Forum Archive Index - June 2002

["Brian & Fiona Brakenridge" <pohuenui.island@xtra.co.nz>]

When I first looked at this chart my immediate reaction, especially considering Steven's recent posts, was are we going to see another long flat period like that which started in 1965?

 

Then it occured to me that that date was a significant date in that it was the year that Warren Buffett kicked BRK into gear.

 

Below is a record of BRK's % change in per-share book value from 1965 to 1983 when the DJI began to climb again.

 

1965    24%

1666    20

1667    11

1968    19

1969    16

1970    12

1971    16

1972    22

1973      5

1974      6

1975    22

1976    59

1977    32

1978    24

1979    36

1980    19

1981    31

1082    40

1983    32

 

So over a 19 year period when the DJI went sideways BRK grew at 24% compounding.

 

Translated, $1000 invested in BRK in 1965 would have grown into $50,000 by 1983.

 

Translated, even when times look pretty grim there are opportunities out there and I maintain you will get out of the market what you put in. Education, research and using all the tools available will give you the edge. Don't panic and don't follow the crowds.

 

Call me the eternal optimist.

 

Cheers

Brian

 

"Opportunity comes to the prepared mind" Charlie Munger