Good News And Bad News From Warren Buffett

Posted by TEBI on May 4, 2020

The world’s most famous investor Warren Buffett spoke at length at the weekend. Now aged 89, Buffett was addressing an online version of the annual meeting of his firm, Berkshire Hathaway. He talked about stocks, the economy and of course the coronavirus crisis.

Some commentators have suggested that Buffett was more downbeat than he has been in the past. He certainly had bad news as well as good. But, as Andrew Ross Sorkin commented in the New York Times, it’s more accurate to say he was neither pessimistic nor optimistic but realistic.

Particularly noticeable was how often Buffett repeated the words, “I don’t know”. That’s right, Warren Buffett, the most successful investor of the modern era, doesn’t know how this crisis will unfold. Yet there are plenty of experts in the media offering their opinions.

Ultimately, as Buffett’s friend, the late Jack Bogle, liked to say, “nobody knows nothing”. If there was ever a time for investors to stay humble, surely this is it.

Bad News

The current situation is unparalleled

In 2008 and 2009 our economic train went off the tracks. This time we just pulled the train of the tracks and put it on a siding. And I don’t really know of any parallel — in terms of the most important country in the world, most productive, huge population — in effect sidelining its economy and its workforce.

Nobody knows how the crisis will play out

We’re not getting a best case and we know we’re not getting a worst case. The range of possibilities is still extraordinarily wide. We do not know what exactly happens when you shut down a substantial portion of your society.

Anything can happen in the markets

Perhaps with a bias, I don’t believe anyone knows what the market is going to do tomorrow, next week, next month, next year. I know America’s going to move forward over time, but I don’t know for sure. Anything can happen in terms of markets. You’re going to have to be careful about how you bet.

… Good News

Nothing can stop America

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