The dateline was 1999, and Buffett was taking a lot grief for his refusal to invest in the dot-com market.
Buffett’s view was that very few of these companies would survive over the long haul, and he wasn’t capable of picking the winners.
Well, I thought it would be instructive to go back and look at a couple of industries that transformed this country much earlier in this century: automobiles and aviation. Take automobiles first: I have here one page, out of 70 in total, of car and truck manufacturers that have operated in this country. At one time, there was a Berkshire car and an Omaha car. Naturally I noticed those. But there was also a telephone book of others.
All told, there appear to have been at least 2,000 car makes, in an industry that had an incredible impact on people’s lives. If you had foreseen in the early days of cars how this industry would develop, you would have said, “Here is the road to riches.” So what did we progress to by the 1990s? After corporate carnage that never let up, we came down to three U.S. car companies — themselves no lollapaloozas for investors. So here is an industry that had an enormous impact on America — and also an enormous impact, though not the anticipated one, on investors.
So the funnel went from 2,000 to 3.
And today, almost 20 years later, we still have Ford and GM and we sort of have Chrysler (as part of the Fiat-Chrysler conglomerate).
But we also have Tesla and Uber and Google and maybe Apple and startups like Otto and Comma.ai and McLaren.
Maybe here is the road to riches. But reading Buffett makes me a little less sure.