4 ms·

Oddly this letter doesn’t have an overarching lesson. Some of the teaching points are that interest rates are low driving up valuations of everything, adjusted

Oddly this letter doesn’t have an overarching lesson. Some of the teaching points are that interest rates are low driving up valuations of everything, adjusted earnings including ebitda are suspect, don’t bet against America, float is under appreciated by gaap.

elisharobinson 5y ago
full picture . they own biggest 'infra' position holding on cash to weather the shit storm . will buy back stock if we fall behind index funds to deliver value .
gwern 5y ago
It was another lousy year for Berkshire Hathaway. Hey, at least this year they matched blind dumb indexing! But no interesting major purchases, no benefit from their cash stockpile despite another extraordinary year of volatility & opportunity, and reading the letter is unimpressive - as much as ever it reads like a rambling copy-paste job from the previous year. One wonders at what point the shareholders should hold a family meeting and take the keys away from great-uncle Warren, and if that point is already past.
- voisin 5y ago
  He had some lousy years in the dot com bubble too and some investors jumped ship. I think those investors are likely regretting that decision in retrospect.
- xiphias2 5y ago
  It looks like at this point Bershire Hathaway is an Apple wrapper. But I’m not sure they know more about Apple products than an average person younger than them.
- nostrademons 5y ago
  They did a bit better than the index - the S&P 500 went up about 21% in 2021, Berkshire Hathaway went up 37%. 37% is a very respectable one-year return for any stock, particularly one that invests conservatively. Also not true that they simply wrap Apple, which went up 32% in 2021. They also beat Tesla, which went up 18%.
  - gwern 5y ago
    Where are you getting 21 vs 37%? I was just looking at their usual history table on pg3 https://www.berkshirehathaway.com/2021ar/2021ar.pdf#page=3 https://www.berkshirehathaway.com/2021ar/2021ar.pdf#page=3 where for 2021, they list "29.6" vs "28.7". As a wrapper around Apple and other assets, and no mention of any incredible 2021 feats in the letter mostly waxing rhapsodic about their past, that sounds entirely plausible. (I also don't see any Berkshire year as high as 37% since 1998, 23 years ago.)
    - nostrademons 5y ago
      I went to Yahoo Finance and looked at the Jan 1 2022 vs Jan 1 2021 market prices, then plugged them into Google calculator to get a percentage gain. BRK-B = 313.2 / 227.87 = 37.88%, AAPL = 174.78 / 131.96 = 32.82%, S&P 500 = 4515 / 3714 = 21.56%. Not really sure how the table at the beginning of Berkshire's annual report is figured. Perhaps they're only marking the public equity portion of their portfolio to market and holding the private equity portion at the price they paid for it minus depreciation, as a sibling comment here suggested. This'll undercount things significantly since, as the annual report notes, they're the largest owner of private infrastructure in the U.S. Plus they bought many of those private assets in the 70s and 80s when price levels were a lot lower.
- deleted 5y ago
  [deleted]

elisharobinson 5y ago

full picture . they own biggest 'infra' position holding on cash to weather the shit storm . will buy back stock if we fall behind index funds to deliver value .

gwern 5y ago

It was another lousy year for Berkshire Hathaway. Hey, at least this year they matched blind dumb indexing! But no interesting major purchases, no benefit from their cash stockpile despite another extraordinary year of volatility & opportunity, and reading the letter is unimpressive - as much as ever it reads like a rambling copy-paste job from the previous year. One wonders at what point the shareholders should hold a family meeting and take the keys away from great-uncle Warren, and if that point is already past.

voisin 5y ago
He had some lousy years in the dot com bubble too and some investors jumped ship. I think those investors are likely regretting that decision in retrospect.
xiphias2 5y ago
It looks like at this point Bershire Hathaway is an Apple wrapper. But I’m not sure they know more about Apple products than an average person younger than them.
nostrademons 5y ago
They did a bit better than the index - the S&P 500 went up about 21% in 2021, Berkshire Hathaway went up 37%. 37% is a very respectable one-year return for any stock, particularly one that invests conservatively. Also not true that they simply wrap Apple, which went up 32% in 2021. They also beat Tesla, which went up 18%.
- gwern 5y ago
  Where are you getting 21 vs 37%? I was just looking at their usual history table on pg3 https://www.berkshirehathaway.com/2021ar/2021ar.pdf#page=3 https://www.berkshirehathaway.com/2021ar/2021ar.pdf#page=3 where for 2021, they list "29.6" vs "28.7". As a wrapper around Apple and other assets, and no mention of any incredible 2021 feats in the letter mostly waxing rhapsodic about their past, that sounds entirely plausible. (I also don't see any Berkshire year as high as 37% since 1998, 23 years ago.)
  - nostrademons 5y ago
    I went to Yahoo Finance and looked at the Jan 1 2022 vs Jan 1 2021 market prices, then plugged them into Google calculator to get a percentage gain. BRK-B = 313.2 / 227.87 = 37.88%, AAPL = 174.78 / 131.96 = 32.82%, S&P 500 = 4515 / 3714 = 21.56%. Not really sure how the table at the beginning of Berkshire's annual report is figured. Perhaps they're only marking the public equity portion of their portfolio to market and holding the private equity portion at the price they paid for it minus depreciation, as a sibling comment here suggested. This'll undercount things significantly since, as the annual report notes, they're the largest owner of private infrastructure in the U.S. Plus they bought many of those private assets in the 70s and 80s when price levels were a lot lower.
deleted 5y ago
[deleted]