Chart of the Week: Warren Buffett Versus Gold
This week’s chart shows how Warren Buffett is falling even farther behind gold.
Back in April, we noted that despite gold’s “real money” attributes… its vital role as “crisis insurance”… and its giant uptrend, the metal still has detractors. One of the highest profile detractors is superinvestor Warren Buffett. Several times over the past few years, Buffett has publicly scoffed at the idea of owning gold.
While we’re fans of Buffett’s wealth-building abilities, we have to point out how listening to him has been a losing deal over the past eight years… especially considering the performance of his investment company Berkshire Hathaway.
This week’s chart displays the performance of Berkshire Hathaway (black line) since stocks bottomed in 2003 versus the performance of gold during the same time (gold line).
When we checked in on “Buffett vs. gold” in April, gold had outperformed Buffett 350% to 75%. The past week has stretched this “gold beats Buffett” ratio even further. Due to its big exposure to financial stocks, derivatives, and economically sensitive businesses, Berkshire plummeted to a new yearly low this week… while gold soared to an all-time high. Buffett vs. gold? No contest!