Hi, Shrewd!        Login  
Shrewd'm.com 
A merry & shrewd investing community
Best Of BRK.ABest OfAll BoardsThe Shrewd’m Weekly ¤Learn to InvestHow to Become Shrewd
Search
Shrewd'm.com Merry shrewd investors
Search
Best Of BRK.ABest OfAll BoardsThe Shrewd’m Weekly ¤Learn to InvestHow to Become Shrewd


The week's question
In December 2024, in the thread "Re: BRK: Why Not XOM?", sykesix asked the members: "What do you do if you arrive early at movie besides go to the snack bar?" This week it is put to everyone again. The button below opens the small thread re-asking it - read what others have said so far, then give your own answer as an ordinary reply.
Answer this questionContinue to Shrewd'mThis note won't appear again
Stocks A to Z / Stocks B / Berkshire Hathaway (BRK.A)
Unthreaded | Threaded | Whole Thread (32) |
Author: rando ✶  😊 😞
Number: of 22989 
Subject: Re: Krugman on the Fed
Date: 07/11/25 10:58 AM
Post New | Post Reply | Report Post | Recommend It!
No. of Recommendations: 4
If very high inflation does happen, what does that do to Berkshire?

An easy answer is that it probably raises the earnings on cash holdings, but that's not real value creation. It could arguably make future acquisitions (either common stock or outright acquisitions) more attractive to the extent that valuations decline as interest rates increase.

For me, the concern would be in any long-term contracts, particularly in the insurance subs. If we price policies based on inflation expectations that turn out to be too low, the future (inflated) claims will lead to painful results in those insurance subs. Probably easily manageable in annual renewals (e.g., auto), less so in other policies.

Of course, you can then argue there's a (maybe more important) macro effect where less secure or higher leveraged competitors are crushed by inflation and Berkshire ends up being the last man standing.

So ¯\_(ツ)_/¯
Post New | Post Reply | Report Post | Recommend It!
Print the post
Members reply directly to rando here — and replies get answered. Reading is free; so is joining the conversation. Join Shrewd'm »
This community has written 22,499 posts about Berkshire Hathaway. The article-length ones it recommended most:
BRK: Why Not XOM? · 62 recs · 2024
Second quarter comments · 60 recs · 2023
Berkshire's Profit Contributors · 58 recs · 2023
Summary of 2Q 2026 · 55 recs · 2026
3Q Summary · 53 recs · 2024
Unthreaded | Threaded | Whole Thread (32) |


Announcements
Berkshire Hathaway FAQ
Contact Shrewd'm
Contact the developer of these message boards.

Best Of BRK.A | Best Of | Favourites & Replies | All Boards | Followed Shrewds | Open Questions | Moving a community | Privacy