American Express Case Study

When the scandal of American express came to light. Warren Buffet believed American express shouldn’t have to pay the sixty million it offered to pay but rather they should have to accept blame and admit to. Buffett even at his own expense offered to testify describing how management was trying to plan to settle. American express ended up paying out large amounts of money; however, was able to bounce back and get its company’s stock back up by 1964. Many were surprised when Buffett wanted to testify because even though he was notorious for being honest just like his father but he had never tried to turn his investments into a place where all their secrets were out in the open.
Buffett would tend to venture from his mentor Ben Graham by looking for cheap stocks based on a handful of

Buffett would look at the pink sheet quotations for stocks not listed on the New York Stock Exchange because the lack of publicly posted price would reduce competition. Buffett would call every market maker and would fight with them merciless. If there were shares selling at $5 a share he would bid $4 and 3/4. This is what he would call “casting the line” which would fish out how hungry the seller was then Buffett would lower his price again and do this over and over again.
However, when Stanton realized Buffett was the one buying many of his stocks he tried to “chisel” Buffett on a deal then he denied making the deal with Buffett. This infuriated Buffett, so instead of selling he decided he would buy to gain control and power of this company. His friend began to notice when he bought enough to get a spot of the board so they began to buy. Warren became extremely angry because this matter was personal to him so he bought them out. The only problem with this was these were his friends but there were others who noticed as well and began to buy which created