Happy Birthday, Warren Buffett!

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Aug 302011
 

Today is Warren Buffett’s 81st birthday.  Happy Birthday, Mr. Buffett!

Since this “Warren Buffett” blog was launched on the occasion of Warren Buffett’s 80th birthday on August 30, 2010, today is its first anniversary.  During the past year there have been 30 posts on this blog.  I hope visitors to this website have found these posts to be useful.

 Posted by at 7:54 am

Warren Buffett Invests $5 Billion in Bank of America

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Aug 252011
 

In a vote of confidence in Bank of America (BAC) and the financial sector, Warren Buffett (Berkshire Hathaway) is investing $5 billion in a special issue of BAC preferred shares with a 6% dividend, and is also receiving warrants to purchase 700 million BAC shares at an exercise price of $7.14 each.  The warrants are excercisable in whole or part in the 10 years following the closing of the deal.  BAC’s closing price on August 25 was $7.65, or $0.51 above the exercise price of the warrants.

 Posted by at 10:25 am

Berkshire Hathaway Adds To Wells Fargo and MasterCard Positions, Takes Initial Stake In Dollar General

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Aug 162011
 

During the second quarter ending June 30, 2011, Berkshire Hathaway added 10 million shares (about $275 million) to its $10 billion position in Wells Fargo.  An additional purchase of $50 million in MasterCard and an initial stake of $50 million was taken in Dollar General, most likely by Todd Combs who was recently hired by Warren Buffett as a portfolio manager.  This information is contained in Berkshire’s 13F filing with the SEC that was posted on the Internet after the market closed on August 15.

I am quoted in a Bloomberg article on this topic:

Buffett, Berkshire’s chief executive officer and head of investments, has turned his focus to stocks as interest rates remained near record lows.

“That does encourage one to invest in equity,” said David Kass, a professor at the University of Maryland’s Robert H. Smith School of Business.  Short-term U.S. Treasury securities, where Buffett keeps most of Berkshire’s $47.9 billion of cash, “are paying essentially zero or close to zero,” Kass said.

The entire article is available at:

http://www.bloomberg.com/news/2011-08-15/berkshire-adds-dollar-general-stake-as-buffett-builds-retailer-investments.html

 Posted by at 8:21 am

Warren Buffett: Raise Income Taxes On Top 0.3% of Taxpayers

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Aug 152011
 

In a New York Times op-ed article (August 15, 2011), Warren Buffett recommends raising taxes on those with taxable incomes exceeding $1 million.  This would affect only the top 0.3% of taxpayers.  “I would leave rates for 99.7% of taxpayers unchanged…”

Warren Buffett reveals in this article that he paid federal taxes of $6.9 million in 2010, which equalled 17.4% of his taxable income.  This would imply that his taxable income equalled $39.9 million in 2010.  Mr. Buffett’s total compensation from Berkshire Hathaway (BRK) contributed only $525,000 to his taxable income.  (Source:  BRK 2010 Proxy Statement.)   The vast majority of his income presumably resulted from dividends and capital gains from his investments that are taxed at 15%.   “I paid only 17.4% of my taxable income — and that’s actually a lower percentage than was paid by any of the other 20 people in our office.  Their tax burdens ranged from 33 percent to 41 percent and averaged 36 percent.”

 Posted by at 12:38 pm