Berkshire Buying some Amazon

I have now seen it all. Berkshire Hathaway has been buying shares in Amazon. Why do I sound so shocked? Because Amazon is a notoriously expensive stock and Warren is the king of value. He has often mentioned his admiration for Jeff Bezos and Amazon but would often say he was too late.

Buffett is the not the only decision maker at Berkshire, it may have been one of his investment managers, Todd or Ted. But you get the feeling they would not have bought the shares if Warren was against it.

To me this feels like a blow for the value ideology. Over the last decade, with low interest rates and high growth, value has been hard to find in the listed environment. The market has rewarded growth and growth has reciprocated with big cash flows.

The world is more transparent now than it has ever been with information very easy to come by. It is also a lot easier to access the market. These two factors will put a premium on listed assets.

Okay maybe value is not dead, I think the definition has changed. Growth needs to be factored in and the average fundamental ratios are higher than in the past.