Description:  Warren Buffett, the billionaire chief executive officer of Berkshire Hathaway Inc., said he rates businesses on their ability to raise prices and sometimes doesn’t even consider the people in charge.

Source: Bloomberg.com

Date: 02/18/2011

Link: http://www.bloomberg.com/news/2011-02-18/buffett-says-pricing-power-more-important-than-good-management.html

Questions for discussion:  

• What does Warren Buffet have to say about the importance of management and the ability of the company to raise prices?
• Do you agree with this view?
• What does this opinion suggest about the performance-based compensation packages paid to managers?
• What does this thinking suggest about the way financial managers are compensated, in general?