Warren Buffett on his Lunch Auction for Charity

Bloomberg has an interview with Warren Buffett talking about his lunch auction for the Glide charity. Class act as usual.

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Eddie Lampert Speech

Eddie is one the great ones. Here's a talk he gave in 2003.

I started my firm in 1988 and began investing. I was inspired by Warren Buffett’s letters while still working on the Arbitrage desk at Goldman Sachs. We consider ourselves “Aggressive Conservative” investors

In investing, we seek to do a few things well, namely
1) Understand the Business
2) Understand the People Running the Business and
3) Get safety from the price that we pay

Lee Ainslie Interview - PM of Maverick Capital

Pension and Investments interviews one of the original Tiger Cubs, Lee Ainslie.

What was the most important lesson you learned from Mr. Robertson? Julian always stressed the importance of integrity in your personal conduct, in how you represented the firm and in evaluating management teams (of companies you were considering investing in) is critically important. At Maverick, the importance of integrity is constantly stressed. As we grow, our biggest risk is bringing on someone new … we don’t know them as well as the people we’ve worked with for years and years. We invest a lot of time in making sure everyone at the firm understands how important our reputation is.

Joel Greenblatt Lecture: 2006 Columbia Reunion

-Value works. Buffett: good AND cheap
-Good companies have high returns on capital: defined as operating profit divided by net working capital plus net fixed assets
-Cheap stocks have high earnings yields: defined as pre-tax operating earnings divided by enterprise value
-50/50 algorithm of good and cheap: Magic Formula!

Video

Source: David Lau

Bill Miller is Outperforming Himself

It turns out Bill Miller runs a smaller fund that gives him more flexibility to be more concentrated and invest outside of equities. It's called the Legg Mason Value Trust Opportunity Prime Trust fund and it is only available to Smith Barney clients. Over the last 5 years it is up 100% vs. 60% in the main Value Trust fund.

Opportunity, on the other hand, is completely flexible: Miller is free to invest overseas as well as in the U.S., and in "convertible securities, private placement securities, debt securities, options, etc.," Athridge explains. The fund can also be more heavily concentrated if Miller wants to make a few big bets.