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From a column by Bill Gross in FT reflecting on his investing career

The combination of leverage and time is a critical one to recognise in any portfolio blueprint. Leverage can be dangerous, but is less so given enough time for fundamentally sound investment ideas to work out.
Just ask Warren Buffett. His belief in superior equity returns over the long term has been anchored by the balance sheets of Berkshire Hathaway’s insurance companies.
The capital from those companies has been more or less impervious to being “called in” at inopportune times. Insurance premiums and and long-term debt have semi-permanence to them that overnight lending and subscriber capital does not. And so Buffett — who should be recognised for his brilliance as a financial architect as well as an investor — has prospered while John Meriwether of Long-Term Capital Management notoriety temporarily stumbled in the face of collateral calls on the company’s trading positions. Buffett has shown that time is a vital third dimension in financial architecture.

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Berkshire Hathaway FAQ

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