[quote by me]
As Mister FanyPants points out, you don't need to pick stocks when you are wealthy and well-connected, or work on Wall Street. You just take advantage of opportunities that you happen to be aware of because of the connections you made while getting rich.
[/quote]
[quote by me]Not to discount his ability to see potential or value in a company and recognize when then stock of that company is undervalued.[/quote]
[quote by you]
Actually you kinda missed my point, Warren Buffet is a great investor, he knows how to find undervalued investments either stocks or businesses and determine if they are something he would like to own. Due to the size of his bankroll and his reputation the deals and products available to him are not available to everyone or sometimes anyone else. For example during the financial crisis Goldman Sachs called him and offered him terms that were insanely favorable to him because they were in dire need of his endorsement more than they needed the capital.
[/quote]
It seems that we are very much on the same page about those points.
My point is: Folks on this forum are engaged in a meaningless debate when they label Warren Buffet an successful "investor" for the sake of comparing those results to their own results as "investors". I guess some would consider that arguing semantics... whether to "label" someone an "investor" or a "businessman".
The comparison (of Buffet to individual investors) is meaningless because:
a) his wealth and influence provides him with business (investment?) opportunities that aren't available to the rest of us
b) Buffett is a business owner and the personal wealth he has amassed is a result of his success in business.
You make that point well in your last post. You say that he has his personal wealth tied up in Berkshire as he clearly believes that he can beat the S&P.
I believe that statement makes my point perfectly. He does beat the S&P, but he does it by running a business, not "investing". Just about every small and medium business owner around is in that same boat. The local plumbers, electricians, restaurant owners, car dealership owners, all the way up to Bill Gates have business ventures that likely outperform the S&P. Those folks are accurately described as businessmen, not investors. Some of the more financially savvy business owners may invest a good portion of their personal wealth in stocks, bonds, etc and be well-diversified. But even when their personal holdings eclipse the equity in their business, they are not looked upon by the community as investors. Even when they sell their business at the end of their careers, they are considered "former businessmen", not investors, which is as it should be.
Sure, Warren Buffett may be more familiar with stock investing than your average small business owner. Yes, give him full credit for being a businessman who successfully manages multiple businesses that are very well diversified. But that does not warrant mythical status of an oracle with an ability to manage a portfolio that consistently beats the S&P.....when that portfolio is stocks and bonds at prices available to small-time investors.
In short, owning a business that produces returns that beat the S&P does not make someone a great investor.