Berkshire Hathaway - Safety and Long-Term Value Proposition

about 1 month ago

"if you start looking at this portfolio, the key focus is you can't go wrong with Birkshhire because if I look at Birkshhire 1 trillion market cap, 45 billion of earnings, they will keep on growing those earnings, 380 billion of cash. You cannot lose with that over time. Therefore, this is half of the portfolio is safety and on top of it in the next crash Buffett will deploy or Greg will deploy the 300 billion buy things on the cheap and then you have more upside long term. However, average Birkshhire P ratio is between 10 and 20 depending on the situation with insurance. So at 45 billion the real value of Birkshhire is between 400 and 800 billion with the money deployed. They are now getting 15 billion on treasuries."

The speaker highlights Berkshire Hathaway as the portfolio's safety anchor due to its massive market capitalization, steady earnings growth, and strong cash reserves. They view the company as a defensive investment that offers stability even during market downturns, citing the potential for opportunistic buying in a crash while also warning of risks like valuation compression over the long run.

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