The majority of Berkshire owned companies have dominant market positions, strong returns on capital and an owner with a fat wallet. As their competitors wilt in the coming downturn, Bershireâs companies will improve their competitive position and reap the benefit when things improve.
Those companies that cant re invest their profits at good returns will pass it on to the holding company for Buffet to invest, something heâs pretty good at.
Berkshire Hathaway is a money compounding machine. Sure, it wonât grow at the pace it did previously, because itâs so big but it will tick along slowly but surely.
They are also increasingly venturing into international markets, where most of the growth is going to be.
And if you take some of the companies that Berkshire has large holdings in, such as Coke, the prospects are very good.
I think the point you miss here is that Buffet does not ignore the macro picture, he just realises that it is impossible to know what is going to happen so why not just invest in the best companies and let them do the worrying for you.
A company like Coke had been around since 1880 something, itâs survived through world wars, epidemics, financial crashes, depressions, inflation, deflation etc etcâ¦..
And it has still churned out great returns on equity, year in, year out and will continue to do so as long as we have a growing world population.
Over the long term most of Berkshire Hathawayâs holdings will go from strength to strength.
Those companies that cant re invest their profits at good returns will pass it on to the holding company for Buffet to invest, something heâs pretty good at.
Berkshire Hathaway is a money compounding machine. Sure, it wonât grow at the pace it did previously, because itâs so big but it will tick along slowly but surely.
They are also increasingly venturing into international markets, where most of the growth is going to be.
And if you take some of the companies that Berkshire has large holdings in, such as Coke, the prospects are very good.
I think the point you miss here is that Buffet does not ignore the macro picture, he just realises that it is impossible to know what is going to happen so why not just invest in the best companies and let them do the worrying for you.
A company like Coke had been around since 1880 something, itâs survived through world wars, epidemics, financial crashes, depressions, inflation, deflation etc etcâ¦..
And it has still churned out great returns on equity, year in, year out and will continue to do so as long as we have a growing world population.
Over the long term most of Berkshire Hathawayâs holdings will go from strength to strength.
