Editor’s Note: Related tickers: Berkshire Hathaway Inc. (NYSE:BRK.A), Brookfield Asset Management Inc. (NYSE:BAM), McDonald’s Corporation (NYSE:MCD), H.J. Heinz Company (NYSE:HNZ)
Charles Munger is going back to school. At least, a lot of his money is. Munger, Warren Buffett’s longtime investing sidekick at Berkshire Hathaway Inc. (NYSE:BRK.A) +1.58%, has donated $110 million in securities to build a massive new dorm at his old stomping grounds, the University of Michigan, the university said in a statement Thursday. (Munger attended Michigan but never graduated, instead enlisting in the army. Despite the lack of diploma, he still managed to get into Harvard Law.) The money—the largest single gift in Michigan’s history—will be used to create a residence hall and fellowship program for graduate students in multiple disciplines. More than 600 students will bunk in apartments with up to seven bedrooms apiece, though they do get their own bathrooms. The design was inspired by a similar complex that Munger helped fund at Stanford University.
Warren Buffett Shows His Faith in Housing (Fool)
When Warren Buffett declared that housing was on the rebound last summer, he immediately put his money where his mouth is. His company, Berkshire Hathaway Inc. (NYSE:BRK.A) (NYSE:BRK.B) partnered with Brookfield Asset Management Inc. (NYSE:BAM) to create HomeServices of America last fall, which has been busily scooping up real estate brokerages — and recently revealed its new logo as the rebranded Berkshire Hathaway HomeServices. …The new entity is gearing up to be a national, full-service real estate company and has incorporated its formerly separate Prudential Real Estate and Real Living brands under the new umbrella. The complete unveiling of the new company will continue throughout this year.
Warren Buffett Has His Secretary—and Barack Obama Has…Me (IWF)
Billionaire investor Warren Buffett has his secretary—and Barack Obama has…me. Like countless other U.S. taxpayers, I was interested but not at all surprised to learn, when I paid my annual visit to Mr. Block, that my effective tax rate for 2012 was higher than Mr. Obama’s enviable effective rate of 18 percent. I wonder if Mr. Buffett’s secretary—who, as the president never tires of reminding us, pays at a higher rate than her mogul boss—can recommend a good support group? Honestly, I didn’t expect President Fair Share to kick in more than his legal requirement. You’d probably have to be even more enamored of big government than President Obama to randomly send insatiable Uncle Sam more than the federal government is “asking” from you.
China’s BYD to ditch petrol power (IOL)
BYD, one of the better known Chinese brands thanks to a stake held by billionaire US investor Warren Buffett, may stop making conventional petrol-fuelled cars within two years and focus on ‘new energy’ battery models as part of a “re-birth plan” to arrest a slump in sales. Shares in BYD, which once harboured long-term ambitions to be as big as Toyota, have tumbled by almost three quarters since a late-2009 peak. Now the company is poring over internal plans to radically adjust and possibly streamline its business – which sprawls across batteries, cellphone assembly, solar panels, LED light bulbs, and electric and petrol-powered cars and buses.
‘Pass the Ketchup!’: Why Food Stocks Should Not Be Overlooked (Nasdaq)
If you read The Snowball, the biography of Warren Buffet — and a great read, I might add — his diet provides a remarkably good divining rod for productive investments. In case you don’t know, Warren Buffett is a greater disciple of hamburgers than Wimpy (if you’re too young to know who that is, check out J. Wellington Wimpy on Wikipedia). When Buffett toured China with buddy Bill Gates, he suffered mightily in the hinterlands of that country and beat a path to McDonald’s Corporation (NYSE:MCD) as soon as he got back to Beijing. When Buffett announced he would acquire food company H.J. Heinz Company (NYSE:HNZ) with 3G Capital for $72.50 per share in a sweetheart of a deal on February 14 (wink), it sent food stocks soaring. Remember, Berkshire (NYSE:BRK.A) is not just a financial buyer. It is a strategic one as well. The price of $72.50 was an important data point. It meant the company felt the market missed something. Specifically, that even at a 20% premium, Berkshire could make money forever.
Berkshire Hathaway Inc. (BRK.A): The Bond Bubble Will Explode (InsiderMonkey)
Conservative investors often seek safety by putting their money into U.S. Treasuries. But that move might be the equivalent of financial suicide. Here’s why. The Simple Argument To quote Berkshire Hathaway Inc. (NYSE:BRK.A)’s Warren Buffett, “Investing is forgoing consumption now in order to have the ability to consume more at a later date.” Now, a 1.75% 10 year bond might seem risk-free. Its yield certainly is, and the US Treasury will certainly print a cashable check when your bond comes due — but the government will determine the true value of your principal in the end. Should it decide to inflate its currency, the future consumption power of your future dollars will be far far less than it is now.
Fund manager likely wishes he’d heeded Buffett on gold (AzStarNet)
Investors including hedge-fund manager John Paulson faced losses this week as gold suffered its biggest rout in three decades. Warren Buffett told them there were better places to put their money. The billionaire chairman of Berkshire Hathaway Inc. (NYSE:BRK.A) cautioned against investing in the metal in February 2012, when an ounce sold for more than $1,700, because it’s not productive like a farm or a company. Gold fell 14 percent to $1,348.21 in the two trading days through April 15, the biggest decline since 1983, and wiped out almost $1 billion in Paulson’s wealth. “What motivates most gold purchasers is their belief that the ranks of the fearful will grow,” Buffett wrote last year in a letter to shareholders. “As ‘bandwagon’ investors join any party, they create their own truth – for a while.”
