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Investing

Five Takeaways From The Berkshire Annual General Meeting 2021

I am concerned about Berkshire post-Buffett. Greg Abel as future CEO stands a chance of preserving the Berkshire culture of operating its businesses independently. However, it will become increasingly difficult without Buffet’s large vote, and, with the rise of index investing to resist short term pressures index investment groups. For now, I will continue to hold 30% of my liquid net worth in Berkshire and sleep well.

S&P 500 returns since 1971 rely on dividends to beat gold

The US stock market index has not progressed since 1971 if you denominate the index in ounces of gold rather than dollars. This is true but neglects the role of dividends in driving stock market returns. Including dividends, the total stock market return is close to 4X that of gold.

What’s the story with Bitcoin?

Bitcoin provokes strong reactions – positive and negative. Warren Buffett thinks Bitcoin is a bubble (“rat poison squared”). Meanwhile, large public companies are starting to get on board with Bitcoin – Square recently bought $50M worth and Paypal are planning to add Bitcoin to Venmo in 2021.

More Passive Investing without Index Funds

I have moved all of my investments to a passive approach so I can divert more time to building businesses instead of stock picking/reading about markets.

Warren Buffett’s Well Worked Will

Mr. Buffett has thought through the matter of donating his shares carefully and, I believe, largely mitigated associated risks by i) spreading out the donation of shares over time and ii) gradually reducing the amount of shares donated each year so that the dollar value of shares entering the market via share sales by foundations is somewhat stabilised.