Buffett on Buffett

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Scores of reporters, columnists, and bloggers have been weighing in on Warren Buffett's subpoenaed testimony before the Financial Crisis Inquiry Commission, especially his suggestion that although Berkshire Hathaway acquired a significant share in Moody's, an agency that gave high marks to ultimately worthless mortgage-related securities, he really didn't believe much in ratings and did his own analysis.

Mr. Buffett's attitude toward the ratings business reminds me of a lucrative but potentially time-robbing job offer I received when I was turning from editing to writing. I suggested instead a part-time, home-based position of a kind that was becoming popular in some book publishing circles, and I pointed out that the company's business division was featuring works extolling the new flexible workplace. I'll never forget the only half-joking reply: "We just publish them. We don't read them."

My favorite commentary is by Mr. Buffett himself, a prophetic assessment of his own position in ratings, and the financial catastrophe that they helped make possible, in a famous remark years ago:

When a management with a reputation for brilliance tackles a business with a reputation for bad economics, it is usually the reputation of the business that remains intact.
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Edward Tenner is a historian of technology and culture. He was a founding advisor of Smithsonian's Lemelson Center and holds a Ph.D in European history. More

Edward Tenner is an independent writer and speaker on the history of technology and the unintended consequences of innovation. He holds a Ph.D. in European history from the University of Chicago and was executive editor for physical science and history at Princeton University Press. A former member of the Harvard Society of Fellows and John Simon Guggenheim fellow, he has been a visiting lecturer at Princeton and has held visiting research positions at the Institute for Advanced Study, Woodrow Wilson International Center for Scholars, and the Princeton Center for Information Technology Policy. He is now an affiliate of the Center for Arts and Cultural Policy of Princeton's Woodrow Wilson School. He was a founding advisor of Smithsonian's Lemelson Center, where he remains a senior research associate.

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