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The week's question
In December 2024, in the thread "Re: BRK: Why Not XOM?", BreckHutHigh asked the members: "What about the long road trips with kids?" 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.
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Stocks A to Z / Stocks B / Berkshire Hathaway (BRK.A)
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Author: mungofitch 🐝🐝🐝 GOLD
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Number: of 21939 
Subject: Re: Not a bad week for the price
Date: 11/04/23 6:18 AM
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No. of Recommendations: 6
Looks like it's the 'Stairway To Heaven' model.
Has a few landings to catch your breath & never a retrenchment!


Even better. It doesn't even have flat spots! Those apparent plateaus are actually rising at inflation + 1.5% since the last time the "high value to date" changed. The notion is that during bear markets, the true value of a share is still rising, you're just not seeing it in the data yet.

The reason for the low rate (1.5%/year) is that it is conservative, and also empirically makes price prediction work the best at the one year horizon. A floor rate of inflation + 4% makes for a smoother graph and is probably closer to true economic reality, but price doesn't catch that "as-yet-unseen" value till a few years after a bear. Other than the fact that it's a smoother graph, I don't have a justification for using the more aggressive 4% number other than that it feels good, so I stick with the 1.5% which has more practical use for me.

Jim
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This community has written 21,448 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 · 57 recs · 2023
Summary of 2Q 2026 · 54 recs · 2026
3Q Summary · 53 recs · 2024
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