Comments on: Lots of Talk About Buffett’s Latest Editorial http://allfinancialmatters.com/2008/10/20/lots-of-talk-about-buffetts-latest-editorial/ A personal finance blog dedicated to discussing such topics as budgeting, asset allocation, 401K, IRA, cash flow, insurance, financial planning, portfolio management, and other areas in personal finance. Fri, 25 May 2012 17:52:53 +0000 hourly 1 http://wordpress.org/?v= By: kitty http://allfinancialmatters.com/2008/10/20/lots-of-talk-about-buffetts-latest-editorial/comment-page-1/#comment-372459 kitty Wed, 22 Oct 2008 14:49:57 +0000 http://allfinancialmatters.com/?p=2894#comment-372459 One thing to remember is that Buffett was correct in the past: 1. In 1979 when everyone was fearful, he told he was buying. He was correct. Not immediately, but he himself said he cannot predict short-term movement. 2. At another time - I believe early 90s, he predicted the next bull market. 3. In 1999 he let it know the market was too high. When everyone was buying internet stocks, he mentioned Cinderella and the ball, and how you have to leave by midnight or you'll be left with pumkin and mice. Commentators told Buffet was old and couldn't understand "new economy". Buffet was correct, and most of the rest of us were indeed left with pumpkin and mice. 4. In 2004, Buffett told he cannot find anything of value in the market. He told he was under-invested, and that it was not pleasant but it was better than to feel like a fool later. He also called derivatives the "financial weapons of mass destruction". Again, he didn't predict the top, but it was better not to buy at 2004 and sell later. At every one of these times, listening to Buffet would've saved us money or helped us make it. Not short-term, but then unless you are a trader, short-term movements aren't as important. The money you need within next 5 years shouldn't be in the market anyway. One thing to remember is that Buffett was correct in the past:
1. In 1979 when everyone was fearful, he told he was buying. He was correct. Not immediately, but he himself said he cannot predict short-term movement.
2. At another time – I believe early 90s, he predicted the next bull market.
3. In 1999 he let it know the market was too high. When everyone was buying internet stocks, he mentioned Cinderella and the ball, and how you have to leave by midnight or you’ll be left with pumkin and mice. Commentators told Buffet was old and couldn’t understand “new economy”. Buffet was correct, and most of the rest of us were indeed left with pumpkin and mice.
4. In 2004, Buffett told he cannot find anything of value in the market. He told he was under-invested, and that it was not pleasant but it was better than to feel like a fool later. He also called derivatives the “financial weapons of mass destruction”. Again, he didn’t predict the top, but it was better not to buy at 2004 and sell later.

At every one of these times, listening to Buffet would’ve saved us money or helped us make it. Not short-term, but then unless you are a trader, short-term movements aren’t as important. The money you need within next 5 years shouldn’t be in the market anyway.

]]> By: frank http://allfinancialmatters.com/2008/10/20/lots-of-talk-about-buffetts-latest-editorial/comment-page-1/#comment-371834 frank Mon, 20 Oct 2008 17:06:39 +0000 http://allfinancialmatters.com/?p=2894#comment-371834 The main thing I took from the Abelson quote above is this: "For one thing, Buffett can afford to be patient as long as he chooses. Most investors don’t have that luxury" I think it bears repeating that asset allocation is crucial to investment decisions and people need to be cognizant of that fact the closer they are to retirement. Sadly, it appears that many forgot. The main thing I took from the Abelson quote above is this: “For one thing, Buffett can afford to be patient as long as he chooses. Most investors don’t have that luxury”

I think it bears repeating that asset allocation is crucial to investment decisions and people need to be cognizant of that fact the closer they are to retirement. Sadly, it appears that many forgot.

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