No. of Recommendations: 1
I will stand by my view that Swedroe is saying Warren is not a great stock picker to gain attention and sell books.
Buffett would probably agree not object to the view that he has not achieved such spectacular success by being a 'great stock picker'. He would say you pick companies, not stocks, you buy great companies when they are reasonably priced, and you hold them forever, or at least until their prospects look irredeemable, such as when they acquire a labour union.
Rather than picking great stocks, Buffett would probably say that you pick a few great companies to invest in and wait for capitalism to make you rich, or, if you can't evaluate which companies are great, just buy the index. Buffett has done much better than this by leveraging his iinvestments, using insurance float as uncallable leverage. Although I can't prove it, I am guessing that this leverage has been responsable for most of Buffett's superior returns, not the fact that he picked great stocks. Would you dispute this claim?
The big problem with Berkshire now is that it is so big, there is nothing reasonably priced that he can invest the float in anymore, and recent stock picks (as in, in the last 20 years), have not worked out very well, with one big exception.
dtb
