Warren Buffett, an American investor, has a great reputation in China's investment circle, which can be described as thunderous, no one knows, no one knows.
Buffett, as the most successful investor of all time, has summarized the way to his success, one of the principles is the principle of the circle of competence.
The so-called circle of power principle is to invest within their own capabilities and refuse to invest in targets that they do not understand.
For decades, Buffett's investment targets have been traditional companies such as coke, candy, insurance, banking, razors...
All along, Buffett rarely makes mistakes, obtains a rich investment return, and his reputation is growing.
Every year, Berkshire's shareholder meeting is a grand event for the global investment community.
Buffett's annual luncheon auction is also a major event in the global gossip scene.
There is no doubt that Buffett is an old-school investor who loves traditional industries, is not interested in the technology industry, and even adopts a hostile attitude towards some emerging industries.
For example, buffett was not inferior to Bitcoin.
There are many styles of investing, and it doesn't matter what kind of style an investor is, what matters is to make money.
All along, Buffett has been very profitable, naturally his old-school style, the world is more admired.
However, there is a problem here, a country always needs to develop, development needs to rely on science and technology, needs to rely on innovation, and needs to push the back wave forward.
A country with rapid development will inevitably rise a large number of emerging industries.
A high-growth crowd will inevitably enthusiastically pursue emerging industries.
The valuation of emerging industries will naturally go higher, and the valuation of traditional industries will naturally go down.
In other words:
In a fast-growing country, the proportion of traditional industries will become less and less.
A country where traditional industries are sought after is certainly not a promising country.
Looking at the United States with this logic, we will know where Buffett's dilemma is!
After decades of development, Berkshire's volume has become a giant. However, in the U.S. economy, there is no room for traditional industries to grow.
That is to say, if you only invest in traditional industries, Buffett may face no shares to invest in. In the principle of Buffett's circle of ability, if there is money and no shares, then hoard money.
The three principles of investment, the first is capital protection, the second is capital protection, and the third is capital protection.
For Buffett, hoarding money is not a problem. The problem, however, is that Berkshire is a public company, and shareholders are looking for profits.
As Buffett personally, it's okay to hoard money. As Chairman of Berkshire, hoarding money means not being able to generate profits, which is a big problem.
On the company's books, there is a lot of cash, which shareholders will never allow, even if you are Buffett.
Guarding a pile of money, you can also manage your own hands. It's an ability, it's a kung fu.
Bafair's way of doing things goes without saying, but obviously can't stand up to a bunch of shareholders who don't do enough.
If, Buffett, who has to throw his money out, has only two options:
First, buy back shares, this is the safest, but does not create profits, and at the same time it is impossible to buy back in large quantities, which does not consume much money.
Second, break through the circle of ability, to invest in areas that are not well known, this is the king, of course, the risk will be very high.
There is a popular saying: You will never make money outside of your cognition.
My first feeling is that the person who says this must be a student.
Corrupt words are not worth a word.
But all entrepreneurs cross the river by feeling the stones. In other words, if the future business is successful, it will make money other than the current cognition.
Whenever you see something clear and clear, and you do it again, there is no chance.
This truth, Buffett naturally understands, sometimes, you can't understand, you have to vote.
Obviously, when Berkshire got to this scale, Buffett also had to do things outside of the circle of competence.
So Buffett began investing in tech stocks. For technology stocks, Buffett is obviously not cold, but he also has to vote.
Investing in technology stocks, Buffett obviously has to do his homework, but obviously he will not understand.
Can't understand, but also pretend to understand, hard scalp investment, position control, the problem is not big.
Buffett invested in technology stocks, and the most successful example is Apple.
In 2016, Berkshire began building a position in Apple stock. In 2017, it began to increase its positions in a big way.
In 2018, Apple became Berkshire's first heavy stock. Buffett was interviewed and said he wanted to own 100 percent of Apple stock.
In 2019, although Buffett began to reduce his position in Apple, his position was still as high as $36 billion, and his position has been profitable so far.
The so-called investment is to bet on uncertain things. Whether it is making money or losing money, the factor of chance will always exist.
Since it is an investment, there will be successes, and there will inevitably be failures.
On November 9, 2021, a local court in California announced that a couple had been sentenced to 30 years in prison.
The charge was: through a new energy company, the Ponzi scheme was committed, defrauding more than $1 billion.
In this dog blood scam, the victim actually has the famous Buffett.
A document filed by Berkshire Company shows that between 2015 and 2018, the tax benefits the company received from investments were likely to be invalid, and a $377 million expense was included in the first quarter to offset the tax incentives.
Later, it was confirmed that the investment was involved in this scam, and Berkshire lost nearly $400 million.
Both of these examples, whether they earn or lose, have contingencies in them.
The achievements of traditional industries, Buffett obviously can not be copied, in the emerging industry.
In recent years, in non-traditional industries, Buffett's investment has not been successful, and the US stock market has been at a historical high, and hoarding money is still Buffett's strategy.
At present, Berkshire's cash assets are as high as $146.6 billion, equivalent to more than 1 trillion yuan, at the highest level ever.
Buffett was born in 1930 and is now 91 years old, an uncompromising old man.
In terms of the natural attributes of the body, Buffett will become more and more conservative, but the world is still soaring.
In the latest crypto asset industry, the post-90s are already old, and Buffett obviously can't understand this field.
A 91-year-old man, apparently running out of time, to adapt to the new environment.
In the Old World, Buffett was still king. In the New World, he was just ordinary.
In the era of digital assets, buffett can no longer see the taillights.
If you are a Shareholder of Berkshire, at this time, do you want to ask:
Warren is old, can still vote or not!
Bitcoin is rat poison