The Trial Balance is CFO’s weekly preview of stories, stats, and events to help you prepare.
Part 1: Buffett and Munger — successful partnership lessons
Over the weekend, Ronald Olson, a director on the board of Berkshire Hathaway and a partner at Munger, Tolles and Olson LLP, which the late Charlie Munger founded, offered his thoughts and observations on what made Warren Buffett and Munger’s partnership, which lasted nearly 60 years, so effective. Olson has had the unique perspective of working with both billionaires and understanding why their partnership has brought great success until the end when Munger passed away in November last year at age 99.
When asked about how Buffett and Munger approached risk, Olson said, “Well, carefully … They have a different set of priorities, a different set of readings, a different set of life experiences. Warren is, as you know, very gregarious. Out front. He’s the one who cuts the deals.
Charlie’s still sitting in his chair, as his kids say, he looks like a book with two legs, reading every day. Now the two of them had this unique partnership … There’s complete trust.”
When asked how that mutual trust can be established, Olson said:
“I would say a couple of things. I mentioned the common backgrounds. They both had IQs that are off the chart… They both had memories that exceeded mine. And they respected that they both were interested in building a company that would have permanence and committed themselves to it, particularly when Warren went along with Charlie finally, and moved from buying what were referred to as cigarette companies with a few puffs left at a cheap price.
Charlie convinced him that it’s far better for permanence to buy wonderful companies at a fair price than fair companies at a wonderful price. And they were dedicated to that.
As Warren said in his tribute to Charlie in the annual letter, he let him take the boughs. And he also noted in the [annual letter to shareholders], that after he had blundered and made a mistake on something, Charlie never reminded him of it. Charlie was to Warren, very much like the combination of a brother and a father.”
Part 2: City of Quincy CFO Q&A and a mountain morning routine
This week, reporter Adam Zaki will publish a two-part series with Eric Mason, CFO of Quincy, Massachusetts. The 31-year-old finance chief for the city of over 100,000 people — which happens to be his hometown — discusses his relationship with the city’s Mayor, what being a modern CFO means to him, his views on technology and cybersecurity and more.
The CFO of Generation West Virginia, Candice Holcomb, will also be highlighted in this week’s edition of the 6 a.m. CFO. Holcomb, a resident of Fayetteville, West Virginia, candidly shares her morning routine in the Allegheny Mountains as a non-profit CFO.
Part 3: The week ahead
Here’s a list of important market events slated for the week ahead.
Monday, June 17
- Empire State manufacturing survey
Tuesday, June 18
- Retail sales, May
- Retail minus autos, May
- Industrial production, May
Wednesday, June 19 — Juneteenth Day holiday
- Home builder confidence index, June
Thursday, June 20
- Initial jobless claims, week ending June 15
- Housing starts, May
- Building permits, May
- Philadelphia Fed manufacturing survey
Friday, June 21
- S&P Global US manufacturing PMI, June
- S&P flash U.S. manufacturing PMI, June
- Existing home sales, May
- U.S. leading economic indicators, May
