Subject: Re: Valuation
Berkshire's value, a two-column valuation method (There are variations on two-column methods) will break Berkshire's valuation into two major parts, operating earnings and investments.

Perhaps a third column should be added for cash (cash equivalent)surplus to what is required for underwriting. If the thesis is correct that WB is holding surplus cash to be deployed during a crisis when asset prices have plummeted below asset values, the cash should have a much greater value than its nominal value.


Three columns! Good grief, next you'll be wanting to separate out investments into stock holdings, associates (ownership stakes between 20 and 50%) and insurance underwriting, and you'll have 5! What should we call it?

Kidding aside, search the word 'groves' on this board and you'll get some recent thinking about how this might be done.

DTB