He's been buying up the railroad
In many cities where it wasn't the day after Election Day -- and even in some cities where it was -- the big news was the move by Warren Buffett to have his Berkshire Hathaway investment company buy whatever pieces of the Burlington Northern Santa Fe Railroad it didn't already own. [BNSF news release & webcast]
In The Buffalo News, is was the centerpiece of the Business Today section:
- Buffett buys railroad for $34 billion - The Associated Press/Buffalo News
The biggest name in investing is making what he calls an “all-in wager” on the U.S. economy — $34 billion to own a railroad that hauls freight ranging from corn to automobiles across the country. ...
“They do it in a cost-effective way and extraordinarily environmentally friendly way,” Buffett told CNBC on Tuesday. “I basically believe this country will prosper and you’ll have more people moving more goods 10 and 20 and 30 years from now, and the rails should benefit. It’s a bet on the country, basically.”
The fact that Mr. Buffett also owns the computer I'm banging on right now -- the building it sits in and the newspaper it feeds into -- has absolutely nothing to do with the fact that I hope this means a very bright guy is betting correctly. If he is, that means the economy might move away from unfathomable derivitives and default swaps, which he never trusted anyway, and back toward making, moving and buying real things. Things like cars. Things that people will want to advertise in, oh, I don't know, newspapers, maybe.
[More on Buffett's view of the news biz is across the blog table here.]
My optimism also has nothing to do with the fact that, when I was a kid, I lived in a town where the big thing to do was watch the Silver Streamliner passenger train, then operated by the Burlington Northern, come through town.
Other takes on the move include The Business Insider's Joe Weisenthal concluding that Buffett knows that his new best friend Barak Obama will be putting a lot more money into the nation's infrastructure, including railroads, and that the president's push toward reducing the nation's carbon output will favor trains over trucks.
News takes from Buffett's hometown paper, The Omaha World-Herald: Warren Buffett believes he can make money owning a railroad, and that bodes well not only for BNSF Railway Co., Buffett's target, but the entire industry and BNSF's chief rival, Omaha-based Union Pacific, analysts and industry experts said.
- The Fort Worth Star-Telegram: Legendary investor Warren Buffett came to Fort Worth just 13 days ago, on Oct. 22, ostensibly just for a meeting of the board of directors of his Berkshire Hathaway holding company. Forty-eight hours later, Buffett left town with fond memories of a good chicken-fried steak and an agreement to spend $26.3 billion to buy Burlington Northern Santa Fe Corp.
"I think every little boy in America grows up fantasizing about running a railroad. Now I’m going to own one," Buffett said in an interview Tuesday after the deal to buy the Fort Worth-based company was announced.
- The Kansas City Star Warren Buffett leads a simple life. But when the revered business legend buys a train set, it’s a $34 billion mega-deal.
- The Dallas Morning News Warren Buffett bought an expensive train set Tuesday, betting $26 billion for Fort Worth's Burlington Northern Santa Fe railroad on the hunch that a recovering economy will stoke the nation's appetite for coal and Chinese imports.
- The New York Times: "This is all happening because my father didn’t buy me a train set as a kid."
Anyone noticing a pattern here?
-- George Pyle/The Buffalo News
