Buffett’s gem of a strategy
Observer – Europe
FT
Published: May 3 2004
Warren Buffett has finally revealed the secret of his investing
success. It is not all about drinking Cherry Coke and eating See’s
Candies.
Concluding a record gathering of shareholders at Berkshire Hathaway’s
annual meeting in Omaha, the famously frugal billionaire was asked how
he justified the expense of entertaining all 19,500 acolytes. Easy, he
said: get them to shop in my stores.
The upscale Borsheim’s Fine Jewelry store and the Nebraska Furniture
Mart enjoyed record sales weekends thanks to the thousands of
shareholders flushwith Berkshire-generated cash who attended and opted
to, er, reinvest their profits. Borsheim’s sales on Friday were 85 per
cent higher than on any other day in its history.
Although known for his humility, Buffett did allow himself a moment to
gloat: “The meeting was probably cheaper per shareholder than any
other meeting in the world.”
Smart moves
What is the secret of success for top DaimlerChrysler executives?
Wolfgang Bernhard, 43, the aggressive Chrysler manager, is probably
wondering after last week’s antics at the US-German car group.
While Jürgen Schrempp held on to his position as chief executive
despite all those problems over Japan’s Mitsubishi Motors, Hyundai and
the threat to his “Welt AG” (world company) strategy, Bernhard found
himself on the way out.
He had been given the job as head of Mercedes Cars. Now he has had to
hand back the keys, and is expected to leave the group.
Why? Like Schrempp, Bernhard did not lack boldness. But he did upset
lots of people, not least the trade unions and Jürgen Hubbert, the
departing headof Mercedes who now gets to look after the lions of the
autobahn for a little longer.
The word is that the job will go to Andreas Renschler, head of
Daimler’s Smart car division, who has been spending time recently
drawing up businessplans for Mitsubishi Motors.
Maybe Bernhard simply lacked that extra shiny car polish required of
DaimlerChrysler leaders. After all, Hilmar Kopper, the former Deutsche
Bankboss who heads DaimlerChrysler’s supervisory board, was quoted in
the German media at the weekend as saying “the Welt AG, it never
existed”. Thus the problems never did either?
Gadaffi’s victory
Reformed revolutionary leader Muammer Gadaffi isn’t the only Libyan
coming in from the cold. Just days after the colonel began a landmark
visit to Europe that ended 15 years of isolation, his 30-year-old son
Saadi made his debut on Sunday in Serie A, Italy’s top-flight football
division.
The younger Gadaffi, who appeared as a substitute for Perugia against
Juventus, has found that a career in Italian football is no more
predictable than his father’s “mad-dog” diplomacy.
After signing for Perugia last year, he played in a few pre-season
friendlies but was never picked for an official match. Contract
problems, a back injury and the slightly unusual fact that he was a
member of the Juventus board of directors all conspired to keep him
off the pitch.
Helpfully, he gave up his job at Juventus, but last October tested
positive for drugs and received a three-month ban.
Everything’s going right for the Gadaffis at the moment – Perugia won
1-0, boosting their fight against relegation.
Starter’s orders
Anyone needing a reminder of how varied Europe is, even before
Saturday’s enlargement, need look no further than plans for two big
sporting events onthe Continent. While Greece is still struggling to
finalise arrangements for the Olympics in a few months, Germany is
pushing ahead with the fine print of plans for the football world cup,
due to open in. . . two years.
German planners say there will be two opening ceremonies, one in
Munich just before the opening game (date for your diary: June 9,
2006), and one in Berlin the day before. The latter will have no
lesser stars than David Bowie and Paul McCartney to draw in the
crowds.
The only thing not going to plan are the national team’s preparations.
Romania beat them 5-1 last week.
Egged on
Several Fabergé eggs, part of Russia’s crown jewels, have been
repatriated. Now the jewellers are following them.
Avakian, the Armenian-born, London-based jeweller, has opened two
stores in Moscow to cater to the burgeoning ranks of the nouveau riche
such as Viktor Vekselberg, the oligarch who bought the eggs from the
US Forbes family.
Avakian marked his store openings last week in typically lavish style
by hiring Moscow’s Novaya Opera Theatre to première the lost suite of
Balanchine’s last ballet, Jewelleries.
Russia’s greatest choreographer, now dead, had always intended that
his sapphire variation should crown his last work to complete the
theme pieces on diamonds, rubies and emeralds.
Self-effacingly, Avakian took to the stage at the end to present prima
ballerina Irma Neoradze with a 34-carat sapphire ring as a token of
thanks.
In the autumn comes the party for friends, and more importantly,
clients, who include actresses Gina Lollobrigida, Catherine Deneuve
and Ursula Andress.
Prêt-à-lire
Observer hears Tom Ford’s reign as Gucci’s creative director will soon
be immortalised in a coffee table book.
Women’s Wear Daily says a “major tome” is due out some time later this
year. Details are still being finalised, but are said to include
contributions by publishing and fashion heavyweights Anna Wintour,
editor of US Vogue, and Graydon Carter, editor of Vanity Fair.
Ford is also contemplating life in the movie business – he has signed
with Hollywood super-agent Bryan Lourd at Creative Artists
Agency. He’s in danger of becoming a one-man-brand.
From: Emil Lazarian | Ararat NewsPress
