No. of Recommendations: 11
Was WB as good as he was because he had CM? How much longer will WB be around? Are the folks remaining as good as he is at deploying capital? The recent slate of posts repeating this mantra to hold the damn stock seem to ignore the idea that BRK is in a major transition.
I will continue to hold the damn stock because the underlying collection of businesses are good. But I will definitely exit if it becomes a company that holds 1/3 of its market cap in cash. I don't see that is good for anyone. Manufacturing your own dividend is nice in concept but what if the underlying stock that you are holding to manufacture that dividend is weighed down by cash that it is unable to deploy at attractive marginal rates of return? Do you have confidence in the post WB leadership to deploy $300B+ and counting productively? If you do, definitely hold the damn stock. But you would have to believe in the BRK culture and "system" to make that logical, rather than rely on your belief in how smart WEB is, I think. If you believe it was WEB genius that made this work, the logical thing would be to question if holding the damn stock continues to make sense.
I hope for one last major bargain acquisition from WEB that could defer the inevitable for some additional years. But its a question of if, not when. WEB may not be around long enough and capital markets can stay irrational long enough such that "when, not if" can not be taken as a given.
