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Politics : Formerly About Applied Materials -- Ignore unavailable to you. Want to Upgrade?

To: Sun Tzu who wrote (30599)	5/25/1999 10:08:00 PM
From: Proud_Infidel	Read Replies (2) \| Respond to of 70976

Sun, BUT, to properly discount this 100 years' worth of earnings, you need to invest all the previous earnings and compound them at 8% for the remainder to 100 years. No, no, no! We are assuming that all previous earnings are reinvested into the company and an 8% growth rate. Using your method we will be double-counting actual earnings. BK

To: Sun Tzu who wrote (30599)	5/26/1999 7:22:00 PM
From: manohar kanuri	Read Replies (1) \| Respond to of 70976

Sun, Perhaps you can demystify for me an aspect of Warren Buffet. In his owner's manual and assorted writings he goes to considerable length to explain a float and the how and why of its joys. Restated in terms I can relate to -- he's leveraged his portfolio with non-callable (or nearly so) margin money at a zero rate of interest. If that is correct, how does one disaggregate this (the effect of leveraging) when you run into statements like "Berkshire Hathaway outperformed the S&P by X% over Y years?" Is it possible to separate out the effect of the float thanks, mano