Stock Market Information

As the Oracle of Omaha, Warren Buffett continues to age, many investors are continually anxious as to what will happen to to his beloved company, Berkshire Hathaway, once he’s gone. Given that the stock is down 30% from it’s peak, some are even beginning to wonder if Buffett has somehow lost his touch in his old age. A recent article at Yahoo! Finance suggested as much, giving a variety of reasons as to why Buffett has made some bad bets recently and that once he’s gone the psychological impact of his loss alone will bring the value of Berkshire Hathaway down.

I think they do have some valid points, and its certainly doubtful that Mr. Buffett’s successor will be able to run the company as efficiently and brilliantly as he has. The stock will also be sure to take quite a knock once he leaves, as some long term investors bail out upon his passing. That said, the company is still Financially solid and, as James Altucher points out, still has a number of positive factors going for it in the long run.

Banks and other financials have been absolutely crushed in recent months, but Buffett has been adding to those positions even as they continue to bleed. If you notice where he’s putting the company’s money, however, many of the banks he’s choosing are those that despite the recent financial troubles will still have their dividends protected and will likely survive the subprime mess not unscathed certainly, but with less competition. In the long term, buying down here at the bottom may prove to be an intelligent move in the future, but of course only time will tell.

Making a specific recommendation for stocks is beyond the scope of this blog, but Altucher at least feels that Berkshire is still a good buy based on it’s long term prospects.