Buffett: Trouble is always coming, buy stocks anyway

Nodrog · 2nd Mar, 2020

Buffett: Trouble is always coming, buy stocks anyway

Becky: What are your thoughts on what’s happening with the coronavirus, if this is a reason to panic and if you were worried about this?

Buffett: I don’t know if I have any special thoughts beyond the news on the coronavirus. The very first day I bought stocks was 12 March 1942. And the stocks were down about 2% that day as it turned out. If you’re buying a business and that’s what stocks are, businesses, in fact, people would be better off if they say, “I bought a business today,” not a stock today because that gives you a different perspective on it than presumably if you go out and buy a farm, if you buy an apartment or a house. If you buy a business, you’re going to own it for 10 or 20 or 30 years. And the real question is has the 10-year or 20-year outlook for American businesses changed in the last 24 hours or 48 hours? I do think that not only our businesses but American business generally will be doing fabulously better 30 years from now or 20 years from now. ...

Buffett: Well, if you look at the present situation, we’ve talked about this before, that you get more for your money in stocks than bonds. That doesn’t have to be the case. I mean, but it’s usually been in the case in America. If you buy a 30-year bond today with a yield of 2% you’re paying 50 times earnings for an investment where the earnings can’t go up for 30 years. Now if somebody said to you, “I want to sell you a stock that’s at 50 times earnings. The earnings can’t go up for 30 years,” you’d say that doesn’t sound very good. Stocks are way better than 30-year bonds. I mean, that’s clear. People really have three basic alternatives, short-term cash which is an option of doing something later, long-time bonds or long-term stocks. And stocks are cheaper than bonds. ...
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Buffett: Trouble is always coming, buy stocks anyway

Nodrog Well-Known Member

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Buffett: Trouble is always coming, buy stocks anyway

Nodrog Well-Known Member

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