Why We Can NEVER Be the Next Warren Buffet

Yes, there are tons of books selling in the market, teaching you how to be the next Buffet. Ask yourself, have you seen a book written by Warren Buffet? If those authors really know how to be the next Buffet, do they need to spend their time writing such books instead of researching the next big business?

I think that such books are useful in some ways because they provide different perspective of investing theories. However, we are all human and we have our own opinion. We'll hardly find anyone who share the same views even on the same thing. For example, some people think Justin Bieber is cute, some people think Justin Bieber is gay. We are looking at the same Justin Bieber here but we all have different views. And that's the beauty of differences that creates the stock market.

Warren Buffet seems to have the most successful stock picking skills/knowledge. But do his skills/knowledge fit us? The answer is NO. Even if Warren Buffet himself will not able to create such wealth if he is born 50 years later. I will tell you why.

The global population in 1960 was just merely 3 billion. In 40 years, it doubled to 6 billion in 1999 and now according UN, we have 7 billion population on earth. For the given another 40 years, do we expect the population would double again to 14 billion? Highly unlikely as the expected global population by 2045 is 9 billion by the UN.

During the age of Warren Buffet

1. Laws and regulations in the stock market is not as strict.
   
2. Not many people practiced fundamental stock valuation.
3. Relatively low level of education in the world.
4. The sudden boom of population growth.

Just imagine he make $1 for every increase of population. He would make $3 billion in 40 years. But if he make $1 for every new baby born, he would make $300 billion in 40 years (without subtracting off the death rate). How about let's say he make $10 for every new baby born, he would make $3 trillion in 40 years!!!!

One would argue that in another 35 years, the world population is expected to grow for another 2 billion. We could have made $10 for every new baby born too. But here's the trick, to be the smartest in a group of 3 billion is super super super super super tough. And to be the smartest in a group of 7 billion, not to mention that higher education rate among these 7 billion people? x100 toughness......

Furthermore, good companies with good constant earnings can be only bought with a very high price. Let's say now we buy stocks of Warren Buffet's favorite companies such as the consumable giants Coca Cola and HP, they do not generate the same return Warren is enjoying right now because they are just too damn expensive!

So here's the suggestion: Let's look for new companies that share the similar characteristic as Coca Cola and buy them while they are cheap. But the problem is: You're not the only smart guy here. Price war will drive up the stocks without increasing the value. Thus, it generates less return.

So let's face the fact, we'll never be the next Warren Buffet.

However, if we do something different, we are able to create a name for ourselves. The catch here? Following Buffetology will not create the same wealth because we live in the different era. Man, that dude is 84 year old..... We have generation gap!!