Tuesday, April 26, 2005

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/

1 Comments:

Blogger lijialefw said...

Why was there no follow on bankruptcy then? The bailout of AIG FP went to (wow power leveling) hedge funds that bound credit swaps on Lehman failing or others betting on rating (wow power leveling) declines. AIG has drained over 100 billion from the government. Which had to go to (wow power leveling) those who bet on failures and downgrades. Many of whom (power leveling)were hedge funds. I-banks that had offsetting swaps needed the money from the AIG bailout or they would have been caught. Its an (wow powerleveling) insiders game and it takes just a little bit too much time for most people to think (wow gold) through where the AIG 100 billion bailout money went to, hedge funds and players, many of whom hire from the top ranks of DOJ, Fed, Treasury, CAOBO

2:18 AM  

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