04 May 2009

Thanks Mr. Buffett... NOT!

Ever feel like someone is jumping up and down on your grave? Warren Buffett says the one industry he would not invest in is newspapers. He seems to think they're a sinking ship.
35,000 people showed up in Nebraska for Berkshire Hathaway's Stockholder Meeting, or as the locals refer to it "Buffett's Big Deal." The locals aren't invited. Most of them don't own so much as one share of Berkshire Hathaway stock, which can run sky-high per share, regardless of whether you are buying "A" or "B."

And what does the Oracle of Omaha tell them? He tells them he wouldn't buy newspaper stocks at any price, based on the outlook for media stocks.

It feels a little like he's jumping up and down on my grave. Yes, it does. Except that to be perfectly accurate, what Warren Buffett said was that he wouldn't buy MORE newspaper stock. He already owns a sizable stake in the Washington Post (saved only, he says, by its position in cable television. I wonder if he's noticed the shift from television to internet? And BH owns the Buffalo News outright. He says they are "working on the business model with the unions" in that company. Good luck.

The NYTimes today notified the federal government that since they have failed to get neccessary concessions from unions at the Boston Globe, they will stop the presses at that venerated old voice in 60 days.

Some say it's a negotiating tactic. Perhaps they've never heard of the Rocky Mountain News, which closed its doors in February after nearly 150 years.

Maybe those same unions aren't acquainted with anyone who worked at the Seattle Post-Intelligencer, which went all digital only a few weeks ago.

It's a sad time for newspapers, isn't it? But maybe it's also sad for Berkshire Hathaway's stockholders, if their "oracle" couldn't see this one coming from a mile off.

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