Cryptic answers are not Warren Buffett's forte, but you can get one any time you like with the Warren & Charlie's Magic Answer Ball.
It's an orb of memorabilia that will be available during Berkshire Hathaway Inc. shareholders weekend, and it's decorated with caricatures of Buffett, chairman and CEO, and Vice Chairman Charlie Munger.
The ball and its floating answer-thingie (technically, an icosahedral die) is from Mattel, which also makes the Magic 8 Ball used by American youngsters for decades to answer life's vexing questions. Borsheim's will sell the $14.02 ball (with tax, that's $15) at its store starting this week and at the Qwest Center Omaha during the meeting.
The ball was supposed to be ready for last year's meeting, but a fire at the manufacturer disrupted production, Borsheim's said.
Instead of the standard Magic 8 Ball answers like “Ask again later” or “Very Doubtful,” the Warren & Charlie Ball's answers include “Diversify,” “SWEEEEET DEAL!” and Munger's widely known demurrer: “I have nothing to add.”
Wikipedia says the Magic 8 Ball was invented in 1946 by Albert Carter and contains a cylindrical reservoir holding alcohol with dark blue dye. The hollow die fills with the fluid so it floats slowly until one of its sides rises to the viewing porthole, revealing its words.
It works best with yes-or-no questions, such as, “Should I sell?” or “Will interest rates rise?” or even “Should I buy this?”
Buy or sell
Although Buffett and Munger will answer shareholders' questions for nearly five hours Saturday when they meet at the Qwest Center, they won't answer questions about what Berkshire might be buying or selling.
Rules of the Securities and Exchange Commission require uniform dispersal of information by publicly traded companies, on the theory that every investor should have access to the same facts at the same time so that no one has an unfair advantage in making investment decisions.
If Buffett were to say something like, “I've been buying shares of XYZ Corp. lately” at the meeting, that could go against SEC rules, because only those at the meeting would hear him say it, real-time.
True, there probably will be 40,000 people watching live or on nearby video screens, and journalists put his remarks online almost immediately. The meeting is on a Saturday, so the words would be spread widely by the time trading markets open Monday.
But if Buffett gave vital trading information at the meeting, one could argue that the annual shareholder meeting should be webcast live on the Internet so that it's available to anyone who wants to watch and listen, not only those who are there in person.
By keeping away from sensitive trading topics, Buffett is maintaining his pledge to keep the meeting for those who attend in person only. As he says in his invitation to shareholders: “We'll see you there.”
And he's not talking about a video chat, either.
Berkshire's next chairman, Warren's son Howard, isn't drawing quite as big a crowd for his planned talk next Sunday noon.
The “Hike to Help Refugees” sponsors have dropped the price, from $100 to $50 for lunch plus the talk or $20 for the talk only, at the University of Nebraska at Omaha's Milo Bail Student Center.
Proceeds (see http://www.hiketohelprefugees.org) will go to provide emergency relief services such as protection, shelter, water and food through the United Nations High Commissioner for Refugees. Howard's book, “Fragile: The Human Condition,” includes pictures and stories of refugees in Africa, Europe and Asia.
Brother Peter Buffett's “concert & conversation” at 7:30 p.m. Friday at the Joslyn Art Museum it benefits the Kent Bellows Studio and Joslyn costs $45 or $75 for preferred seating and a reception with Buffett, or $90 for preferred seating, the reception and an autographed copy of his book, “Life Is What You Make It.”
Ticketomaha.com is handling sales.
TheStreet.com reporter Eric Rosenbaum puts the question succinctly: “Can Buffett believe in a firm accused of fraud by the SEC?”
He's talking about Goldman Sachs Inc., the New York financial company accused in a civil lawsuit by the SEC of setting up a fraudulent investment. Buffett invested $5 billion in Goldman in the fall of 2008 and could invest more.
Buffett and Berkshire, Rosenbaum wrote, “have walked a fine line when it comes to Goldman Sachs. ... Buffett has spoken out in support of Goldman Sachs, previously, and specifically about Goldman's reputation.
“Buffett has always walked a fine line between his criticism of Wall Street practices and his investment in some of those same practices, so maybe the latest news event just magnifies the contradictions that already exist.”
Rosenbaum notes that a survey naming Berkshire as the most respected business in the country, with high integrity, rated Goldman as one of the least respected businesses.
“At some point, though, one has to wonder if Berkshire's investment with Goldman Sachs could even begin to taint the seemingly impenetrable armor of the Oracle of Omaha,” he wrote.
Bloomberg News also reported that Goldman's stock value has declined since the allegations were filed, causing a paper loss for Berkshire of about $1 billion.
Far East trip
Buffett may be heading east later this year.
Eitan Wertheimer, chairman of Berkshire subsidiary Iscar Metalworking Cos. of Israel, said he is looking forward to “schmoozing” with Buffett about a Far East trip while Wertheimer is in Omaha for the annual meeting.
TheStreet.com reported that Iscar hopes to make foreign acquisitions of its own, with China the most likely target, and that Wertheimer is arranging for Buffett to make a trip with him to the region. They would stop at Iscar's Japanese unit Tungaloy, which makes automotive and aerospace tools. Iscar also has Chinese and South Korean plants.
“We are dying to buy, but there is very little variety around, and it has to be the right price,” Wertheimer said. “I don't want to be big and stupid. I enjoy a lot to be the No. 2 and be the smart guy. I want to be the Einstein of the field.”
What's that partnership between Berkshire and Leucadia Corp., called Berkadia Commercial Mortgage, doing lately?
Business website Philly Deals reported that Berkadia arranged a $16.25 million refinancing loan for the Whitman Plaza shopping center in South Philadelphia.
Bethpage Federal Credit Union of Long Island, N.Y., is charging 7 percent on the 30-year loan. The shopping center, about one-fourth the size of Omaha's Westroads, is 25 years old and anchored by a Kmart store.
Crossroads refinancing, anyone?
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