Last year the business press widely reported that the famously technology-averse Warren Buffett had purchased $1 billion of Apple stock. When Berkshire Hathaway publically revealed several months later that the stake had increased to $1.5 billion, the media again went into a frenzy. Credible outlets such as CNN, Forbes, and Time devoted articles to the investment, which usually included extensive praise for Apple and reasons to follow the celebrated Oracle of Omaha into the stock.
In fact, it is almost certain that Buffett had nothing to do with the decision to invest in Apple.
Almost nobody mentioned the obvious: that the purchase was initiated by either Todd Combs or Ted Weschler, who assist Buffett in making investments and have near-total autonomy over their decisions. To its credit, The Wall Street Journal published an honest piece about the move, confirming that Buffett had nothing to do with the decision to buy Apple. But Buffett’s statement was scarcely noted in the media, which has continued to credit him for the investment.
As any Buffett follower can attest, such an investment would be completely out of character for a man who has repeatedly stated that he does not understand Apple’s business and would not invest in the company. So why do the media continue to misrepresent his position?
Perhaps Buffett has become so synonymous with Berkshire Hathaway that any action taken by the company is automatically attributed to him personally. But my own feeling is that most financial media would rather generate an eye-catching headline. Buffett’s famous aversion to technology stocks and the attendant baseless speculation around his about-face makes for a compelling story. An article about a comparatively obscure Berkshire manager purchasing Apple stock does not.
Whatever the reason, the media do their readers a great disservice by implying that Warren Buffett had anything to do with his company’s investment in Apple.
Disclosure: I am long BRK-B