Warren Buffett's investments have been successful in part because there has not been any financial catastrophe in the USA.
This is an insight I have to credit to Aswath Damodaran, the New York University professor and arguably the best academic on company valuations.
Warren Buffett keeps saying that buying stocks is the best investment, even during a war. But nuclear war? America has never experienced a real ground war invasion or conflict, let alone a nuclear war.
Yes, undervalued, value, Benjamin Graham style stocks of commodity producers or transporters of commodities like Warren Buffet partly owned and run conglomerate Berkshire Hathaway's Burlington Santa Fe could end up rising multiple fold after the dust from the current war settles.
However, if a nuclear war erupts or a full blown ground war erupts, in the mid term at least, things will be very difficult for both people and companies and the world's main stock market indices could fall more than 75 % from their most recent highs.
Every strategy, including investing strategies has one or several weaknesses. Warren Buffett's style is relying on the human or US in particular spirit and ingenuity surviving and thriving in the long-term. And yes, humanity has moved on successfully from crisis and wars many times in the past driven mainly by greed.
Gordon Gekko, the fictional character from the movie Wall Street is famous for saying "Greed is good".
Really? What if humanity's greed causes a nuclear war and the subsequent nuclear winter? The same nuclear winter that destroyed dinosaurs, the then dominant species on the planet Earth.
As far as I am concerned, all commodities producing companies are grossly, deeply undervalued at the moment.
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