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Berkshire Hathaway Inc. Message Board

  • dazznshazz dazznshazz Mar 29, 2008 8:57 PM Flag

    For those who are down on America...

    ...and think the only things worth investing in are commodities or foreign (to Americans) stocks, I think these words from Wally Weitz are timely;

    "John Templeton once said, "The five most expensive words in investing are ,"This time it is different.". In the equity markets, participants are acting as if things are different this time in that they seem to believe that energy and commodity prices will remian high and that the consumer and financial sector will will remain depressed indefintately. We do not believe that this will prove to be the case."

    "Technological progress throughout time has done nothing but make basic materials and energy less expensive and more efficient. We believe this process will continue, and intellectual and financial capital will continue to outperform physicall-based substances such as energy and commodities."

    "This time is also not different in that the naysayers about America are wrong, just as they always have been in the past. For 300 YEARS, the American economy has made forward progress and will continue to do so. With the low exchange value of the dollar, the export sector of our economy is already showing signs of strength."

    "Additionally, anecdotal evidence of foreign buyers purchasing real estate assets shows that real estate prices will stop somewhere short of zero."

    "Our point is that skepticism about the future of America is misplaced. The notion that you must invest internationally as the only avenue for substantial growth is wrong when considered as an either/or proposition. Enterprising and well-run companies will prosper in the U.S and internationally."

    Amen to that, to which I will also add: As a buyer of American shares myself (mostly because the prices are so depressed and the USD is so low - a great double-whammy on the comeback trail) I have looked at China as an investment but I only have to look at the way those barbarians are treating the people of Tibet to rethink my attitude towards China as a safe harbour. I NEVER have to have those worries about America.

    One more thing: This board used to be full of contrarians. Now all I hear is worry and gloom and doom about America and how commodities are the way of the future. You're all beginning to sound like those fools at the height of the dot-com craze.

    Please, take a look at yourselves and get over it. America has always been and, in my opinion, will always be the best place to invest on Earth.

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    • dazz i called both the tech/internet bubble crash and real estate/credit collapse.

      This time it truly is different imo.
      The US needs a real scare to get back on course. Just listen to our stupid politicians. Hillbilly and Obama want to bail everyone out. FNM & FRE are given approval to write and expan loan book when they really are severly undercapitalized

      We are going to get it, but do not be fooled by a sudden sharp rally that comes anytime due to negative sentiment. The next down wave will frighten many investor. I for one have prepared and hope to steal some real good companies at the point of maximum pain.

      As for energy, it will take some years for us to bleed ourselves off of fossil fuels. Energy will reamin relatvely high due the increasing demand from china india russia brazil and other opec countries. Depletion rates are high and finding costs are spiraling upwards.

      Will we overcome? sure, but we need to be scared to death to face reality. Kind of like a few homesellers still in denial asking 2005 peak prices.
      Nedicare is going to bankrupt the country but nothing is done. Nothing. Lobbyist polute the federal government thriough bribes and payoffs. The US since slick willy took charge has been on a downward spiral. Sorry but this is what I see. It is OK to win at all cost and not play the game fairly as long as you win.

      The scare is coming and a collapsing dollar and a derivative meltdown maybe the instruments that brings the chaos that we need.

      • 3 Replies to JC145
      • Thanks JC. What makes the world go round is a difference of opinion and that is something you and I have.

        I'll back my optimistic view of your country and its future against your view any time of the day over the coming years.

        Cheer up. The world aint as bad as you think it is. My money's on the US beating this crap just like it beat the S&L crisis, the bond crisis, the '87 crash, the russian crisis, the Asian crisis, the dotcom crisis...need I go on.

        This time is different? Of course it's different but I believe the outcome's going to be exactly the same. America will prosper.


      • Well, I don't really disagree with all that. It is going to be scary for a while... The least one can do is being in companies that can take advantage of that LONG TERM: BRK, FFH things like that.

      • we need 'chaos' like a hole in-the-head!!!trying to avoid these messes is the only alternative...enough with your gloomy knew before we knew before horsey/froggy knew...BULL CRAPOLA & BULL PUCKIE...

    • Keep waving your flag and living in De Nile, Cleopatra.

    • Dazz you took the words right out of my mouth.

      I've been battling the gloom and doomers for weeks.


    • america is a fine place to invest. it has the most robust mix of small- and mid-cap companies in the world by far, and the documentation required by the SEC is the most shareholder-friendly standard in the world.

      america economically and politically is past its prime- so much so that one Nero can do tremendous damage in eight short years. empires wax and wane, this time is no different. the vandals aren't at the gates, but 300 years ago america was not the center of the world, and in another 300 years it won't be, either. your sense of "always" is a little addled.

    • I read the Markel letter and reread Immelt's letter from GE just now.

      Immelt's tone is basically like screw this, we have a great company, our prospects are good, and our stock is going to go up, here's why.

      At some point people are going to have to decide whether they believe in US businesses or not.

      Clearly some of the smart guys out there are believers.

      I think when you can get premier US companies at good prices you buy some. Like Buffett advises don't go whole hog all at once but get in there over time. May take some time, but should work out.

      I'll take the GE's and BRK's over any other country's leading companies and take my chances.

    • BTW; It wasn't Wally Weitz who I quoted it was Thomas S Gayner from Markel in his annual letter to shareholders. Apologies for the misquote.

    • Nobody's really down on America. Some posters just like to bait the group. Alan Abelson's column today may be on target:

      "Besides seizing an opportunity to once more express our vast esteem for the universally beloved Veep, we cite the "so?" episode because it reminds us of the remarkable insouciance displayed by all too many denizens of Wall Street as they confront a seemingly endless deluge of bad news.

      Oh, we're quite aware that according to the sentiment surveys, a majority of investors claim to be bearish. But at heart, they're unreconstructed bulls, ready at the slightest excuse to scramble back into the market with hoots and whoops."

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