All the talk and commentary about Warren stepping down is a little irrational given that it is going to be happening and everyone knows it. If it is tomorrow vs in 2 years time, what difference does it make to the combined future cash flows over the next 10 years?
Yeah, we're in the (relative) endgame here under even the best of scenarios. I do think there will be some drop on the day it happens, but I expect the long-term mindset of Berkshire shareholders will quickly win out and most will see it as a buying opportunity. Like you said, Berkshire's performance over the coming decades is what matters most.
Perhaps you've already written on the topic, but a post or two on imagining how the first few years of the post-Buffett era of Berkshire plays out would be an interesting read. When as investors would we really notice the difference? In a year, three years, ten years? If Warren had passed five years ago, what would be noticeable different today? My two cents for the unwanted, but inevitable event is to expect a sell-off, followed by a buyback. In the short-term that will just be noise, but long-term it will all be about Greg Abel's capital allocation abilities which I frankly don't know much about.
Hi Doug -- Thanks for the suggestion! I'll add that to the list. I would love to know more about Greg Abel's capital allocation outlook, too. I did come across one short anecdote from when he acquired NV Energy for BHE. https://www.kingswell.io/i/70900787/heres-why-im-not-worried
A sell off is not inevitable (though very desirable) Warren himself has said numerous times that he expects a rally in the share price when the news breaks and given his reasons. If it is not already priced in that a 94 year old will be one way or another stepping down then it's more than a bit ridiculous. But who knows what will actually happen, point being it's not an inevitability.
All the talk and commentary about Warren stepping down is a little irrational given that it is going to be happening and everyone knows it. If it is tomorrow vs in 2 years time, what difference does it make to the combined future cash flows over the next 10 years?
Yeah, we're in the (relative) endgame here under even the best of scenarios. I do think there will be some drop on the day it happens, but I expect the long-term mindset of Berkshire shareholders will quickly win out and most will see it as a buying opportunity. Like you said, Berkshire's performance over the coming decades is what matters most.
Perhaps you've already written on the topic, but a post or two on imagining how the first few years of the post-Buffett era of Berkshire plays out would be an interesting read. When as investors would we really notice the difference? In a year, three years, ten years? If Warren had passed five years ago, what would be noticeable different today? My two cents for the unwanted, but inevitable event is to expect a sell-off, followed by a buyback. In the short-term that will just be noise, but long-term it will all be about Greg Abel's capital allocation abilities which I frankly don't know much about.
Hi Doug -- Thanks for the suggestion! I'll add that to the list. I would love to know more about Greg Abel's capital allocation outlook, too. I did come across one short anecdote from when he acquired NV Energy for BHE. https://www.kingswell.io/i/70900787/heres-why-im-not-worried
A sell off is not inevitable (though very desirable) Warren himself has said numerous times that he expects a rally in the share price when the news breaks and given his reasons. If it is not already priced in that a 94 year old will be one way or another stepping down then it's more than a bit ridiculous. But who knows what will actually happen, point being it's not an inevitability.