May 2012     Issue 9

Berkshire Shareholders Meeting – 2012
So soon after Buffett’s remarkably candid announcement that he had been diagnosed with stage 1 prostate cancer, it was impressive to hear him and his 88 year old Vice Chairman, Charlie Munger, displaying their usual high levels of energy, acerbic wit and razor sharp analytical powers to handle the 6 hours of questions from shareholders and analysts. We have written up our highlights from the event, which you can read here.

Buffett starting out
This article published in Forbes magazine gives a fascinating insight into the choices Warren Buffett made when he started his first fund.

Interview with Charlie Munger
This 30 minute interview took place the day before the Berkshire shareholder meeting. The interviewer, Becky Quick is one of the panel of three journalists who choose (in their view) the best of the questions sent in for the shareholders meeting. Munger explains the opportunistic approach of Berkshire Hathaway and the importance of their business experience to their investment success (and vice versa), dismisses gold as an investment “civilised people don’t invest in gold, they invest in productive businesses” and comments on the dynamics of the macro economy and his enthusiasm for the two US presidential candidates (in spite of the “poisonous” state of US politics).

The causes and consequences of the European crisis
Whilst we are bottom up investors and retain a detachment from the market’s daily oscillations, driven by the next political sound bite from a European Head of State, we cannot ignore the potential ramifications of the current Eurozone crisis on a fundamental level for the companies we invest in. In this article, which was written in January, Jonathan Mills sets out our prognosis for the Euro and how this is shaping our investment strategy.

Value works – statistical evidence of the success of value investing – Michael van Biema, van Biema Value Partners.
This presentation from the London Value Investor Conference in April received excellent reviews from the delegates. Michael van Biema is the founder and managing principal of van Biema Value Partners, LLC – a fund of value funds. Michael was a faculty member of Columbia Business School from 1992 to 2004, where he taught an MBA course on value investing. He is the co-author of the book “Value Investing from Graham to Buffett and Beyond”. In this presentation, he sets out the statistical evidence for the long-term success of value investing and the underlying factors that drive this success.

The London Value Investor Conference – 2012.
This inaugural conference in London was an oustanding success.  The event competely sold out as 150 delegates came to listen to a very strong line up of presentations by value investors from both sides of the Atlantic.   Feedback from the event was universally positive and it was clear from the general buzz in the breaks and the evening reception that the London value investing community enjoyed the opportunity to gather. The conference raised over £10,000 for the SMA Trust, a children’s charity which supports vital research into finding a cure for Spinal Muscular Atrophy.