CENTS & NONSENSE: On tonight's episode of "Sage of Omaha: the next generation" Grandpa interviews his potential successors from Europe's greatest economic success story - the Emerald Isle.
Stay tuned to see if they have the modesty, frugality, economic knowledge and common sense to become . . . the world's most successful investor.
Our host, eccentric Grandpa Buffett, a publicity-shy, penny-pinching billionaire who built a $120 billion (€89 billion) portfolio for his holding company Berkshire Hathaway, loves nothing better than a burger and cherry Coke. Gramps, now 78, started his career dealing shares at age 11. Three years later, after saving up from two paper rounds, he spent $1,200 to buy farm land that he rented out to tenant farmers.
Today, his personal wealth is estimated at $52 billion. Despite his riches, he still lives in the home he purchased in 1958.
"I need somebody who shows independent thinking, emotional stability and a keen understanding of both human and institutional behaviour." Who in Ireland can fill his sensible leather shoes?
Cue folksy intro theme music. Gramps comes on stage, strumming his beloved ukelele. Behind him follows straight-man sidekick and Berkshire Hathaway vice-chairman Charlie Munger, also know as Chuckie.
After finishing a peanut butter and chocolate snack, our host, 83-year-old Chuckie, steps up to the microphone and says: "Warren is the world's third richest man. Four Irish candidates still think they have the experience, determination and patience to take over at the helm and profitably invest a multibillion dollar portfolio.
"Let's meet the finalists: chairman of budget airline Ryanair and cowboy wannabe, Michael O'Leary; Taoiseach and anorak convert, Bertie Ahern; novelist and world-famous eavesdropper, Maeve Binchy; and, of course, former UN high commissioner for human rights and mná na hÉireann, Mary Robinson.
"Since Gramps invests in companies where he finds value for money, we'll start with the best buys around. Which shop offers the best value on new, basic, white cotton T-shirts. Is it Oxfam, Brown Thomas or Penney's?"
Michael: "Brown Thomas's designer menswear department. I have about 20 of those shirts in the customised California closet at my big country pile."
"No, I'm afraid you're disqualified. The answer is Penney's."
Michael: "I may be out but you'll see a full page ad on this injustice tomorrow!"
Last year, Berkshire Hathaway returned an impressive 18 per cent. One A share in the company costs around $109,000. A recent Los Angeles Times investigation found that 87 per cent of Berkshire's publicly disclosed stockholdings were invested in companies that profited from activities in conditions of lax environmental practices and human rights abuses.
"Only three contestants remain for the investment strategy round. If you had a spare billion dollars, would you invest it in utility companies, derivatives or an ethical fund?
Mary: "An ethical fund that protects native people and their lands from exploitation by big business."
Warren turns red and speaks for the first time during the competition. "Please! It's profit before people, Mary. You'd invest in a utility company because you want to make money, not because you want to save a Native American tribe that worships rivers. Get outta here."
Two contestants remain. When they signed up for the contest, they agreed to disclose their personal finances. This allows the Sage of Omaha to investigate if they put their money where there mouth is.
"Bertie, I see you did not have a bank account when you were minister for finance. Besides your house, how did you save or invest during that time?
Bertie: "It is nobody's business but my own. Why are you harassing me? Don't look at me. Just look at the economy. I did that!"
"If you want to stay in the running you'll have to reconsider that position.
He turns to the last contestant. "Maeve, do you consider yourself a good investor?
Maeve: "No, not really, Gordon entered me in this contest."
"Okay, but you have earned a substantial tax-free income. How have you invested it?
"Um, we bought a house in Dalkey a few decades ago and now we have a place in South Africa."
"You must spend a fortune going back and forth?"
"No, I set a TV series in Capetown so I think RTÉ gave me a few flights, royalties and a consultancy salary."
Chuckie and Gramps confer. "Bertie has disqualified himself. Maeve, you are folksy, modest, frugal, a good investor and I'm sure you'll have no problem overhearing market gossip from CEOs. You win!
Margaret E. Ward is a journalist specialising in personal finance and consumer issues. She is also a director of Clear Ink, the Clear English Specialists. Please write to her at: cents@clearink.ie.
