This year’s shareholder letter:
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In recent years, the sensible course for us to follow has been clear: Many stocks have offered far more for our money than we could obtain by purchasing businesses in their entirety. That disparity led us to buy about $43 billion of marketable equities last year, while selling only $19 billion. Charlie and I believe the companies in which we invested offered excellent value, far exceeding that available in takeover transactions.
Overpriced market? What overpriced market.
Warren Buffett: I Overpaid for Kraft Heinz
I knew. Sold KHC to BRK 
also sold COP to BRK many years ago. FA is BS because it is based on unpredictable future cashflows and arbitrary discount rate. GIGO. Everybody who uses FA is correct!!! and also wrong!!!
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How do you say rental in Austin is far better than rental in bay area? You assume possible future rent, current mortgage rate, holding period and appreciation.
Similar assumptions people make on flipping, buying cost, remodel, carrying cost, selling cost and then selling price. Before offer, you make future assumptions and submit an offer.
All these are assumptions about future and the calculations you make out of it is called “Fundamental Analysis”.
Similar to it, experienced Analysts make assumptions on company and it is called fundamentals.
Either in real estate or in stock, there is a difference between assumptions vs actual and is called variance.
If variance is wide, failure is common either real estate or stock.
Success or failure is due to the same person : Buffet !
No one (including buffet) is hitting success consistently 100%, but the higher success rate wins.
All the while I view those cashflow and future appreciation computations for RE rental are garbage. I know some of you take them as gospel 
I have unlearned FA for stocks long ago 
I doubt @manch did FA even though he knew a lot about FA. At best, FA is academically recognized scientific voodoo.
@harriet, Do you do FA for the stocks that you have bought or planning to invest? I know you timed your purchase e.g. 52-week low.
Charlie and I happily acknowledge that much of Berkshire’s success has simply been a product of what I think should be called The American Tailwind. It is beyond arrogance for American businesses or individuals to boast that they have “done it alone.” The tidy rows of simple white crosses at Normandy should shame those who make such claims.
There are also many other countries around the world that have bright futures. About that, we should rejoice: Americans will be both more prosperous and safer if all nations thrive. At Berkshire, we hope to invest significant sums across borders.
Over the next 77 years, however, the major source of our gains will almost certainly be provided by The American Tailwind. We are lucky – gloriously lucky – to have that force at our back.
Just finished reading this year’s WB letter. It felt much shorter than past years’…
Exactly. Especially when you’re looking at a 5 or 10 year horizon. No one is going to be right. I’m sure there was a time FA said Nokia and RIMM would be worth even more than their peak price. Everyone knew the cell phone market was going to grow like crazy. No one predicted Apple then android would happen and take all of their market share.
The further into the future the cash flow prediction the less accurate it’ll be.
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I think you are frustrated by KHC drop, exactly like I felt AAPL dropped from $225 to $142 !
Even today, my biggest drop was AAPL and Biggest gainer is from TSLA.
In retro respect, I should have been careful with AAPL when many analysis predicted the fall of AAPL.
Second issue, I purchased few stocks beyond a comfort limit, including AAPL.
Think of those who bought STMP when it was $208, dropped to $83 few days before. This was horrible fall. It suddenly came up to $99 today !
How do you deduce this? I think I have told you the reason why FA is not good moons ago - refer to old threads 
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I don’t depend on FA for stock picking but I do review the financials for sanity check.
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Whoever says that they blindly buy real estate without even calculating their financials, rent-parity etc, I do not think it is correct.
In every business, every walk of life, we do calculate with some assumptions, that is the basis of fundamentals.
I can build a small hut/room with handyman, but to build a skyscraper we need big team of architects/engineers…etc…with lot of computerized design.
Similarly, It may be true for small amounts,no fundamentals, but hard for multi-millions and billions of investments.
If anyone assumes fundamentals analysis is useless/wrong, they are missing the important aspect of sound investment, esp at this computerized world.
I do not want to go on argue on this further, but sincerely would like to indicate the missing part so that they can get benefit out of it.
I stop here, no further update on fundamentals.
Fundamental analysis is a method of evaluating a security in an attempt to assess its intrinsic value, by examining related economic, financial, and other qualitative and quantitative factors.
In terms of stocks, fundamental analysis focuses on the financial statements of the company being evaluated.
In other words, past data. In stocks, we are investing in the future! We all know future is unpredictable.
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What metrics do you employ?
A buffet on Buffett.
Can’t tell you all my secrets, geez 
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PM me 
Any socialist RE investor following Warren Buffet? 
Definition of wealthy?
Some lawmakers, including socialist Rep. Alexandria Ocasio-Cortez, D-N.Y., are pushing for higher taxes on the wealthy. She recently proposed a 70 percent marginal tax on incomes over $10 million in an effort to bridge the growing gap between the rich and the poor.
None of us earn that much. In fact, hardly any1 can do that. My guess, founders/CEOs of a business, hedge fund managers, SVPs of mega cap companies,… probably that’s about it. Tax them!
Warren’s “ultra-millionaire” tax would apply to people with more than $50 million in assets and is projected to raise $2.75 trillion over a 10-year period, according to her team.
None of us have that much assets. Having $50M in assets is pure luck. So tax them!
@buyinghouse, I support WB proposal out of jealous 
of the wealthy.
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You are the first guy who gets it. You know, not being a billionaire, nor using the many tax loopholes where you won’t move a finger to get $ mitigation without all the mumbling jumbling about withholdings and whatnot.
But, there are some posters here defending those who wouldn’t dare to even saying good morning to them. It is pathetic up to some point, then it turns their rhetoric into a circus.
By the way, after the second world war, the taxes were what? 90+ percent?
And, even if the taxes were 70%, the tax loopholes I always talk about, but nobody pays attention to, make that 70 a laughable number.
Tax loopholes are there, for the protection and preservation of the higher class wealth, not the buyinghouse or some posters here. 
Warren Buffet believes in life insurance as a way to leverage money, but please, don’t tell certain bunch of ignorant (being ignorant on a subject is not bad, you just don’t know it, or you don’t want to believe it) people about it. 
During the WWII taxes were raised to 94%. To fight a war. Congress hyped the Cold War and kept taxes high until Kennedy dropped them 17 years later. The government doesn’t like to give up its greedy use of your money. They would just as soon take it all and give it back to whomever they think is deserving.
BTW the 70% doesn’t include state and local taxes, property taxes excise taxes liquor and tobacco taxes and a million other fees.
People forget income tax in 1913 was originally only 1% on the top 1%. A slippery slope soon forgotten .
From 1913 to 1941 the tax went to 90% and included everyone.
Ah the good old days
When income taxes were only to fight wars.
Now they are used to redistribute wealth
Aka communism
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