Re:Warren Buffett’s Berkshire dumps most of Goldman Sachs stake
by mxschumacher on Saturday May 16, 2020 @11:06AM
(#23203955)
When Buffett cut cheques to Goldman, GE and Bank of America in the financial crisis of 2009/2010 there were not many other players willing or able to invest billions of dollars. Berkshire might have the most solid balance sheet in the world - they are strong when others are losing their shirt.
The source of Berkshire's strong performance was a combination of very good investments (buying American express in 1964) and insurance float, a great credit facility with negative interest rates.
Given the size of the private businesses Berkshire owns, it is quite naive to assess the firm purely on stock-picking performance of Buffett. The operating results really matter, producing $25bn+ of operating profits per year isn't too shabby.
Maybe in the past there was lots of deep-value out there, but now we have analysts working every strategy.
Or squeeze a percent or two of efficiency by taking companies private under 1 umbrella. On average it works out, but it doesn't take many mistakes to sour it.