Warren Buffet’s Rising Celebrity Status: What Are The Consequences?

Don’t get me wrong I am a huge fan of Warren Buffett and both his personal and Berkshire Hathaway investing track records speak for themselves as one of the most solid and consistent in recent investing history.

I can’t help but wonder though if Buffett’s rising celebrity status doesn’t have a negative effect for true long term Berkshire Hathaway (BRK-A) (BRK-B) investors.  Hardly a day goes by without some sighting, comment, or mention of Buffett in the news.

Over the past year I have seen:

• Numerous TV interviews with Buffett.
• A Warren Buffett cartoon featuring his voice work.
• The memorable op-ed piece to the New York Times.
• A book on Buffett’s life and works.
• Numerous public appearances.

There are invariably some consequences to this:

• Time -  Warren has played a very active role at Berkshire, by taking time out for these activities it invariably decreases the time he could be spending making more money for stock holders.  Not just that though Buffett plays a role in mentoring tomorrow’s leaders at Berkshire, time also that has been lost.
• Attraction - There are far too many investors in the world who jump from one hot investment to another. Often times the media is the driver for these investors. As the volume charts on Berkshire clearly show more and more of these investors have jumped in at Berkshire over the last several years. One bad piece of press for Berkshire will lead them all to jump out making the true long term investor’s trip that much more bumpy.
• Face - As Marlboro with the Marlboro man or Dell with the “your getting a dell dude” guy can clearly attest having a face linked to your brand can be good for business and also very very bad for business. Lets face facts Warren isn’t a young man anymore one day he will pass away.  If the business is perceived to be Buffett one can only imagine what will happen to the share price.
• Pedestal - We love to build celebrities up and then tear them down. Their is immense respect for the talent that these people have be it Donald Trump or Michael Jackson. But when they make a mistake society is very quick to jump on them and knock them down and in so doing destroy their business around them.

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