Warren must be pissed today

with stocks ripping.

…with stocks ripping.

Well, he has the consolation that BRK/A is up $11,457 per share today.
He doesn’t really care all that much, but hey, it’s a nice validation that he has created value.
He’s human, more or less.

Berkshire’s short term correlation with the broad market never ceases to amaze me.
I guess few entities with big money trade individual stocks any more. Just funds and sectors.

Mr Munger’s views on cryptocurrencies are well known.
I sometimes feel the same way about investment funds, ETFs and the like.
Does it make any sense that there are now far more investable collections of stocks globally than there are stocks?

Jim

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“He’s human, more or less.”

so we think. :wink:

“I sometimes feel the same way about investment funds, ETFs and the like.
Does it make any sense that there are now far more investable collections of stocks globally than there are stocks?”

The combination of a wholesale move to passive investments and gargantuan levels of government supplied liquidity has distorted things.

These are strong forces and not much sign of them changing anytime soon. Seems a little odd that a company’s stock price can now be influenced by what index or ETF is slots into, rather than the business prospects and fundamentals.

I know nothing about these things but imagine investment bankers and company boards think about the metadata associated with their stock. Can’t be healthy in the long term.

I worked in an investment bank a long time ago and remember my boss telling an engineering company with a low PE that his master plan was to make some acquisitions and reposition the company as a support services company. Support services companies having much high PE ratios. Fees for the bank. Higher share price for the CEO to exercise share options. Musk has been a master at this game. No real impact on the present value of future cash flows.

I don’t know how it all ends up but I’ll stick with reasonably priced Berkshire over an index.

Heard Jamie Dimon talk about quantitative tightening (“QT”) recently. Has never been done before he said so we don’t know the effects.

Anyway, knowing what you own seems sensible. It provides an important psychological steel perhaps: conviction to hold through the dark times when everything seems in doubt. So that you might enjoy the very long term benefits of owning a productive asset with some magical characteristics that help it grow.

One other thought on Berkshire specifically which for whatever reason seems usually either undervalued or fairly valued relative to the index. For me personally, who gets nervous when bubble valuations form, it would be a shame if a bubble valuation in Berkshire pushed me out of the stock and I missed out on another 20 or 30 years of the Berkshire magic. It suits me to compound slowly and quietly and get on with life.

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