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The week's question
In March 2025, in the thread "Re: OT, out", Umm asked the members: "Do you think it is because America is made up of magical soil that makes businesses based in America magically profitable?" This week it is put to everyone again. The button below opens the small thread re-asking it - read what others have said so far, then give your own answer as an ordinary reply.
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Stocks A to Z / Stocks B / Berkshire Hathaway (BRK.A)
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Author: mungofitch ✹✺ SILVER
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Number: of 22354 
Subject: Recent returns
Date: 06/12/25 11:24 AM
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Just an observation that when you measure something, the choice of yardstick matters.

Berkshire's price is up 4.2% since January 21, a rather arbitrarily selected Monday picked from a graph.
But that's the price measured in US dollars. The US dollar on a trade weighted basis is down -10.49% in the same stretch.
So, in terms of purchasing power, a share of Berkshire is worth 6.75% *less* than it was then. You couldn't buy nearly as much global "stuff" now.
i.e., a person would have done better with Euro notes stuffed in a mattress (or on average any currency) than Berkshire shares, no matter where they lived.

Trade weighted dollar index is a peculiar thing to visualize, but the US dollar has dropped in value by
-3.9% versus the Australian dollar
-9.7% against British Sterling
-4.5% against the Canadian dollar
-9.5% against the Euro
-7.5% against the Japanese yen
-10.2% against the Swiss franc

The US dollar is actually still quite high if you look at a longer time frame. There are several reasons to suppose that there may be more room to move lower.
* Tariffs generally depress the currency of a country imposing them
* Less obviously, import tariffs generally depress exports of the country imposing them, which depresses the currency
* There is no current prospect for a reduction in the US budget deficit, so continual capital account surpluses are required to keep the currency stable, yet...
* there is a modest shift in global investment flows away from US-domiciled securities underway--small in percentage, but not a short term tactical move.
Take all that reasoning with a bucket of salt. Currencies make stock price prediction look simple and obvious.

Jim
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This community has written 21,861 posts about Berkshire Hathaway. The article-length ones it recommended most:
BRK: Why Not XOM? · 62 recs · 2024
Second quarter comments · 60 recs · 2023
Berkshire's Profit Contributors · 58 recs · 2023
Summary of 2Q 2026 · 55 recs · 2026
3Q Summary · 53 recs · 2024
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