Professor Glen Arnold

Donald Graham: the second key person Katherine’s son, Donald, a Harvard graduate, Vietnam veteran and former policeman did not join the family firm until he was 26 in 1971, as a lowly reporter. He worked his way up, becoming executive Vice President, then publisher of the newspaper. All the while, his mother retained her positions […]

Buffett, as a director of Washington Post was able to share his insights on good managerial practice. Today’s Newsletter considers some of his contributions to shaping the company. Share buy-backs One thing he pressed for was share repurchases. He persuaded the board that when the price is low enough it makes great sense for your […]

For two years the share price fell. A crippling strike did not help, on top of the Watergate fall-out with threats to its TV licences. During the strike Katherine and Warren worked side-by-side rapping up newspapers into bundles and pasting labels by hand, often until 3am – they would go home filthy and exhausted. Eventually […]

After accumulating slightly over 5% of Washington Post’s shares in late spring 1973 Buffett wrote to Katherine Graham saying he would like to buy more. She was terrified that a raider would take the company out of family hands or influence it for political purposes, and so she did not received this letter from Omaha […]

In this Newsletter I’m going to challenge Buffett a little on this statement he wrote in 1985, 12 years after the purchase (I’m going to question whether there is just a little bit of hindsight bias. What I mean is, it turned out well, so when he looked back to 1973 it seems that it […]

The Washington Post newspaper routes, for which the 13-year old Buffett rose early back in the 1940s, provided a large proportion of the $9,800 he saved in his teenage years. Who’d thought that this small amount of foundation capital would eventually lead to Buffett controlling the largest holding of Washington Post shares outside of the […]

In early 1973 Buffett hired Salomon Brothers to raise $20m in senior notes (a bond) for BH, even though he did not need it for the operating business (the interest rate was 8%). This was to pay off an older debt of $9m, with the rest providing some extra firepower for the share portfolio when […]

From the late 1960’s Buffett was frustrated in his search for shares at reasonable prices; he likened himself to a sex-starved man on a desert island. He did manage to buy a few between 1970 and 1973 for Berkshire Hathaway, but the immediate results were not encouraging as he witnessed the portfolio value falling: “We […]

This is a long Newsletter (2006 words), for which I apologise, but well worth the effort because it brings a high level of understanding with regard to some key factors in valuing companies and their shares. If you get what Buffett is saying here then you will be in a good position to understand the […]

Here is a quiz for you: Which is the better business? Company A produced post-tax profits of $2m last year. Company B did the same. Company A has only $8m of net tangible assets whereas Company B has five times as much, $40m of net tangible assets. Profit growth is anticipated to be the same […]