Postcards: Nintendo Switch or Berkshire Stock?

We're 20 days from Christmas and seven days from my daughter's birthday. Decisions need to be made on presents.                                                                                                                                                                                                                                                                                                                                                                                                                 Forwarded this email? [Subscribe here]() for more [Postcards: Nintendo Switch or Berkshire Stock?]( We're 20 days from Christmas and seven days from my daughter's birthday. Decisions need to be made on presents. [Garrett {NAME}]( Dec 5   [READ IN APP](   Dear Fellow Expat: My daughter turns six years old in a week. Time flies (etc.) She only asked Santa for one present: Roller skates. She’s simple… like me. She really likes the roller-skating rink – and the opportunity to play the Mario Kart game there. It got me thinking… should I get her a Nintendo Switch so she and I can play Mario Kart together now and then? Or… do I stick with the original plan and give her the same gift I gave her for the previous five birthdays? One share of Berkshire Hathaway B-Class stock (BRK.B). Both presents would cost about $330. I know the general sentiment is to spoil the kid. But let’s weigh the pros and the cons, shall we? And learn a critical lesson about the Florida Republic. [Upgrade to paid]( Making Sense of Christmas Why would I buy my daughter a Nintendo Switch instead of Berkshire stock? Reasons include the fact that there are plenty of age-appropriate games, and she can use them while we make the occasional drive to Baltimore. I can’t take another 18-hour singalong of [Taylor Swift songs up Interstate 95](. There’s more. I know there are opportunities for us to have some fun together playing Mario Kart… and that video games improve cognitive capabilities and hand-eye coordination. I grew up on video games – and I turned out okay… I guess (It helped as a lacrosse goalie, and I advocate for “smart” screen time). So, those four points go directly into the “Buy” column for video games. But that brings me to Berkshire Hathaway. Every purchase has an opportunity cost. And – I know that Nintendo machine will end up in a box somewhere in three or four years. Berkshire stock, however? Well, that’s the first appeal. Berkshire Hathaway, led by Warren Buffett, is known for its long-term investment strategy. If you're looking for an investment that has the potential to grow steadily over the years, here’s your stock. Berkshire Hathaway holds a diversified portfolio of well-established businesses, and Buffett's investment philosophy involves holding stocks for the long term. Next, I want to give my daughter the gift of investment education. [My father taught me how to read stock quotes]( when I was her age. And it unlocked a love and appreciation for the investment world. I didn’t know then how valuable it was. But it is truly the gift that keeps on giving. Introducing a child to investing at an early age can be a valuable educational experience. Owning Berkshire Hathaway can teach her about the stock market, investing, and the potential benefits of patience and long-term thinking. Berkshire – as a diversified company with lots of different holdings – also provides the opportunity in the years ahead to educate her on many different businesses, including insurance, utilities, and consumer goods. This isn’t a gift for right now. It’s a gift for the next 30 years. Berkshire for 80 Cents on the Dollar This is just a gentle reminder that you [can buy Berkshire Hathaway for 80 cents on the dollar](. The SRH Total Return Fund (STEW) is a closed-end fund and owns $532 million in BRK Class A stock and another $117 million in BRK.B stock. It also owns a lot of stocks that Buffett loves, like JPMorgan Chase (JPM) and Yum! Brands (YUM), and Enterprise Product Partners (EPD). So, if you’re like me, maybe you should buy some B shares. Or perhaps you buy into STEW because it has a dividend and trades at a discount. You can’t go wrong either way. Christmas Goals Let’s conclude with a very important question. What’s the real gift here for my daughter? The answer is: Delayed gratification. One of the single most important things you can teach a child is the importance of delayed gratification. Patience for a reward is critical to their development, and anyone who has ever launched a business, made an investment or worked on a long-term project requires significant focus and dedication. When I tell my daughter that the shares she owns will be worth significantly more in the future – and she will benefit from the time that generates those returns – she does understand. I hope that by the time she turns 18, she will have seen what a long-term investment can provide. I expect the shares she owns right now will be worth 100% more. She will see it in action. She will occasionally ask, “How is my money doing?” I want her to ask this question – even if it makes her sound 20 years older. She is invested. She has skin in the game. I know that I sound like I’m 1,000 years old. But these lessons will separate her from her class in the future. In a world of “me” and “now,” a handful of us still preach the lessons that must be taught. Whenever someone stops me and asks how and why she can do the things that she does… There are two answers. First: She asks. Her curiosity is remarkable. Second: I answer. That takes time and patience. But the reward is incredible. This year, give the gift of the financial markets. I promise you, the kids will get it. It might take a few explanations. It might require some explaining to other adults. But in a world where half of the country doesn’t invest in the stock market (the greatest wealth engine ever built), you want any child you know to embrace it. Start. Them. Young. Stay positive, Garrett {NAME} PS: As I said yesterday, I will talk tomorrow about a special event hosted by my friend and colleague, Porter Stansberry. It won’t be a separate email. It will be a part of tomorrow’s Postcards, and I assure you that there will be great insight into the markets coming. I ask that you take a moment to hear his prediction for 2024. This is one of the most important contrarian outlooks you’ll hear this year. You're currently a free subscriber to [Postcards from the Florida Republic](. For the full experience, [upgrade your subscription.]( [Upgrade to paid](   [Like]( [Comment]( [Restack](   © 2023 Garrett {NAME} 548 Market Street PMB 72296, San Francisco, CA 94104 [Unsubscribe]() [Get the app]( writing]()