2020 Berkshire Hathaway Annual Letter [pdf]

If you like them you can read other letters, in particular older letters. The letters for the later part of the 1970s are especially instructive in terms of what is it like to live in an inflationary regime.

Buffett is one of the few people that have "seen it all", from deflationary 30s, war 40s, greatest 50s, cultural 60s, inflationary 70s, capitalist 80s, excessive 90s, normal then excessive again 00s, deflationary 10s and whatever the 20s will be.

Is Buffett really still the gold standard, Berkshire has been outdone by the s and p 10 year rolling average over the last evade and that was true before the pandemic.

I get that 20% annual returns aren’t sustainable as you get into managing hundreds of billions but it seems to me the make up of the market has changed dramatically over the 2010s and Buffett hasn’t adapted or evolved.

While I'm not of these meme investors who thinks Buffett is "washed up", I confess that I've increasingly wondered if it's just sorta over. In some sense, it's not his fault. Berkshire has grown so large that it has significant scale problems. I joke that Buffett found the investing equivalent of the Donkey Kong kill screen, he basically broke the game. It's incredible.

But there have been self-inflicted issues. The seemingly unconditional refusal to explore technology companies. (While his Apple investment was great, even Buffett would tell you this is a consumer company and not a tech company) The allowing of the two new managers to keep breaking Berkshire's rules, such as not investing in IPO's, or not investing in airlines. The large write down in PCP. The double-speak about "never bet against America" while remaining paralyzed during the COVID panic. Maybe these things are moot compared to the scale problem.

But I think the more disheartening issue is Buffett's last 5-6 letters have been forgettable, and today's was really just a recap of Berkshire's main assets, not offering anything particularly insightful or interesting. I think he's still doing an admirable job but Berkshire just isn't what it used to be. Everything has a cycle.

Do you honestly believe that Warren does not understand inflation?

Came here to write exactly this. Berkshire is special