"Now we have lots of money and no ideas." So says the Oracle of Omaha to the crowd and the inquiries of Doug Kass at the big Omaha showdown. And I come back and say, "Give me a break." You have a million ideas, and because of who you are, you can make them happen very easily.
I am totally into Warren Buffett. He is totally rigorous. He has answered Kass's questions about management style and succession and break-up very well. Buffett has made a series of brilliant acquisitions for Berkshire Hathaway (BRK.A) (BRK.B),including Heinz (HNZ), where, given the endless moves higher in the consumer packaged goods since that February tour de force, he has truly gotten a bargain.
But I find his constant "we are loaded and looking for ideas" commentary somewhat boilerplate at this moment and, yes, a tad lame.
Because he has all the ideas he wants; he just chooses to pass on a lot of good ones.Let me explain. Buffett did not see the housing crisis coming. He didn't see the downturn. He bought housing-related stocks before it. He didn't double down at the bottom. He didn't dodge the decline. He just kind of sat there with the "we have lots of money and no ideas" attitude the whole way. A simple "we had lots of money and we didn't see the top or the bottom of the housing crisis" would have suited me. Or how about some real humility: "We could have used our money to buy down some of the best situations that were really underwater but we passed on them and we regret it. " The criteria that Buffett uses to buy companies has very little to do with the cycle. He can always argue that whatever wasn't bought simply doesn't fit into what he buys and whatever he buys fits into what he buys. I find the circular reasoning very difficult to swallow if it was from anyone else but Buffett. In fact, everyone else but Buffett would be asked, "How could you not buy the rest of USG (USG) at the bottom?" Or, "How about buying some housing-related stocks when they were cheap, instead of now when you just lament there are no bargains?"
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