This blog post originally appeared on RealMoney Silver on Jan. 28 at 7:56 a.m. EST.
"The first rule of investing is not to lose; the second rule is not to forget the first rule." -- Warren BuffettOver the past week, I have outlined the potholes in Berkshire Hathaway's (BRK.A) investment portfolio and the sharp drop in market value in some of Warren Buffett's largest holdings. It was not my intention to overly dramatize the short-term miscues nor was it my intention to understate the remarkable long-term investment achievements of Warren Buffett. It was my intention to underscore that the strategy of investing in companies that have apparent moats to protect their business -- and these moats have been so dear to Buffett's investment strategy over multiple decades -- could either:
- have been abandoned by the Oracle of Omaha, owing to his reluctance to alter/sell off his strategic and principal holdings and maintain a tax-efficient portfolio approach; or
- have been influenced by his mistaken analysis of the changing competitive landscape facing some of his portfolio companies (in other words, the moat has been flooded!).
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