Here's a statement of the obvious: The opinions expressed here are those of the participants, not those of the Mutual Fund Observer. We cannot vouch for the accuracy or appropriateness of any of it, though we do encourage civility and good humor.
According to this article, Buffett and Berkshire Hathaway avoid huge income taxes by buying companies, canceling their targets' dividends, and then using the money to buy out other firms. The author suggests Buffett is happy to call for higher taxes on the wealthy, but not on himself. Provocative.
Since when does one's net worth have anything to do with how high one's tax rate is or should be? And what does Mr. Buffett's relationship with President Obama have to do with how much tax he pays?
For years Mr. Buffett has maintained that he has gladly paid all the taxes that he is required to by law. I don't think anyone challenges that. He operates his business exactly like everyone hopes a good CEO would do. None of his shareholders are complaining as far as I know. None of the charities he supports are complaining as far as I know. Who out there sends in more to the IRS then they have to?
A lot of companies don't pay a dividend. Only 81% of the S&P 500 do. From time to time some analysts and shareholders have advocated or suggested that Berkshire Hathaway should do so. What would be the point other than the hoped for taxable income thrown off. Put it to a vote of the shareholders. It's nobody's business but theirs.
The final paragraph gets to the heart of the matter. Mr. Buffett is friends with the President so that's why nobody challenges him. Really? It's all because he's friends with a Democratic President? I don't recall any Republican President's calling for Mr. Buffett to pay more taxes.. Do we then go after the Koch brothers and anyone or everyone who isn't a Democrat as well?
Berkshire companies are great for investors, but not so for American consumers:
1. You have probably never heard of a tiny company called Geico. That's why Geico spent $1.1Billion on ads in 2012, or 6.5% of premiums while Travelers spent $2.31 per $100, which was the industry average. State Farm actually was below average in their spending at $1.60 per $100. I can't even find what USAA or AAA spend because it doesn't register. They just hang on to good customers for decades.
2. Dairy Queen and See's Candy are excellent establishments for most people since average body fat is about 12% for adults and most finish a marathon twice a year. I’m trying to get Dairy Queen to sponsor our marathon, the LA Dairy Queen Marathon, where runners/crawlers will juice upon on Blizzards every 5 miles to push them to victory. Since BH only owns 9% of Coca Cola, they get honorable mention for their fabulous water + sugar combo. Mr. Buffet gushed in 2015 that See’s spend no money on R&D and just spits out cash faster than the Treasury Dept.
3. Ben Bridge Jewelers - Lets spend precious dollars on fabulous jewelry because your partner will leave you if you don't show your commitment via precious stones. Remember that that stones appreciate more than SP500 because there is a tremendous shortage. If a buyer asks about blood spots, kindly inform them traces of blood, sweat and tears confirms genuine authenticity.
4. As 12% owners of Moody’s, BH revels every time Moody issues a AAA ratings for companies. BH knows that there are no downsides, because courts rule/will rule that ratings are just opinions, protected by the First Amendment and all lawsuits must be rejected to protect the Constitution. So what if those AAA rated companies go bankrupt - Freedom isn’t free.
5. Mr. Buffet stated that his Heinz buying Kraft is no worry for consumers because there is no monopoly on food vendors. He forget to mention that Heinz ketchup has a 60% market share of ketchup in the USA.
The Buffet has a army of attorneys that slice and dice the tax code to achieve their goals. It's probably legal but not possible for most citizens.
The Buffet's railroads do very well partly due to the connection he has in the White House. As for the other companies owned or major shares bought via BH, it's a hit and miss. DQ is not a top destination for most fast food junkies. In fact, fast food is slowly trending to a newer menu. I'm not sure if DQ is participating. Heinz? I prefer Delmonte catsup. It has that little extra zing.
Who was the cute lady on CNBC that asked the Buffet directly why he didn't write a check to the IRS? She is not with them any longer if my shaky memory is correct. Hmmmmmmm.
So if I understand the last two comments Warren Buffett or Berkshire Hathaway if you prefer, alone and/or through their henchmen, are forcing consumers to buy insurance through Geico and their ketchup from Kraft. They are also responsible for obesity in America by forcing people to eat ice cream and candy from their holdings because there are no other outlets for any of these items across the USA.
They control the stock and bond markets because their 12% stake in a ratings entity allows them to manipulate and price things in a way that is only advantageous to them. The rest of the investing world and ratings agencies are too minuscule to be of any concern.
And last, but not least, they control the President of the United States and by extension the railroads. High fuel costs (remember $4/gallon) and the subsequent oil production boom had nothing to do with any of that. I'll save you the trouble, it's the state of Nebraska that held up the Keystone pipeline but Mr. Buffett probably owns that as well.
I can't believe you left out his holdings in American Express, MasterCard, US Bank, Wells Fargo, Direct TV, Walmart, P&G, IBM, General Motors, John Deere, Goldman Sachs, USG, Verizon and something like 20 other companies. There's got to be something hinkey going on there, correct? Or maybe none of these slackers add anything to the bottom line.
I'm not sure where my comments painted that kind of picture except for the White House one. Of course, the Buffet is not the only person asking and getting favors. As for the other companies, I don't track BH and I don't have any interest in it or the Buffet for that matter. He is not the same person of say, twenty years ago. He has become a bit of a political hack. Charlie Munger on the other hand pretty much stays out of the limelight. I do not dispute their investing success.
Come on John, you're a smart guy. I know you can do better.
You implied that Mr. Buffett (btw it's 2-t's, not 1) games the tax code like only he can do. Who out there games the tax code to pay more taxes? What other wealthy individual doesn't do the same? What corporate entity doesn't do the same? Even our beloved Apple, like many other corporations, games the tax code by leaving their profits overseas. All legal under current laws enacted by (fill in the blank)?
You implied a connection between the White House and Mr. Buffett's investment in the railroads. What is the connection because I don't see it other than an investment opportunity he took advantage of which he likes to do from time to time. He started buying BNSF in roughly 2006 which pre-dates the current administration so help me out here. He bought the rest, shrewdly I might add, during the financial crisis in 2009. Others could have done the same. It was a great time to gather shares of great companies and the railroad was right up Berkshire's alley.
I have no idea about what he did with the missing news lady. Would it matter if she wasn't cute? Hmmmmm. Since we're on the subject of irrelevant issues why is Brian Williams shunned and disgraced over his misstated wartime exploits while Bill O'Reilly still has a voice? Bigger hmmmmmm.
My beef isn't with you or equalizer. It's with Barron's cruddy reporting and ridiculous innuendo. From time to time they go after individual stocks as well such as Linn Energy and Kinder Morgan. Unfortunate.
I won't prolong the cons versus proggie debate, that's for another forum. To end, I do not hold the same respect for the Buffettas others do. My personal opinion. I believe that Charlie Munger is the real brains of the two.
@Maurice: I may have linked the article incorrectly. I subscribe to Barron's and I know others do not. I've been trying to post pay-wall protected articles on the board, but obviously I don't have the same skill as Ted.
Comments
Since when does one's net worth have anything to do with how high one's tax rate is or should be? And what does Mr. Buffett's relationship with President Obama have to do with how much tax he pays?
For years Mr. Buffett has maintained that he has gladly paid all the taxes that he is required to by law. I don't think anyone challenges that. He operates his business exactly like everyone hopes a good CEO would do. None of his shareholders are complaining as far as I know. None of the charities he supports are complaining as far as I know. Who out there sends in more to the IRS then they have to?
A lot of companies don't pay a dividend. Only 81% of the S&P 500 do. From time to time some analysts and shareholders have advocated or suggested that Berkshire Hathaway should do so. What would be the point other than the hoped for taxable income thrown off. Put it to a vote of the shareholders. It's nobody's business but theirs.
The final paragraph gets to the heart of the matter. Mr. Buffett is friends with the President so that's why nobody challenges him. Really? It's all because he's friends with a Democratic President? I don't recall any Republican President's calling for Mr. Buffett to pay more taxes.. Do we then go after the Koch brothers and anyone or everyone who isn't a Democrat as well?
1. You have probably never heard of a tiny company called Geico. That's why Geico spent $1.1Billion on ads in 2012, or 6.5% of premiums while Travelers spent $2.31 per $100, which was the industry average. State Farm actually was below average in their spending at $1.60 per $100. I can't even find what USAA or AAA spend because it doesn't register. They just hang on to good customers for decades.
2. Dairy Queen and See's Candy are excellent establishments for most people since average body fat is about 12% for adults and most finish a marathon twice a year. I’m trying to get Dairy Queen to sponsor our marathon, the LA Dairy Queen Marathon, where runners/crawlers will juice upon on Blizzards every 5 miles to push them to victory. Since BH only owns 9% of Coca Cola, they get honorable mention for their fabulous water + sugar combo. Mr. Buffet gushed in 2015 that See’s spend no money on R&D and just spits out cash faster than the Treasury Dept.
3. Ben Bridge Jewelers - Lets spend precious dollars on fabulous jewelry because your partner will leave you if you don't show your commitment via precious stones. Remember that that stones appreciate more than SP500 because there is a tremendous shortage. If a buyer asks about blood spots, kindly inform them traces of blood, sweat and tears confirms genuine authenticity.
4. As 12% owners of Moody’s, BH revels every time Moody issues a AAA ratings for companies. BH knows that there are no downsides, because courts rule/will rule that ratings are just opinions, protected by the First Amendment and all lawsuits must be rejected to protect the Constitution. So what if those AAA rated companies go bankrupt - Freedom isn’t free.
5. Mr. Buffet stated that his Heinz buying Kraft is no worry for consumers because there is no monopoly on food vendors. He forget to mention that Heinz ketchup has a 60% market share of ketchup in the USA.
The Buffet's railroads do very well partly due to the connection he has in the White House. As for the other companies owned or major shares bought via BH, it's a hit and miss. DQ is not a top destination for most fast food junkies. In fact, fast food is slowly trending to a newer menu. I'm not sure if DQ is participating. Heinz? I prefer Delmonte catsup. It has that little extra zing.
Who was the cute lady on CNBC that asked the Buffet directly why he didn't write a check to the IRS? She is not with them any longer if my shaky memory is correct. Hmmmmmmm.
They control the stock and bond markets because their 12% stake in a ratings entity allows them to manipulate and price things in a way that is only advantageous to them. The rest of the investing world and ratings agencies are too minuscule to be of any concern.
And last, but not least, they control the President of the United States and by extension the railroads. High fuel costs (remember $4/gallon) and the subsequent oil production boom had nothing to do with any of that. I'll save you the trouble, it's the state of Nebraska that held up the Keystone pipeline but Mr. Buffett probably owns that as well.
I can't believe you left out his holdings in American Express, MasterCard, US Bank, Wells Fargo, Direct TV, Walmart, P&G, IBM, General Motors, John Deere, Goldman Sachs, USG, Verizon and something like 20 other companies. There's got to be something hinkey going on there, correct? Or maybe none of these slackers add anything to the bottom line.
You implied that Mr. Buffett (btw it's 2-t's, not 1) games the tax code like only he can do. Who out there games the tax code to pay more taxes? What other wealthy individual doesn't do the same? What corporate entity doesn't do the same? Even our beloved Apple, like many other corporations, games the tax code by leaving their profits overseas. All legal under current laws enacted by (fill in the blank)?
You implied a connection between the White House and Mr. Buffett's investment in the railroads. What is the connection because I don't see it other than an investment opportunity he took advantage of which he likes to do from time to time. He started buying BNSF in roughly 2006 which pre-dates the current administration so help me out here. He bought the rest, shrewdly I might add, during the financial crisis in 2009. Others could have done the same. It was a great time to gather shares of great companies and the railroad was right up Berkshire's alley.
I have no idea about what he did with the missing news lady. Would it matter if she wasn't cute? Hmmmmm. Since we're on the subject of irrelevant issues why is Brian Williams shunned and disgraced over his misstated wartime exploits while Bill O'Reilly still has a voice? Bigger hmmmmmm.
My beef isn't with you or equalizer. It's with Barron's cruddy reporting and ridiculous innuendo. From time to time they go after individual stocks as well such as Linn Energy and Kinder Morgan. Unfortunate.
And yes, I have or do hold shares in all three.
Out.