Warren Buffet Too Commit Mistakes: Answerable to Investors for Mistakes

1. Warren Buffet has to answer his more than 30000 investors in view of drastic reduction seen in Berkshire Hathaway Inc. (BRK.A). He has also commited mistakes for which Warren Buffet is answerable to the investors who have reposed so much faith in him. Questions likely to be fired at him because of his mistakes in investment are as stated beloW:
(a) Though Warren Buffetji calls derivatives as “financial weapons of mass destruction” but still wrote $37 billion in puts on equity indexes.
(b) He has cheated as a financial advisor because as a column advisor for Washington Post; he has advised public in Oct to “Buy American” and still sold big chunks of positions in Johnson & Johnson (JNJ) and Proctor Gamble (PG.
(c) Why succession plan is not being made public because of which it has suffered a reduction in its rating from triple-A credit rating and same has been executed by Fitch.
(d) Why did he have large exposure to financial sector despite the woes prevalent in this sector?
(e) Why did he purchase of oil firm ConocoPhillips (COP) at the height of the oil bubble?
(f) He has been optimist on US economy though same is surviving on foreign lenders, very high levels of indebtedness in consumer/government sectors, and printing money by the central bank.
(g) Why executed investment in water treatment firm Nalco (NLC), which has a negative return on equity, total debt to equity greater than 800% and book value consisting mostly of intangibles and goodwill.

2. Thus we see that even Warren Buffet too commit mistakes and is thus answerable to his investors who are likely to come from all over the world despite swine flu fear. So he can also not escape the wrath of general public and can we derive some lessons from the same.

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