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Wednesday, April 7, 2010 as of 11:14 AM ET

Liz-Vision
  • September 19, 2008 10:54 AM UTC by Liz Claman

    Warren Buffett and David Sokol: Smartest Guys in the Room

    Hey Gang,

    Amidst all this financial drama, two guys kept their heads while everyone on Wall Street was losing theirs: David Sokol, Chairman of MidAmerican Energy Holdings and Warren Buffett, Chairman and CEO of MidAmerican’s parent company Berkshire Hathaway (BRK). While the Wall Street gang was desperately following each ‘tick’ of the government’s moving-target plan that seemed to change hour by hour, these two guys made a few phone calls to each other in Omaha and worked up a quickie plan to scoop up Constellation Energy (CEG), which had fallen dramatically in the previous days.  They bought CEG for $4.7 billion dollars, or $26.50 a share. David Sokol gave us the details in person exclusively yesterday (see clip below).

    Constellation was a $60-dollar stock last year. It fell to the mid-$20s and trading of the shares actually had to be halted once in the past few days on worries it had too much exposure to Lehman’s (LEH) problems.  The Sokol-Buffett team had been following CEG for years, watching their competitor like a hawk. Clearly they’ve admired it from afar, were perfectly aware of what problems might (or might not be!) be there and were waiting for just this moment which Treasury, Wall Street and the Fed handed to them on a platinum (forget silver!) platter at a severely discounted price.

    David Sokol kindly rushed uptown to Fox Business’ studios from meetings downtown to give us the moment-by-moment drama of how it all came down.  I want you to hear the story because it sends a great message that you’ve no doubt heard before: It’s important that when everyone else around you is losing their heads, be sure to KEEP YOURS.

    Warren Buffett once told me when I asked him why he doesn’t live in New York City, the so-called “Financial Capital of the World,” “Liz, I chose to stay in Omaha rather than New York because by the time the clock struck noon on any given day, I’d had 19 ‘great tips’ whispered in my ear and none of them were really great.” By staying away, he’s gotten closer than anyone else on the planet to what all those guys on Wall Street really want: Money and Success.  But he’s the first to say it doesn’t come without guys like Sokol at your side.  Listen in on our interview. I think you’ll find it awfully interesting.

    Say more with less: short and sweet phraseology keeps ATC informed during the critical transitions of your flight. Top form comes in both what you say and how you say it.(ATC NOTEBOOK)(air traffic control)

    IFR March 1, 2010 | Kramer, Tarrance People are naturally social creatures, eager to converse with their own kind. While friendly chit-chat is great during quality time with the friends and family, when you key up a radio frequency, it’s time to pare back the language and cut to the chase.

    Student pilots are taught to aviate, navigate and communicate–in that order. But once you start working on your instrument rating, your communications must be kicked up a notch. If you want to fly IFR, getting comfortable on the radio is not optional. ATC is expecting to hear certain things from you during different phases of your flight. Why are they important and what is the best way to say them?

    Wheels Up An aircraft’s takeoff and initial climb are critical periods on both sides of the radar scope. While the pilot is ensuring his instruments are in the green, the controller has a few things to check, too. And the controller needs a good transmission from the pilot to make it happen.

    [ILLUSTRATION OMITTED] To understand why, let’s peek behind the scenes at the Tower-Approach Control relationship. A control tower and its overlying radar facility use a Letter of Agreement (LOA) to specify what altitudes and headings aircraft are assigned upon departure. The LOAs are unique to each facility. Our Tower uses 2000 feet for propeller aircraft and 3000 for jets. Departure headings are restricted to within 20 degrees of the runway heading. If I release an IFR Cirrus SR22 for departure off Runway 16, I expect the Tower to do two things: Assign him 2000 feet and give him a heading somewhere between 140 and 180 degrees.

    How will I know if that SR22 is complying? Well, it’s up to the pilot to tell me. When he checks in on departure, I’m expecting to hear a single, clean transmission from him that contains his current altitude, his assigned altitude and his heading. Good radio technique gets your information across in as few words as possible. Compare the following two transmissions:

    “Greenview Departure, this is Cirrus Four Alpha Bravo, I’m with you, climbing out of 900 feet for 2000 feet, on a heading of 140.” “Greenview Departure, Cirrus Four Alpha Bravo, 900 for 2000, heading 140.” Say them out loud. As you can see, both transmissions get the important info across. However, that first one is chatty and less professional. There are 13 extra words in there, all useless. The “this is” and “on a” are just dead air. The “climbing out of” is redundant because, well, isn’t the airplane taking off? And if he’s talking to me on my frequency, isn’t he in fact “with me”? site chase student loans

    The second one is short, sweet, and sounds far more elegant. It accomplished everything in far fewer words. If that Cirrus is the only plane on my scope, the long transmission doesn’t affect me. However, if I’m working 15 other airplanes, those seconds are precious. I’d rather hear the second version.

    The more quickly you fulfill your end, the more quickly I can accomplish mine. When I look at the Cirrus’ radar target and see that it also shows him climbing out of 900 feet, that verifies his transponder’s radar altitude readout matches what he’s seeing on his instruments. I can therefore trust that altitude. Secondly, the “for 2000, heading 140″ tells me that he is in compliance with the LOA altitude and heading assignments. Any discrepancies, such as a bad altitude assignment, incorrect altimeter setting or a faulty transponder, can be noted and dealt with sooner rather than later.

    On The Way In While en route at your cruising altitude, it’s good technique to check in with each new controller by simply stating your altitude. “Houston Center, Cirrus Four Alpha Bravo, level 12,000.” [ILLUSTRATION OMITTED] The controllers in the Centers and TRACON facilities along your route of flight will have your flight plan information in front of them, in either paper flight-progress strips or electronic form. This will display your requested cruising altitude. When you check in with your altitude, they’ll be able to corroborate the two.

    However, once you begin the descent phase of your flight, it becomes extra critical to check in with your altitude. ATC is now dealing with an aircraft that is moving vertically, not just laterally at a fixed cruise altitude. The controller wants to confirm your current altitude and what you’ve been assigned, in case there’s any traffic that may conflict with your descent.

    You can take care of it all in a quick, clean format: “Greenview Approach, Cirrus Four Alpha Bravo, 7600 for 4000, information Charlie.” So, why is checking in with your assigned altitude extra-critical during descent? Doesn’t ATC have flight progress strips showing to what altitude your aircraft is descending? Well, this may seem strange, but our arrival strips don’t actually display an altitude. Departure strips do. En route strips do. Why not inbound strips?

    Let’s hit the LOAs again for a second. At my TRACON facility, our LOA with our sister TRACON to the east requires them to feed us aircraft landing within our airspace at one of three altitudes: 4000, 6000 or 8000. Radar facilities around the country operate under similar agreements with their neighbors to grant flexibility to put arrivals above or below other traffic. Because there are multiple altitude options, our flight progress strips for arriving aircraft have no hard altitude printed on them.

    When I accept a handoff on your arriving aircraft, I know you’ll either be level at or descending to one of those three altitudes. How do I know which one? Well, I’m hoping you’ll tell me. If you don’t, you can bet your headset I’ll be asking you for the info: “Cirrus Four Alpha Bravo, Greenview Approach, verify assigned altitude.” Don’t wait for ATC to prompt you. Be ahead of the game and quick with the information.

    Going Missed A missed approach can be quite a thrill–especially in real IMC. While you’re cleaning up the airframe and otherwise convincing the airplane to fly again, ATC will probably see your altitude increasing and start doing some shuffling to fit you back in the sequence. Get on the radio and tell them your plan.

    Missed-approach procedures can be either executed as published on the approach plate or manually issued by ATC. A published missed procedure contains an assigned altitude, a turn direction, a holding fix, and a frequency. ATC-as-signed procedures will contain the above as well, but are verbally assigned either by the radar controller or by the Tower.

    For a published missed approach, include your altitude and the fix towards which you’re flying. Controllers have potentially dozens of instrument approaches in their airspace. It’s not likely they’ll have every single missed approach procedure memorized. log their memory: “Greenview Departure, Cirrus Four Alpha Bravo, executing missed-approach, turning right to GUNLY, 700 for 2000.” Manually-assigned missed-approach instructions can improve the whole operation. For example, if a student pilot is practicing several ILS approaches to the same runway, ATC may assign him a heading and altitude to fly that will put him in position for his next ILS. On the go, the phraseology would be, “Greenview Departure, Cirrus Four Alpha Bravo, executing missed approach instructions, 800 for 1500, heading 180.” Speak Well Fly Safe While ATC has the big picture, as you can see we often depend on you to fill in the details. What you say and how efficiently you say it is key to giving controllers the information they need to provide you with safety and service. Doing so ensures all parties are on the same page and keeps problems from becoming disasters. chasestudentloansnow.com chase student loans

    It’s a skill controllers have to learn as well. When I began my ATC training, my instructor took a count of how many extra, useless words I used on the radio in one day. During our debrief, he told me to take all those words and multiply them by how many hours, days, and years were left in my 25-year career. I pictured thousands and thousands of pointless words clogging up the airwaves. He got his point across.

    Years later, I’m not 100-percent chatter-free, but I won’t waste a pilot’s time with excessive babble. I’ve also come to appreciate pilots who are succinct and professional. Keep the transmissions quick and on point, and your next controller will appreciate you, too.

    RELATED ARTICLE: THE QUIZ En route in hard IMC can be so … boring. But here’s a bright side: Use the time to see how well you know the rules about motoring on down the airways. Here are a few questions to get you started. Answers are on page 22.

    [ILLUSTRATION OMITTED] 1. Except when authorized by ATC, where on the airway are you expected to fly when you’re operating under IFR?

    a. Anywhere within four miles left or right of the center.

    b. In the center except when necessary for operational need, such as leading a turn or steering clear of weather, during which four miles left or right is available.

    c. In the center except when turning on a bend in the airway.

    d. Always in the center. Period.

    2. When approaching a waypoint (fix or station) where there is a bend in the airway, the pilot is expected to:

    a. Overfly the point, observe full passage and then turn.

    b. Begin the turn at the first sign of station passage.

    c. Lead the turn to roll out on the next segment as centered as possible.

    d. There is no rule on this. It’s up to the pilot.

    3. The total protected areas left and right along an airway segment that is 100 miles long or less are how wide?

    a. Two miles left and right of course b. Four miles left and right of course c. Six miles left and right of course d. Eight miles left and right of course 4. In non-mountainous areas, airway MEAs guarantee at least 1000 feet of obstacle clearance. In mountainous areas, you’re guaranteed at least:

    a. 2000 feet of clearance b. 1700 feet of clearance c. 1500 feet of clearance d. It depends on the terrain in question.

    QUIZ ANSWERS [ILLUSTRATION OMITTED] 1. c. Per FAR 91.181, when you’re flying IFR on an airway, you’re expected to fly dead-center. The exception pops up in AIM 5-3-5, which clarifies that leading a turn is considered part of adhering to a route. In practice, drifting a bit left or right to avoid a cloud top can be done without ATC permission if the frequency is crowded. But it’s better to ask for any significant jog.

    2. c. This is further in AIM 5-3-5. You’d have to be cranking along at 290 knots or more to actually fly out of the protected airspace just because you didn’t lead the turn, but pilots are expected to take wind, degree of turn, true airspeed and other variables into account when planning when to start the turn.

    3. c. Did you say b? Four miles is just the primary area. There are another two miles of secondary area, for a total of six.

    4. d. Surprise again. The commonly-cited 2000 feet is the standard; however, clearance from the floor of the primary area to obstacles or terrain can be as low as 1500 in the Eastern U.S. or 1700 in other areas. Weather, actual terrain, distance between navigational facilities and the potential for major pressure changes along the route are all taken into account when evaluating a reduction from 2000 feet.

    Tarrance still throws in the occasional (and sincere), “So long,” “Take care” or “Have a good flight”–when he can get away with it.

    Kramer, Tarrance

    NEW MOTHERS FACE SHORTER AND SHORTER HOSPITAL STAYS

    The Columbian (Vancouver, WA) July 5, 1995 | Knight JOSE, Calif.-Childbirth in the cost-conscious ’90s has come to this:

    Pregnant women timing contractions in hospital parking lots until after midnight to circumvent health insurance plans that only fund a one-day stay for normal deliveries.

    New mothers learning how to breast-feed, diaper and bathe baby by video because there is not time to be shown by a nurse.

    Low-income patients on Medi-Cal (California’s Medicaid) routinely getting twice the hospital time of women in most private health insurance plans. go to site jaundice in newborns

    Twenty years ago, the average hospital stay after childbirth was four days. Now, despite the fact most obstetricians recommend a 48-hour recovery, post-delivery hospital time has gradually been whittled away by private plans to the point where 24 hours is now the industry standard. And eight-hour stints are on the horizon.

    It all has sparked a nationwide furor, with politicians and physicians both hoping to put the brakes on this trend driven by efforts to reduce soaring health costs.

    In May, a New Jersey infant died of a streptococcal infection following a hospital discharge 28 hours after birth. That state is expected to soon become the first in the nation to require all insurers to permit a minimum 48-hour stay.

    On the federal level, Rep. George Miller, D-Calif., submitted a bill to require that all insurance companies offer a two-day stay.

    Several medical associations have requested that insurance carriers impose a hiatus until scientific studies can document that early discharges are not harmful to either mothers or infants.

    One-day average Four of the largest carriers insuring patients in the South Bay area Blue Cross, Kaiser Permanente, LifeCodes, and FHP/TakeCare said that their patients average one-day hospital stays following childbirth, give or take a few hours.

    “Generally, complications, if they’re going to occur, are going to occur within 24 hours,” said Mary Davis, medical policy manager at Blue Cross-Wellpoint, of Woodland Hills, Calif., which allows one-day hospital stays for vaginal births without complications.

    Some companies say they will show up even sooner. One Kaiser Permanente affiliate in Southern California, buoyed by studies that suggest problems are evident long before 24 hours, has started encouraging new mothers and newborns to leave eight hours after childbirth.

    Disagreement But some of the nation’s leading medical groups disagree.

    In May, the American College of Obstetricians and Gynecologists reiterated that it recommends hospital stays for uncomplicated deliveries ranging from 48 hours for vaginal births to 96 hours for Caesarean section, not including day of delivery.The association said it was concerned that 24-hour stays for vaginal births and 72-hour stays for Caesarean deliveries had become routine. The group is alarmed at reports of dehydration and undetected jaundice in newborns discharged early. web site jaundice in newborns

    In June, the American Medical Association urged that decisions about discharge be left to physicians, as opposed to being decided by “economic considerations.” Officials at some California hospitals say they are observing mothers and infants returning at growing rates. At Valley Medical Center, for example, pediatricians this year have seen at least 30 babies admitted with severe jaundice shortly after leaving that hospital or others. A decade ago, there were none.

    Dehydration is common among the newborns of mothers not properly breast-feeding.

    Knight

sal r s

this rescue bill must be passes by congress, that is it!

October 2, 2008 at 4:35 pm

sal r s

the rescue bill must be passed by congress, there is only one train leaving the train station at WASH>DC continuing to talk conservative principles is stupid, the Bull is out in the woods and the bears are closing in. I also am a conservative but it is just to late for us to discuss the same thing over and over again. do your best to make congress pass this bill! this bill must pass! thank you.

October 2, 2008 at 4:33 pm

cashflow

I think that the democrates and republicans should hold off and not let Bush push them into making a quick fix without accountability!!! Go after Merrill Lynch's CEO 161 million payout...And all the other thieves...if you did that you would recover 900 Billion...Do you think the American people are stupid??? White Collar Crime...that's what it is!

September 22, 2008 at 3:55 pm

Choxie

A better title fits this article than "the Smartest guys in the Room." The title reminds me of that Enron book, "The Smartest Guys in the Room." A very different picture is cast on those characters, than what is represented here.

September 22, 2008 at 2:08 pm

Sam Marx

When you interview W. BUFFETT again, here's a question to ask, " Which stocks would you buy if they were 20% lower in price ?" Sam Marx

September 19, 2008 at 3:08 pm

Sam Marx

Here is a question for W.Buffett," Which stocks would you buy if they were 20% lower ?" Sam Marx

September 19, 2008 at 3:05 pm

Patrick

Warren Buffett is real smartest guy!

September 19, 2008 at 1:14 pm

about this blog

  • Liz Claman joined FOX Business Network (FBN) as an anchor in October 2007. Her debut included an exclusive interview with Berkshire Hathaway CEO and legendary investor Warren Buffett.

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