"
Five or six years ago," Warren Buffett was saying two Sundays ago at the press conference following the Berkshire Hathaway annual meeting, "
Korea offered extraordinary values." Buffett recalled scanning a one-page Citibank research summary listing company after company trading at approximately three times earnings. He said that he bought 20 of these castaways for his personal account (the market caps were too small to contribute meaningfully to Berkshire). "
I don't know why it was so extraordinarily cheap at the time... ," Buffett went on. "I've never found a way to lose money buying stocks at two to three times earnings." And not only did the stocks rally, but also the won appreciated, to 9.4 from about 11.5. "
And professors still teach that markets are efficient," the Sage of Omaha mused. "
Korea is a great example that markets are still inefficient... It pays to dig." The bargains in Korea made him think of the non-bargains in America: "
We don't find screaming bargains among big companies in the United States anywhere," he said.
From '
GRANT’S Interest Rate Observer' (subscription required)
~
“And professors still teach that markets are efficient”
Love that line !
#
The Sage of Omaha
