When you think of a man who manages money like none other, Warren Buffet is sure to come to mind. So if he came and offered you advice on your stocks, you’d take it, right? Well, apparently Mr. Buffet gave some money advice to the late Steve Jobs. However, unlike you, Jobs didn’t exactly follow Buffet’s suggestion to the letter. Here’s how it went.
Two years ago, Steve Jobs approached Warren Buffet to talk about Apple’s cash reserve. Steve made the argument that he felt the company’s stock, which at the time was sitting at just over $200, was undervalued. Buffet agreed. So according to CNBC the money man himself offered Mr. Jobs four options: stock buybacks, dividends, acquisitions, or just letting the cash pile up. “I would use it for buybacks if I thought my stock was undervalued,” Buffet said. “Steve didn’t do anything, and of course, he didn’t want to do anything. He just liked having the cash.”
So that’s the route Apple chose. However, it seems that their method has been paying off and continues to do so. The company currently has more spending money ($97 billion) than the country in which it resides – the U.S. Not to mention, they occasionally make smart acquisitions to further the development of their innovative products. Take Siri for example, which was later implemented into the iPhone 4S, and most recently Chomp, an app that offers an easier way to search the App Store, which has led people to suspect that an App Store redesign is on the horizon.
All in all, both Warren Buffet and Apple are good with their money.