Praise for 'remarkable' Bezos from Buffett

Buffett sang the praises of Bezos at Berkshire's annual meeting earlier this year, commenting that what the Amazon founder has done across multiple sectors is "remarkable." He called Bezos "the most remarkable business person of our age," and said he missed the boat on Amazon, using one word to explain his decision not to buy the stock: "stupidity." Lawrence Cunningham, a law professor at George Washington University and author of the book "Berkshire Beyond Buffett," said the rise of Amazon puts one in mind of a variation on Buffett's "ovarian lottery" philosophy — that the world from 1975 to 2020 or so belonged to Buffett's skills, while the world of 1995 to 2045, say, may belong to Bezos'. "That's how I took Warren's comments at the annual meeting," Cunningham said. "Jeff can see and steer how tech reshapes industries in ways Warren probably cannot. Warren long avoided tech; Jeff makes tech unavoidable." There's another Bezos acquisition that gets overlooked as being in a Buffett sweet spot: The Washington Post. Bezos bought the newspaper three years ago from the Graham family, to whom Buffett was a longtime confidante. Buffett, who owns several newspapers, was on the Post's board for a long time. In addition, Berkshire was a large shareholder, and Buffett did briefly consider buying the newspaper when it was for sale but decided against it, citing, among other reasons, not wanting to saddle a new CEO with a metro paper.

Jeff seems to relish cutthroat competition, and that itself seems to be a big driver of the moats he builds. ... Warren would have hated that world; Jeff thrives in it. Lawrence Cunningham professor of law at George Washington University

"Not only does Warren love groceries and newspapers, the economics of both have been changing in ways that no one could have imagined when Warren fell in love with them," Cunningham said. "Warren's moat was defined in part as immunity from competitive threats — powerhouses like Wal-Mart, McLane, Kraft. Jeff seems to relish cutthroat competition, and that itself seems to be a big driver of the moats he builds, certainly at Amazon, and it seems with WaPo as well as recent visions in traditional industries positioned for upending. Warren would have hated that world; Jeff thrives in it." Bezos ($85 billion) has now passed Buffett on the ranking of the world's wealthiest, second only to Bill Gates. Buffett currently ranks fourth, at $77 billion.

For Buffett's right-hand man, Berkshire vice chairman Charlie Munger, a grocery war also is a little personal. Munger is a longtime member of Costco's board of directors and has referred to Costco shares — downgraded by Wall Street firms since the Amazon deal announcement — over the years using any number of superlatives. He said in 2014 that even at a relatively high multiple, "I'd certainly rather buy Costco at 25X earnings than 90 percent of the other stocks." And here's an example that really ratchets up the hyperbole: "I believe Costco does more for civilization than the Rockefeller Foundation," Munger said at an event in 2011.

Buffett has grocery stores 'in his blood'

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