This post by Jill Schlesinger originally appeared on CBS' MoneyWatch.com.
Time will tell whether Burlington Northern Santa Fe is a money-maker, although I would be the last one to doubt Warren Buffett.
The deal is not just momentous in terms of size, but it also includes the first ever 50-for-1 stock splitof its smaller, class B shares (for the record, Class A trades at approximately $100,000 per share.) The B shares fetch over $3,300 each today, which means that after the split, the cost of one share will be around $65. I remember my brother in-law asking me about his holding in Berkshire Hathaway some years ago. My response was that owning the shares was akin to having a fairly inexpensive value fund in your portfolio.
So, the deal is the largest ever for Berkshire and Buffett said it was an "all-in wager" on economic recovery, which made me chuckle. This guy is what broadcasters like to call a bite machine! Here are some of my favorite Buffett quotes:
• "Rule No.1: Never lose money. Rule No.2: Never forget rule No.1"
• "Be fearful when others are greedy. Be greedy when others are fearful."
• "It's far better to buy a wonderful company at a fair price than a fair company at a wonderful price."
• "You only find out who is swimming naked when the tide goes out."
• "Whether we're talking about socks or stocks, I like buying quality merchandise when it is marked down."
• "Price is what you pay. Value is what you get."
• "I don't look to jump over 7-foot bars: I look around for 1-foot bars that I can step over."
• "Most people get interested in stocks when everyone else is. The time to get interested is when no one else is. You can't buy what is popular and do well."
• "Never count on making a good sale. Have the purchase price be so attractive that even a mediocre sale gives good results."
• "In the business world, the rearview mirror is always clearer than the windshield."
• "The investor of today does not profit from yesterday's growth."
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