contrarian@coalmine

WaMu Shows, Again, Smart Money Can Be Wrong

You state, "don’t make a financial company your largest position, unless it has a very strong balance sheet and no liquidity issues, plus superior management, like Berkshire Hathaway (BRK.A)".

I'm always amused that investors place blind faith in the Berkshire Hathaway portfolio, with the assumption that there are no potential ticking financial bombs hidden somewhere in the vast insurance empire; nor do they question the high P/E ratios of some of the BRK.A core investments, especially consumer staple companies, that sell at premiums simply because Warren Buffet consumes them (i.e. invest in what you personally like).

Armchair quarterbacking is great sport--"don’t make a financial company your largest position"-- but, it's worthless as advice for future investment returns. I'll stick with "Buy low, Sell high".