Oracle Chronicle

The day finally arrived for me and my Applied Portfolio Management classmates this week. We were off to Nebraska to meet with the Oracle of Omaha himself, the CEO of Berkshire Hathaway Inc., the world's greatest investor, Warren E. Buffett. This is truly is one of the most interesting personalities of our time. Here's a man worth in excess of $40 Billion dollars who's still at work well into his 70's, lives in an ordinary Midwest home, drives a Lincoln and spends his time playing bridge and enjoying his family.

On the first day of our two-day trip we toured two of Berkshire Hathaway's businesses, Borshiem's Jewelers and the Nebraska Furniture Mart. The managers who ran these firms were of one mind in their reverence of Mr. Buffett and his ethical approach to doing business. As Susan Jaques of Borsheim's told us, "It takes 37 years to build your reputation, and you can lose it in 37 seconds." She said she considers this every time she faces an important decision. It was interesting to note that Mr. Buffett is not a micromanager, he picks good businesses with great management, buys them at low prices and then takes his hands off the wheel and lets his managers do their jobs.

The next day our meeting with Mr. Buffet consisted of a 90 minute question and answer session and an informal lunch with him afterwards. He delivered his Q & A with wit and wisdom and humility. From the perspective of an academic, it is quite possible to take issue with a lot of what Mr. Buffett stands for. A certain Rotman prof even regards him as nothing more than a fluke, a 5-sigma event, literally the luckiest investor that ever lived. My feeling is that this prof is clinging to the Efficient Market Hypothesis like Ashlee Simpson to her singing career. But Mr. Buffett, in turn, doesn't especially care for academics either, having little in the way of formal education himself. The point is that he gave us a different perspective on the things we were taught here at B-School. Maybe markets aren't efficient, maybe diversification isn't always the way to go. Don't always believe everything you're told.

All in all, I can't possibly think of a better way of finishing off my Rotman MBA experience. This was truly an unforgettable once in a lifetime opportunity. Thanks once again to John Watson for picking up the tab on this round.

Here's a shot from our lunch with Mr. Buffett at Gorat's Steak House:

I can't tell you exactly what Mr. Buffett said, but what he recounted to me that day over roast beef sandwiches was more than just a stock tip. It was no less than his own personal super-secret recipe for Kwan. Rod Tidwell once defined Kwan as "Love, respect, community.... and the dollars too. The package. The Kwan."

Well, Warren Buffett, you are my ambassador of Kwan, man.

My New Job

I'm happy to report today that my job search has come to a successful conclusion. I've accepted a position as an Associate Financial Engineer with Algorithics Incorporated. Check out the link for info on the company if you are so inclined. I'm very excited about this opportunity, as it is incredibly well suited to my skillset. It will be largely finance-related, but will also require some math skills and a degree of sales proficiency. This is a very well respected company and they're doing some very exciting work. I'm not just drinking the Algorithmics Kool-Aid at this point, I'm taking it intravenously from an I.V. I'm wheeling around with me wherever I go.

In hindsight, choosing the Rotman specialization in Financial Engineering & Risk Management paid off nicely for me. Especially beneficial were Tom McCurdy's Financial Modeling & Trading Strategies course and John Hull's Financial Risk Management. There's no way I land this job without that background. Again, for those of you who might be interested (I'm quite aware that many TAML readers are not) Rotman's website describes the specialization thusly:

You will learn about derivatives markets and how instruments such as futures and options can be used for risk management. You will learn about risk management from the perspective of: a corporate treasurer interested in hedging exposure to interest rates, exchange rates and commodity prices; a fund manager who wants to change the nature of exposure to financial markets; and a financial institution that trades derivatives and is faced with an increasingly complex regulatory environment. You will also learn how to price a wide range of derivatives instruments.

For anyone in the first year at Rotman or on their way here next year who might be looking in, my advice is in addition to getting to know your classmates and the class ahead of you, get to know your profs. In my case, the interview at Algorithmics was set up through a contact of the aforementioned Professor McCurdy. Thanks Tom. It's immensely satisfying to see something you've worked towards for almost 2 years finally become a reality. As Hannibal Smith used to say, "I love it when a plan comes together".

Detroit Redux

Detroit Tigers opening day festivities went off as planned last week. Nobody in our group got seriously injured or arrested while we were downtown, and isn't that really all you can hope for when yours truly joins up with a group of Detroit's finest low-lifes for a pub crawl around the new Comerica Park to celebrate the arrival of baseball and spring weather? Now, baseball and beer are a natural match, and in fact I find it impossible to watch a game without beer because, let's face it, 90% of the time nothings happening so you need the beer to make it tolerable. I'd like to describe it in greater detail, but frankly I don't remember much after the 3rd or 4th inning.


Thanks on this trip go out to Jay for the hospitality, to Murphy for making the long drive across town to join us for Wrestlemania and late-night White Castle and to TAML's favorite baby, Thea, for her overall cuteness.

In an unrelated sidebar, I'm giving my NBA nickname-of-the-week to the New Jersey Nets' Brian Scalabrine - aka "Air Veal". That's almost funny enough to make me forget where Vince Carter plays and root for the Nets to squeek into the playoffs. Almost.