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Warren Buffett - BRKA=BFD

Tim Knight from Slope of Hope's picture




 

Originally published on the enigmatic Slope of Hope.......

"Next up on CNBC - - an octogenerian fund manager who completely missed the boat on technology in the late 1990s and, since the early 2009 bottom, has underperformed the S&P by 50%. Stay tuned!"

So how many people do you think would stay riveted to their flat-panel Samsung to watch that? Not many, I'm guessing. But if the aforementioned gent is named Warren Buffett, the entire nation comes to a halt and hangs on to every word. A quick glance at Amazon yields 2,100 results when one does a search on his name (including the surprisingly-titled Warren Buffett Invests Like a Girl: And Why You Should, Too).

Just out of curiousity, I pulled up a chart that overlaid the plain old boring, run-of-the-mill SPY with Berkshire Hathaway Class A common stock. The results are shown below in blue and black, respectively. This is not to say Berkshire has done poorly - - it's just that the completely ordinary SPYders have offered up twice the performance as the inexplicably-but-perpetually-newsworthy Mr. Buffett.

0229-warren

I realize what Warren Buffett has done over the very long haul has been extraordinary and that self-made billionaires merit some attention. But can the world please stop thinking that this man is the be-all, end-all guru the mass media holds him out to be? Even with unlimited access to the highest levels of power in the government, his performance recently has been well short of spectacular.

 

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Thu, 03/01/2012 - 00:11 | 2211140 alexwest
alexwest's picture

could author of this article pull out HIS OWN VERIFIED PERFOMANCE FIGURES AND compare to spx chart?

thank u

alx

Wed, 02/29/2012 - 17:54 | 2209962 williambanzai7
williambanzai7's picture

If he was really as good as he thinks he is, he wouldn't be spending so much time talking up his crony book.

Wed, 02/29/2012 - 17:07 | 2209707 Zero Govt
Zero Govt's picture

the tape never lies... Buffet has lost it (and not just to the Bill Gates Trust)

Over-confident from Omaha is the Bear markets breakfast ..yummy

He'll have to scrape a job at his other occupation, Govt tax planning (ie. how to thieve other peoples wealth)

Wed, 02/29/2012 - 16:36 | 2209519 Dermasolarapate...
Dermasolarapaterraphatrima's picture

plot GLD vs BRK...that's even better .

Wed, 02/29/2012 - 17:10 | 2209722 ejhickey
ejhickey's picture

neither Gld or Brk  pay dividend.  Just sayin...

Wed, 02/29/2012 - 17:51 | 2209668 ATG
ATG's picture

or silver, which WEB had and sold for a few dollars profit, before it outperformed BRK/A seven to one.

Word is WEB wrote calls on his London Silver and had it called away to SLV by JPM or Barclays like the JPM expropriation of OMFG customer cash and precious metal delivery positions:

http://bit.ly/xEdjZH

Guess D WEB didn't believe his R dad re gold and liberty:

http://en.wikipedia.org/wiki/Howard_Buffett

Or maybe WEB has a secret stash for when he can no longer shill for central bank owners:

http://media.nowpublic.net/images/e4/5/e4594d60413a45a3aa6d436d4ae5bac0.jpg

WEB's latest letter makes the interesting point that $14 T of gold can buy most productive American assets, but neglects to say that bankster corporate government theft of these productive assets renders the point moot.

Tokyo Real Estate could buy all of US real estate once upon a time too, when they bought Pebble Beach and 30 Rock before they coughed them up.

Incidentally, WEB said in his latest letter he does not dump his losers and hopes BRK/A goes down so he can buy more of it:

http://www.berkshirehathaway.com/letters/2011ltr.pdf

Those European naked index puts have BRK/A $9 B underwater so far, and were exercised early, exactly why BRK/A lost its AAA credit rating.

Things could get rather interesting with further maket declines when the Fed pump finally fails and turns into a Fed dump...

Wed, 02/29/2012 - 16:30 | 2209501 BeetleBailey
BeetleBailey's picture

Methinks we should roofie Becky Quick, Viagra Warren, get them a big cot, let him have his two minutes of "fame" - and maybe he'll go quietly into the night......and perhaps we'll all benefit with Quick not leering at us every day. A confused, dour look will be the replacement.

Wed, 02/29/2012 - 16:21 | 2209452 SheepDog-One
SheepDog-One's picture

Buffet has done GREAT on a steady regimen of insider trading.

Wed, 02/29/2012 - 17:10 | 2209726 ATG
ATG's picture

Like First Baron Lord Keynes before him and both GS's...

Wed, 02/29/2012 - 16:17 | 2209432 realitybiter
realitybiter's picture

I'd talk trash, too, about an asset class that had kicked my ass for the last decade by 400%.  Talk is cheap.  Get in the ring!!

 

It is never too late Warren to say, "yeah, Dad was right."

You may as well.  

you know you are only a couple of cokes away from him confronting you and asking "why?"...but then again, maybe you are so evil that you know that meeting will be geographically impossible.

 

Wed, 02/29/2012 - 17:42 | 2209905 ATG
ATG's picture

Howard Buffett:

Speaking on the floor of Congress, he said of military interventionism that,

“ Even if it were desirable, America is not strong enough to police the world by military force. If that attempt is made, the blessings of liberty will be replaced by coercion and tyranny at home. Our Christian ideals cannot be exported to other lands by dollars and guns. Persuasion and example are the methods taught by the Carpenter of Nazareth, and if we believe in Christianity we should try to advance our ideals by his methods. We cannot practice might and force abroad and retain freedom at home. We cannot talk world cooperation and practice power politics.[9][10]

In the summer of 1962, he wrote "an impassioned plea... for the abolition of the draft" in the National Review.[5] Buffett wrote:

“ When the American government conscripts a boy to go 10,000 miles to the jungles of Asia without a declaration of war by Congress (as required by the Constitution) what freedom is safe at home? Surely, profits of U.S. Steel or your private property are not more sacred than a young man's right to life.[5]

In addition to non-interventionism overseas, Howard Buffett strongly supported the gold standard because he believed it would limit the ability of government to inflate the money supply and spend beyond its means.[11]

http://en.wikipedia.org/wiki/Howard_Buffett

Wed, 02/29/2012 - 17:29 | 2209737 ATG
ATG's picture

Watched Diet Cherry Cokes with aspartame destroy the largest holder of one of BRK's key investments...

Wed, 02/29/2012 - 16:15 | 2209426 cygnetsong
cygnetsong's picture

Probably an 80 year old is more focused on wealth protection versus growth at this point.  That he underperforms the market now doesn't prove much.

Wed, 02/29/2012 - 17:32 | 2209750 ATG
ATG's picture

huh?

for a recital of three "unforced errors" in NatGas, Fixed Income and Housing by the Chair of BRK/A:

http://www.berkshirehathaway.com/letters/2011ltr.pdf

Wed, 02/29/2012 - 16:13 | 2209393 sgt_doom
sgt_doom's picture

Thanks for this blog post, but really, Warren Buffett keeps claiming that raising the tax rates would be super!, but somehow forgets to mention he lobbies against any change in credit derivatives (which he strenuously lobbied against re: Dodd-Frank legislation), and his company has been in tax court for quite some time, battling the IRS to avoid paying billions in back taxes....

Credit derivative strucutured deals are how corporations and global banks avoid paying any corporate taxes, while equity swaps, and other kinds are how they avoid paying capital gains taxes.

(Not to mention all that ultra-leveraging and ultra-leveraged speculation they do with them.)

Wed, 02/29/2012 - 17:16 | 2209762 ATG
ATG's picture

WEB consistently in the market for tax credits since at least 1990:

http://bit.ly/zxTL3D

 

 

Wed, 02/29/2012 - 19:55 | 2210355 sgt_doom
sgt_doom's picture

Great stuff, thanks!

Wed, 02/29/2012 - 15:55 | 2209325 Johnk
Johnk's picture

I understand Buffett is hated because he takes advantage of, and proposes taxing the Plutocracy he is a part of, but cherry picking starting and ending periods to compare results is really pointless. 

A week ago Berkshire might have greatly outperformed the S&P during the period from 11:30am to noon.  Meaningless. 

Those who view Berkshire as a business and not as a lotto ticket are concerned with book value over time, not short-term fluctuations like the chartist traders that Knight caters to (nothing wrong with that either).

Certainly BRK's shares have been priced less favorably recently by Mr. Market, but let's pick another time period: March 2000 until today.  Berkshire has dramatically outperformed the S&P 500 over that period, and as a bonus his shareholders didn't lose 90%+ of their money in the tech crash, unlike many traders who didn't "miss the boat" on technology.

 

 

Wed, 02/29/2012 - 17:40 | 2209793 ATG
ATG's picture

Since March 2000, the S&P 500 and BRK declined -86% in terms of gold, more in terms of the silver WEB bought and sold:

http://bit.ly/zQFMbI

Like real estate, much of the 19.8% nominal returns the last 47 years were central bank debt usury money mirage inflation and foreclosures.

http://www.berkshirehathaway.com/letters/2011ltr.pdf

Now with 0MFG and other financial depository institution implosions and thefts, we have real counter-party risk in derivatives and securities...

Wed, 02/29/2012 - 16:13 | 2209410 sgt_doom
sgt_doom's picture

 "I understand Buffett is hated because he takes advantage of, and proposes taxing the Plutocracy he is a part of,..."

 Please read my comment below, for final comprehesion, as in, it doesn't matter the tax rates, when they ain't paying any taxes, sonny!!!

Thanks for this blog post, but really, Warren Buffett keeps claiming that raising the tax rates would be super!, but somehow forgets to mention he lobbies against any change in credit derivatives (which he strenuously lobbied against re: Dodd-Frank legislation), and his company has been in tax court for quite some time, battling the IRS to avoid paying billions in back taxes....

Credit derivative strucutured deals are how corporations and global banks avoid paying any corporate taxes, while equity swaps, and other kinds are how they avoid paying capital gains taxes.

(Not to mention all that ultra-leveraging and ultra-leveraged speculation they do with them.)

Wed, 02/29/2012 - 17:47 | 2209935 ATG
ATG's picture

In fact, WEB just announced on page 16/21 he will do no more derivatives because they now require collateral:

http://www.berkshirehathaway.com/letters/2011ltr.pdf

 

 

Wed, 02/29/2012 - 15:43 | 2209265 Smokey1
Smokey1's picture

WEB eats shit.

Wed, 02/29/2012 - 15:36 | 2209212 Freegolder
Freegolder's picture

Irony of ironies: A permabear having a pop at a permabull. Both permanently wrong.

Wed, 02/29/2012 - 15:29 | 2209185 Gauthijm
Gauthijm's picture

Crony Capitalist!

Of teh worst Kind, an Obama Crony!

JMG

Wed, 02/29/2012 - 16:10 | 2209399 Every Third Word
Every Third Word's picture

Warren made a directional bet on the US and it paid off, perhaps the greatest buy and hold strategy borne out of portfolio strategy rather than brilliance.

 

It's pretty clear, from the vantage point of time, that the US screwed its position post-WWII: We had all the advantage in the world and pissed it away with the vietnam war, the great society.

 

Wed, 02/29/2012 - 15:23 | 2209148 digitlman
digitlman's picture

*CLAP CLAP CLAP*

 

Thanks.  More people need to clue into this.

Wed, 02/29/2012 - 15:34 | 2209202 notbot
notbot's picture

You know, I thought you were cherry picking by showing the move off the bottom...I thought the S&P probably had a bigger dip than BRK.  Turns out, the drawdown was about the same.  Interesting...

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