, 2011, at 5:59 PM, buffalonate wrote:

    Buffet runs a decentralized operation. He finds good managers and lets them do their job. The operations will be fine after he is gone. He also has brought on a new investment guy with a track record of avoiding risk. What is irreplaceable about Buffett is his ethics. People feel good about selling their business to him because he won't sell it off in pieces or make it unrecognizable.

  • Report this Comment On April 07, 2011, at 6:00 PM, ynotc wrote:

    Many successful CEOs (Jack Welch) will actively groom leaders and provide assignments that give the potential leader a chance to prove themselves and make mistakes.

    When they make mistakes (we always do including Buffett) it is a matter of how you respond. Buffett is usually forthright (less so lately)

    Buffett has not provided a chance for anyone in his organization including Munger to really get in the drivers seat and take a spin. We won't know if anyone can allocate capital as well as he can or if they will get the chance to make mistakes until it happens

    This is bad managment and stewardship on Buffetts part.

  • Report this Comment On April 07, 2011, at 6:00 PM, lethalvb01 wrote:

    I think we simply should apply Buffet's investing rules to his own company and see where it stands. I would bet that Buffet built his business based on the same solid companies that he invested in to get him where he is today.

  • Report this Comment On April 07, 2011, at 6:14 PM, boogspadre wrote:

    Seriously, if there was an Investor of Buffet's caliber out there, why would he/she FOLLOW Buffet. They'd be off forming their own Berkshire-Hathaway. No, its worse than 50/50. More like 95/5. No way Buffet's company repeats the successes without him. That person, if they are in waiting, is somewhere else.

  • Report this Comment On April 07, 2011, at 6:16 PM, CarrieMike wrote:

    It is a scary prospect for those of us who have owned the Baby B's since they were first issued. I am thinking about selling off...slowly as I don't think they will continue to appreciate at rates that others, esp. dividend stocks, will.

  • Report this Comment On April 07, 2011, at 6:27 PM, teaka wrote:

    Not sure why everyone keeps suggesting that Sokol was the only one in the succession plan at Berkshire. I believe 4 or 5 were in the running so that means that at least 3 are left. I remember reading somewhere that WB will be replaced by 3 so is it possable that Berkshire-Hathaway will be broken up

  • Report this Comment On April 07, 2011, at 6:54 PM, munrow wrote:

    I have been selling Berk-B a bit at a time all year. My portfolio returns exceed the performance of Berk by double digit percentages. It is time to move on. I see a cult of personality blindness at play. It's a fair stock, I guess. There are better. I will keep a small percentage...just in case it starts to beat the market...something WEB thinks will become increasingly difficult given the size Berk has become.

  • Report this Comment On April 07, 2011, at 7:00 PM, Robin1938 wrote:

    The most serious criticism in my mind is Tom Gardner's that there is not a system of internal learning. That by itself woudl be reason to sell. We need to look for evidence to support the learning culture. Several observers have pointed out that it may be very difficult to sustain the growth history if for no other reason than it is too big.

  • Report this Comment On April 07, 2011, at 7:04 PM, beechtree1 wrote:

    I sincerely hope that Berkshire is built to last and prosper over its preferred time horizon:FOREVER.

    I have invested in this company about two-thirds of my family's wealth and I follow it not only because of my financial interests in it, but also because reading all I can find about it has become a learning platform for me, enormously helpful in my task to preserve what we have and maybe even add to it, over time.

    My concentration on this company and my deep

    knowledge of it has helped me develop a "gut feeling" , and it is this feeling that makes me believe Berkshire is, indeed, built to last.

    I would agree with your colleague Joe Magyer that

    Mr Buffett is writing his succession plan with his

    cheque book, working towards making it a

    company that even a ham sandwich

    could run. Let us also not forget that with Bill Gates on the board we could well have someone perfectly suited, groomed even, to carry on the master's work in areas other than those the divisional heirs will undertake.

  • Report this Comment On April 07, 2011, at 7:16 PM, joekirby wrote:

    Warren would be imposible to duplicate. He grew with the company so his knowledge of what and how belongs to him alone. Who else would work for $100,000.00 a year so right off the bat the culture changes, There are no replacements for this man,

  • Report this Comment On April 07, 2011, at 8:31 PM, TMFMmbop wrote:

    I don't understand this objection: "Buffet runs a decentralized operation. He finds good managers and lets them do their job."

    After Buffett leaves, who is in charge of finding those good managers? Further, Buffett has said in the past that companies find him because he's Buffett. I don't see anyone in the ranks ready to replace that competitive advantage.

    Berkshire did not become what it is today by earning 6% to 8% returns on capital. Yet that's what we're all looking at if the future of Berkshire is an amalgamation of regulated businesses. It's future is not as bright as its past -- and frankly, from a selfish, legacy standpoint, Buffett is probably ok with that. His shares will belong to the Gates Foundation, who will be very happy with billions worth of bonds.

    Tim Hanson

  • Report this Comment On April 07, 2011, at 8:37 PM, BuyloPESellHiPE wrote:

    If the CEO of BRK-A is replaced by a great human being, in his 60s, does not crave the money, loves to talk and rewards his managers for making money ONLY the right way. Then I would think this person understands the Warren Buffett Principles and lives it; and I would comfortably say that the Company will dominate over the next two or three decades.

  • Report this Comment On April 07, 2011, at 8:37 PM, jc09058 wrote:

    I inherently believe that Berkshire Hathaway can be duplicated. Just consider those areas that Warren Buffett ignores because he doesn't understand the companies. Therefore, it is not only possible but there are look alikes that are trying now.

    Granted, they have a long way to go to repeat Mr. Buffett's track record but it can be done. I really wonder how many number two companies on Mr. Buffett's list are capable of generating the returns that the number one companies did in the early days.

    Overall, the work Ben Graham and Warren Buffett has done shows the process works and very nicely too. So, let's do it again.

  • Report this Comment On April 07, 2011, at 9:16 PM, Sherricom wrote:

    My biggest question here is why did Tom keep Berskshire in HIS Core for MF Stock Advisor while he has all these questions about succession planning?


  • Report this Comment On April 07, 2011, at 10:17 PM, 459289 wrote:

    OK so what about Ford Motor Co, Disney, Bill Gates and Microsoft, Nike, There are so many companies that have done very well after their founders have left. Lets hear about them.

  • Report this Comment On April 07, 2011, at 10:59 PM, todavek wrote:

    What's the big deal about Buffet and BH in the modern world, last 5-10 yrs?

    The most valuable ingredient in the senior BH fund is TIME. The compounding over time. But the performance in the last decade, separated out, is pretty average, not spectacular.

    I could throw darts at a list of good solid stocks and make a portfolio, and let it age for 30-40 years, and you'll think I'm a genius also.

  • Report this Comment On April 07, 2011, at 11:12 PM, anartistindc wrote:

    Warren Buffet will not live forever.

    When has anyone last seen "the Hathaway man"?

  • Report this Comment On April 08, 2011, at 2:23 AM, TMFTomGardner wrote:

    So many things to say. I find the comments above to be incredibly interesting. I think the first obvious point is that no one knows. Berkshire is an incredibly profitable company. Its financial management has been brilliant. And the underlying principles are so extraordinarily great when compared to other companies. Look around the industries that Berkshire operates in and the average competitor is comically weak. Berkshire thinks long-term, where its competitors scrounge for short-term profits driving annual bonuses. We can all wring our hands about it (and we probably should!) -- but the way companies in the financial sector operate is just incredibly weak.

    Given all that, it's incredible that we're talking about the staying power of Berkshire. We should really be spending our time poking holes in the our financial system because virtually every constituent of the American economy thinks shorter-term than does Berkshire. In fact, I'm amazed to see the various people that Berkshire's leaders occasionally defend...when it is obvious to me that they are less sophisticated in their thinking and less patient/long-term in their perspective. If we wanted to compete with China effectively, we should have -- a long time ago -- followed the simple principles of compounding advanced in every action that Berkshire takes.

    That's another set of articles for another time.

    We are forced, however, as investors to evaluate what will happen to Berkshire Hathaway when its primary leaders are not at the helm. While I've never applauded the diet of hamburgers and Cherry Cokes (which runs contrary to the nutritional guidance of every qualified doctor), I'm expecting present leadership to be in place for another decade. Who knows really -- I may not be alive to see if it's true!

    I believe Berkshire's leaders and their principles will flourish for at least 5-10 years. That's why I continue to believe in BRK. Remember, the average US investor holds their stocks for less than 150 days (insane!). What I am saying with my BRK recommendation in Stock Advisor is that I feel very good about the next 5+ years.

    My points in the comments above are, however, that I feel increasingly uncomfortable about Berkshire 10-25 years forward. I agree with the commenters above that Sokol was not the only (and maybe not even the leading) candidate for CEO. But he was in the group. And as I said, I'm not really concerned with the legal or even ethical issues here. Neither of those will sink the massive business that is Berkshire.

    But what does concern me are the systems in place to protect against this. I also felt BRK's response was inadequate. For what it's worth, I also think Sokol's response was unremarkable. I think he should have said instantly, "I am firm in my believe that I did nothing wrong. I brought an idea to our founder that I believed in enough to own the stock myself. However, because of the public concern, I am giving my gains to charity, instantly. I love Berkshire and apologize for any problems I may have brought to Mr. Buffett and the owners of this company." (Instead, he leads with the fact that he wants to start a mini-Berkshire? I am not impressed.)

    The issue I have is systems. Not vision. Not today's operations. But the long-term builder mentality. That long-term planner would, I believe, be publicly trying out different hands in leadership roles -- demonstrating to the world that BRK has a system in place that will deliver excellence for many decades to come. But I don't see that. Of course, maybe it's happening behind closed doors. Maybe it's all over the place. Maybe there are 50 people inside of BRK who could take over. But I'll admit that as a passive outside shareholder, I'd like to see more evidence of it. In fact, in the ideal, I'd like to be able to view Berkshire as entirely independent of Mr. Buffett. (Gasp -- I know. But who really pictures Walt Disney or knows anything about him..when you think of Disney?)

    All of us have to disappear at some point to make room for the next generation of leaders. In my experience, it is better to disappear when you can still coach. It is better to become Chairman to make way for a new CEO. And that would make me far more comfortable about BRK 10+ years from now.

    But that is not the plan at BRK right now. And it is their prerogative to make that choice. I see problems with the present approach, though. But again, I believe BRK will be a market beater over at least the next 5 years.

    Tom Gardner

  • Report this Comment On April 08, 2011, at 4:47 AM, SPARTANBURG wrote:

    I'd like to think Berkshire is built to last. After all we live a whole life time trying to anchor on something and Buffett wisdom is about as close as one can get to stability and long term outlook. Having said that, I must admit that Buffett has really put his back, in words at least, on the succession of his company. Obviously it's not easy to do (in view of reality and the Sokol affair). But if I had to choose for the long term, my mind and wallet will follow Buffett and Munger easier than any other heads of companies.

  • Report this Comment On April 08, 2011, at 7:48 AM, Flyboy32 wrote:

    The problem you have here is that the successor will be compared to Buffet and not how well or bad he is running the compay. To use a sports analogy, Rose for the Chicago Bulls is a great player, but he will never be a Michael Jordan. The next successor to Buffet needs to be judged on his own merits and performance, and not the Buffet standard.

  • Report this Comment On April 08, 2011, at 8:59 AM, smokyfied wrote:

    I am surprised that the Fools on the Hill are so certain that Berkshire's performance without Buffet is such a risk. I thought Fools were buy and hold investors and yet they recommend Berkshire. There is a contradiction here and I have a big investment in BRK=B based upon the Fool's recommendation. What now Fools? I am all ears.

  • Report this Comment On April 08, 2011, at 11:26 AM, vaidybala wrote:

    For the retired investors, leaving the glory of the past aside, how does BRK provide now returns, other than blanket selling. Take the profit and run? Long term hold is a strategy only few can play and sustain. That means only a few benefit. About sustainability, nothing in this world is ever lasting. This is not religious preach, but is a fact, read history of the world.

    thanks for letting me say my opinion.

  • Report this Comment On April 08, 2011, at 12:03 PM, DJDynamicNC wrote:

    I went into this article unsure of my opinion, and I have to say, Joe Magyar convinced me. I doubt Berkshire will ever turn Buffett-like levels of profit again once he is gone, but it doesn't need to.

  • Report this Comment On April 08, 2011, at 2:32 PM, mathpad2008 wrote:

    To your answer the obvious....YES Buffett is a master at buying great companies that run themselves. The market right now is operating on a knee-jerk reaction to the bone headed manuver on Sokols part...However dont lose focus on the fact that Berkshire was not made by the likes of Sokol or any one else for that matter,Berkshire is the product of purchasing undervalued companies at the right time and price, usually when everyone was running for cover..IMO

  • Report this Comment On April 08, 2011, at 5:19 PM, ddepperman wrote:

    No. Berkshire will lose value when its clear and definitive competitive edge retires or dies.

    Ditto Apple.

  • Report this Comment On April 08, 2011, at 7:30 PM, ebersolg wrote:

    We have come to expect that WB is infallable and the press has helped the cause. Berkshire was founded on less than a perfect financial decision and Warren will be the first to acknowledge it. What has made BH a strong and enduring conglomerate is the ability to continually make more good decisions than bad ones.

    The only bad decision that was made regarding Sokol is that he did not leave him go before when he said he was planning to depart on two prior occasions. ALthough a good manager It was obvious that he was not part of, or wanted to be part of, the BH culture. He wanted to be WB not work for him.

    Nothing is forever and no company comes with a guarantee, That is why we trade stocks.

  • Report this Comment On April 09, 2011, at 5:20 PM, cordwood wrote:

    A culture change?

    Would like to be a "fly-on-the-wall" re any board room discussion of paying a dividend.

    Once you've wrapped up the Monopoly Board how do your fellow players buy the next round.?..oh,that's right ,they don't even get Monoply money dividends...BUT there is always another game to play.

    Dividends are not important to all be it. BH may be a golden goose,personnaly I prefer to have some eggs for breakfast.

  • Report this Comment On April 09, 2011, at 6:52 PM, susan400 wrote:

    "" Considering that most public companies get succession horribly wrong,""'

    why in the world would teh author say that?

    sucessions have to happen and

    for 150 yrs of US corp history, did cos with sucessions die ?


  • Report this Comment On April 10, 2011, at 2:28 PM, wrenchbender57 wrote:

    My guess is that behind closed doors WB does not make all the decisions by himself now. He is likely using the input of the rest of his team. WB and CM's strength is that they look for the right buys, invest for the long term and NOT react to every investor whim. I believe that culture will stay intact after WB and CM leave. So, I will hold on to my B stock. But, it is not and will not be the majority of my portfolio. Diversification is always best, even it BRK.B is a diversification within itself. Hope that makes some kind of sense.

  • Report this Comment On April 11, 2011, at 10:36 AM, jusayes wrote:

    Ben Graham taught W. Buffet everything he knows. Why wouldn't Buffet do the same for whoever he has in mind to take over. I imagine he taught many close to him. This company is something he loves and would want to see live on for many years to come.

  • Report this Comment On April 11, 2011, at 10:39 AM, Mainstreet102 wrote:

    Of course there will never be a direct replacment for Buffett. But the "Oracle" has built a portfolio of businesses that virtually run themselves with minimal involvment & strong futures. Frankly he's admitted that future growth will be more modest. So anyone getting in at this point & expecting huge upside isnt listening. I believe this is a solid long term play & bought again last week among all the "Sokol mania". Who said Sokol was the heir apparent? Certainly not Warren. If anything there appears to be several candidates. All this talk is as if Buffett had announced his retirement and must pick a successor immediately..which is just not the case.

  • Report this Comment On April 13, 2011, at 3:38 PM, getrichordietryi wrote:

    Tom G has BRK as a Best Buy Now on SA which does not seem to agree with his comments on this article...

  • Report this Comment On April 13, 2011, at 4:32 PM, investdiva100 wrote:

    Buffet's profits were based on his skills for interpreting the market. If he passes those skills onto his team, that is only the first step. The successors must also exude qualities that the company and investors hold dear - confidence in your abilities, honesty, integrity, put customer service and investors first, etc. You can have all the skills you want but if you are fearful or feel overwhelmed, you are going to make mistakes. If you easily succumb to greed, things will be even worse. Someone can step up and take the reins, but they have to have the whole package in order for the company to continue to succeed and not be run into the ground.

  • Report this Comment On April 13, 2011, at 11:58 PM, hcaufield wrote:

    I agree, with the conduct in question, even under Buffett nose, the market moving they have done will be in question.

  • Report this Comment On April 14, 2011, at 2:20 PM, muddlinthrough wrote:

    at tshk1221's comments:

    "However, the one paradox I encountered was that BRK itself needs a very high and complicated level of human input from a CEO who is as bright as James Dimon of JP Morgan Chase or John Stumpf of Wells Fargo, the ones with very strong and extensive knowledge and experience in the financial industry, who can make your 50:50 chance of BRK built to become greater 90% or more."

    AND the comparisons to GE's 'Atomic Jack's' departure...

    WB has a reputation, and a survivorship bias. At a certain point, the 800# bulls drive the market...and they become the market. Asking if BRK & the Baby B's will continue is like asking if Fidelity will continue.

    It really doesn't matter how badly the inheritors do...WB will eventually retire or die at his desk, the momentum will continue for 2-10 years, the smart money will leave, the rest will stay, and eventually the boat will slowly sink or float along dumping out reliable but non-growth level dividends.

    Having watched Tom's choices for several years, and followed rarely but with appreciation when I do make the right bet and take the advice immediately, I'm betting the Fool will be in 'the smart money.'

    Disclosure: I haven't followed the SA purchase of BRK-B, but did pretty well with BWLD.

  • Report this Comment On April 15, 2011, at 6:30 PM, drinkthekoolaid wrote:

    Perhaps Sokol realized he was not the heir apparent and chose to parlay his remaining influence into a nice bonus.

  • Report this Comment On April 15, 2011, at 8:52 PM, RothsRule wrote:

    Regarding a successor at Berkshire Hathaway:

    In BH 2009 annual report to shareholders, Warren Buffet in talking about Charles Munger, himself and Ajit Jain:

    If Charlie, I and Ajit are ever in a sinking boat - and you can only save one of us - swim to Ajit

    That seems very suggestive to me. I never

    heard Sokol being referred to in those terms.

  • Report this Comment On April 19, 2011, at 1:14 AM, d22cold wrote:

    I see berkshire successor problems arising from more the smaller businesses purchased when they start to look for alternative managers.

    I think due to Buffetts control and Berks size the price is likely below S&P equivalent, but it likely deserves more.

    Personally it would be better to see the large income paid out in dividends once he passes than allow another to possibly screw up how its invested.

    This would be one way to allow BH to be valued at what it should be when it pays out 50-75% of income the share price would rise as its income does.

    While returns will not be amazing i would rather have BH than most or all North American ETF's which try to track broad indicies.

    My money and my mouth are on Berkshire to beat the indicies.

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