"It should be obvious to everybody by now that such stock market largesse is made in Washington ... The specific address is the Eccles Building," writes John Gilbert, CIO of General Re (a BRK.A, BRK.B unit), reflecting on Twitter's (TWTR) $25B market cap (on its first day of trade). "Correctly accounted, the company makes not a dime. But who cares when circumspection is the investment equivalent of tuberculosis."
He notes Twitter came public during the same week Cisco tumbled on disappointing results. It was 2000, Gilbert reminds, when Cisco was valued at about $500B, or 200x the company's then-earnings. "Cisco and brethren were going to change the world. Sort of like Twitter today," he says, pointing to Cisco's "Rocky-Mountains-meet-the-Great-Plains" stock chart.
"Following such a crowd is an excellent hedge against ever being financially independent. Gravity wins in time."