Warren Buffett just released the 2017 Berkshire Hathaway shareholder letter, an annual
missive that is part performance review and part market wisdom, often offered with a
healthy dose of humor and a few jabs at the financial services industry. (One of my
favorites: “When trillions of dollars are managed by Wall Streeters charging high fees, it
will usually be the managers who reap outsized profits, not the clients.”)
Worries about rising inflation have spooked stock and bond investors. As a reminder, inflation occurs when the prices of goods and services rise and as a result, every dollar you spend in the economy purchases less. The annual rate of inflation over from 1917 until 2017 has averaged just over 3 percent annually. That might not sound like much, but consider this: today you need $7,272.09 in cash to buy what $1,000 could buy in 50 years ago.
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