For the investor, a too-high purchase
price for the stock of an excellent company can undo the effects of a
subsequent decade of favorable business developments.
Should the stock market advance to
considerably higher levels, our ability to utilize capital effectively in
partial-ownership positions will be reduced or eliminated.
This will happen periodically: just ten
years ago, at the height of the two-tier market mania (with
high-return-on-equity businesses bid to sky by institutional investors),
Berkshire’s insurance subsidiaries owned only $18 million in market value of
equities, excluding their interest in Blue Chip Stamps. At that time, such
equity holdings amounted to about 15% of our insurance company investments
versus the present 80%. There were as many good businesses around in 1972 as in
1982, but the prices the stock market placed upon those businesses in 1972
looked absurd. While high stock prices in the future would make our performance
look good temporarily, they would hurt our long-term business prospects rather
than help them. We currently are seeing early traces of this problem.
沒有留言:
張貼留言