Buffett Posts Worst Performance Against S&P in Decade

Wait a minute... he's a century trader.

Jan. 4 (Bloomberg) -- Warren Buffett recorded his worst performance against the stock market in a decade last year after committing $26 billion to a railroad takeover and lowering his expectations for investment returns.

Berkshire Hathaway Inc., the company Buffett has led as chairman for more than four decades, advanced 2.7 percent on the New York Stock Exchange in 2009, less than the 23 percent return in the Standard & Poor’s 500 Index. It was Berkshire’s worst showing since falling 20 percent in 1999, compared with a 20 percent gain in the index. Berkshire beat the index in 15 of the last 22 years.

http://www.bloomberg.com/apps/news?pid=20601087&sid=aoxammlga6dw&pos=5

 

I've just finished reading the Buffet biography - The Snowball. Its a fantastic book.

There is one passage where he talks about paying stock for an acquisition. He is totally and completely against it unless he feels that the stock he is using as currency is way overvalued.

The fact that he layed out a good chunk of stock for this purchase could be read as no more than an attempt to unload what he thinks is some wildly overvalued Berkshire Hathaway.

 

1)There should be an onslaught of investors who will brag about how their 10-year rate of return was better than BRKA's.
2) There should also be another onslaught of investors who will justify subpar performance by saying that even Buffett struggled to make money.

 

Then of course there are those of us who watched WEB's postion in USG go from 11 to >100 and back down to 14 and think pfffttttt three dollars in the last decade, you da man.

 

.....but the fundamentals seemed so "good" the entire way!