David Rosenthal: uncertainty

Transcript context

…If you think about all the pensions that invested from the Graham era through today that generated money for the people whose pensions they support, that’s awesome to the extent that they had access to public equities that were no longer just treated as lotteries. Warren, I don’t know, was probably neutral to Berkshire Hathaway, his involvement. He stopped investing in the business, but the business was going to die anyway. Die any faster. That’s a good question. It is interesting because the least charitable view that you can take on pure investors is that you’re just reallocating piles of money. You’re not creating new value for the world, and that’s the least charitable in lots of ways. If you think about the ways that great venture investors are value add, yes there’s something there to bringing a lot more than capital. Some of the things we’ll talk about in part two where someone with a really strong reputation can come in and save a business who is in the midst of blowing up like the Salomon Brothers or something like that, that is much more than reallocating money from one pile to another, so you are legitimately creating new value for the world. It’s interesting, though. Up to 1970 where we’ve covered here, I’m not really sure that you could make an argument that what the Buffett Partnerships were doing was in any type of value creation.…

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