Warrent Buffett on Charlie Rose

Warren Buffett was on Charlie Rose for the whole hour last night (and broadcast at 9pm rather than the usual 11pm at least on WGBH) and is really worth watching. I think he avoided saying a large number of negative things about Wall Street thinking this is just not the time for that but trust that what he did say was honest. His comments on Paulson made me more confident in this package being effectively administered and his comparisons ('economic Pearl Harbor' and 'patient with a heart attack') were new to me and seemed quite effective metaphors. Anyway, I recommend watching the whole thing.

It is also really worth reading this excerpt on derivatives from the 2002 Berkshire annual report. This is the report from which the phrase 'financial weapons of mass destruction' comes from but it is really worth reading the whole thing (only 2 pages).

Maestro plays the Subway station

This Washington Post story is another great link gotten from Kottke. Story is very long but quite interesting. It addresses the question "Can one of the nation's great musicians cut through the fog of a D.C. rush hour? Let's find out."

Google IPO

Google filed its S-1 form announcing its IPO. The letter by Sergey Brin, with many references to Warren Buffett's Berkshire Hathaway letters, is well worth reading. Yes, it comes across as arrogant but honestly arrogance has never bothered me if it is warranted. We'll see how this goes. What can Wall Street do to them if the Powers That Be there don't like them as I agree they won't? I may consider participating in the auction depending on how it is being handled (haven't read details of that yet) and what the dutch auction price is likely to be.

Netflix cont'd

Well, Netflix is up more than 2 points since I sold yesterday which would have been $1000+. I am going to have to learn to not be bothered by things like this if I am going to keep with my current investment plan (relatively short-term trading - not just buy and hold for years). The hope is that at least I would be equally happy if it dropped 2 points after I get out as unhappy if it goes up 2 points but I have a feeling this isn't true.

Just picked up at the library a biography of Buffett and one of Peter Lynch's books. Definitely plan to read them and wonder if that will affect my plans.

Update: and now the next day it's up ANOTHER two points. I am seriously reconsidering (not just based on this) bailing on this short-term trading plan and going for the long haul. The tax implications are much better too that way of course.

First Individual Stock Sale

Well, I am certainly not going to post such things regularly but I decided this one deserves it as I for the first time sold an individual stock today. I bought Netflix (NFLX) on June 13 at $19.88 per share (500 shares) and today sold it for $25.70 per share for an after-commissions profit of $2870 (or 28.9%). I probably should have sold it earlier at 27-28 but unwisely didn't. Also, my selling of it doesn't indicate lack of confidence in the company (which I love) but rather that I think in the short term it is more likely to go down than go up. In fact, I am hopeful it will do so and then I will rebuy it. If it keeps going up, so it goes. Given a stock hits its peak/minimum only a few days a year, I will almost always be wrong in choosing the perfect time to buy/sell but my hope is of course I am just right enough to make money and beat the market. If not, I'll get out and just go for an Index Fund.

Alternatively, I may find I would be better off doing more of the Buffett/Motley Fool style of buy-to-hold rather than trying to play the market fluctuations at all. Again, hopefully I'll see how it goes but there is obviously a ton of money to be made (or lost) in the massive fluctuations, much more than in just holding a stock unless it is absolutely skyrocketing. Comments welcome. I am definitely a total beginner at this and just hope some of my game skills are applicable to the market as I think they should be.

Sage of Omaha

I was talking with a friend today about Warren Buffett's endorsement of Arnold and being somewhat surprised at how much of a difference it made to me, not that I know anything about CA politics, but I am suddenly taking Arnold as a serious candidate, not just a well known celebrity who might get elected on name recognition. It means a lot to me because I have a huge amount of respect for Buffett and, in particular, because I am certain that he is way too ethical to give his endorsement unless he really believed in it. He also rarely takes a public stand so when he does, I notice it. It is interesting that this is his second political statment of national newsworthy attention in a short period, following his appearance on Nightline opposing Bush's dividend tax cuts.

It happens that I also just a few days ago requested a book on Buffett from the library and today read an excellent BusinessWeek article on him which I highly recommend.

Related to this, I have actually gotten into investing a bit lately, buying individual stocks for the first time a couple of months ago. For a long time I have wished I could get an interest in the market and thus hopefully make some money in it but I have always been instantly bored with investment discussions in the past for some reason. In the last few weeks, however, that seems to have finally changed and I am actually taking an interest in it and following some stocks and doing some research. I have a feeling (which could be way offbase) that I have the skills that I could be a pretty good investor if I could manage to devote enough interest/concentration to it. Maybe I finally will be and it just took actually buying some stocks to find the interest. Of course, right now my stocks are down a bit ;) I'll probably post more about this in the future and in fact may go ahead and create an investing category now for this post to go in.