No. of Recommendations: 5
This would be a good time to start a bet with the board. My portfolio against BRK. David against Goliath.
Call it Bitcoin (GBTC), Brookfield (BAM) and Tesla (TSLA) against BRK/A.
All of them could be argued are in the mid-range of recent valuations. (In the past, this board has been good at pointing out when BTC and TSLA are in the midst of excessive exuberance. Good calls.) Right now, I would say with both GBTC and TSLA at roughly twice their recent lows and half their all-time highs that's no longer the case. BAM and BRK are off their highs too.
TSLA: 215
GBTC: 30
BAM: 31
BRK: 530,000
I don't do decimals.
I think these stocks are appropriate because I own them, but more importantly, they represent an anti-BRK portfolio. (I am far from being anti-BRK.) Also, BTC and AI(TSLA) have been recently criticized by Munger. And, BAM is a pure asset manager - similar to BRK's model in many ways ... it's a competitor.
I don't want to start a new conversation about these investments. It IS the BRK board and GBTC and TSLA do not fit into what has been a very good investing methodology for the last century. Value investing clearly works. But, this board needs the occassional antagonist to keep your creaky old bones moving and a little stimulation to try and preserve what little neuroplasticity you have left.:)
It's a few days ahead of the end of a year. But, it's a Sunday and I want to include the election in next years results. According to my back-of-the-envelope calculations it was a good year for both of us:
TSLA: 215-250 =16%
GBTC + BTC (spin): 30-61 =103%
BAM: 31-53 =70%
----------------------
Total 63%
BRK: 530-680 =28%
----------------
Total 28%
This is very close to my actual portfolio and within a few percent of my actual returns.
Very recently I've sold some BAM. Still love the company and like the restructuring they're undertaking but the price has gotten a little rich.
Tesla has gotten much cheaper in the last year. Progress in data centers/autonomy/AI, semi-truck, energy storage, 4680 cell production, Cybertruck ramp and humanoid robot all have me excited for the future. The pace of innovation, their competitive advantage, has not slowed.
GBTC doubled but so did the value. I judge BTC in terms of adoption and regulatory certainty. The ETFs are bringing in hundreds of millions of dollars from new investors every day. MSTR (along with others) are converting USD into BTC for those who can only invest in stocks and bonds. People all over the world are saving in BTC. If it truly does go mainstream, it's probably anywhere from a 10-100X. Conceivably, a 10X in the next few years. A lot depends on the upcoming election in terms of regulatory certainty. Either way, it seems that nobody wants to alienate the Bitcoin voter ... maybe one in four own crypto. Also, I've never seen a reliable estimate on what percentage of all BTC are held by Americans.
Berkshire is looking tired. WEB isn't getting calls anymore from people wanting to sell him good businesses at great prices. The recent discussion of Geico was I thought instructive of the bigger problem: they're falling behind in tech. You can't stay competitive just by running a lean ship anymore. You need to innovate or you'll get passed by. Trying to catch up isn't where you want your businesses to be.
I've trimmed my BAM and bought more TSLA recently but for simplicity I'll run the same companies again for the next year. I still own BAM but it's a taxable account and I'm locked in. Also, even at an elevated price it presents less risk than my other choices.
Next year:
TSLA: 250
GBTC + BTC: 61
BAM: 53
BRK: 680,000.
Good luck!
