The Essays of Warren Buffett: Lessons for Corporate America / Edition 2


In the third edition of this international best seller, Lawrence Cunningham brings you the latest wisdom from Warren Buffett's annual letters to Berkshire Hathaway shareholders. New material addresses:

- the financial crisis and its continuing implications for investors, managers and society;

- the housing bubble at the bottom of that crisis;

- the debt and derivatives excesses that fueled the crisis and how to deal with them;

- controlling risk and protecting reputation in corporate governance;

- Berkshire's acquisition and operation of Burlington Northern Santa Fe;

- the role of oversight in heavily regulated industries;

- investment possibilities today; and

- weaknesses of popular option valuation models.

Some other material has been rearranged to deepen the themes and lessons that the collection has always produced:

- Buffett's “owner-related business principles” are in the prologue as a separate subject and

- valuation and accounting topics are spread over four instead of two sections and reordered to sharpen their payoff.

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Product Details

  • BN ID: 2580966446121
  • Manufacturer: Carolina Academic Press
  • Publication date: 4/1/2008
  • Edition description: New Edition
  • Edition number: 2
  • Product dimensions: 6.60 (w) x 10.00 (h) x 0.70 (d)
  • These items ship to U.S. address only. No APO/FPO.

Meet the Author

Warren Buffett is the Chief Executive Officer of Berkshire Hathaway, a $70+ billion holding company engaged in a variety of businesses. Lawrence Cunningham is a Henry St. George Tucker III Research Professor of Law at the George Washington University Law School.
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Table of Contents

Introduction 1

Prologue 27

I Corporate Governance 29

A Owner-Related Business Principles 29

B Full and Fair Disclosure 37

C Boards and Managers 40

D The Anxieties of Business Change 52

E An Owner-Based Approach to Corporate Charity 58

F A Principled Approach to Executive Pay 65

G Audit Committees 74

II Corporate Finance and Investing 77

A Mr. Market 77

B Arbitrage 81

C Debunking Standard Dogma 87

D "Value" Investing: A Redundancy 98

E Intelligent Investing 105

F Cigar Butts and the Institutional Imperative 111

G Debt 115

III Alternatives to Common Stock 117

A Junk Bonds 117

B Zero-Coupon Bonds 124

C Preferred Stock 130

D Derivatives 140

E Foreign Currencies and Equities 147

F Unconventional Commitments 154

IV Common Stock 157

A The Bane of Trading: Transaction Costs 157

B Attracting the Right Sort of Investor 162

C Dividend Policy and Share Repurchases 164

D Stock Splits and Trading Activity 171

E Shareholder Strategies 174

F Berkshire's Recapitalization 175

V Mergers and Acquisitions 181

A Bad Motives and High Prices 181

B Sensible Share Repurchases Versus Greenmail 192

C Leveraged Buyouts 192

D Sound Acquisition Policies 195

E On Selling One's Business 198

F Advantages in Acquisitions 202

VI Accounting and Valuation 205

A A Satire on Accounting Shenanigans 205

B Look-Through Earnings 211

C Economic Goodwill Versus Accounting Goodwill 216

D Owner Earnings and the Cash Flow Fallacy 225

E Accounting for Mergers 232

F Intrinsic Value, Book Value, and Market Price 234

G Some Insurance History and Accounting 239

H Aesop and Inefficient Bush Theory 243

VII Accounting Policy and Tax Matters247

A Standard Setting 248

B Stock Options 249

C "Restructuring" Charges 254

D Segment Data and Consolidation 257

E Deferred Taxes 258

F Retiree Benefits 261

G Distribution of the Corporate Tax Burden 262

H Taxation and Investment Philosophy 267

Epilogue 273

Afterword and Acknowledgments 283

Index 285

Concept Glossary 289

Disposition Table 291

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Customer Reviews

Average Rating 4.5
( 7 )
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  • Anonymous

    Posted February 17, 2005

    food for thought and worth digesting

    I believe all managers in financial institutions need to read the thoughts presented in Financial due dilligence and lessons for corporate cuts across the globe.good and timely stuff for all.

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  • Anonymous

    Posted May 16, 2001

    Buffett Says First Rate

    At the 2000 annual meeting of Berkshire Hathaway, Warren Buffett answered a shareholder's question about good books to read by saying this one is the best book on investment philosophy and that Cunningham did a great job. Buffett had said a similar thing a couple of years ago at the annual meeting right after the book first came out in the original edition. I think he is still right--even more right with this new edition.

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    Posted January 18, 2011

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