"I was not thrilled with Buffett’s BHE comments or the rail progress."

Yeah look, it's certainly not good news but a couple of things......

1. I have found over the years Warren will clearly state problems and sometimes over emphasizes them. I site General Re with bad derivatives on the book, Net Jets tanking at one point in time, Sokol plunking down for shares in Lubrizol and Heinz Kraft & Wells Fargo investments going sideways. All these issues were things needing highlights in the annual letter and he went out of his way to explain the issues. I'm not minimizing BHE or BNSF because the issues are very real and more capital intensive than the other issues I mentioned but at least he's upfront about and clearly working on the issue. And who better to work on it?

2. Regarding regulatory issues- I think he's telegraphing his line in the sand by talking about it in the letter. It's no different than US chip manufacturers releasing statements saying there will be delays in the building of their fabs. They were sending a message to the US government telling them too much red tape and holding up the money is going to stop them from building in its tracks. And wahlah, suddenly the money starts coming out! I'm not saying that's what's going to happen here but regulators for rails or power won't like reading him talking about possible bankruptcy or getting out altogether in key areas.

3. Warren has said many times that Greg's a better day to day manager than he is. Well, here's a time to let the young man shine! Hopefully he can help minimize things and manage us out of the situation.

4. It's time to build another grove! If the problems are so deep that it appears returns will permanently be diminishing then it's time to get aggressive with the cash pile and perhaps overpay a little for another grove. I'm kind of surprised he keeps saying he won't buy Occidental. If Oxy's future is so secure with all that's in the Permian Basin and he's so bullish on it then why taking purchasing it outright out of the equation?

Again, the problems at both units are definitely a very real but I think we are looking at worse case scenarios all around because Warren conditioned us to in the AR. Wiley old bugger!!