Warren Buffett: Why stocks beat gold and bonds

[bwolinsky]

Quote from sumfuka:

I still prefer gold over stocks. Reason being it is one of the few things that could be manipulated. And you don't have to worry about time decay. Currencies used to be good but in this day and age, who is to say that particular currency won't collapse. Nations are crumbling right before our eyes.

So Buffett can keep compounding on his stocks, and I'll keep compounding on the metals. Everyone wins.

There is no "compounding" in medals. It is inflation, and will stop, and so will your compounding.

Buffet knows cash flows are more dependable than the prospect of rising prices in commodities. I completely understand where he's coming from, and you do not. Compounding medals will stop.

 

[bwolinsky]

Quote from Debaser82:

Gold is up 5000 % since the early 70's.

And XOM is up tens of thousands of percent since then, so gold has lagged that stock for sure.

Think the split adjusted price from mid seventies of XOM is below $0.15.

 

[sumfuka]

Quote from bwolinsky:

There is no "compounding" in medals. It is inflation, and will stop, and so will your compounding.

Buffet knows cash flows are more dependable than the prospect of rising prices in commodities. I completely understand where he's coming from, and you do not. Compounding medals will stop.

Really??? There's no compounding in metals? I must be doing something very wrong then.

Buffett is 1st and foremost an Insurance Guy. I don't know how long you have been alive. But my experience with insurance people is less than honorable.

 

[bwolinsky]

Quote from sumfuka:

Really??? There's no compounding in metals? I must be doing something very wrong then.

Buffett is 1st and foremost an Insurance Guy. I don't know how long you have been alive. But my experience with insurance people is less than honorable.

You are. Riding the coattails of an inevitable bubble burst that you've just so happened to catch when any time in the last 30 years really wasn't that great of an opportunity and that's the point Buffet will make to you and so will I.

 

[sumfuka]

Quote from piezoe:

you're deluding yourself. Mr. Buffett is correct. You should read the article again and learn to think in terms of purchasing power. Wall street hype and markets are always reported in nominal dollars, you must think in terms of purchasing power to be able to invest wisely.

For example, when you discount the S&P for inflation you find the that the total return since the mid seventies is, if you omit dividends, roughly that of Treasuries with of course greater risk. However, if you include dividends, you now get a return a little better than inflation. Over longer periods, gold keeps you roughly even with inflation, and bonds lose to inflation.

The key to long term investing is dividends, or value investing as someone else has pointed out. I prefer the dividend route and only consider, for long term investing, stocks in a long term up trend with a history of raising dividends. I will buy nothing but stocks that pay dividends.

Fair enough. You make valid points. Just not my cup of tea. I prefer hard assets.

 

[sumfuka]

Quote from bwolinsky:

You are. Riding the coattails of an inevitable bubble burst that you've just so happened to catch when any time in the last 30 years really wasn't that great of an opportunity and that's the point Buffet will make to you and so will I.

What is a bubble?

 

[denner]

Quote from sumfuka:

What is a bubble?

Beau's sense of self importance.

 

[bwolinsky]

Quote from denner:

Beau's sense of self importance.

Or missing that Gold's been a terrible investment since 1980 compared to stocks.

 

[sumfuka]

Quote from denner:

Beau's sense of self importance.

Every now and then it's important to have the retarded kids feel special. Boost their ego up and let them be. Hopefully they'll become someone else s problem.

All I said was Buffett might have a bias towards metals, and this nigga gets all emotional like I took a shit on his dinner.

 

[bwolinsky]

Quote from the dumb ass that doesn't know when to sell gold:

Every now and then it's important to have the retarded kids feel special. Boost their ego up and let them be. Hopefully they'll become someone else s problem.

All I said was Buffett might have a bias towards metals, and this nigga gets all emotional like I took a shit on his dinner.

There's no room for ego in trading, which is why I let my systems trade for me.

Your "compounding" comment is dumb luck. Buffet's bias is that they're terrible investments long term, and if that's a bias, we really know who the retarded kid that needs to feel special is.

So what has gold done lately?

Breaching to its all time high, it has set three lower highs in a row and aren't you wondering what to do?