Berkshire Hathaway: COVID-19 and the Great Disconnect

Assignment guidelines:

The individual project uses two of the items from the Harvard Business Publishing Coursepack:

The Risk of Not Investing in a Recession, by Pankaj Ghemawat, 2009

Berkshire Hathaway: Covid-19 and the Great Disconnect, by Bertrand Guillotin, 2021

The first one is an essay about businesses not investing in capital projects during a recession and the potential

negative consequences for them and the second is about Warren Buffet, considered to be possibly the greatest

investor of all time, and how he, for once, had a major failure in not responding to the Pandemic and lost 25% of

the value of his company as a result.

Analyze Berkshire Hathaway:

• What happened to Berkshire Hathaway? What did Warren Buffet do? Was this the correct move? Has

anything changed since the paper was written?

• How much value did it lose during the Pandemic in dollars and percentage?

• Compare with the S&P 500 index – what performance should have been expected?

• Has it regained value by now? Why/why not?

• If you were Warren Buffet, what would you do to regain what was lost? What about a stock buyback?

How much cash is available and how much would you spend to buy it back? Should you divest (sell off)

and parts of the company?

• If you were the board of directors what are the options? What would you do? Should Warren Buffet be

fired?

• Does the first paper have relevance to this discussion? Why/why not?

• What did you learn that you can apply to your own investing?

In order to earn high marks the paper should provide discussion of issues that led up to the situation, the

ramifications for the company and the possible future outlook using information outside of the case study. Use

relevant financial numbers and calculations to support your discussion.

Requirements

• This is an individual assignment

• Your paper must be in proper APA format

• You must use outside references, and you must use proper APA referencing and in-text citations and you

must reference the papers from the Coursepack and the textbook

• Show your calculations and reference where you obtained the formulae

• Max. 2,000 words, no minimum

• Do not use “filler material.” Filler material is verbiage that does not add value to your paper. Do not add

unnecessary definitions (if we have read about it in class it is unnecessary).

• Provide an executive summary (or abstract) of your paper no more than one half page long

• Provide a one-page case summary and a conclusion

• No table of contents

• The rubric is located on the Moodle Course Page