Bitcoin Forum

If you purchased Berkshire Hathaway stock in 1980 you would have paid $200 for a share.
This stock is now worth $192,000 per share.  Yet it took 34 years to get there.

See this:  http://finance.yahoo.com/echarts?s=BRK-A+Interactive#symbol=BRK-A;range=1d (http://finance.yahoo.com/echarts?s=BRK-A+Interactive#symbol=BRK-A;range=1d)
Click "Max" for the range.

From March 1981 to Aug 1982 it didn't move a penny.  Sat at about $500 for the entire year.
From October 1984 to October 1985 it didn't move a penny.   Sat at $1300 for the entire year.

Those of us annoyed by the lack of price increases lately - need to get some perspective.  

$200,000 is a possibility.  But 1 year with no price increase is perfectly in line with "how things play out" sometimes ...

-B-

Bitcoin will never pay dividends  :'(

Interesting analysis. As far as I see it Bitcoin is a solid idea, as exposure has increased so has the price this is due to belief in the actual technology. So yeah you could be right.

Im going to be so friggen old in 34 years :(

-B-

I would be a good way to invest into your retirement.  Either way it is a good investment.

Not sure bitcoin will have that kind of long term durability

Maybe you're viewing it like a company then.   

When I think of the future of Bitcoin, I think of a million new innovations coming which may be better than it.   But I still see it being incorporated into a foundational layer of the new digital economy.  Part of the very fabric of what is coming in the future, which will have many layers.  I still believe it will be the grand daddy of them all.  I don't see any reason why it would just "poop out" completely.  Companies do that.  The internet doesn't poop out after awhile.  Why would Bitcoin.

-B-

Yeah I tend to agree with the previous poster.  There isn't much way to tell how this will change our society.  For me and many others I suspect this is uncharted territory and people should expect the unexpected.

Very interesting.
Btw, the stock has never ever made any stock split even at that high price, so maybe we shouldn't move to a smaller unit in bitcoin as well. :D

Me too.  How much do you think one of those fancy nanny/chef/sports trainer/therapists/assistant/butler robots will cost?  Hopefully less than a bitcoin.  I only have 2 right now.  

amazing chart yes. but that took 30 years, people here get afraid when bitcoin lost 20 USD in one week  :P

i think its an good investement but a risky one. either we lose 99% or the price will rise alot.

Berkshire Hathaway, stock in a stock market. Not currency/money istlef. BTC is and CC's are going to make BH look like a basket case.
can't use log graphs and don't know what a s-adoption curve is.

BH was never subject to almost universal commentary by every central bank plus, an alphabet soup of other agencies, nor had leading powers issue various dictums about it, if that gives you any idea of the magnitude of BTC.

Nothing even close to BTC has existed in history. BTC is almost a new thinking entity, its kinda close to a wetware agents/silicon data/backend, all working to/because they decrease S [entropy = inefficient systems] and so agents can accrue more E to themsleves. That's why its more or less a fait accompli

One wonders about ethierium, or nxt going the next step or something on BTC.

very possible. but you shouldn't expose our true agenda that openly. to the public bitcoin still has to be about liberty, democracy and this other nonsense we usually say.

https://i.imgur.com/Y7GbLFe.jpg

Owning berkshire means owning a slice of a huge conglomerate of profitable, growing businesses.  Owning bitcoin means owning an electronic numerical value that's guaranteed by the network.

Berkshire is a productive asset, bitcoin is effectively an e-commodity.  There is virtually no intrinsic value in bitcoin (it doesn't generate massive amounts of value for society).  Owning berkshire for long periods of time is investing (long-term profit and value growth), while owning bitcoin for long periods of time is speculating (believing the next sucker will buy a non-productive asset at a higher price than you).

Bitcoin has massive intrinsic value. Eg replaces 1/2 of the world banking infrastructure for one.

You make a good point and you could well be correct.

My $.02.

;)

How could you compare stocks with bitcoin?
Stocks is all about futur cash flows, whereas bitcoin is all about adoption.

Same as Berkshire actually kind of neat when I think of it that way
(Cough there was 1)

I think you guys missed his point.

Think about it again.

My $.02.

;)

I can see other scenarios than Bitcoin becoming massive or disapearing


Bitcoin obv has intrinsic value

I think OP made a very interesting parallel because people get anxious after a 2months decline or a 3months stability when long term means a longer time than Bitcoin's age and Bitcoin's future looks very bright

1991-1998 1000%, B.A doesn't pay any dividends, he choses his companies very well and paid a small price while leaving the good managers in place with a lot of freedom but removing the bad ones; look at his portfolio http://www.fool.com/investing/general/2013/12/02/why-warren-buffetts-berkshire-hathaway-wont-pay-a.aspx

Me too; far too old to enjoy it  :( But I have no doubt if it succeeds, it'll not take 34 years to do it.

You could put 2k a year in a IRA account and in 40 years you should be have tens of thousands to hundreds of thousands ;D

I'll be a sprightly 72.

Other than potential matches in value at various points there's zero comparison between the two.

Bitcoin will never be as stable as BRK either.

https://i.imgur.com/7hIds5d.png

If only btc looked like this, I would have no problem just hodling.

Of course it will...
dont be silly

Stability is exactly the issue.

Profit on the ups and downs.

My $.02.

;)

Bitcoin is new and growing but there are a lot of uncertainties so the volatility is high

The volatility will go down but the volatility hasn't been a huge problem for holders that made a lot of money

It does look like BRK if you use the same time scale: the first few years of Warren Buffet's partnership. It rose exponentially, just like Bitcoin.

No, because Bitcoin is not a company and bitcoins are not shares. Bitcoin is a disruptive technology protocol.

Maybe you should have asked if we are the "TCP/IP" stock holders of the future.

Yes in 34 years I will be 73!

Bitcoin has therefore encouraged me to exercise more, get better sleep, and eat my veggies :)

But I agree.  I don't think the timescale for BTC hitting $200,000 will be 34 years.  If it happens, I see it happening in 1/3 that time.  Just because BRK is the 1885 locomotive of stocks and BTC is the 2014 technology of innovation.

If you think about it though guys - here's a stock.  BRK.  How many stock holders? 

Now think about Bitcoin.  How many possible users?   Its staggering what that could mean for all time high price of Bitcoin.

-B-

Five years and over a million percent rise since inception, let me know when Berkshire Hathaway can do the same in fifty years.

Lol that's not how it works  :D

BRK could be a private company having as little as a single owner and it's valuation wouldn't change (if anything It'd be higher). Bitcoin with one user is not worth anything really.

I would have to have quite the patience to wait 34 years and hold my assets the whole time securely
Hope its a bit faster than that :)

34 years without any dividend can be hard but if you had x shares you can sell one once in a while and get some profit

Owning BTC means owning part of a system that can replace 50% Of what all banks do at least. Conservatively that is worth 500M~to 1T a year.

Think of the costs involved in securing the back end of the banks, banking branches, etc.

Then there is the cash side, the whole cash printing handling side of things is replaced by BTC that cost trillions a year to deal with.

This no intrinsic value is so often repeated but never actually thought about.

The number of IT consultant, systems, property, branches and all the costs and maintiance each year are huge.

I think you completely missed BittBurger's point.  In the future, the number of bitcoin users will outnumber the number of BRK stock holders by many staggering orders of magnitude.  Right now we are at (maybe) ~1-2M bitcoin users, and that's worldwide.  To put this in perspective, I believe the total user base for World of Warcraft is something like ~8M worldwide (and that's for 1 obscure MMORPG out of hundreds of MMORPGs that only a small populous of the world actually cares about).  So we haven't even reached parity with the WoW crowd yet.

Hell, Facebook alone has achieved ~1.3B active monthly users in just 10 years, and that's without its users having any monetary incentive driving them to get involved and sign up.  And they aren't even in China, they're banned from it.

http://static.guim.co.uk/sys-images/Guardian/Pix/pictures/2014/2/4/1391511321556/Facebookusers.png

Notice too, that FB's biggest gains in users was the next few years just after the 1M users/month level.  I believe it took them 4 years prior just to hit the 1M user mark.

The bitcoin user base could eventually grow into the hundreds of millions, maybe even a few billion daily users, merchants, institutions, investors, etc. around the world.  It's the exponential growth and utility of the Bitcoin network that will give BTC it's total (purchasing) power and value, and it will grow at a much faster rate than BRK did.  Likely at the Facebook rate of adoption or so.

So yeah, $200K/BTC valuation is easily achievable one day.  I wouldn't be surprised if we saw that by 2018-2020.

https://i.imgur.com/v37ishv.png

Such a shame bitcoin is not more stable

Well Bitcoin is not a really stable investment but most stocks/investments are not.
That said its always been a bit tricky for me to classify BTC as currency or stock and kind of label it in one category.

Very good post, puts things in perspective.
I agree.

LIES!

Bitcoin DOES pay dividends its called "Tx Fees"

setup a node and start collecting

Neither does Berkshire

I run a full node and don't collect TX fees, only miners do.


But they might some day. I thought it was even discussed at the stockholders meeting this year.

I believe that Bitcoin will go up in price at least $1000+ but who knows when? Until the market stabilizes and Gov'ts become more educated on BTC more traditional investors and merchants will continue to shy away

Thank you for the clarification and correction

Bitcoin and shares in Berkshire Hathaway are entirely different animals. However, with that, I do think there is an incredible upside with Bitcoin, maybe even reaching levels of growth that Buffett had experienced with his company. Maybe in time, Bitcoin will also be worth in excess of $100,000 per coin.

Well I am fairly confident that Berkshire Hathaway will not pay dividends when Warren is still alive, that would affect the brand power of the company and go against the founders wishes over the last few decades.

Anyways your right it was discussed but the proposal was opposed
http://www.reuters.com/article/2014/03/16/us-berkshire-dividend-idUSBREA2F0N220140316

"Our shareholders are far wealthier today than they would be if the funds we used for acquisitions had instead been devoted to share repurchases or dividends," he said in his March 2013 annual letter.

The logic behind what he says is true; he diversifies and seek profit but it is usually wise to pick companies that offer dividends with a few exceptions