Warren Buffett is going on safari, said Dennis Berman in The Wall Street Journal. His prey: “big, industrial businesses with near-monopoly positions and solid sales growth.” Pretax annual income of at least $75 million and a market value of $5 billion to $20 billion are also musts. And because, in Buffett’s words, “America’s best days lie ahead,” U.S. companies get priority. The 80-year-old CEO of Berkshire Hathaway announced his acquisitive mood in his eagerly anticipated annual letter to shareholders. He also shared the glad tidings that Berkshire’s fourth-quarter earnings jumped 43 percent, to $4.38 billion, thanks largely to profits from Burlington Northern Santa Fe, America’s second-biggest railroad, which Berkshire bought in 2010 for $27 billion. America’s retail investors, who revere Buffett as “the Sage of Omaha,” are poring over the letter in the hope of profiting by following his lead.
They’re in for a disappointment, said Jack Hough in Market​Watch.com. Unlike Berkshire, they don’t have $38 billion in cash. Nor do they have Buffett’s access to private deals. In the 27 pages (including attachments) of his letter, “Buffett spends only about four paragraphs on ordinary stocks,” primarily two he already owns: Wells Fargo and Coca-Cola. He then proceeds to write enviously of the freedom from investor scrutiny that private companies enjoy. And he “gushes” over the preferred stock he bought from General Electric and Goldman Sachs. Those were private deals unavailable to Main Street investors. Nor, for that matter, can they profit from Buffett’s favorite investment, Burlington Northern. He bought the railroad outright, making “the Berkshire purchase look less like a stock market endorsement than a means of escaping the stock market’s restraints.” Buffett obviously loves America. But he doesn’t seem to care for its public stock markets.
Subscribe to The Week
Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.
Sign up for The Week's Free Newsletters
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
Create an account with the same email registered to your subscription to unlock access.
-
Issue of the week: Yahoo’s ban on working from homefeature There’s a “painful irony” in Yahoo’s decision to make all its employees come to the office to work.
-
Issue of the week: Another big airline merger
feature The merger of American Airlines and US Airways will be the fourth between major U.S. airlines in five years.
-
Issue of the week: Feds’ fraud suit against S&P
feature The Justice Department charged S&P with defrauding investors by issuing mortgage security ratings it knew to be misleading.
-
Issue of the week: Why investors are worried about Apple
feature Some investors worry that the company lacks the “passion and innovation that made it so extraordinary for so long.”
-
Issue of the week: Does Google play fair?
feature The Federal Trade Commission cleared Google of accusations that it skews search results to its favor.
-
Issue of the week: The Fed targets unemployment
feature By making public its desire to lower unemployment, the Fed hopes to inspire investors “to behave in ways that help bring that about.”
-
Issue of the week: Is Apple coming home?
feature Apple's CEO said the company would spend $100 million next year to produce a Mac model in the U.S.
-
Issue of the week: Gunning for a hedge fund mogul
feature The feds are finally closing in on legendary hedge fund boss Steven Cohen.