Category Archives: Warren Buffett

The Broken Clock Investor: Always Warning, Rarely Winning

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Dear Mr. Market:

One of our favorite recurring themes here at Dear Mr. Market is what we like to call the “Broken Clock Club” — the group of perma-bears, doomcasters, and media pundits who reliably forecast financial catastrophe year after year. Like a broken clock, they’re eventually right… but for all the wrong reasons and far too late to be of any use to investors.

Let’s rewind to December 2023. Headlines were ablaze with bold predictions of economic calamity. Chief among them was the infamous economist Harry Dent, who warned of a 1929-style market crash hitting in early 2024. (click here to review that article that grabbed a lot of nervous eyeballs back then). Dent’s call wasn’t exactly an outlier; it echoed a chorus of dire predictions centered on Fed policy, inflation hangovers, geopolitical instability, commercial real estate defaults, and consumer weakness.

Yet here we are, approaching mid-2025, with the S&P 500 not only above its December 2023 levels, but clawing its way back and approaching highs throughout the first half of this year. What gives?

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RIP Charlie Munger : Farewell to an Icon of Investing

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Dear Mr. Market:

In the world of finance and investing, the passing of a visionary figure leaves an indelible mark on the landscape they helped shape. Today, we bid farewell to an icon, a man whose wisdom and wit transcended the realms of business and life itself. Charlie Munger, the renowned investor, philanthropist, right hand man of Warren Buffett and Vice Chairman of Berkshire Hathaway, passed away today, but his legacy endures through the profound insights he shared with the world.

Charlie Munger was a man who not only navigated the complexities of the financial world but also imparted invaluable lessons on success, rationality, and the pursuit of knowledge. Join us as we explore the essence of Charlie Munger’s wisdom through ten of our favorite quotes he shared over his 99 years of life:

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Investing & Diversification: When Less is More

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Dear Mr. Market: download

In many of our letters to you we discuss the ups and downs of the stock market. In doing so, we often times will share basic knowledge and investing reminders to our readers to help guide them. Without question, even a rookie investor will have learned the simple advice of diversifying their portfolio. “Do not put all your eggs in one basket!”

While that “advice” is intuitive and seems to make sense, it’s mainly regurgitated by every financial advisor because of one alarming reason. Yes, on one hand it’s with the intent of managing risk but part of the dark reality is because most people (pros included) don’t know what they’re doing. This last sentence may sound harsh but our job is to be candid and also share ideas and truths that you may need to know yet not always hear elsewhere.

If you stop reading this article right now do yourself a favor and at least spend seven minutes when you have more time. The seven minutes we want you to spend are watching the following clip of Warren Buffett and Charlie Munger. Click here to view it and learn their basic belief that most investors over diversify and are simply “protecting themselves from ignorance”. Continue reading →

Manic Market

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Dear Mr. Market:51Xur1KZWKL

For some of our newer readers it might serve us well to remind everyone of who you are and what this “Mr. Market” character is all about. If you haven’t read Benjamin Graham’s book, The Intelligent Investor, you need to. Even though it was written in 1949, much of what Graham wrote is still applicable today and it’s simply one of the best books on the stock market ever written. Warren Buffett himself loves the book and says that it changed his life. Here’s a summary from Buffett and his description of our very own “Mr. Market”: Continue reading →

Warren Buffett’s Baby

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Buffett2Dear Mr. Market:

This past weekend, the investment world descended on Omaha, Nebraska; best known perhaps as the hometown of one of the most successful investors in the world. Warren Buffett, also known as the “Oracle of Omaha”, will be hosting investors at the annual Berkshire Hathaway shareholders meeting. The schedule is filled with presentations, shopping & dining experiences, and social interactions that will be the highlight for many individual investors.

The investment community has been fascinated with Warren Buffett for his colorful comments and impressive track record. He has proven to be a in a class all by himself looking for good companies at an attractive price and has never been scared to be a contrarian. Flipping through the pages of the 2014 Berkshire Hathaway Annual Report, we can’t help but notice that many of the principles Buffett applies to prospective investments are now making his own company look very attractive.

The class ‘B’ shares of Berkshire Hathaway (BRK.B) currently trade at $141.21 per share while the ‘A’ shares trade for an impressive $213,400 per share! Through the first four months of the year BRK.B is down -5.93% while the S&P 500 is up 1.3%. Buffett has been quoted as saying, “price is what you pay, value is what you get.” Last year (2014) the S&P 500 delivered an impressive 13% and BRK.B doubled that, rewarding investors with a 26% return for the year. Continue reading →