Newspaper Bears

I am a huge fan of Warren Buffett's sidekick, Charlie Munger. I think Munger is one of the greatest investors of all time. I don't think Buffett would disagree with this statement. As a professional investor on Wall Street, I naturally gravitated toward Munger's "lattice of models" approach to investing (see my book, Quantum Investing). Buffett and Munger often have wonderful insights into the business of investing. I was intrigued by this comment on the state of the newspaper business.

(steve)

A roomful of journalists could not resist asking about the prospects for newspaper stocks. Buffett and Munger were surprisingly bearish on newspapers, a major investment for Berkshire through its large stake in the Washington Post Co. and its outright ownership of the Buffalo News.

After saying that he and Munger are "newspaper addicts" and that "it's still an unusually good business," Buffett struck a somber note.

"The economics of newspapers are very, very close to certain to deteriorate over the next 10-20 years," he warned. "I see nothing that will turn around the erosion from both the circulation and advertising standpoints."

ps: for a fascinating glimpse of one possible future for the media business, check out the EPIC 2014 video at this website: http://www.broom.org/epic/