Buffett’s advice on investing
March 3, 2008
On the 29th of February the Berkshire Hathway announced that it had completed an excellent year with respect to making profits. They said that the company was able to make a gain of almost 11 percent on its net worth at the end of the year 2007. the CEO of Berkshire Hathway announced on the 29th of February while he was facing the shareholders that Berkshire was able to grow it’s book value of per share by an overwhelming 21 percent on an yearly basis ever since he had taken the reins of the company almost 44 summers ago.
However the cautious crooked investor was quick in remarking that the performance the company was able to showcase in the last years might not be a guarantee for the future outcomes of the company’s ventures. He cautioned the investors that Berkshire is going to be restrained by the success the company has been able to achieve in the past few years. Berkshire, whose interest rates from chocolate making to making planes is predicted to be hit by the slimming in the gain margins.
While he was giving the report Buffett went on to boast that the successful record Berkshire has been able to maintain in the past can be neither duplicated nor repeated. He went on to say that the pool of assets as well as the revenues the company has now is too huge for any one to outsize. He however also noted that because of these huge earnings the company itself might not be able to make very big profits after a point of time.
The fact that such a comment was made right when most of the component companies of Berkshire had finished an exceptionally brilliant year, is a very good example to show how crooked an investor Buffett is. The underwriting gains dropped to almost $3.37 billion in 2007 from $3.84 billion in the year before that is taken into consideration. But this was the year when Buffett had announced that the insurance executives of his company had ‘simply shot the lights out’.
Another thing about which Buffett is concerned about is apart from natural disasters is the bill the government will come out with. This would force the company to tell the shareholders of the US companies that the company had actually been increasing their incomes by decreasing the amount of money that would be used for funding the different insurances.
If that situation isn’t bizarre enough, Buffett continues to note that if stocks were to return 10% yearly through this century, then Dow would touch 24 million by 2100. He advices all potential investors that investing in the equities blindly taking heed from various advisers wont be a good idea as the math just isn’t right.
Buffett, who is 77 at the moment, is unfazed about his age. He looks as fit as always and has no plans of retirement in his mind. The only thing he advised the people present at the meeting was to be careful when going ahead with their investments.
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