Warren Buffett: The expenses of investors are Wall Street’s income
In his annual letter to shareholders, the founder of Berkshire Hathaway Warren Buffett called the US “an incubator for unleashing human potential” and advised “Never bet against America.” Buffett is confident in the American entrepreneurial spirit and, despite some economic disruptions, is optimistic about the continued US leadership in the world.
Berkshire Hathaway is today the world’s largest investment fund that owns assets in American companies. All four of Buffett’s diamonds are also American: the insurance business, the BNSF railroad company, a 5.4 percent stake in Apple, and the energy company Berkshire Hathaway Energy.
While Buffett is confident in their stability in insurance, railways and Apple, the energy sector, in his opinion, is the most vulnerable today due to the outdated grids. So Berkshire Hathaway Energy has launched a massive $18 billion project to modernize and makeover the outdated power grid. According to Buffett, this process will take many years and eat up the expected profits for decades to come. But in the end, these investments will be properly awarded.
Another warning from Buffett concerns retail investors, who have recently made the stock market jittery by staging a massive campaign against Wall Street. Buffett reminded that the expenses of investors are Wall Street’s income, and the best way to make capital is “the passage of time, an inner calm, ample diversification and a minimization of transactions and fees.”
At 90, Buffett doesn’t even think about retirement. An example for him is Rose Blumkin, whose company Nebraska Furniture Mart Buffett once bought. Rose Blumkin worked daily running the business until she was 103, but Buffett also considers 103 a ridiculously premature retirement age.
