12 | LMT BUSINESS JOURNAL
MONDAY, DECEMBER 31, 2007
Deal maker with hot hand opens his wallet
By VIKAS BAJAJ
Warren E. Buffett is in no mood to quit.
At 77, Buffett, the country’s most famous
investor, is in the midst of his hottest streak in
almost a decade. And he is capping his run
with a flurry of deal-making.
Friday, Buffett stunned Wall Street by
announcing that he would enter the troubled
bond insurance business. He also spent about
$440 million for a unit of ING Groep, the
Dutch financial giant.
Three days earlier, on Christmas, he
agreed to buy a $4.5 billion stake in the industrial conglomerate owned by the Pritzker
family. And a few weeks before that, he waded
into the junk bond market, buying $2.1 billion
of debt issued by TXU Corp., the electric utility.
As the fortunes of big Wall Street firms
sink, Berkshire Hathaway, the holding com-
pany that Buffett runs out of Omaha, Neb., is
on a tear. Its Class A shares have jumped 27
percent this year, their best showing since
1998, when they soared 52 percent. The
Standard & Poor’s 500-stock index, by comparison, has gained a mere 4.24 percent this
year.
In a telephone interview on Friday, Buffett
said the timing of his recent investments was
a coincidence. Since the credit crisis erupted
this summer, he has repeatedly tried to blunt
speculation that he might ride to the rescue of
an ailing bank or Wall Street firm.
“We had no compulsion at the start of the
year to do anything,” Buffett said. “On the
other hand, there was no limit to what we
could do.”
Thousands of investors on and off Wall
Street study what Buffett does. It’s no wonder:
Over the past four decades he has built
Berkshire Hathaway into a $216 billion company with businesses ranging from insurance
YOUR JOB
YOUR CASE
NEW YORK TIMES NEWS SERVICE
and corporate jets to ice
cream and underwear.
During that time, his company’s book value has
soared by more than
360,000 percent.
Amid the turmoil in the
financial markets this year,
Buffett quietly tinkered
BUFFETT
with his company’s vast
stock portfolio, which totaled $78 billion as of
Sept. 30.
He has increased his stakes in two major
banks, U.S. Bancorp and Wells Fargo, and
cast new bets on Burlington Northern, the
country’s second-largest railroad, and
CarMax, the biggest used-car dealership. On
Friday, in addition to announcing his intention to enter bond insurance, Buffett agreed to
buy NRG, a reinsurance unit of ING.
With about $47 billion in cash on hand,
Berkshire still has plenty of money for acqui-
sitions. At the company’s annual meeting in
May, Buffett said he would consider a deal as
large as $60 billion.
But Buffett warned Friday that the crisis
that began in the market for housing debt
shows few signs of abating. He added that he
had decided to establish his own bond insurance company, rather than purchase one, to
avoid “buying into anybody else’s trouble.”
Berkshire, which has an AAA credit rating, will enter the business as bond insurers
like MBIA and Ambac are struggling to raise
capital and protect their gilt-edged ratings.
Buffett said he believes that most of the
investments that are available to him in the
financial industry “don’t make sense.”
People who follow Buffett said such
wariness is a hallmark of his investing
style. He has learned from past mistakes,
said Gerald Martin, a finance professor at
American University and Texas A&M
University.
YOUR STUFF
YOUR FUTURE
Turning a job evaluation into a bigger paycheck
By EILENE ZIMMERMAN
NEW YORK TIMES NEWS SERVICE
Q: You’ve just had a year-end
performance evaluation and want to
talk to your boss about a raise. How
should you prepare?
A: For starters, know your worth
in the marketplace. Consult the
Occupational Outlook Handbook
from the Labor Department or
check salary survey Web sites like
salaryexpert.com or payscale.com to
find out the salary range for your
job.
Next, write a list of your accomplishments since the last evaluation.
Be specific, using numbers to show
increased revenue, higher sales or
new clients for the company, in
order to make a business case for
the raise you want.
Then put yourself in the boss’s
shoes and consider how he or she
likes to receive information —
whether it’s in the form of dataheavy bullet points or a dramatic
story — and present your case, said
Robert Bontempo, an associate professor at Columbia Business School
who teaches executive MBA courses
on negotiation and persuasion.
You must also prepare yourself
psychologically, said Kenneth N.
Siegel, an industrial psychologist
and president of the Impact Group,
a leadership consulting firm in Los
Angeles.
“You’ve got to go into these dis-
cussions with a clear sense that this
is something you have earned, not a
gift from your boss,” Siegel said, “so
focus on what you’ve earned, not
what you deserve.”
Then set up a specific time to
meet with your boss and signal that
it will be an important conversation,
said Todd Dewett, an associate professor of management at Wright
State University in Dayton, Ohio.
Q: During that conversation with
your boss, are you negotiating or
persuading?
A: Negotiating is the process of
making
mutually
beneficial
exchanges; persuasion is trying to
change someone’s attitude or values. People often confuse the two
and wind up undermining their
own effectiveness, Bontempo said. If
your meeting will focus on the
amount of your compensation, it’s a
negotiation, with you stating the
metrics and benchmarks you’ve hit
and using that to justify what you
want, he said.
But you will need to use persuasion if someone higher-ranking
than your immediate supervisor has
control over compensation decisions. In that situation, you must
enlist your boss as your ally,
Bontempo said.
“Your goal then is attitudinal, not
transactional,” he said. “You ask:
‘What are your beliefs about my
contribution to the last project I did?
What can I do to change your
beliefs?”’
It’s more likely, however, that
your boss has barely been thinking
about you at all, which usually
means that you’re doing a good job.
In that case, your meeting is all
about raising awareness, Bontempo
said.
Q: Should you mention that your
mortgage payment just went up or
that your wife is pregnant?
A: Trying to argue for a raise
based on what is happening in your
personal life is generally considered
bad form.
“Don’t whine,” said Laura Sejen,
head of compensation consulting at
Watson Wyatt, the human resources
consultancy in New York. “This is
about your performance, not about
your life outside of work. A manager might be sympathetic to you, but
those aren’t your strongest arguments.”
Q: Talking about money is often
uncomfortable, so how do you bring
up specific amounts or percentages?
A: Let your boss do it, said
Michael Soon Lee, a negotiations
consultant, martial artist and author
of “Black Belt Negotiating.” Lee said
that letting the boss make the first
suggestion sets the lower limit.
“They can only go up from there,”
he said. “If your boss intended to
give you an 8 percent raise and you
suggest 6 percent, you can’t change
your mind and say, ‘No, I meant 8
percent,”’ he said.
If you’re forced to make the first
move, always ask for more than you
think you can get, he said.
Q: Can you ask for a raise even if
you didn’t have a stellar year?
A: If you had a subpar year, it will
be harder to make a case for a pay
raise, Sejen said.
“At minimum, you need to be
meeting the daily goals of your job,”
she said. “If you aren’t doing that,
don’t bother asking.”
On the other hand, you also don’t
have to be a superstar to rate a
salary increase.
MONDAY, DECEMBER 31, 2007
LMT BUSINESS JOURNAL | 5
School offers instruction for ‘cycle driving
By ZACHARY FRANZ
LAREDO MORNING TIMES
Webb County residents who
want to learn how to drive a motorcycle no longer have to wait for
months or travel out of town,
thanks to a new safety course running every weekend near Laredo.
Gregory’s Driving School offers
the three-day motorcycle driving
school every Friday through
Sunday, said owner Mary GregoryFox.
The class is required for anyone
under 18 to legally operate a
motorcycle in Texas, and older people who pass the test are exempt
from taking a motorcycle driving
test when seek a motorcycle
endorsement on their driver’s
license.
Previously, Gregory-Fox coordinated motorcycle-driving courses
in Laredo, but they were taught by
instructors from the Department
of Public Safety. Those instructors
were only available every couple
months, and there was no permanent site for the classes.
Now, Gregory’s Driving School
has two of its own, certified
instructors. They also have a permanent location – a two-acre,
paved area just off U.S. Highway
59, about 17 miles east of Laredo.
Previously, there was a long
waiting list for people interested in
taking the class, Gregory-Fox said.
“People were waiting half a
year or a year,” she said.
Indeed, husband and wife
Miguel and Maritsa Carillo, who
were in the first class last weekend, said they had been trying to
enroll in a motorcycle class since
February.
Miguel Carillo knew how to
drive a motorcycle before the class,
but wanted to improve his technique so he would be more comfortable on his heavy touring bike.
His wife was learning to drive a
motorcycle for the first time.
Such a range of abilities and
motives is typical for students,
Gregory-Fox said.
The class starts from the
absolute basics, with lessons on
how to maintain balance on a
motorcycle, she said. Lessons
cover topics such as proper turning, correct riding posture, rules of
the road and how to minimize the
chance of injuries and damage in
case of an accident, she said.
By the end of the course, most
students are comfortable driving
and able to pass the written exam
required by the Department of
Public Safety, she said.
Many insurance companies
offer discounts to people who have
successfully completed the course,
Photo by Ricardo Segovia | Laredo Morning Times
Students from Gregory’s Driving School talk before class starts on Sunday, Dec. 23. The school offers the three-day motorcycle driving
school every Friday through Sunday at a paved area off U.S. Highway 59.
Gregory-Fox said.
The class begins with classroom
instruction on Friday afternoons,
and continues with about six hours
of driving exercises on Saturday
and Sunday.
The course costs $190, and
includes a textbook and insurance
for the three-day class, GregoryFox said.
Call Gregory’s Driving School
at 722-6151 or 729-8233 to register.
OIL | Continued from Page 4
October crude oil
production
Texas preliminary October
2007 crude oil production averaged 873,447 barrels daily, down
from the 888,494 barrels daily
average of October 2006.
The preliminary Texas crude
oil production figure for October
2007 is 27,076,862 barrels, a
decrease from 27,982,144 barrels
reported during October 2006.
November oil and gas
completions
In November 2007, operators
reported 464 oil, 660 gas, 76 injection and three other completions
compared to 423 oil, 846 gas, 20
injection and one other completion during November 2006.
Total well completions for 2007
year to date are 13,080 up from
12,308 recorded during the same
period in 2006.
Operators reported 325 holes
plugged and 2 dry holes in
November 2007 compared to 299
holes plugged and three dry holes
in November 2006.
October natural gas
production
Texas oil and gas wells produced 480,315,199 Mcf (thousand
cubic feet) of gas based upon preliminary production figures for
October 2007, up from the October
2006 preliminary gas production
total of 470,732,283 Mcf.
Texas production in October
2007 came from 129,915 oil and
76,129 gas wells.
November drilling permits,
completions
RRC District: (3) SOUTHEAST TEXAS
Permits To Drill Oil/Gas Holes: 195
7. PECOS - 1,034,709
Permits To Drill Oil/Gas Holes: 97
Oil Completions: 227
8. UPTON - 994,196
Oil Completions: 22
Gas Completions: 21
9. MIDLAND - 884,841
Gas Completions: 36
RRC District: (8A) LUBBOCK AREA
10. CRANE - 775,592
RRC District: (4) DEEP SOUTH TEXAS
Permits To Drill Oil/Gas Holes: 61
Permits To Drill Oil/Gas Holes: 151
Oil Completions: 44
OCTOBER TOP 10 GAS PRODUCING
Oil Completions: 10
Gas Completions: 1
COUNTIES, BY PRELIMINARY PRODUCTION
Gas Completions: 80
RRC District: (9) NORTH TEXAS
TOTAL GAS (MCF)
RRC District: (5) EAST CENTRAL TEXAS
Permits To Drill Oil/Gas Holes: 356
1. ZAPATA - 23,785,520
Permits To Drill Oil/Gas Holes: 47
Oil Completions: 21
Oil Completions: 2
Gas Completions: 53
Gas Completions: 55
RRC District: (10) PANHANDLE
RRC District: (6) EAST TEXAS
Permits To Drill Oil/Gas Holes: 109
Permits To Drill Oil/Gas Holes: 193
Oil Completions: 22
Oil Completions: 11
Gas Completions: 68
3. FREESTONE - 20,580,463
4. HIDALGO - 19,591,558
5. PECOS - 17,746,098
6. WEBB - 14,528,716
7. JOHNSON - 14,087,555
Gas Completions: 180
RRC District: (7B) WEST CENTRAL TEXAS
2. PANOLA - 22,072,844
OCTOBER TOP 10 OIL PRODUCING
RRC District: (1) SAN ANTONIO AREA
Permits To Drill Oil/Gas Holes: 83
Permits To Drill Oil/Gas Holes: 41
Oil Completions: 7
CRUDE OIL (BBLS)
Oil Completions: 27
Gas Completions: 2
1. GAINES - 2,210,277
Gas Completions: 11
RRC District: (7C) SAN ANGELO AREA
2. YOAKUM - 2,032,247
RRC District: (2) REFUGIO AREA
Permits To Drill Oil/Gas Holes: 150
3. ANDREWS - 1,957,536
Permits To Drill Oil/Gas Holes: 67
Oil Completions: 66
4. HOCKLEY - 1,547,293
Oil Completions: 5
Gas Completions: 99
5. ECTOR - 1,429,738
Gas Completions: 54
RRC District: (8) MIDLAND
6. SCURRY - 1,184,017
COUNTIES, PRELIMINARY PRODUCTION
8. WISE - 13,697,861
9. ROBERTSON- 13,622,910
10. TARRANT - 13,514,542