That's a good point. Almost everyone will play the leverage game once it gets popular: this means that opportunities for the kind of statistical arbitrage peopl

That's a good point. Almost everyone will play the leverage game once it gets popular: this means that opportunities for the kind of statistical arbitrage people like mellow out, and what's more the whole stock market will be so highly inter-networked that the short term stock price will be fragile. But through judicious investment and directorship one's illiquid investments -- as Berkshire Hathaway tends to make them, can be multiplied far more profoundly than traditional leveraged investment. In this way B.H. operates more like private equity or a venture firm -- what's amazing is the difference in scale. Incidentally, I worked out the same numbers for my own financial situation. It doesn't make a lick of sense for me to save up and diversify at this point, or even actively invest to chase the best return I can, not now. All of my money and effort should go back into my startup, so that I achieve profitability there, and liquidity.