Despite paying some lip service to the party-line opinion of Warren Buffet’s investing skills and acknowledging that his folksy vibe can provide a competitive advantage when it comes to buying businesses from owners who want to see them in friendly hands, today’s Journal raises an eyebrow at the octogenerian’s claim that “Omaha will beat Wall Street in the end.” Buffett shuns leverage and modern risk management. His buy-and-hold approach can verge on stubborness to recognize a bad bet. And his management of some recent acquisitions like Dexter and Gen Re have left something to be desired. It’s hard to argue with the long-term wealth creation for his shareholders though.
Buffett’s Myopic Take on Wall Street [WSJ]
Granted, Gen Re has been a disappointment but Buffett is hardly alone in that camp--Employer’s Re wrote what turned out to be some pretty crappy business on Jack Welch’s watch and AIG (generally thought of as being pretty good at the insurance game) is still boosting reserves for the late 90’s. Thinking back a bit, he also single-handedly (if a little ham-handedly sometimes) saved Solomon Brothers from extinction, no mean management feat.
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