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Business/Finance See other Business/Finance Articles Title: The Empire Strikes Back at Warren Buffett The Empire Strikes Back at Warren Buffett Brad Hoppmann | May 8, 2015 at 4:30 pm There was a clash of the titans in Las Vegas this week, aside from the Mayweather-Pacquiao fight. Hedge fund kingpins gathered at a ritzy casino to swap stories. Maybe they gambled with their own money, for a change. Anyway, one billionaire went on the attack against Warren Buffett. The world’s greatest investor is a hypocrite, he said. Is it true? Does it matter? No and no. Buffet isn’t worried. The Force is with him. *** Even Warren Buffett’s critics admit his results have been spectacular. He makes money for his investors the old-fashioned way, with solid research and extreme patience. Buffett also knows how to manipulate Wall Street to his own advantage. He’s outsmarted them repeatedly. As folks in Omaha might say, “He got their goat.” This is from today’s Wall Street Journal front page. For years, Warren Buffett has poked, prodded and needled hedge-fund managers. This week, one of the biggest bit back. Daniel Loeb, founder of the $17 billion hedge-fund firm Third Point LLC, took a shot at what he called a “disconnect” between the billionaire investor’s words and his actions. “I love how he criticizes hedge funds, yet he really had the first hedge fund,” Mr. Loeb said Wednesday at a hedge-fund industry conference in Las Vegas. “He criticizes activists. He was the first activist. He criticizes financial-services companies, yet he likes to invest with them. He thinks we should all pay more taxes, but he loves avoiding them.” Within seconds, Mr. Loeb, known for his searing letters to corporate chieftains, sounded regretful, calling his remarks “gratuitous” and a “potshot.” But his comments — and the applause and cheers that they drew in a room packed with a thousand hedge-fund managers, investors and others — show that beneath the public adulation of the Berkshire Hathaway Inc. chief lies a layer of envy and resentment in some corners of Wall Street. [Read the rest at WSJ.] Daniel Loeb’s comments were perfectly true. That’s not really an issue. Rather, they are interesting because of who said them and where. Hedge fund managers like Loeb live on a completely different planet from you, me and Warren Buffett. For proof, check out this snippet from the same WSJ story. The remarks quickly struck a nerve at the conference, where some hedge-fund executives cluster around cabanas at the Bellagio’s Tuscan-themed pool and pile into limousines paid for by major investment banks for rides to nightclubs. They were also the subject of polite conversation at a private dinner Wednesday that included former high-ranking government policy makers, providing a short respite from talk about interest rates over asparagus salad and glazed roasted chicken, a person familiar with the matter said. I promise you, I didn’t make that up. Cabanas and limousines are perfectly normal for this crowd. I have no idea whether Warren Buffett likes asparagus salad and glazed roasted chicken. We know he loves Coca-Cola (KO). Plus, his Berkshire Hathaway (BRK.A) company owns the Dairy Queen burger and ice cream chain. If these hedge fund executives really want to learn something, they should point their limousines to the nearest Dairy Queen. They’ll see how the other 99.9% eat… and how Warren Buffett almost always wins. *** My Thursday article on Tesla (TSLA) and solar energy drew plenty of response (see How to Escape from the Grid). Here is one that came in by e-mail. Reader Margie F. says: “The article on the Tesla Powerwall was very interesting to me. “My husband and I built a solar house in Hayward, CA in 1979. We were a family of eight with two college-age kids, three high schoolers, and a middle school child. Our average monthly utility bill for the first year was $80. Electricity powered the hot water, dryer, heat, everything but the gas cooking appliance. “The solar house was a result of many years of research into solar technologies and energy efficient building. I am still a student and thrilled to see progress made in my lifetime.” Brad: Thanks for writing, Margie. I suspect early pioneers like you helped inspire Elon Musk’s interest in solar energy. It will be interesting to see how the technology develops the next few years. By the way, my friend Patrick Watson had a good story on this same subject at Newsmax this week. Commenters are going bananas over it, too. Check it out. *** As always, I welcome reader feedback on my afternoon thoughts or any other topics. You can leave a comment on our website or send me an e-mail. *** The Labor Department’s monthly employment report mostly matched expectations. Nonfarm payrolls rose 223,000 in April and the unemployment rate fell slightly to 5.4%. Average hourly earnings rose 0.1% in April and 2.2% from a year ago. U.S. stocks soared at the open and stayed strong all day. Traders saw the report as a sign the economy is healthy, but not so strong as to make the Fed hike interest rates sooner. Here’s what else happened today. • Thursday’s UK election brought a surprise, keeping PM David Cameron’s Conservative Party in power. • Cameron promised to call a referendum on the UK leaving the European Union. Now we’ll see if he follows through. • U.S. chemical and GMO seed company Monsanto (MON) made a $46.5 billion bid for Switzerland’s Syngenta (SYT) agribusiness giant. • Syngenta’s cagy reply: “No, thank you. But feel free to bid again at a higher price.” • Graphics chipmaker Nvidia (NVDA) slumped after a negative sales forecast. • Wal-Mart (WMT) said it would buy rival Target’s (TGT) shuttered Canadian locations. • President Obama was in Portland, Oregon today to promote his Trans-Pacific Partnership plan at Nike (NKE) headquarters. • Nike was an odd venue to choose. The company was an early leader in outsourcing American jobs overseas. Now, Obama says the TPP will bring some of those jobs back. • Is he right? I don’t think so. The TPP is on a Fast Track to Secrecy. It is more likely to Import More Foreign Workers. • The S&P 500 has been trading between 2,040 and 2,126 for the last two months. Today’s rally left it near the top of the range. Maybe Monday will bring a breakout. Good Luck and Happy Investing, Brad Hoppmann Publisher Uncommon Wisdom Daily Poster Comment: Interesting. Post Comment Private Reply Ignore Thread Top • Page Up • Full Thread • Page Down • Bottom/Latest
#1. To: BTP Holdings (#0)
It is. Give us the upshot in a few words pls. I don't look to Cameron for any progress in Britain, quite the contrary.
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