The greatest one

Source: Forbes

  By Guest Blogger Doug Rowat

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When Warren Buffett announced that he would be stepping down as CEO of Berkshire Hathaway at the end of the year, it gave the media an opportunity to highlight Berkshire Hathaway’s otherworldly performance. The overall market-value gain of Berkshire Hathaway shares from 1964 to 2024 was a staggering 5,502,284%—a number so massive that it seems made up.

The boys on the Animal Spirits podcast a few weeks ago put the Berkshire Hathaway gains into perspective in another way: Berkshire Hathaway, they pointed out, could lose 99% of its value tomorrow and it would still be outperforming the S&P 500 since inception.

What the Animal Spirits podcast didn’t highlight though was what the legendary value investor would probably do if the stock did drop that much: enthusiastically buy more:

So, yes, Buffett was (is) an investor of extraordinary talent. But he’s much more than that, of course.

He’s probably the most quoted investor of all time and every financial advisor, strategist and market pundit has a favourite Buffett quote to draw on for perspective and insight in any market environment.

I’ve highlighted Buffett’s wisdom myself many times, either on our weekly client calls or right here on this blog. My favourites were always his reflections on extreme market risk. Buffett wasn’t a salesman; he was blunt and realistic, reminding investors that some risks simply can’t be protected against:

There is, however, one clear, present and enduring danger to Berkshire against which Charlie [Munger] and I are powerless. That threat to Berkshire is also the major threat our citizenry faces: a “successful” (as defined by the aggressor) cyber, biological, nuclear or chemical attack on the United States. That is a risk Berkshire shares with all of American business.

In fact, Buffett frequently raised the subject of nuclear war, at one point in 2002 stating that

We’re going to have something in the way of a major nuclear event in this country. It will happen. Whether it will happen in 10 years or 10 minutes, or 50 years … it’s virtually a certainty.

These perspectives seem particularly relevant today following the Kashmir border fighting between India and Pakistan or the ongoing rise of AI. And while Buffett’s emphasis on these dire risks may seem depressing, viewed another way, his warnings are really a reminder to make the most of the time that we’ve got.

On a personal note, Buffett played a significant role in salvaging my own finances. Early in my investment career, after getting my brains beat in with my tech-stock investments during the early 2000s, I finally turned to (limped to?) Buffett’s annual shareholder letters and began reading them in earnest.

In mid-2002, after the dust had settled on the tech wreck, I switched direction and bought some ‘wide moat’ Buffett favourites. It matters not what stocks I bought specifically, but it should surprise no one that Berkshire Hathaway itself has easily eclipsed the returns of both the Nasdaq and the S&P 500 since mid-2002.

And Buffett sacrificed much to achieve these results. His success was due to a single-minded focus on his craft. He’s probably spent as much time examining balance sheets as Paul McCartney’s spent time strumming chords on an Epiphone Casino.

Unfortunately, Buffett’s focus on investing was so all-consuming that his family paid a price. His family has often stated that he was never fully present as either a husband or father. His first wife, Susan, in the documentary Becoming Warren Buffett, highlighted that when she was in bed with a stomach flu, Buffett brought her a colander in case she threw up. When she explained how a colander wouldn’t work, Buffett then brought her a cookie sheet to place under the colander.

Clearly, Buffett’s mind was elsewhere. And while his family might not have benefitted from his preoccupation with capital markets, the rest of us certainly did. Buffett became fabulously wealthy because of his talent and hard work, but so did millions of others. And even if we didn’t become wealthy, we still became better investors.

We owe him our thanks.

So, with much gratitude Mr. Buffett, this one’s for you.

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Doug Rowat, FCSI® is Portfolio Manager with Turner Investments and Senior Investment Advisor, Private Client Group, Raymond James Ltd.

Source: https://www.greaterfool.ca/2025/05/24/the-greatest-one/