With the exception of a brief position in silver that constituted less than 0.1% of 1% of Berkshire Hathaway’s overall assets, Warren Buffett has stayed far away from making purchases of outright commodities or collectibles during his fifty-one year stewardship of Berkshire Hathaway. Although a lot of people assume that Buffett came to his reluctance of collectible ownership rationally through historical studies of the collectibles markets, he actually learned this lesson through experience like the rest of us.
In 1959, Benjamin Graham was scheduled to speak at Beloit College about valuing individual common stock investments and bonds. Buffett wanted to see Graham speak in person, and so he called his friend Tom Knapp who worked at the Tweedy, Browne brokerage house that served as Graham’s broker. In fact, Knapp was the third partner, and back then it was called Tweedy, Browne & Knapp.
Buffett convinced Knapp to go with him, … Read the rest of this article!