In the Q&A session Saturday morning at Berkshire Hathaway's annual meeting, CEO Warren Buffett and vice chairman Charlie Munger repeatedly warned investors to lower their expectations. When a shareholder asked whether Buffett's recent purchases of publicly traded stocks were likely to greater than 7% to 10% over time, Buffett promptly said no.
Asked what's in store for the economy, Buffett said he doesn't have a clue and doesn't care. His simple point: As an investor, you don't need to predict the economic cycle (or even pay much attention to it). Instead, you should focus on evaluating individual businesses if you pick your own stocks -- or, simply buy the entire market in the form of an .
When a shareholder asked for the single best specific investment idea Buffett could recommend to an individual in his 30s, Buffett said: "I would just have it all in a very low-cost index fund from a , maybe Vanguard. Unless I bought during a strong bull market, I would feel confident that I would ...and I could just go back and get on with my work."
In response to a similar question from an investor asking how Berkshire would invest differently if it had only a few million dollars , Buffett advised him to think small. "That would open up thousands of opportunities," said Buffett.
Earlier this year there were "very " that "we could buy nowhere near enough of to make a difference to Berkshire," but a smaller investor could have exploited. "Most of the opportunities would probably be in small stocks or in specialized bond situations."
