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Actually his strategy is mostly to buy businesses that are so fundamentally solid that even an idiot could run them (because one day an idiot will). The whole "
by H8crilA 2y ago
Actually his strategy is mostly to buy businesses that are so fundamentally solid that even an idiot could run them (because one day an idiot will). The whole "fixing it up" thing is for the so called activist investors.
The basic problem is that people do not want to appreciate the social value of capital allocation, well because a side effect of it is often making millions or even billions of dollars for yourself. And yet not having this mechanism is precisely the reason why the USSR collapsed.
- jiggawatts 2y agoHe’s explained in interviews that he’ll buy things like a steel mill for less money than its scrap value, then install his own (competent) accountants and start making an actual profit on top of that. Imagine this from the perspective of the employees: years of bad management, facing down the barrel of unemployment in a shrinking industry. Suddenly Buffett turns up, fires the bad managers and tells you profits are up so here’s a Christmas bonus. Capitalism at work.