Tren Griffin+ Your Authors @trengriffin I work for Microsoft. Previously I was a partner at Eagle River, a private equity firm established by Craig McCaw. I am on the board of directors of Kymeta. Aug. 27, 2019 1 min read + Your Authors

"Chart shows the market value of all publicly traded securities as a % of the country's business--as a % of GNP. The ratio has certain limitations in telling you what you need to know. Still it is probably the best single measure of where valuations stand." 

25iQuiz: Does Warren Buffett use this "indicator" in buying a complete or partial interest in a specific business? Or does he use it instead in determining a long term rate of return assumption for something like a pension plan or endowment?

Has Warren Buffett ever said anyone can use this or any other indicator to time the market in the short term?

BRK has ~$208B in securities (at mid-year), $122B in cash and complete ownership in the businesses in the graphic? What has Munger said about investing at this scale?

The indicator never "flashes" since its long term. BRK can't currently buy individual businesses at a price with an acceptable margin of safety. Occidental was an exception (fab pricing for WB). BRK decisions are made individually and fully bottom up. BRK doesn't time markets.

You can follow @trengriffin.


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