Berkshire_Bull
Recycles dryer sheets
- Joined
- Sep 7, 2004
- Messages
- 174
I think that Berkshire is a good investment and may outperform the market going into the future, but I don't know if another person could keep a handle on all the different subsidiaries. I think Berkshire's cash hoard is a big mistake. By sitting around and getting 4% instead of the 10 or 12% Buffett could get by buying companies isn't a smart decision. If you earn 4% for 5 years, what do you have to earn over the next 15 years to get to 12% over 20 years? (I'd post the answer but I don't have my BAII handy) but I can tell you you'll need somewhere in the neighborhood of 15%. The other question is what is the value of Buffett himself, a man that has generated over $7 billion of trading/ arbitrage gains over the last two years? Berkshire is undoubtedly a valuable basket of businesses, but it is "dear" to many people. Many people have fallen in love with Buffett's story, and thus the security itself. That is when it is time to stay clear. There will be a time to buy Berkshire, I'm afraid now isn't the time.