Warren Buffett Still Buying Stocks, Sees 'Good Value'
By: Alex Crippen | Executive Producer
Will the Fed's action affect Berkshire's decisions? No, said Buffett, pointing out that in all the years he's worked with partner Charlie Munger, they've never had a conversation about macroeconomics when deciding whether or not to buy a company.
"In terms of whether to buy Oriental Trading today or pass, whether to buy Heinz today or see, we do not get into macroeconomic discussions at all. Everybody thinks we do."
(Read more: Buffett's Advice to Apple's Cook: Ignore Einhorn)
For him, price is the main consideration because it "takes care of the future."
Buffett joked that while he got a business he likes, and a partner he likes (3G Capital), in the $23 billion acquisition of H.J. Heinz, he "barely liked" the price and wouldn't have made the deal if 3G founder Jorge Paulo Lemann wasn't involved. "We get terrific management," he said, with 3G running Heinz. It's a long-term deal, said Buffett. "We hope to own Heinz 100 years from now."
Asked if he would buy another consumer products company, Buffett replied there's "nothing on my plate right now" but "if something comes along, and it looks like we can make a deal, and the price is right, we're ready to go."
(Read more: Buffett to Cramer: 'Real Money' Spent on NatGas Rail Conversions)
Buffett said unusual options activity the day before the Heinz deal was announced was "clearly insider trading" and he's confident the SEC will "nail that guy." He noted that while Berkshire works very hard to keep upcoming deals secret, there were several investment banks and others involved in the negotiations, making a leak more likely.
Among other topics covered during the three hours:
- Buffett's advice to Apple CEO Tim Cook: Ignore pressure to return to cash to shareholders and "run the business in such a manner as to create the most value over the next five to ten years."
- Buffett said Berkshire plans to hold its Bank of America warrants through the end of their 9-year lifetime.
- Buffett repeated his belief that big-city newspapers have a "far worse" business model than local community papers. When asked if he has any interest in buying the Chicago Tribune or L.A. Times from the privately-held Tribune Company, he responded, "No thanks."
- In his annual letter to shareholders released Friday, Buffett said he was looking for someone who is bearish on Berkshire to ask questions during May's annual meeting. Today he revealed that Doug Kass will be taking on that role.
