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News Link • Gold and Silver

Warren Buffett Does a Disservice


Warren Buffett shuns gold as an investment ... The billionaire investor Warren Buffett has said he'd always bet on a good business to deliver better returns than gold over time, even as the precious metal sets fresh records. Billionaire investor Warren Buffett says of gold: 'you can fondle it, you can polish it, you can stare at it. But it isn't going to do anything.' – UK Telegraph

Dominant Social Theme: The metal is worthless.

Free-Market Analysis: Warren Buffett is at it again, talking down gold and the Telegraph is reporting on it: "Gold really doesn't have utility," the 80-year old told shareholders at Berkshire Hathaway's annual general meeting. "I'd bet on a good producing business to outperform something that doesn't do anything."

Buffet may indeed bet on a producing business to outperform gold, but in the 2000s his track record is considerably spottier than in other decades and the past three years of the financial crisis have savaged his portfolio. Meanwhile, the "greatest investor in the world" has sat on the sidelines while gold has moved from US$250 to over US$1500, throughout the 2000s. He did apparently own some silver but sold it years ago.

The Telegraph tells us that when he was asked about gold at his annual meeting in Omaha, Nebraska, Buffett said "if you take all of the gold in the world and put it into a cube, it would be about 67 feet on a side and you could get a ladder and get up on top of it. You can fondle it, you can polish it, you can stare at it. But it isn't going to do anything."


1 Comments in Response to

Comment by Rocky Frisco
Entered on:

No, gold won't make a profit. What gold does is hold its value. In today's world, gold holding its value may result in more wealth than a profit in Federal Reserve Notes.

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