Holy clickbait hit piece. Pro Publica took 2 decades of leaked records and found 1 trade trade where he sold before Berkshire sold and 1 trade where he bought while Berkshire bought. This all totaled in less than $100 million, 0.1% of Buffet's current net worth.
This is just p-hacking. They have such a glut of data and so little context that they're going to find suspicious-looking things.
* The article also mentions he sold some Wells Fargo shares from his personal account after its price rose 20%. According to a Fortune article from April, 2009, Buffett's TV comments on Wells Fargo made the price raise. The article apparently wants you to draw the conclusion that Buffett pumped the stock on TV so he could sell at a profit.
Man has preached against insider trading for decades, he himself condemned such activities, he himself encoded the rules.
He still broke those.
As someone who's always thought of Buffet as sort of a role model, it is a sad to see this happen. I have seen him speak and preach about those just too much just to find out it was simply not true.
He even made a specific example about not owning Wells Fargo in his personal portfolio and..he did.
I can't understand people excusing him, a lie is a lie, no matter how harmless and casts a huge shadow on his reputation, integrity and trustability.
I don't even understand the point of having a personal portfolio. It's not illegal or anything. But it's just..odd.
It's really baffling how many people jump on the ship of underplaying this, especially with someone like Buffet who's built his personal brand on condemning such a lack of transparency.
Maybe he had Wells in his personal portfolio for awhile, realized it, and then sold. If you look at the chart, it wasn't a particularly good time to sell.
The trades that Congress continually make are much more suspect. I don't understand why there's not more focus on those trades where there is blatant corruption.
I can't believe I'm even replying a troll account nor your rampage into defending Buffet or even yourself lying, the wells Fargo thing is like half the article.
He said he preferred Wells Fargo, but Berkshire was “buying Wells Fargo stock and that takes me out of the business of buying Wells Fargo,” so he bought shares of Chase for his personal account because it was his second choice.
“That’s one of the problems I have,” he said. “I can’t be buying what Berkshire is buying and I’ve got some money around and therefore I go into my second choices or into tiny little companies.”
No one's calling him a criminal, rather pointing he's an hypocrite.
By the way CNBC and Probublica both asked Buffet for comments and he declined.
It took a lot of courage by ProPublica to put out this piece knowing they would deal with the wrath of the Buffet faithful. No one had any issues when they were reporting on Clarence Thomas.
Unfortunately there is quite the cult-like mentality around Buffet. He is worshipped by many who fail to see that while gifted he is no different than any other human.
By this I mean he is capable of trading on personal benefit, fear, avarice and ignorance just like any other human being.
> it raises the question of why Buffett made one choice for his own portfolio and the opposite choice for Berkshire’s investors
You can't actually determine that from tax returns. For all you can tell from returns the transaction could have been intended to trigger taxes or to change allocations between account types (e.g. to move a position from a taxable account to an IRA), and was matched by another transaction that preserved the position.
Similarly, you can't tell if the timing was controlled by the tax payer or if it was some long-set-in-advance programmatic trade (it's also pretty hard to tell if it was triggered by a derivatives contract). AFAICT the article also makes no effort to establish he was personally aware of BRK's plans in those securities, which would be a necessary condition for a potential conflict.
Perhaps there is substance here but if he was engaging in crooked trading you would expect to see a systematic pattern of it, not two isolated trades that didn't even appear to produce an outsized benefit for him.
Tax information is as easily misleading as it is revealing.
It's astounding to me how there is utter silence about the fact that propublica (and god knows who else) got their hands on the detailed tax records of every person in America... likely the biggest data breach in history, certainly the biggest government breach of private information about the public-- and over material that has some of the strongest legal protection: unlike a lot of our other private data it's a felony to print/republish tax return information without authorization.
But I guess possessing that kind of info confers a degree of immunity from criticism, after all-- anyone of impact who asks too many is at risk of having their own records scrutinized.
As far as I know, ProPublica has never said it received tax information on every American, just the wealthiest. So I'm not sure it's the largest breach in history. Still, it does seem like the leak is a story in itself.
For what it's worth, here's their ethical justification:
> Many will ask about the ethics of publishing such private data. We are doing so — quite selectively and carefully — because we believe it serves the public interest in fundamental ways, allowing readers to see patterns that were until now hidden. [0]
And their legal justification:
> A federal law ostensibly makes it a criminal offense to disclose tax return information. But we do not believe that law would be constitutional if applied to bar or sanction publication of a story in the public interest when the news organization did not itself remove the information from the control of the IRS or solicit anyone else to do so — as we did not. [0]
They also note that tax records are public in certain jurisdictions, including in Sweden, Norway, and the state of Wisconsin.
They've confirmed it essentially by listing about the hundred or so parties that used to validate the information-- including their own staff, politicians, etc. It's certainly not just material on the "wealthiest" Americans, though that's one of the ways they've limited their reporting in order to argue a public interest angle.
I think the ethics of their coverage is complicated at best, but it's also orthogonal to the fact that the leaker committed a serious felony and that the government has failed to protect information which it is obligated to protect. This is a serious breach of our trust and security and deserves inquiry regardless of where you stand on ProPublica's subsequent usage. (particularly given the earlier rumors that the leaks were by someone in the Biden administration as an effort to promote the administrations proposed tax reforms, which it seemed suspiciously well timed to do)
But as far as their usage goes-- many of the articles seem like this one: grinding thorough huge amounts of data to pick out a slightly suspicious piece of straw in a huge haystack and highly speculative-- by no means a smoking gun due to the limitation of the tax records and the general absence of other forms of investigation. Is this specific article a matter of general public interest enough to justify the felony invasion of tax records? I don't agree that it is. Even if their speculative allegations were true here, it sounds de minimis and not of particular public concern.
> They also note that tax records are public in certain jurisdictions, including in Sweden, Norway,
Yes, and not in the US. Where they are public there are differences in what gets reported and other rules governing the use of the information that mitigate harm, simply knowing that it will be public offsets part of it.
> listing about the hundred or so parties that used to validate the information-- including their own staff, politicians, etc.
This sounds vaguely familiar, but I wasn't able to find it again. Do you happen to have a source for that?
Also, even if some less wealthy people were included, that doesn't necessarily mean most Americans are. Whoever leaked it may have included those people knowing ProPublica could vet it. (Also, some politicians are among the very wealthiest Americans.) It also contradicts what they've said elsewhere:
>Goodwin: Can you speak a little bit more about what’s in the data? People were curious about how many people were listed and if there’s any discernible criteria for what was included.
>Eisinger: You can thumbnail it as the 1% of the 1%. We don’t have waitresses and plumbers, and even doctors and lawyers, we have a thin slice of the wealthiest Americans. [0]
This story is less clear-cut than some others they've published, perhaps. But I don't agree that $80 million in trades that may violate ethics policies the person himself established are de minimis.
I agree that the whatever security issues may have lead to this information being leaked are also issues, for what it's worth.
> whatever security issues may have lead to this information being leaked
I'm interested in ending the _collection_ of this information. Since we went off the gold standard, and the uniparty spends unlimited amounts, let's stop the privacy invasion of the personal income tax.
A few trades out of decades of trading records is likely just a mistake. If Buffett wanted to front Berkshire trades, he would’ve done that many times and no one would have stopped him.
It took a lot of courage by ProPublica to put out this piece knowing they would deal with the wrath of the Buffet faithful.
No one had any issues when they were reporting on Clarence Thomas.
Considering the power that Buffet wields in the marketplace, he and his followers should welcome inspection, reporting and oversight in the same way that chief justices should.
It doesn’t take courage to put out dumb clickbait. I’m not “Buffett faithful” or whatever…just a layman who can recognize and call out dumb clickbait when it relates to the financial markets.
It's not their only bad financial piece. The one claiming landlords are all secretly hoarding apartments because algorithms are telling them it'll raise the rent is basically nonsense.
(This is a cartel, which besides being illegal is impossible because all the members are motivated to detect and most of them cannot act on the advice. The sole actual housing cartel in the US is NIMBY zoning laws; you need the force of law to prevent defection.)
Maybe I don’t understand your comment but algorithmic price fixing is very much a thing across many many industries where participants collude on pricing.
If the outcome is the same, it doesn’t matter how you got there whether it was a written note or algorithm created by insiders.
The claim is landlords are using algorithms to keep units vacant to increase prices. They can't do this because most of them only own 1-2 units.
But you're still describing a cartel, which can only happen if the number of producers is fundamentally limited, because any new producer doesn't care if the others have to lower prices.
I used to respect Propublica. It would regularly have interesting reporting not found elsewhere. It’s deteriorated to the level of Jacobin, featuring inconsequential puff hit pieces like this, while paying scant attention to larger issues of systemic inequality like zoning.
In this time of tremendous wealth inequality, I welcome their in-depth reporting that holds the powerful accountable regardless of what side of the political sphere they sit.
ProPublica is demonstrating that they will report on both liberals and conservatives.
…on Republican chief justices and “progressive” billionaires.
We need more journalism of this type not less of it.
Income inequality in the US has not increased since 2014 via Piketty's methodology (the one most people use), but also hasn't increased since the 60s by other ones. It's also gotten better since 2019 because low end wages have dramatically improved.
Wealth inequality is largely (not entirely) illusionary since it's mostly based on the marginal price of stocks. Bezos has billions in Amazon shares, so theoretically he could sell them for billions in cash, but the only reason they're worth billions is investors know he will never do that.
(However, since he lost half his fortune by cheating on his wife, we can see how many billions he values Latina news anchors at.)
The amount of money buffet made from that trade is literally like $100 to you and me. It's laughable, what journalism is today, literally zero integrity. Buffet is one of the good guys...
This is why no one cares about journalists anymore too many purposely misleading pieces trying to force some kind of narrative.
It doesn't even have to be a mistake. Imagine I have a large investment firm, I make investment decisions in this firm. I own Johnson and Johnson shares both at my firm and personally, I decide J&J is no longer a good investment. I decide to sell both but personal obviously first because when the firm starts offloading, the price will fall at Berkshire trade sizes. I do not have a conflict on interest because they are basically the same interest and investment to me.
But as a boss, what I do care about is my employees clouding their judgement because their personal stakes and that of my company are in conflict. Warren doesn't have that conflict because of how much of Berkshire he owns
Honestly it may be even worse if he doesn't follow his company, investors in berkshire would wonder, why the hell are they selling but Warren still holding, are his employees worse than him?
Is Buffett likely to respond to this piece? I hope it can be sufficiently explained and contextualized but I would love if Buffett took on Congress and stopped the bullshit that is the very prevalent insider trading that occurs with members constantly. One of the few actual grievances I think is legitimate with respect to the Pelosis. Sketchy as fuck
This is just p-hacking. They have such a glut of data and so little context that they're going to find suspicious-looking things.
* The article also mentions he sold some Wells Fargo shares from his personal account after its price rose 20%. According to a Fortune article from April, 2009, Buffett's TV comments on Wells Fargo made the price raise. The article apparently wants you to draw the conclusion that Buffett pumped the stock on TV so he could sell at a profit.