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Why the Buffett myth is dying

  A person’s success is inseparable from personal efforts, but also inseparable from the general trend of the times and historical trends.

  Berkshire Hathaway, a company owned by “stock god” Buffett, recently announced its second-quarter earnings report, showing a quarterly net loss of nearly $43.8 billion, or nearly 300 billion yuan in RMB. People are talking: Is the Buffett myth about to burst?
  Buffett certainly disagrees with the badmouthing. He defended himself that the so-called losses were nothing more than an illusion created by modern financial laws. Holding high the banner of “value investing”, he has been advising clients not to pay attention to temporary fluctuations. History also seems to have proven him right—from 1965 to 2021, Buffett’s investments have an annualized return of 20.1%, far higher than the 10.5% return of the U.S. S&P.
  However, the myth, although not yet shattered, is slowly dying. You know, in the 1970s and 1980s, Buffett’s annualized rate of return often reached 30%, and in some years it even reached 80% or even more than 100%. But that largely disappeared after 2000.
  In nearly half of the last 20 years, Buffett has only achieved single-digit returns; in the last 10 years, he has only earned an annualized return of more than 30%. Data will not deceive people. In Wall Street, where funds are full of funds, Buffett is indeed not so good.
  In the past few decades, Buffett has been sought after not only for his investment performance, but also for his unique investment style and humorous and friendly personality. The author has met this old man, and his approachability is really impressive, but I have to point out that Buffett is an idol created by the financial media, especially in China.
  Over the years, many domestic financial media have over-chased Buffett, not only keeping track of his news, but also organizing a “pilgrimage” to his hometown. Through media publicity, Buffett’s shareholders meeting has become a carnival event that can be searched, but is this rational?
  Buffett is good at using the power of the media. The most representative one is his annual lunch auction. It was originally a charity, but it has become a profit-making tool for some people, such as some upstarts in China, who eat and take pictures with Buffett. Packaging yourself as a successful person who has been officially certified by the “Stock God”, and swindling and cheating at home and abroad.
  Fortunately, time is a tool for testing investment myths. In recent years, the Chinese have calmed down a lot in dealing with “stock gods”. On the one hand, the long-term touts of the media make everyone tired. On the other hand, people find that “stock gods” often have bad times, such as Buffett’s quarterly losses.
  In fact, “stock gods” cannot be learned. Factors such as era, character, and experience determine that the success of others cannot be replicated. You can understand Buffett’s investment philosophy, but it is a fool’s dream to use the method of seeking a sword to get rich once and for all.
  Buffett’s success is inseparable from his personal qualities, but one thing that cannot be ignored is the era and national background he lived in – the period when Buffett accumulated the fastest wealth was the golden age of American economic development, and his rate of return gradually increased. The period of slow down is also the era of continuous decline in the overall strength of the United States. For this, Buffett is well aware of it, otherwise why does he always emphasize that “a person can never be successful by shorting his own country”?
  A person’s success is inseparable from personal efforts, but also inseparable from the general trend of the times and historical trends. When Chinese investors rack their brains to study the Buffett myth, don’t forget that he has an investment philosophy that is easy to learn – work hard for your country to be better.

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