03/31/2011 12:52 pm ET | Updated May 31, 2011

Buffett's Heir Apparent Confused Personal Interest With Business Loyalty

My favorite legal guru on white collar legal offenses tells me this morning that David Sokol's purchase of 96,000 shares of Lubrizol ($10 million) "appears legal, but stupid and arguably confusing his personal interest with his business loyalty."

This was all too apparent in Sokol's whiny performance on CNBC this morning where he mused inconsequentially about, "The only thing you can do is just say if you invest your own money, you don't even mention it to anyone at Berkshire."

Excuse me, but Mr. Sokol, you bought 96,000 shares for $10 million not 100 shares for $106,000. You had an obligation to really spell out the true extent of your position to your boss. And that new information the Lubrizol CEO gave you on January 25th that swung the deal with Buffett; are you sure that wasn't material and substantive? Because it ended up in a $135 a share offer -- a 30% premium over what you paid for your shares.

Here's what Neil Hume of FT's Alphaville blog quipped this morning after Sokol's wooing of Buffett's favorite TV personality. "When he looks back at Thursday's interview with CNBC it might be with some regret," writes Hume with proper understated British wit. "When you are in a hole, stop digging etc."

So, the big megillah questions are; 1) Did Buffett push Sokol out the door? I says yes. Get thee to a private equity nunnery and pillage the equity holders some poor leveraged up industrial; and 2) who is the favorite to succeed Buffett now? My choice has always been the brilliant insurance entrepreneur Ajit Jain, who speaks to Buffett each evening at 10 pm, according to the misbegotten Buffett biography.

I'm biased of course, because I like and admire Ajit. But, also, every time I've tried to convince Buffett to let me put Ajit on the cover of Forbes, he says with the classic Buffett humor: "When the whale breached the water, sometimes he gets harpooned." Ajit always smiles with Cheshire cat look when he hears that.