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THE LONG GAME

Warren Buffet just lost over $2 billion in two days

Investor Warren Buffet arrives for the premiere of the film "Wall Street: Money Never Sleeps" in New York September 20, 2010. REUTERS/Lucas Jackson (UNITED STATES - Tags: ENTERTAINMENT PROFILE BUSINESS) - RTXSGWV
REUTERS/Lucas Jackson
Your loss is my gain.
By Zach Wener-Fligner
Published Last updated This article is more than 2 years old.

On first glance, Warren Buffet has had a rough week.

It started on Monday, when IBM’s stock plunged after a torrid earnings report in which the company announced it was abandoning its 2015 Roadmap (an IBM plan to double earnings per share by 2015) and paying GlobalFoundries $1.5 billion to take on IBM’s chip-manufacturing division.

IBM is down nearly $19 a share so far this week, a more than 10% drop. Buffet’s Berkshire Hathaway, which owns 70.2 million of those shares, took a $1.3 billion hit.

Then came Tuesday. After Coca-Cola missed sales estimates, its stock dropped by about $2.50 a share, or 6%. Given Berkshire’s 400 million shares, that makes another $1 billion loss.

The funny thing is, Buffet could probably care less. As a world-renown value investor, he’s investing in the long game, regardless of short-term blips. In fact, Buffet has said in the past that he wanted IBM’s shares to stay low so the company could buy back shares on the cheap: “We should wish for IBM’s stock price to languish throughout the five years,” he wrote in 2011. It’s often a winning play for existing investors in the stock.

In that case, Buffet may actually be having a very fine week.

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