If You Knew David Like I Knew David
Buffett's comments about investing and the economy were, as always, interesting, and were the main value from the meeting.
Regarding the Sokol affair, clearly it's good that Buffett acknowledged some responsibility for missing the problems. I was glad Berkshire put more color around the storyline that there was new information to show that Sokol misled them between the first and second press releases. Understandably, Berkshire's view of Sokol's actions evolved in the month following their revelation, although, as Munger acknowledged, a lot of that evolving had to do with the public's reaction to events. Nothing new of significance was learned between March 30 and April 26th, when the audit committee report was issued. I will grant that perhaps the audit committee was not fully informed when the first press release was issued, which if true would be unfortunate because that press release drew sweeping legal and ethical conclusions. Anyway, Buffett's defense of the first press release more or less boiled down to all the good things about David that the audience didn't know. Buffett is a big Al Jolson fan. Adapted from what Jolson sang in 1925:
"I have got a sweetie known as David,
In the words of Shakespeare he's a 'wow,'
Though all of you may know him too,
I'd like to shout right now,
David has a perfect reputation,
No one ever saw him on a spree,
Nobody knows where David goes,
Nobody knows but me.
if you knew David like I knew David,
Oh! Oh! Oh! what a guy!
There's none so classy,
As this fair laddie,
Oh! Oh! Oh! what a guy."
> I suspect events will tell whether Buffett severely overestimated Sokol's capabilities and ethics -- or not.
> Regarding the rest of the meeting -- No word on the successor. He's "straight as an arrow." Seriously? After Sokol, we're supposed to simply take Buffett's word on this? Hints that the person is Ajit Jain are no more than that -- back to coyness and hinting again. I'm in a musical mood today, so time for Tom Lehrer.
"Warren, tell us.
All your shareholders are nervous.
Who will you tap with your wand,
Will it be Abel or Rose or Jain?"
> Howie Buffett to be chairman. Look, I like Howie. He's extremely honest. He's got good intentions. He's an excellent photographer. He knows, probably, as much about ethanol as anyone on earth. But he doesn't have the business experience to be chairman of Berkshire.
> No indication of changes in governance. Perhaps there will be some. Will Walter Scott, sponsor of David Sokol, chairman of Berkshire's nominating committee, and subject of torturous language regarding independence in Berkshire's proxy, remain on the board or remain in his current role? People who have embarrassed Buffett have a habit of disappearing from the scene. By the way, I like Walter Scott a LOT and think he's one of the better influences on Buffett ... except in the case of David Sokol.