Wally Weitz used to be called "The other oracle of Omaha", until last year. His fund lost 38% in last 12 months. This is his letter to shareholders.
These are fascinating times for investors. The economy is in “shambles,” to use Warren Buffett’s term, and capital markets are under great stress. The government is committing trillions of dollars to provide liquidity to the markets and stimulate the economy yet it remains unclear how effective the various programs will be. On the other hand, there are signs that credit is beginning to flow again and opportunistic (vulture) investors are bringing billions of dollars to distressed real estate and securities markets.
We would expect this tug of war between the bullish and bearish forces to continue for some time—maybe years—but our working assumption is that the American economy will emerge from this recession in recognizable form. We expect that good companies will find ways to cope with this environment and come out of this period intact. We are wary of the short-term economic outlook, but we believe that there are a number of quality businesses whose stocks are selling well below their conservatively calculated business values and that we will eventually be rewarded for buying these stocks at bargain prices. We appreciate shareholders’ patience during this extraordinary period.
Read the complete shareholder letter
These are fascinating times for investors. The economy is in “shambles,” to use Warren Buffett’s term, and capital markets are under great stress. The government is committing trillions of dollars to provide liquidity to the markets and stimulate the economy yet it remains unclear how effective the various programs will be. On the other hand, there are signs that credit is beginning to flow again and opportunistic (vulture) investors are bringing billions of dollars to distressed real estate and securities markets.
We would expect this tug of war between the bullish and bearish forces to continue for some time—maybe years—but our working assumption is that the American economy will emerge from this recession in recognizable form. We expect that good companies will find ways to cope with this environment and come out of this period intact. We are wary of the short-term economic outlook, but we believe that there are a number of quality businesses whose stocks are selling well below their conservatively calculated business values and that we will eventually be rewarded for buying these stocks at bargain prices. We appreciate shareholders’ patience during this extraordinary period.
Read the complete shareholder letter
