> Warren Buffett Blog: Buffett likes Stocks instead of Bonds

Thursday, June 1, 2017

Buffett likes Stocks instead of Bonds

I would bet my life that stocks over 30 years outperformed the 30 year bond. I would come close to doing it, betting that over ten years, they'll do better than the ten year bond, versus the one year bond or two year bond. I have, you know, no idea whatsoever. But stock if you look at American equity, basic business of America, American equity earns a tremendous return on tangible net assets. That's what the business is about. That's what the farm is producing. Now, a bond is limited in what it can produce. But when you say reversion to the mean, I'm not sure what the mean is. I mean, the mean is going to be based upon returns on equity, the amount of equity reinvested and reemployed. And I would say there the prospects are so much better than in fixed dollar investments, that, you know, admittedly, I liked stocks a lot better a few years ago. And I've said that on this program. But the stocks versus bonds right now, it's not close. Now, bond yields can change a lot. If bonds go to 15 percent, I may be recommending bonds.