The ClientWise Blog

Buffett Bullish on America

Posted by Chris Holman on Mar 1, 2011 12:38:00 AM


As you Buffettologists already know, Warren Buffett released his annual shareholder letter over the weekend. By word and deed, he seems quite optimistic on the future course of the US from an investment vantage point.

Since Mr. Buffett is his own best communicator, I’ll let him speak for himself:

"Money will always flow toward opportunity, and there is an abundance of that in America. Commentators today often talk of “great uncertainty.” But think back, for example, to December 6, 1941, October 18, 1987 and September 10, 2001. No matter how serene today may be, tomorrow is always uncertain.

Don’t let that reality spook you. Throughout my lifetime, politicians and pundits have constantly moaned about terrifying problems facing America. Yet our citizens now live an astonishing six times better than when I was born. The prophets of doom have overlooked the all-important factor that is certain: Human potential is far from exhausted, and the American system for unleashing that potential – a system that has worked wonders for over two centuries despite frequent interruptions for recessions and even a Civil War – remains alive and effective.

We are not natively smarter than we were when our country was founded nor do we work harder. But look around you and see a world beyond the dreams of any colonial citizen. Now, as in 1776, 1861, 1932 and 1941, America’s best days lie ahead."

Buffett as a Leader
Although Buffett's reputation was built on his sage investing prowess, his leadership has always been equally perceptive. Indeed, his investing success is a function of his ability to pick great managers, and trusting their judgment.

His holding company, Berkshire Hathaway, has 76 different operating units…from Burlington Northern Santa Fe, to GEICO, to See’s Candies. As a leader of his businesses, Buffett is notoriously hands-off. Every two years he sends out a letter to his 70+ managers that says a variation of the following:

  • Run this business like it’s the only business that you and your family can own over the next 100 years,
  • Don’t measure your success by quarterly earnings,
  • Measure your success by whether or not the moat around your business, that which gives you the competitive advantage, has widened or narrowed.

Berkshire's annual shareholder meeting, "Buffetpalooza", will be held on April 3oth, at the Qwest Center in Omaha.

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Topics: Investing