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A rather timely post there Sydney guy! Why CEOs are like...

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    A rather timely post there Sydney guy!

    Why CEOs are like teenagers
    With so much cash on corporate balance sheets in America, this warning from Buffett on the dangers of acquisition-hungry CEOs will probably prove timely in hindsight. I’ll let his analogy speak for itself…
    If Wall Street analysts or board members urge that brand of CEO to consider possible acquisitions, it’s a bit like telling your ripening teenager to be sure to have a normal sex life. Once a CEO hungers for a deal, he or she will never lack for forecasts that justify the purchase. Subordinates will be cheering, envisioning enlarged domains and the compensation levels that typically increase with corporate size. Investment bankers, smelling huge fees, will be applauding as well. (Don’t ask the barber whether you need a haircut.) If the historical performance of the target falls short of validating its acquisition, large “synergies” will be forecast. Spreadsheets never disappoint.

    https://www.livewiremarkets.com/wires/7-pieces-of-wisdom-from-the-2017-berkshire-letter
 
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