Things have changed in business structure, cash reserves, a lot of stuff. So this should be less useful now than it used to be. But it surprisingly remains a pretty tight correlation. I think, as said earlier, that there's a number of items that tend to offset each other so that the change - just like P/B - takes place slowly.

This is it. It's years now (15?) since I was reading valuations of BRK on fool.com and understood that book value was gradually getting worse and worse as an indicator, and "fair value" as price-to-book should be rising gradually over the years. I decided that ~1.75 was a fair level, even though ~1.5 was a more typical valuation.

So here we are years and years later, and price/book hasn't even got above 1.5 much. We now have probable buybacks below 1.2 (say) and 1.5 has been close to as high as it gets - this is a ridiculously small range for a single stock, I normally consider that any stock can double or halve in value, and the volatile ones do much more. So we have relatively low volatility, relatively underpriced which gives us higher annual growth and extra upside rather than downside, and all in a diversified, AAA company. Luxury!

(Are there other AAA companies worth considering? I seem to remember people saying there are hardly any left - perhaps that scarcity makes them more valuable?)

SA