No. of Recommendations: 15
Is this better:
What do you think happens to SPY in panic and turmoil?
SPY falls 50%+, and Berkshire falls 50%+. They did in the GFC.
Much better.
So we now have 2 data points of what BRK did during "panic and turmoil":
- .com crash: BRK did the opposite of the S&P
- GFC: BRK did the same as the S&P
Agreeing on that could be the starting point to discuss which factors were responsible for that completely different behaviour (and in which way that could be related to a potential AI crash), like:
A) Valuation: Having been out of favor during the .com mania BRK was strongly undervalued during the .com crash. Not so during the GFC (and not so now).
B) Limited vs. Systemic risk: The .com crash was limited to the dramatically overvalued parts of the market, of which BRK was not a part. The GFC represented a systemic risk, a risk for the whole financial system.
