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Charlie,

In all that there's one thing that I didn't come across: inflation. Buffett has always been adamant that quality equities are the safest place to beat long term inflation. The coupons on those corporate bonds never change. In contrast, high quality companies, especially of consumer staples, find a way to pass inflationary costs on to consumers. So, he targets companies with pricing power and simple, primarily essential businesses. If they maintain that pricing power, they'll succeed in building inflation into their profit margins, and thus into their divis, offsetting the erosion you'd experience in a bond. That's what "good management" does. I also think you're assigning too much risk to equities in general. Is P&G common more risky than a C rated bond? No way. There's less long term risk in quality equities than you're acknowledging, when purchased in a diversified port. It's not surprising to me that a BRK junky, after years of listening to Buffett, would prefer this direction. It's WEB's own preference stated time and time again.
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