The World’s Billionaires

#2 Warren Buffett

Last year America’s most beloved

investor was the world’s richest man.

Previous: William Gates III

Next: Carlos Slim Helu & family

AP Photo/Matt Sayles

Net Worth:$37.0 bil
Fortune:self made
Source:Berkshire Hathaway
Age:78
Country Of Citizenship:United States
Residence:Omaha, Nebraska
Industry:Investments
Education:University of Nebraska Lincoln, Bachelor of Arts / Science, Columbia University, Master of Science
Marital Status:widowed, remarried, 3 children

Last year America’s most beloved investor was the world’s richest man. This year he has to settle for second place after losing $25 billion in 12 months. Shares of Berkshire Hathaway down 45% since last March. Injected billions of dollars into Goldman Sachs, GE in exchange for preferred stock last fall; propped up insurance firm Swiss Re in February with $2.6 billion infusion. Admits he made some “dumb” investment mistakes in 2008. Upbeat about America’s future: “Our economic system has worked extraordinarily well over time. It has unleashed human potential as no other system has, and it will continue to do so.” Scoffs at Wall Street’s over-reliance on “history-based” models: “If merely looking up past financial data would tell you what the future holds, the Forbes 400 would consist of librarians.” Son of Nebraska politician delivered newspapers as a boy. Filed first tax return at age 13, claiming $35 deduction for bicycle. Studied under value investing guru Benjamin Graham at Columbia. Took over textile firm Berkshire Hathaway 1965. Today holding company invested in insurance (Geico, General Re), jewelry (Borsheim’s), utilities (MidAmerican Energy), food (Dairy Queen, See’s Candies). Also has noncontrolling stakes in Anheuser-Busch, Coca-Cola, Wells Fargo.

The Business of Giving

Buffett grant to Gates

Foundation 30 percent less this year

Posted by Kristi Heim

The worst sin toward our fellow creatures is not to hate them,
but to be indifferent to them: that’s the essence of inhumanity.
- George Bernard Shaw

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Monday, June 29, 2009

Its time for you to take control

Nobel Freakonomics

We don’t read Paul Krugman much these days—not since the New York Times outsourced its newsroom to the White House press office—but we did catch his column, “Not Enough Audacity,” in which the Nobel Prize-winning economist frets that Obama’s health care efforts aren’t radical enough:

On one side there’s Barack the Policy Wonk, whose command of the issues — and ability to explain those issues in plain English — is a joy to behold.

But on the other side there’s Barack the Post-Partisan, who searches for common ground where none exists, and whose negotiations with himself lead to policies that are far too weak.

Now you’d think Obama’s masterful “command of issues” might have included the notion that the person nominated for Treasury Secretary should be a guy who paid his taxes on time. But leaving that aside, let’s look at the President’s “ability to explain those issues in plain English,” which skill leaves Krugman all weepy:

Mr. Obama offered a crystal-clear explanation of the case for health care reform, and especially of the case for a public option competing with private insurers. “If private insurers say that the marketplace provides the best quality health care, if they tell us that they’re offering a good deal,” he asked, “then why is it that the government, which they say can’t run anything, suddenly is going to drive them out of business? That’s not logical.”

This is very smooth, and it certainly seems “crystal-clear,” assuming you don’t think about it for, oh, half a second.

But it is nothing like logical: Government has no profit motive. Private insurers do. So a government payer, even as badly run as it will be, will wreck the private insurers’ business models.

Stock-market-wise, we couldn’t care less how the health-care model gets resolved. In the investment business, you deal with facts as they are, not as how you wish them to be.

But we wonder: how did a Nobel Prize-winner like Krugman get fooled by a slick bit of rhetoric with no inherent basis in fact?

Well, the Times’ web site describes the economist thusly:

His professional reputation rests largely on work in international trade and finance; he is one of the founders of the “new trade theory,” a major rethinking of the theory of international trade.

Let’s hope he’s not working on a major rethinking of the theory of human health care…

The Smart Grid: An Introduction
Put it to Work

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