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Investing Warren Buffett Watch

  Friday, 31 Dec 2010 | 4:47 PM ET

Buffett Stomps S&P in 2010

Posted ByAlex Crippen

Shares of Warren Buffett's Berkshire Hathaway (Class A) have finished the year with a gain of 21.4 percent for 2010, far outperforming the benchmark S&P's 12.8 percent gain, excluding dividends.

(We're using Class A to stay consistent with past years, despite the Class B split. The B shares are up 21.9 percent this year.)

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  Wednesday, 29 Dec 2010 | 3:54 PM ET

Bad Year for Buffett-Backed BYD

Posted ByAlex Crippen
090413_Fortune_Cover_Buffet.jpg

A missed sales target caps a tough year for shares of BYD, the Chinese electric car company backed by Warren Buffett's Berkshire Hathaway.

BYD tells Bloomberg that it will sell between 520,000 and 550,000 cars this year. That's below the already-reduced target of 600,000. In August, BYD cut that goal by 200,000 vehicles.

The Chinese company has started a trial programwith the Los Angeles Housing Authority for an electric car fleet and it still expects to sell its K9 electric bus in the U.S. in 2011. Sales in the U.S., however, of the E6 electric car are now planned for 2012. That's two years behind schedule.

BYD expects a "sizable profit " from electric vehicles in about five years, but its third quarter profits fell 99 percent after weak sales this summer.

At today's close of HK$40.50, the Hong Kong listed stock has lost half its value since early April, when it hit its 2010 high just above HK$80.

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  Wednesday, 15 Dec 2010 | 7:40 AM ET

What's Obama Trying to Bolster?

Barack Obama
Barack Obama

President Barack Obama invited two of the world's richest men to the White House Tuesday to discuss ways to boost the U.S. economy.

The White House says Obama's meeting with Bill Gates and Warren Buffett focused on ideas for spurring economic growth and making the U.S. more competitive. But we want to know what you think? Was this meeting more about bolstering the economy, or Obama's 2012 re-election campaign? Share your opinion:

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  Tuesday, 14 Dec 2010 | 12:51 PM ET

Mr. Buffett Goes to the White House ... Again

Posted ByAlex Crippen

For the second time this year, Warren Buffett has met with President Obama in the White House's Oval Office.

The session this morning (Tuesday) also included Bill and Melinda Gates.

According to a brief White House statement, Mr. Obama invited the trio to the White House discuss the Giving Pledge , "the initiative they launched earlier this year that invites the wealthiest individuals and families in America to commit to giving the majority of their wealth to philanthropy."

The statement goes on to say the conversation also covered "ideas for growing the economy and making America more competitive including investment in education to better prepare the next generation and investing in innovative areas with opportunity for growth."

In July, Buffett met with President Obama in the Oval Office to "discuss the economy and our ongoing efforts to work with the private sector to stimulate growth and create jobs."

During that visit, the president noticed that Buffett's tie was frayed, and gave him a new, gift-wrapped, red tie.

No word on whether Buffett wore that gift today, or if he put on another disreputable tie in hopes of getting a second free piece of neckwear.

Current Berkshire stock prices:

Class B:

Class A:

For more Buffett Watch updates follow alexcrippen on Twitter .

Email comments to buffettwatch@cnbc.com

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  Thursday, 9 Dec 2010 | 4:36 PM ET

Stocks End Mixed; Nasdaq Hits 3-Year High

Posted ByAbby Schultz

Stocks trimmed losses to end narrowly mixed Thursday as Treasury prices firmed and the dollar stabilized.

The Dow Jones Industrial Average fell 2.42 points, or 0.02 percent, to close at 11,370.06 a day after ending slightly higher in a session dominated by moves in Treasurys and metals.

McDonald's, DuPont, and Boeing declined, while Bank of America and Cisco rose.

The S&P 500 rose 4.72 points, or 0.4 percent, to close at 1,233.00, its highest close since September 19, 2008.

The Nasdaq marked its highest close since December 31, 2007, rising 7.51 points, or 0.3 percent, to close at 2,616.67.

The CBOE Volatility Index, widely considered the best gauge of fear in the market, fell to nearly 17.

Among key S&P 500 sectors, financials, telecom and materials rose, while consumer discretionary and technology fell.

The dollar rose slightly against a basket of currenciesas the euro fell after Fitch cut ratings for Ireland's sovereign debt, and a political party in Ireland said it would vote against a European Union bailout for the country. Gold and silverpricesrecovered some of their gains.

Investors flocked to an auction of $13 billion in 30-year bonds that had a yield of 4.410 percent and a bid-to-cover ratio of 2.74. The bid-to-cover is a measure of how much is bid for each dollar auctioned.

The auction result surprised the market as it was on the heels of the worst two-day selloff in Treasurys in two years. After the auction, the 10-year Treasury note rose 20/32 higher to yield 3.19 percent, down from 3.27 percent late Wednesday.

Bond investors have been concerned that an agreement between President Obama and Republicans to extend the Bush-era tax cuts for a further two years would threaten financial stability and spark inflation.

On Thursday, the markets were awaiting direction from Washington about the tax cut plan as Congress continued to wrestle over the details. Aversion of the compromise is expected to be put before the Senate later today, according to Senate Majority Leader Harry Reid.

Most investors seem to expect a compromise will be reached, and if it's not, "it could be a market moving event," said Kevin Kruszenski, head of listed trading at KeyBanc Capital Markets in Cleveland.

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  Thursday, 9 Dec 2010 | 3:55 PM ET

Stocks Trim Losses Before Close; Banks Rise

Posted By Abby Schultz, JeeYeon Park

Stocks eased losses ahead of the close Thursday as Treasury prices firmed, but gains were limited by a stronger U.S. dollar.

The Dow Jones Industrial Average fell less than 10 points a day after ending slightly higher in a session dominated by moves in Treasurys and metals.

DuPont , McDonald's and Boeing declined, while Bank of America and Cisco rose.

The S&P 500 and Nasdaq rose slightly, but were still set to close at two-year-highs. The CBOE Volatility Index, widely considered the best gauge of fear in the market, fell below 18.

Among key S&P 500 sectors, financials, telecom and consumer staples rose, while consumer discretionary and technology fell.

The dollar weakened versus the euroas Fitch cut ratings for Ireland's sovereign debt, and a political party in Ireland said it would vote against a European Union bailout for the country. Gold and silverpricesrecovered some of their gains.

Investors flocked to an auction of $13 billion in 30-year bonds that had a yield of 4.410 percent and a bid-to-cover ratio, a measure of how much is bid for each dollar auctioned, of 2.74. The result surprised as it was on the heels of the worst two-day selloff in Treasurys in two years. After the auction, the 10-year Treasury note rose 20/32 higher to yield 3.19 percent, down from 3.27 percent late Wednesday.

Bond investors have been concerned that an agreement between President Obama and Republicans to extend the Bush-era tax cuts for a further two years would threaten financial stability and spark inflation.

On Thursday, the markets were awaiting direction from Washington about the tax cut plan as Congress continued to wrestle over the details. Aversion of the compromise is expected to be put before the Senate later today, according to Senate Majority Leader Harry Reid.

Most investors seem to expect a compromise will be reached, and if it's not, "it could be a market moving event," said Kevin Kruszenski, head of listed trading at KeyBanc Capital Markets in Cleveland.

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  Thursday, 9 Dec 2010 | 12:37 PM ET

Stocks Waver Ahead of Bond Auction; BofA Rises

Posted By CNBC.com

Stocks traded mixed Thursday as Treasurys erased most of their gains ahead of a 30-year bond auction and despite evidence the U.S. economy continues to improve.

The Dow Jones Industrial Average fell more than 25 points a day after ending slightly higher in a session dominated by moves in Treasurys and metals.

DuPont , Travelers and IBM fell, while Bank of America and Verizon rose.

The S&P 500 and Nasdaq were trading flat. The CBOE Volatility Index, widely considered the best gauge of fear in the market, fell below 18.

Among key S&P 500 sectors, energy, technology, and consumer discretionary fell, and telecom and financials rose.

The dollar weakened versus the euroas the rating agency Fitch cut ratings for Ireland's sovereign debt, and an political party in Ireland said it would vote against a European Union bailout for the country. Prices for gold and silver recovered some of the gains lost Wednesday in the wake of rising Treasury yields and a rising dollar.

Markets have wobbled over the past several days, while investors have ditched bonds amid concerns over whether a recent tax deal in Washington would threaten financial stability and spark inflation.

After their worst two-day selloff in two years, Treasurys continued to weaken ahead of a 1 p.m. $13 billion auction in 30-year bonds by the U.S. Treasury. The 30-year Treasury bond slipped 1.4 percent, to yield 4.4 percent, while the 10-year note 2.2 percent to yield 3.2 percent.

Bond investors have been concerned about an agreement between President Obama and Republicans to extend the Bush-era tax cuts for a further two years.

The markets largely remained quiet as the drop in jobless claims, while more than expected, was still largely in line with trends in the weekly indicator, said Kevin Kruszenski, head of listed trading at KeyBanc Capital Markets in Cleveland.

The markets were also awaiting direction from Washington about the tax cut plan as Congress continued to wrestle over the details, although Kruszenski said most seem to expect a compromise will be reached. If it's not, "it could be a market moving event," he said.

Financials got a boost from Barclay's, which upgraded three asset managers: Janus Capital , Waddell & Reed and Legg Mason to "overweight." The brokerage firm said the firms will be supported by an improving economy, and noted they were attractively valued.

Also in financial news, Morgan Stanley is planning to cut its bonus payments by up to 15 percent this year due to volatile market conditions, the Wall Street Journal reported, citing a person familiar with the situation.

Ford shares were up modestly after Bank of America raised its earnings-per-share estimates and increasing its price target for the automaker to $24 a share from $20, based on a price-to-earnings ratio of 10 times estimated 2011 earnings. The brokerage said the stock should outperform because of the company's "strong mangaement, solid operating results, a consistently improving balance sheet, industry-leading product, and recovery in the U.S. sales cycle."

The brokerage also upgraded Goodyear Tire & Rubber and Cooper Tire & Rubber , citing attractive stock valuations. Goodyear was upgraded to "buy" from "underperform," and Cooper Tire was upgraded to "buy" from "neutral."

On the tech front, Dell rose slightly after news it was in "advanced discussions" to buy Compellent Technologies , a data storage solutions company. Compellent's shares fell.

Ciena advanced after delivering a positive sales outlook for the first quarter, and despite a disappointing fourth-quarter loss.

Akami shares sank after the Internet content delivery firm said pricing in its media business is falling. The firm, which provides technology to speed the delivery of Internet content, also said it would not update its outlook for the current quarter.

Shares of Conagra fell after the maker of Chef Boy-Ar-Dee pastas and Healthy Choice meals cut its 2011 outlook after disappointing fiscal second-quarter results.

Meanwhile, shares of Eastman Kodak soared more than 10 percent on 300 times its normal volume on rumors the company was a takeover target.

FBR Capital Markets gave mixed reviews of home improvement retailers Home Depot and Lowe's , raising Home Depot to "outperform" from "market perform," and lowering Lowe's to "market perform" from "outperform." FBR said Home Depot was more focused on "traffic and value" than its rival.

Sirius XM Radio gained after radio host Howard Stern said he was staying with the satellite radio station , although the terms of the agreement were not disclosed.

Lululemon Athletica soared after reporting its profit nearly doubled in third quarter as strong sales continued for its yoga clothes. Lululemon's net income rose to $25.7 million, or 36 cents a share, in the quarter ended Oct. 31, up from $14.1 million a year ago, and more than the 25 cents a share forecasted by analysts.

And the philanthropic campaign led by Warren Buffett and Bill Gates is set to get a cash injection after another seventeen U.S. billionaires pledged at least half their fortunes to the cause. Facebook co-founders Mark Zuckerberg and Dustin Moskovitz are among the donors.

Meanwhile, a watered-down spending bill has been approved by the House as the Democrats seek to lock in current spending levels before Republicans take control of the House in January.

Bullish sentiment among individual investors surveyed by the American Association of Individual Investors reached a four-week high, the group reported Thursday.

Expectations that stock prices will rise over the next six months rose 3.4 percentage points to 53 percent, a four-week high, according to the AAII's weekly survey. Bullish sentiment has been above its 39 percent historical average for 14 consecutive weeks, the group said.

In economic news, initial claims for unemployment benefits fell by 17,000 to 421,000, according to the U.S. Labor Department. That's less than the 425,00 forecasted by economists surveyed by Reuters. The four-week moving average fell by 4,000 to 427,500, near a two-year low, the Labor Department said.

In the previous week, claims were revised up to 438,000 from 436,000, the government said.

In a optimistic sign about holiday shopping, U.S. wholesale sales in October climbed more than they had in seven months as inventories continued to rise, the Commerce Department said Thursday. Wholesale sales rose 2.2 percent to a seasonally adjusted $362.1 billion, much more than expected, and compared with a 0.5 percent gain in September. Inventories rose 1.9 percent in October to $427.1 billion after a 2.1 percent rise.

European shares extended gains from the previous session with technology stocks showing the strongest rise. The Bank of England kept its monetary policy on hold, as widely expected.

Asian indexes closed mostly higher, but Chinese stocks saw sharp losses.

On Tap This Week:

THURSDAY: 30-year Treasury bond auction, DuPont investor day
FRIDAY: International trade, import and export prices, consumer sentiment, and Treasury budget

More From CNBC.com:

»Read more
  Thursday, 9 Dec 2010 | 11:40 AM ET

26-Year-Old Facebook Co-Founder Mark Zuckerberg Joins Buffett's Giving Pledge: 'Why Wait?'

Posted ByAlex Crippen
Mark Zuckerberg, co-founder and CEO of Facebook
AP
Mark Zuckerberg, co-founder and CEO of Facebook

Another 17 individuals or families have joined Warren Buffett's "Giving Pledge ," including the 26-year-old co-founder and CEO of Facebook.

The news release early this morning emphasizes that Mark Zuckerberg's youth contradicts with the more familiar image of a wealthy person turning to philanthropy later in his or her life.

He's quoted as saying:

"People wait until late in their career to give back. But why wait when there is so much to be done? With a generation of younger folks who have thrived on the success of their companies, there is a big opportunity for many of us to give back earlier in our lifetime and see the impact of our philanthropic efforts."

Zuckerberg is number 36 on the latest Forbes ranking of the 400 richest Americans, with an estimated wealth of $6.9 billion as of September. The year before his wealth was estimated at $2 billion.

But, as the Wall Street Journal notes in its coverage of the new pledges, since Zuckerberg's wealth is from "his ownership state in a company that has yet to list on the stock market, much of that wealth is theoretical at this point."

Also on the December pledge list: Carl Icahn and Michael Milken .

Current Berkshire stock prices:

Class B:

Class A:

For more Buffett Watch updates follow alexcrippen on Twitter .

Email comments to buffettwatch@cnbc.com

»Read more
  Thursday, 9 Dec 2010 | 9:12 AM ET

Futures Gain After Jobless Report

Posted By CNBC.com

U.S. stock index futures added slightly to gains Thursday after weekly jobless claims fell more than expected.

Initial claims for unemployment benefits fell by 17,000 to 421,000, according to the U.S. Labor Department. That's less than the 425,00 forecasted by economists surveyed by Reuters. The four-week moving average fell by 4,000 to 427,500, near a two-year low, the Labor Department said.

In the previous week, claims were revised up to 438,000 from 436,000, the government said.

Markets have wobbled over the past several days, while investors have ditched bonds amid concerns over whether a recent tax deal in Washington would threaten financial stability, and if inflation is on the horizon.

Treasurys were hit by their worst two-day selloff since the collapse of Lehman Brothers this week, sending yields sharply higher, in the wake of an agreement between President Obama and Republicans to extend the Bush-era tax cuts for a further two years.

The rising yields were a signal of stronger economic times ahead, Dennis Gartman, founder The Gartman Letter, told CNBC.

"It's not a negative story, it's a positive story. Rates are going higher for a number of reasons, but I don't think you can discount the importance of increasing demand, increasing strength in the U.S. economy," Gartman said.

Bond yields eased off their highs in early trading Thursday, with the benchmark 10-year note yield slipping to 3.25 percent and the 30-year long bond at 4.45 percent.

European shares extended gains from the previous session with technology stocks showing the strongest rise. The Bank of England kept its monetary policy on hold, as widely expected.

Asian indexes closed mostly higher, but Chinese stocks saw sharp losses.

In other U.S. economic news, October wholesale inventories will be be released at 10 a.m., with economists expecting a rise of 0.7 percent, according to Briefing.com.

In corporate news, Morgan Stanley is planning to cut its bonus payments by up to 15 percent this year due to volatile market conditions, the Wall Street Journal reported, citing a person familiar with the situation.

Dell rose slightly in the premarket after news it was in "advanced discussions" to buy Compellent Technologies , a data storage solutions company. Compellent's shares fell.

Shares of Conagra fell in the premarket after the maker of Chef Boy-Ar-Dee pastas and Healthy Choice meals cut its 2011 outlook after disappointing fiscal second-quarter results.

Sirius XM Radio gained after radio host Howard Stern said he was staying with the satellite radio station , although the terms of the agreement were not disclosed.

Lululemon Athletica soared in the premarket after reporting its profit nearly doubled in third quarter as strong sales continued for its yoga clothes. Lululemon's net income rose to $25.7 million, or 36 cents a share, in the quarter ended Oct. 31, up from $14.1 million a year ago, and more than the 25 cents a share forecasted by analysts.

And the philanthropic campaign led by Warren Buffett and Bill Gates is set to get a cash injection after another seventeen U.S. billionaires pledged at least half their fortunes to the cause. Facebook co-founders Mark Zuckerberg and Dustin Moskovitz are among the donors.

Meanwhile, a watered-down spending bill has been approved by the House as the Democrats seek to lock in current spending levels before Republicans take control of the House in January.

On Tap This Week:

THURSDAY: Wholesale inventories, 30-year Treasury bond auction, DuPont investor day
FRIDAY: International trade, import and export prices, consumer sentiment, and Treasury budget

More From CNBC.com:

»Read more
  Saturday, 4 Dec 2010 | 12:53 PM ET

Warren Buffett: 'Pleasure' to Write $50M Check for Nuclear Fuel Bank

Posted ByAlex Crippen
Warren Buffett
Getty Images
Warren Buffett

Warren Buffett likes to portray himself as the multi-billionaire cheapskate who feels great pain from every dollar bill that leaves his wallet.

But there's no sign today of that stingy public persona he sometimes exaggerates for laughs.

Buffett says in a statement from Sam Nunn and Ted Turner's Nuclear Threat Initiative that it will be a "pleasure" to write a $50 million check, fulfilling his promise to help fund an internationalnuclear fuel bank.

Back in 2006, Buffett offered the money if the UN's International Atomic Energy Agency could raise another $100 million from one or more countries around the world.

It took several years, but that goal was met and the IAEA formally voted yesterday (Friday) to create a multinational nuclear fuel bank that will serve as a reliable source of reactor fuel for nuclear power plants, so that countries won't have to make that fuel themselves.

As the Washington Post notes today, "The same centrifuges used to prepare uranium for power plants can also be used to enrich it to higher, weapons-grade levels."

That's why the U.S. and other countries are worried about Iran's efforts to make nuclear fuel, despite that country's assertions that it is only trying to make electricity.

Buffett says in the Post, "Essentially what we're saying to the world is, if you want to be in the peaceful use of nuclear power, you don't have to have those enrichment facilities."

In the NTI statement, Buffett (an advisor to the group) is quoted as saying, "The IAEA fuel bank is an investment in a safer world and an essential tool in reducing nuclear dangers. I believe that the fuel bank will help reduce the risk of enrichment proliferation globally. It will be a pleasure to write a check for funds that will help reduce global dangers.”

Buffett tells the New York Times , "I've never been $50 million lighter and felt better." He hopes the bank will at least partially put the nuclear "genie back in the bottle" because the "spread of weapons of incredible destructive capability is the No. 1 problem facing mankind."

In an interview withReuters , Buffett says he may be contributing even more money to efforts to stop the spread of weapons of mass destruction:

"Throughout my lifetime I will be interested in this subject and I will back that interest up with money... If the project sounds like a good one and has any real chance of reducing the probabilities of the terrible use of nuclear, chemical and biological weapons I'm prepared to put up significant money... Something can come up that requires a million dollars or something can come up that requires a $100 million."

Calling the threat of WMDs the biggest problem facing mankind in the 21st century, Buffett said, "We really have to prevent weapons of tremendous potential harm being used by these people who have evil intentions ... this is not a problem that we can wish away."

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About Buffett Watch

  • Warren Buffett is arguably America’s most-admired and most-followed investor. Buffett is the largest shareholder and CEO of Berkshire Hathaway and one of the world’s most famous and most generous philanthropists. Legions of investors - from all walks of life - follow Buffett's homespun investment philosophy: invest in what you know, invest in value. Here on CNBC.com's Warren Buffett Watch, we’ll keep you up to date on what the “Oracle of Omaha” is doing by following Buffett's trades, words and deeds.