Elizabeth Warren is ‘mad as hell’ — but isn’t running for president

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RANCHO PALOS VERDES, California — For a person who’s not running for U.S. president in 2016, Massachusetts Sen. Elizabeth Warren can deliver a heck of a stump speech.

In a spirited and wide-ranging chat with Re/code co-founders Walt Mossberg and Kara Swisher at the tech publication’s annual Code Conference, Warren repeatedly called for investment in the middle class, a constituency she said has been undeserved for decades. Warren added that the U.S. has stopped investing in infrastructure and education, at least in the way it did between 1930 and 1980

“I’ll tell you exactly what happened. Ronald Reagan was elected president,” she said, arguing that Reagan’s programs of trickle-down and supply-side economics have led to tax cuts in both good and bad times, as well as pulling back on investments for the future. Read more…

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Going from Knowledge to Data with Warren Buffett (the Value of Promises)

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For 50 years Warren Buffett has issued his annual letter to shareholders#. Their clarity is one of the two reasons why so many of us read them.

We expend so much energy reading and writing about data — big and small — and yet so little understanding how to use knowledge to extrapolate information that gives us actionable data these days. Buffett is a master at that process.

Take for example what he says about investing in insurance, one of the industries in which I spent some of the best years because of the type of business it is that makes is a long game:

Simply put, insurance is the sale of promises. The “customer” pays money now; the insurer promises to pay money in the future should certain unwanted events occur.

Sometimes, the promise will not be tested for decades. (Think of life insurance bought by people in their 20s.) Therefore, both the ability and willingness of the insurer to pay, even if economic chaos prevails when payment time arrives, is all-important.

This is the one type of promise that positively needs to come through when it counts. As anyone who has had to resort to using the coverage knows, it’s a long shot you don’t want to take. Choose your provider carefully.

Berkshire’s promises have no equal, a fact affirmed in recent years by certain of the world’s largest and most sophisticated P/C insurers, who wished to shed themselves of huge and exceptionally long-lived liabilities. That is, these insurers wished to “cede” these liabilities – most of them potential losses from asbestos claims – to a reinsurer. They needed the right one, though: If a reinsurer fails to pay a loss, the original insurer is still on the hook for it. Choosing a reinsurer, therefore, that down the road proves to be financially strapped or a bad actor threatens the original insurer with getting huge liabilities right back in its lap.

What would happen if we started thinking about all kinds of services and products using this lens? Balancing the present moment action with it long term consequences. For organizations we would flip the question. Which assemblage of strengths will deliver endurance and resilience to your business sustainably?

If you are looking for additional thoughts on investments, check out Tren Griffin’s a dozen things taught by Warren Buffett post#.


Conversation Agent – Valeria Maltoni

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