The week ahead

Tom Hudson: Whither the Oracle of Omaha?

 

Special to The Miami Herald

The tone on Wall Street in the week ahead will be set from a convention center in Middle America even before the opening bell Monday. When the world’s highest profile long-term investor spends his weekend eating Dilly Bars, sipping Cherry Coke and pontificating about elephants, it has the potential to move the market.

Warren Buffett is the modern face of the patient investor. He first bought stock in Coca-Cola in 1988. He’s owned American Express stock for a generation. It’s no secret Buffett, though his Berkshire Hathaway holding company, likes to own stocks. He owned about three-dozen different stocks at the end of last year worth more than $75 billion.

Berkshire’s annual shareholder meeting in Omaha always provides great imagery. Here’s Buffett with the Geico gecko. (Berkshire owns Geico.) There’s Buffett tossing newspapers. (He owns dozens of small and medium sized papers.) The Fruit of the Loom costumes, Borsheim diamonds and Sees Candies. (He owns all of those, too.) Buffett is a value investor and he knows the value of putting on a good show.

The meeting will be over before the trading week begins but that’s when the speculation begins. Buffett has said he is in the market for “another elephant.” He means he is looking for a big company to buy. Berkshire has the financial power to bag an elephant. It has $42 billion dollars in cash and boasts among the highest credit ratings of any public company allowing it to borrow money at low interest rates. After thousands of people followed Buffett to Omaha, billions of dollars could follow his next market move.

Tom Hudson is a financial journalist based in Miami. He is the former co-anchor and managing editor of Nightly Business Report on public television. Follow him on Twitter @HudsonsView.

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