I was looking at charts of the S&P500 on Friday.
In the last 16 years (since the financial crash) the US economy has roughly doubled in size. Even with the recent drop, the S&P500 is at over 5x the 2009 level...

It's always hard to get a handle on valuation levels, especially S&P versus Berkshire, because the answer depends so much on the interval chosen.

I tried a new method to pick a "fair" interval.

On June 17, 2005, just under 20 years ago, the S&P 500 was valued about 5% more richly than its average valuation multiple since then.
On June 17, 2005, just under 20 years ago, Berkshire was valued about 5% more richly than its average valuation multiple since then.
Since those are the same, it seems like a reasonable starting point.

Currently, the S&P 500 is valued about 25.6% more richly than its average since that same date in June 2005.
Currently, the S&P 500 is valued about 27.5% more richly than its average since that same date in June 2005.
Again, pretty close, so it's coincidentally not such a bad end point to consider.
Both got a little more expensive, and by the same amount.

The observation from the interval from then to now is that the observable value of Berkshire (using peak-to-date book-per-share) has risen (8.3%/year) a lot faster than the observable value of the S&P has (4.02%/year).
This is a discussion of the value and valuation level of each, not total return! Obviously the S&P also pays a dividend.
Unfortunately, that gap (4.27%) in real value growth per unit is a whole lot more than can be made up for by S&P dividends. Thus the real pretax total return of Berkshire has been 2.22%/year higher than the real total return of the S&P. SPY real total return has been 7.00%/year since then, and Berkshire real return has been 9.22%/year.

The gap in this specific interval is, I think, a whole lot more meaningful than most figures you see, since both horses in the race started at the same apparent level over over/undervaluation, and both ended at the same level as well. In this instance, the difference in returns is equal to the difference in value generation.

Here is a graph of the value of the S&P index using smoothed real earnings, and the value of a share of Berkshire using peak-to-date book-per-share, with that same baseline in June 2005. Again, this is NOT a comparison of total returns, but the rate of value growth per unit. The S&P paid enough in dividends to close about half the visual gap.
http://www.stonewellfunds.com/BRKandIndexValueGrow...

Nothing earth shattering, just pointing out that in the last ~20 years, the value of a share of Berkshire has risen a whole lot faster than the value of the S&P 500 index has.

Jim