Why Warren Buffett is impressed with these kids

Miroslav Bergen thought he would be "terrified" at meeting Warren Buffett, but he was wrong.

Miro, 14, was one of the winners of "Grow Your Own Business Challenge," a nationwide contest related to the animated "Secret Millionaires Club," which teaches children about finance and where Buffett voices his own character.

"He's a nice, down-to-earth person," said Miro, who lives in Short Hills, New Jersey. "I entered this competition not really as an entrepreneur because I wasn't experienced in business. But I had an idea. Now business people are giving me advice."

The contest, in its fourth year, attracted entries from more than 4,000 boys and girls ages 7 to 14. The top entrants flew to Omaha, Nebraska to be judged and show Buffett their ideas.

"You're looking at the future and it's a pretty good looking future," Buffett, chairman of Berkshire Hathaway Inc and the world's third-richest person according to Forbes magazine, said in an interview.

Bergen won for "Beyond the Books," a website that lets people work together to create online courses and study guides, in a "Wikipedia of education." People would pay to advertise, or pay a monthly fee to have ads removed.

Bryn Hansen, 11, and Emily Harkins, 12, of Omaha, won the team contest for "Keep Track Sticky Back," sealable plastic pouches costing $7.99 to $66.99 that have sticky backs so they can be attached to nearly anything.

"This competition has taught us a lot, not just business skills but also cost-evaluation, problem-solving skills, and business etiquette, and how to interact with other people," said Emily, who was on "cloud nine" after winning.

Winners each got $5,000, and said they plan to invest it toward their businesses. Bryn and Emily may also seek a patent.

Buffett gave each finalist 10 Class B shares of Berkshire -if they vote to reelect him next year as chairman.

Many entries were pure online concepts. That is a change from when Buffett would buy Coca-Cola six-packs at his grandfather's grocery store for 25 cents, and then sell bottles for a nickel each.

"They've had the benefit of the Internet," Buffett said, "and that's reflective of the products they've come up with. They are leagues ahead of where I was at the same age."

Still, Buffett remains a role model. "He has a ton of inspirational quotes to believe in yourself, to save money, and maybe someday grow up to be someone like him," Bryn said.

The Fairholme Foundation sponsors the contest. By Kids for Kids Co oversees it. Genius Brands International Inc created "Secret Millionaires Club."

source: www.abs-cbnnews.com

Why Warren Buffett is taking his checkbook abroad

NEW YORK - Warren Buffett, in his annual letter to Berkshire Hathaway Inc shareholders last year, called America "the mother lode of opportunity."

This year, his 50th at Berkshire's helm, the world's third-richest person could write something quite different.

When Buffett releases this year's letter on Saturday, he may point to opportunities outside of the United States, after he recently decided to buy a German motorcycle accessories retailer and said he may shop more in that country.

That would mark a significant turn for Berkshire, a conglomerate with more than 80 businesses, giant stock investments and a $360 billion market value.

Buffett did not return a request for comment.

In his letter, eagerly awaited on Wall Street for Buffett's candid thoughts on investing, business and life, the 84-year-old Buffett may detail his vision for Berkshire in the decades to come, including after he is gone.

His comparatively taciturn second-in-command, 91-year-old Charlie Munger, is also expected to express his thoughts.

"Warren Buffett recognizes that global investing is going to be an important part of the future," said Michael Yoshikami, chief executive of Destination Wealth Management in Walnut Creek, California and a longtime Berkshire shareholder.

Buffett's strategy of buying solid companies at low prices has gotten more difficult in the United States. In the first quarter of 2009, when the S&P 500 index was barely one-third of what it is now, stocks on average cost 12.9 times projected full-year earnings.

At the end of 2014, that multiple had reached 17.4, above the long-term average of 14.8 times earnings, meaning it costs more to get the same financial pop.

By contrast, the rest of the world's growth has been sluggish. Germany is expected to grow just 1.3 percent this year, while the U.S. economy may expand 3.6 percent, according to the International Monetary Fund.

Though Buffett said this week the falling euro was not his primary driver for buying in Europe, it was a factor. The currency has slid about 20 percent against the U.S. dollar since May.

DOLLARS FOR DOUGHNUTS

In the last year, Berkshire has announced several purchases worth or estimated at a couple of billion dollars each.

These have included Procter & Gamble Co's Duracell battery unit, the Van Tuyl auto retailer, and SNC-Lavalin Group Inc's AltaLink energy transmission unit in Canada.

Buffett also kicked in $3 billion toward Burger King's purchase of Canadian doughnut chain Tim Hortons, which created Restaurant Brands International Inc.

Burger King is run by Brazil's 3G Capital, which shares ownership with Berkshire of ketchup maker HJ Heinz Co.

Berkshire ended September with $62 billion in cash, well above the $20 billion cash cushion Buffett likes. That leaves more than $40 billion to go shopping.

That means Buffett needs big purchases, which he calls "elephants," to soak up significant amounts of money. He has said he would team up again with a partner such as 3G Capital.

"There may be opportunities overseas that he would certainly consider," said Cathy Seifert, an analyst with S&P Capital IQ.

But even if Berkshire spreads its wings geographically, Seifert said, it will not turn its back on a good U.S. purchase.

"I definitely would not rule out the U.S.," she said.

source: www.abs-cbnnews.com