Subject: Re: Make Berkshire Compound Again!
I might think of that as good capital allocation but without evidence of good timing.
My first thought that hearing Berkshire was buying $10B in a private placement was, uh, what?
What I might have expected to see in its place was, "Berkshire loaned $10B to GOOG via an x year, 5% bond, plus warrants" (to purchase GOOG before 2041 at 1.5x today's price)
...therefore locking in no downside, plus a potential windfall. The Buffett Way, if you will.
GOOG needs the capital, right? So, why is the deal for a bunch of cash in exchange for a minor, one-time price break?
I see the probable upside in this deal. What I don't see is any downside insurance.
And downside insurance is why I own so much BRK. I mean, being retired and all
-sutton
not a financier, but geez