Should Investors Heed Buffett's 26-Year-Old Warning Today?
It's hard to believe today, but in 1999, Warren Buffett's reputation as one of the greatest investors in history was in serious doubt.
For years, he had sat out on the historic tech boom, warning about valuations as the Nasdaq Composite (NASDAQINDEX: ^IXIC) zoomed 85% higher in 1998, then 102% in 1999. That year, Berkshire Hathaway Class A shares fell 23% while the S 500 (SNPINDEX: ^GSPC) rose by 18%. Barron's even speculated that Buffett was losing his touch, in a December 1999 article titled, "What's Wrong, Warren?"
But Buffett stuck to his guns. Speaking in Sun Valley, Idaho, before a conference full of venture capitalists, billionaire tech company founders, and dot-com visionaries, he pointed to history to show how overvaluations can destroy returns.
Source Fool.com
