Welcome to our March Newsletter

On March 5th the Dow reached a record high surpassing the previous high set on October 9 2007.

It has been a long wait for investors who are now looking forward to seeing benefits for their patience in the market.

I’m sure all our readers have heard of Warren Buffet. His letter to shareholders was out recently and is always a good read to give context around his investment approach. Here is an excerpt that I thought was good;

"American business will do fine over time. And stocks will do well just as certainly, since their fate is tied to business performance. Periodic setbacks will occur, yes, but investors and managers are in a game that is heavily stacked in their favour. (The Dow Jones Industrials advanced from 66 to 11,497 in the 20th Century, a staggering 17,320% increase that materialized despite four costly wars, a Great Depression and many recessions. And don't forget that shareholders received substantial dividends throughout the century as well.)

Since the basic game is so favourable, Charlie and I believe it's a terrible mistake to try to dance in and out of it based upon the turn of tarot cards, the predictions of "experts," or the ebb and flow of business activity. The risks of being out of the game are huge compared to the risks of being in it.

My own history provides a dramatic example: I made my first stock purchase in the spring of 1942 when the U.S. was suffering major losses throughout the Pacific war zone. Each day's headlines told of more setbacks. Even so, there was no talk about uncertainty; every American I knew believed we would prevail.

The country's success since that perilous time boggles the mind: On an inflation-adjusted basis, GDP per capita more than quadrupled between 1941 and 2012. Throughout that period, every tomorrow has been uncertain. America's destiny, however, has always been clear: ever-increasing abundance.

If you are a CEO who has some large, profitable project you are shelving because of short-term worries, call Berkshire. Let us unburden you"

In this issue we discuss the importance of Trauma Insurance Cover, tips on Buying your First Home and a reminder to those of you who still have Retirement Annuity Policies in South Africa that now may be the time to consider cashing in these policies. 

Until next time

Regards 

Gordon Hatch