Why Warren Buffet Is Confident Your Kids Will Be Richer Than You

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You and Warren Buffett have something in common: Neither of you have much need for Tinder these days. The Oracle From Omaha mentioned this as he laid out his prognosis for the U.S. in his annual letter to Berkshire Hathaway’s shareholders (Class A shares currently trading around $198,000 per, in case you were wondering). Also, Buffett thinks your kids are “the luckiest crop in history.”

Using typically folksy, accessible math, Buffet points out that the country’s annual population growth is .8 percent, and the annual GDP growth is 2 percent, which creates an annual real GDP per capita growth rate of 1.2 percent (Buffet’s italics). That’s 34.4 percent growth in a single 25-year generation. So forget the Donald Downers and Bernie Bummers, says Buffet — even modestly successful Americans have a higher standard of living than John D. Rockefeller Sr. had when he was one of the world’s richest men 100 years ago. Consider that Johnny Rock had no Netflix to stream first-run Oscar flicks, no phone to crush candy on, and no Barbie doll of any size or shape, and it’s tough to argue with Buffet.

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Long Term US GPD Growthaneconomicsense.org

You might counter with something about growing income inequality and the market’s rather bloodless ability to make certain skill sets obsolete 20 or 30 years before someone plying those skills has reached retirement. But Buffet notes those forces, reiterates his long standing support of social safety nets, and reminds everyone that, “For 240 years it’s been a terrible mistake to bet against America … America’s golden goose of commerce and innovation will continue to lay more and larger eggs.”

As Buffet goes, often so goes the market, and it looks like your kid’s — and everyone else’s — stock is on the rise. Except Tinder; might be time to short those guys.

[H/T] npr

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