January 2nd, 2013 9:04 PM by Eric Fang
My resolution is similar every year. For this yearof 2013, I will run one Marathon if possible.If not, at least I will run a marathon relay.
I will continue try my best to lose weight. BUt 10 lbsis good enough. And it will be hard for me to lose more.
Last year's focus was running. And this year I will focus on reading. And read financial books.
Yesterday, when my wife and my daughter went shoppingat Union Square Center of San Francisco. I readWarren Buffett's annual letters to his share holders.
I will introduce lots of his investing ideas this year.Here is the first one for the year 2013:
Why Warren Buffett does not invest on gold?
According to berkshire hathaway annual report 2011(Page 17-18),Gold belongs to a category of investment which will neverproduce anything, but they are purchased in the buyer's hope that someone else will pay more for them in the future.Though gold has some industrial and decorative utility,it is either of not much use or precreative.
Today the world’s gold stock is about 170,000 metric tons. If all of this gold were melded together, itwould form a cube of about 68 feet per side. (Picture it fitting comfortably within a baseball infield.) At$1,750 per ounce gold’s price as I write this its value would be $9.6 trillion. Call this cube pile A
Let’s now create a pile B costing an equal amount. For that, we could buy all U.S. cropland (400 million acres with output of about $200 billion annually), plus 16 Exxon Mobils (the world’s most profitable company, one earning more than $40 billion annually). After these purchases, we would have about $1 trillion left over for walking-around money (no sense feeling strapped after this buyingbinge). Can you imagine an investor with $9.6 trillion selecting pile A over pile B?
Whta do you think after reading this?