Warren Buffett stole more than a Railroad Company

in #money8 years ago (edited)

I want to let you in on a little secret

Secret

"He stole it.", says Jeff Matthews, author of Secrets in Plain Sight, a book on Berkshire Hathaway. Speaking of the BNSF purchase by Warren Buffett, Jeff Matthews explains how lucrative the purchase of BNSF was.

Many would say that Buffett was lucky with the timing of the 26.5 Billion purcahse of BNSF, made in 2009 during a shaky economy. At the time there wasn't much public knowledge of the domestic oil boom that unraveled over the following years. It was this oil boom that provided over 15 Billion in dividends within a 5 year time span and fully paying off the entire investment.

Now, whether or not Buffett was aware of such an imminent shift in the oil markets that went on to create this situation is immaterial to this article. What it does do is quell the minds of any speculators questioning an uncharacteristic purchase.

I want to present you with an entirely different motive to the BNSF purchase. I won't refute the fact that Buffett likely had an inclination that BNSF could prove to be a profitable investment. I just want to present you with the icing on the cake, or even the secret no one would ever share.

BNSF Oil Train

This isn't anything I've heard discussed or mentioned before, but rather something I've arrived at through speculation.

I want you to ask yourself, what's the most valuable information you can have as an investor?

If you answered insider knowledge, you'd most likely be correct. But, fortunately or unfortunately, insider knowledge, if used for trading purposes, is illegal. Insider trading provides an investor/trader with knowledge that isn't publicly available, giving them an advantage over others that's just not fair.

But, what if there was such a thing as legal insider knowledge! Well, there isn't, not technically. However, Warren Buffett now has the next best thing, BNSF. So, how does BNSF provide insider knowledge you may be asking...

Well, guess who knows where raw material orders are being sent and finished products are being delivered well before quarterly earnings reports... Guess who can correlate that over previous periods and fairly accurately predict growth or slow downs with certain companies...

BNSF Tractor Freight

That's right, that's about as close as it gets to insider knowledge. Buffett now has his finger on the pulse of the American economy. Tie that to institutional investment experience and you now have the secret weapon - legal insider trading.

The good news is, you could always buy some Berkshire Hathaway stock yourself and let him do the dirty work!

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Great idea, Jacob! I hadn't thought of it before, but I think you're spot on. Owning a major supply-chain participant such as one of, if not, the largest railroads in the US would be an incredible advantage for him to monitor the near future of major industries nationwide.

Great post jacobt. I'd hazard a guess that your speculation is eerily accurate here. Thanks for sharing.

Yeah, six of one and half a dozen of the other. A truthful and accurate account of how the big players roll in this country. An insightful post, and good for you for putting it up. It's not all a bed of roses up at the top. I smell some rats too.

Appreciatively history was recorded and the truth is known.

If I could afford Berhshire Hathaway stock, I wouldn't need Berkshire Hathaway stock :)

He eats cheeseburgers and drinks Coke and lives in the same house he bought in the 50's. And he's the biggest shark out there.

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