Via this item at the azizanomics blog the other day comes another way to look at Warren Buffett’s recent comments about “valueless” gold in the depiction of Berkshire Hathaway stock priced in the yellow metal.
I’d have to agree with the chart’s creator John Aziz when he notes:
Warren Buffett had a great ride: he grew his wealth and businesses in an era of unprecedented growth powered by OPEC oil, and later by Chinese industrialism. That era — the era of the American free lunch — is coming to an end. His insights are applicable to that era. Today is a different world.
![[Most Recent Quotes from www.kitco.com]](http://kitconet.com/charts/metals/gold/t24_au_en_usoz_2.gif)
![[Most Recent Quotes from www.kitco.com]](http://kitconet.com/charts/metals/silver/t24_ag_en_usoz_2.gif)
![[Most Recent USD from www.kitco.com]](http://www.weblinks247.com/indexes/idx24_usd_en_2.gif)
I completely agree with the quote about Buffet’s good luck. The media and most Americans idolize wealth and lionize the uber-rich so they attribute superhuman powers to Bill Gates, Donald Trump, Warren Buffet, etc.
But, in a nation of 320 million, SOME of them are going to strike it rich (like Hearst, Rockefeller, Carnegie, etc. in times past) in a BIG way. It doesn’t mean these people are infallible or that they are super-geniuses.
If you review Buffet’s bio, you’ll see he made lots of mistakes along the way but he had the extreme good fortune to catch a huge upswing in general in the markets and he made enough good deals early on to get him to the point where he had enough money that his mistakes didn’t stop him. Same with Bill Gates and his immense good fortune to come along at the right time. They’re smart but they are not infallible.
Naturally, you tend to “dance with the one that brung ya.” Stocks got Buffet rich and he has no use for commodities. It would be very hard for anyone who got rich in the stock market and M&A to admit that the glory days are over just as it is hard for people who recently make a killing in real estate to admit that real estate is not the path to riches today.
However, the world of cheap oil is ending and it this will require adjustments on a large scale. Whoever gambles on that concept will probably be the super-rich of the future and 50 years from now people will hang on every word that person utters. But it will only be apparent with hindsight.