He was comfortable putting over 33% of the entire partnership into this single stock. It shows that even back then, he understood that when the odds are heavily in your favor, you bet big, a distinct departure from Ben Graham.
If he had continued with these 'buy, fix, and sell' liquidation plays, Berkshire never would have become the $1 Trillion fortress with $300B+ in cash that it is today. That strategy works beautifully for small sums, but it simply does not scale to managing billions
To move the needle on that much capital, he had to shift toward 'Great Businesses at a Fair Price', compounders like Coca-Cola, Apple.
Always a pleasure, reading you!
Thanks, Bryan!
Great breakdown
He was comfortable putting over 33% of the entire partnership into this single stock. It shows that even back then, he understood that when the odds are heavily in your favor, you bet big, a distinct departure from Ben Graham.
If he had continued with these 'buy, fix, and sell' liquidation plays, Berkshire never would have become the $1 Trillion fortress with $300B+ in cash that it is today. That strategy works beautifully for small sums, but it simply does not scale to managing billions
To move the needle on that much capital, he had to shift toward 'Great Businesses at a Fair Price', compounders like Coca-Cola, Apple.
Thanks for sharing this history.
Interesting story - thanks for circulating it