The Daily Buffett

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The Illusion of Success

November 12th

The Great Bubble ended on March 10, 2000 (though we didn’t realize that fact until some months later). On that day, the NASDAQ (recently 1,731) hit its all-time high of 5,132. That same day, Berkshire shares traded at $40,800, their lowest price since mid-1997.

Warren Buffett

On March 10, 2000, as the NASDAQ reached its zenith, Berkshire Hathaway's shares sunk low, a discrepancy that might seem odd to the untrained eye. Yet, for the discerning investor, it points towards the inherent unpredictability of the market, and the deceptive nature of immediate success.

The NASDAQ's all-time high represented a bubble on the verge of bursting, a fleeting moment of glory soon to be overshadowed by a downturn. Berkshire's low, on the other hand, concealed an imminent rise, a potential soon to be realized.

This contrast serves to highlight the precariousness of chasing after short-term gains and the dangers of being swayed by the market's capricious trends. It underscores the virtue of patient capital, the wisdom of looking beyond instantaneous highs and lows, and the value of long-term investing.

As we navigate the investing world, let us remember that today's low could be tomorrow's high. And let us strive to cultivate the vision to see beyond the immediate, the patience to weather the storm, and the wisdom to recognize opportunity, even in the midst of perceived adversity.

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Copyright © 2023 by Scott Sansovich