Is Europe becoming uninvestable?

[Spekulatius]

16 hours ago, NnnnotSoSmart said:

Am I wrong, or has there been a notable scarcity of European equities in Berkshire's portfolio? Posco?  Think they took a sizable loss on that one.

 

Posco is Korean. I think it was Charlie’s pick.

[Dalal.Holdings]

5 hours ago, Charlie said:

Profitability is lower in Europe, Circle of Competence, companies are not run in the favour of shareholders, legal problems, employee has more rights,

low quality banks in Europe, Berkshire not so much known as in the US....

 

Buffett made a road trip in Europe.

 

Look at a list of the most profitable companies of the world. Then you have the reason. 

Well there you go. Your post directly addresses the topic of this thread, explains why Europeans such as yourself (and Norwegian SWF and Swiss Natl Bank) turn to America to deploy capital, and why it is likely Warren has largely avoided Europe.

 

My overarching point in this thread is that if Europe does not want to be left hopelessly behind the U.S. and China, this will have to change (it will need to embrace capitalism instead of its current antagonistic relationship with private enterprise).

 

 

Edited December 5, 2025 by Dalal.Holdings

[Dalal.Holdings]

https://www.reuters.com/sustainability/boards-policy-regulation/indias-steel-exports-europe-set-drop-eu-carbon-tax-looms-2025-12-05/

“Imports of steel into the European Economic Area will face a carbon tax under the EU's Carbon Border Adjustment Mechanism (CBAM) starting on January 1. The decarbonisation-oriented levy will also apply to cement, electricity, fertilisers and other products.”

 

Another cool acronym from the Brussels geniuses to brag about over wine in the evenings—CBAM.

 

So now not only will European industry face higher input costs for energy (which it already struggles with!), but also steel, cement, fertilizers, etc. All in the name of taxing “carbon”, something only genius policy makers of Europe could dream up, especially right as they claim they will start rebuilding their militaries…

 

The guys sitting in Brussels are doing everything they can to turn the continent into a museum.

 

Edited December 5, 2025 by Dalal.Holdings

[Charlie]

1 hour ago, Dalal.Holdings said:

Well there you go. Your post directly addresses the topic of this thread, explains why Europeans such as yourself (and Norwegian SWF and Swiss Natl Bank) turn to America to deploy capital, and why it is likely Warren has largely avoided Europe.

 

My overarching point in this thread is that if Europe does not want to be left hopelessly behind the U.S. and China, this will have to change (it will need to embrace capitalism instead of its current antagonistic relationship with private enterprise).

One of the disadvantages of the German industry is that it always has been very capital-intensive and not the asset-light model that can work so magically.

[Dalal.Holdings]

38 minutes ago, Charlie said:

One of the disadvantages of the German industry is that it always has been very capital-intensive and not the asset-light model that can work so magically.

Sure but then you have asset light European businesses like Ubisoft that are also struggling. I think the problem is much deeper than capital intensity.

 

I think a lot of Europeans view capitalism as fundamentally wrong which is why there are so many labor issues, taxes, and regulations (Europeans like the idea of punishing 'evil' corporations and are more antagonistic to private enterprise).

[Charlie]

3 hours ago, Dalal.Holdings said:

I think a lot of Europeans view capitalism as fundamentally wrong which is why there are so many labor issues, taxes, and regulations (Europeans like the idea of punishing 'evil' corporations and are more antagonistic to private enterprise).

I don´t think so. People are hugely profiting from Amazon, Apple, Alphabt and AI.

 

[NnnnotSoSmart]

Time to pick on Britain today as we shift our focus away from the EU for a moment...

 

Doomberg can be an interesting listen.

 

In the interview below, Doomberg makes the case that the United Kingdom is becoming a failed state, struggling with energy dependency, industrial decline, and internal unrest. 

 

(22:20 min) "We're developing an internal mental model around the concept that Britain is a failed state. Just plain and simply a failed state. It doesn't produce its own energy. It's losing ...it's bleeding its heavy industry at an alarming rate. It's hemorrhaging it. Kier Starmer has a 10% approval rating and he's immovable, except from perhaps an internal coup within his party. But his party has no candidates that would inspire any confidence to replace him. That the lead candidate would be the hapless Ed Milliband, which would be an even bigger disaster for Britain. It's going broke. Various indicators of civl unrest are flashing red in the Country.  The London elite are totally detached from the day-to-day lives of the average British citizen, and are incapable of effectuating any positive change from what we can tell. And so, is Britain heading into a sort  of debt crisis where it has to print its way out?... On global media propaganda .. by far the worst is British.  It is often wholly incompatible with the truth. And you can just spot manipulative lies (BBC?) and stories fabricated out of whole cloth from a mile away.  ... To see a once great Country spasm into a death cycle is kind of scary because then you start to think about your own Country..."

 

 

 

I have a sister (born American now naturalized British citizen) that has lived in London for over 30 years.  I won't be sending this to her. 

[Dalal.Holdings]

12 minutes ago, Charlie said:

I don´t think so. People are hugely profiting from Amazon, Apple, Alphabt and AI.

 

I don't think the average European has a size-able investment account in U.S. tech giants. I think most Europeans just have most of their money at the bank owning low returns. Equity ownership in Europe is much lower than in the U.S. From what I've seen, ~45% of U.S. household wealth is in stocks while for Europe it's like 5%.

 

Most Europeans don't own stocks and don't care much for capitalism because they don't understand how it creates prosperity. So no, the average European is not profiting off U.S. tech stocks. They are pro-imposing fines & regs on American tech giants who they view as evil; these regs of course also hurt their own tech sector.

 

Among the Europeans who do invest (such as those on this forum), yes they love investing in America's winners of capitalism....and they don't see the irony.

 

Ask why outside of Spotify and Adyen there are no big European tech winners...Just today the EU fined X in its effort to suppress free speech. It has also fined Apple, Google, and Meta. EU says its fines can be as high as percentages of a firm's global revenue...

[Charlie]

10 minutes ago, Dalal.Holdings said:

I don't think the average European has a size-able investment account in U.S. tech giants.

I mean as a customer. These companies make life much easier, save time and money and answer questions.

[NnnnotSoSmart]

Excerpt from:

 

White House Report

National Security Strategy of the United States of America
November 2025

 

(page 22) 

 

C. Promoting European Greatness
American officials have become used to thinking about European problems in
terms of insufficient military spending and economic stagnation. There is truth to
this, but Europe’s real problems are even deeper.

Continental Europe has been losing share of global GDP—down from 25 percent
in 1990 to 14 percent today—partly owing to national and transnational regulations
that undermine creativity and industriousness.

But this economic decline is eclipsed by the real and more stark prospect of
civilizational erasure. The larger issues facing Europe include activities of the
European Union and other transnational bodies that undermine political liberty and
sovereignty, migration policies that are transforming the continent and creating
strife, censorship of free speech and suppression of political opposition, cratering
birthrates, and loss of national identities and self-confidence.

Should present trends continue, the continent will be unrecognizable in 20 years or
less. As such, it is far from obvious whether certain European countries will have
economies and militaries strong enough to remain reliable allies. Many of these
nations are currently doubling down on their present path. We want Europe to
remain European, to regain its civilizational self-confidence, and to abandon its
failed focus on regulatory suffocation.

This lack of self-confidence is most evident in Europe’s relationship with Russia.
European allies enjoy a significant hard power advantage over Russia by almost
every measure, save nuclear weapons. As a result of Russia’s war in Ukraine,
European relations with Russia are now deeply attenuated, and many Europeans
regard Russia as an existential threat. Managing European relations with Russia
will require significant U.S. diplomatic engagement, both to reestablish conditions
of strategic stability across the Eurasian landmass, and to mitigate the risk of
conflict between Russia and European states.

 

https://www.whitehouse.gov/wp-content/uploads/2025/12/2025-National-Security-Strategy.pdf

 

[Dalal.Holdings]

40 minutes ago, NnnnotSoSmart said:

Excerpt from:

 

White House Report

National Security Strategy of the United States of America
November 2025

 

(page 22) 

 

C. Promoting European Greatness
American officials have become used to thinking about European problems in
terms of insufficient military spending and economic stagnation. There is truth to
this, but Europe’s real problems are even deeper.

Continental Europe has been losing share of global GDP—down from 25 percent
in 1990 to 14 percent today—partly owing to national and transnational regulations
that undermine creativity and industriousness.

But this economic decline is eclipsed by the real and more stark prospect of
civilizational erasure. The larger issues facing Europe include activities of the
European Union and other transnational bodies that undermine political liberty and
sovereignty, migration policies that are transforming the continent and creating
strife, censorship of free speech and suppression of political opposition, cratering
birthrates, and loss of national identities and self-confidence.

Should present trends continue, the continent will be unrecognizable in 20 years or
less. As such, it is far from obvious whether certain European countries will have
economies and militaries strong enough to remain reliable allies. Many of these
nations are currently doubling down on their present path. We want Europe to
remain European, to regain its civilizational self-confidence, and to abandon its
failed focus on regulatory suffocation.

This lack of self-confidence is most evident in Europe’s relationship with Russia.
European allies enjoy a significant hard power advantage over Russia by almost
every measure, save nuclear weapons. As a result of Russia’s war in Ukraine,
European relations with Russia are now deeply attenuated, and many Europeans
regard Russia as an existential threat. Managing European relations with Russia
will require significant U.S. diplomatic engagement, both to reestablish conditions
of strategic stability across the Eurasian landmass, and to mitigate the risk of
conflict between Russia and European states.

 

https://www.whitehouse.gov/wp-content/uploads/2025/12/2025-National-Security-Strategy.pdf

 

Yep. I read it. Can't deny that there are some true, but hard to swallow pills in there for Europe.

[cubsfan]

1 hour ago, Dalal.Holdings said:

Yep. I read it. Can't deny that there are some true, but hard to swallow pills in there for Europe.

 

But never too late to act. It's in their self-interest as the US desires a very strong Europe.

[Loss Horizon]

7 hours ago, NnnnotSoSmart said:

Continental Europe has been losing share of global GDP—down from 25 percent
in 1990 to 14 percent today—partly owing to national and transnational regulations
that undermine creativity and industriousness.

But this economic decline is eclipsed by the real and more stark prospect of
civilizational erasure. The larger issues facing Europe include activities of the
European Union and other transnational bodies that undermine political liberty and
sovereignty, migration policies that are transforming the continent and creating
strife, censorship of free speech and suppression of political opposition, cratering
birthrates, and loss of national identities and self-confidence.

Should present trends continue, the continent will be unrecognizable in 20 years or
less. As such, it is far from obvious whether certain European countries will have
economies and militaries strong enough to remain reliable allies. Many of these
nations are currently doubling down on their present path. We want Europe to
remain European, to regain its civilizational self-confidence, and to abandon its
failed focus on regulatory suffocation.

 

This is essentially a copy of Soviet and Russian propaganda about the West. The West under leadership of the US was always in permanent civilizational and moral decline, it was called "rotting West". The workers in the West were mistreated and suffered from capitalists, unlike well-off Soviet workers. Every single crisis was blown out as a sign of the forthcoming collapse. People stood in food lines, didn't have running water inside, and believed in superiority over the West for almost a century. Soviet Union also had some strong leaders, who had unlimited power and ruled by executive orders, to do "the right thing for the people". That didn't help economically and socially long term unfortunately. I guess for a strong leader the biggest threat is existence of successful societies where top leaders don't possess full power personally.

Edited December 6, 2025 by Loss Horizon

[UK]

https://www.bloomberg.com/news/articles/2025-12-06/in-spain-and-italy-banks-drive-a-long-awaited-stocks-recovery?srnd=homepage-europe

 

“Banks have outperformed the Nasdaq by a factor of two in the last three years. You would’ve done much better owning the SX7E than the hyperscaler AI,” Giles Rothbarth, portfolio manager and co-head of the European equity team at BlackRock, referring to the Euro Stoxx Banks Price Index.

 

[Spekulatius]

11 hours ago, UK said:

https://www.bloomberg.com/news/articles/2025-12-06/in-spain-and-italy-banks-drive-a-long-awaited-stocks-recovery?srnd=homepage-europe

 

“Banks have outperformed the Nasdaq by a factor of two in the last three years. You would’ve done much better owning the SX7E than the hyperscaler AI,” Giles Rothbarth, portfolio manager and co-head of the European equity team at BlackRock, referring to the Euro Stoxx Banks Price Index.

 

Yes, the European banks have done very well, due to improved profitability from restructuring and also the EU abandoning the zero interest rate policy which was suffocating banks.

 

I think the industrial restructuring will some similar opportunities. just look at Exor‘s  portfolio, there are opportunities to improve margins in many business (CNH, Stellantis, Philips) and with a larger than 50% discount to NAV, the value creation opportune is immense.

 

These are not European business either, they operate world wide.

Edited December 6, 2025 by Spekulatius

[Dalal.Holdings]

6 hours ago, Loss Horizon said:

 

This is essentially a copy of Soviet and Russian propaganda about the West. The West under leadership of the US was always in permanent civilizational and moral decline, it was called "rotting West". The workers in the West were mistreated and suffered from capitalists, unlike well-off Soviet workers. Every single crisis was blown out as a sign of the forthcoming collapse. People stood in food lines, didn't have running water inside, and believed in superiority over the West for almost a century. Soviet Union also had some strong leaders, who had unlimited power and ruled by executive orders, to do "the right thing for the people". That didn't help economically and socially long term unfortunately. I guess for a strong leader the biggest threat is existence of successful societies where top leaders don't possess full power personally.

The problem with this line of thinking is that any criticism of Europe can be dismissed as “Russian propaganda”.

 

These things are objectively true:

1) Europe’s economies are stagnant due to productivity & structural issues

2) Europe is way behind the U.S. and China in technology

3) Europe cannot effectively project military power in its own backyard

 

If this continues (if the gap grows), more and more Americans (pop 330 million) will start asking why it’s worth expending so much protecting this 500M population, especially when priorities are moving to the Pacific (something true since Obama). You are seeing Germans protest voluntary service. You are seeing Spain resist increasing funding. Meanwhile, the Europeans gloat about how their quality of life, pensions, and healthcare is so good. This is happening while there is a war in Europe and European leaders are livid that the U.S. is trying to end…

[Marco Van Basten]

11 hours ago, Loss Horizon said:

 

This is essentially a copy of Soviet and Russian propaganda about the West. The West under leadership of the US was always in permanent civilizational and moral decline, it was called "rotting West". The workers in the West were mistreated and suffered from capitalists, unlike well-off Soviet workers. Every single crisis was blown out as a sign of the forthcoming collapse. People stood in food lines, didn't have running water inside, and believed in superiority over the West for almost a century. Soviet Union also had some strong leaders, who had unlimited power and ruled by executive orders, to do "the right thing for the people". That didn't help economically and socially long term unfortunately. I guess for a strong leader the biggest threat is existence of successful societies where top leaders don't possess full power personally.

Actually it is not.   Europe is indeed not doing well sadly, and you can hardly call the US the USSR.  Europe indeed does not have freedom of speech, as this BBC article points out: https://www.bbc.com/news/world-europe-60111140.  Europe is indeed being destroyed by welfare and immigration from countries with values diametrically opposed to values that once made Europe an incredible place.  

[Loss Horizon]

4 hours ago, Dalal.Holdings said:

The problem with this line of thinking is that any criticism of Europe can be dismissed as “Russian propaganda”.

 

These things are objectively true:

1) Europe’s economies are stagnant due to productivity & structural issues

2) Europe is way behind the U.S. and China in technology

3) Europe cannot effectively project military power in its own backyard

 

If this continues (if the gap grows), more and more Americans (pop 330 million) will start asking why it’s worth expending so much protecting this 500M population, especially when priorities are moving to the Pacific (something true since Obama). You are seeing Germans protest voluntary service. You are seeing Spain resist increasing funding. Meanwhile, the Europeans gloat about how their quality of life, pensions, and healthcare is so good. This is happening while there is a war in Europe and European leaders are livid that the U.S. is trying to end…

 

9 minutes ago, Marco Van Basten said:

Actually it is not.   Europe is indeed not doing well sadly, and you can hardly call the US the USSR.  Europe indeed does not have freedom of speech, as this BBC article points out: https://www.bbc.com/news/world-europe-60111140.  Europe is indeed being destroyed by welfare and immigration from countries with values diametrically opposed to values that once made Europe an incredible place.  

 

I can totally understand you folks. Having a strong and unstoppable national leader who you think is acting in your interests is a most intoxicating feeling. I wish I could feel that ever again.

[Dalal.Holdings]

5 minutes ago, Loss Horizon said:

 

 

I can totally understand you folks. Having a strong and unstoppable national leader who you think is acting in your interests is a most intoxicating feeling. I wish I could feel that ever again.

Did you disprove any of those three things I said? The gap between the U.S. and EU has grown since the 1990s, long before Trump.

 

I realize it's much easier to accuse us of being fascists though.

[Gregmal]

The problem with the EU is that it was created to resemble the US, in a good way. But instead has basically become an elitist social club that only rips off the stupidest, most extreme far left liberal junk policies and implements/influences their adoptions and injections in ways that largely bypass its citizens. 
 

On top of that, there’s this inherent high school principal arrogance that “entitles them to everything”, which means they can push cash grabs of corporate profits, or push antitrust crap just for show(like they’re about to do with Netflix and like the did over a video game at Microsoft).

[cubsfan]

 

[Gregmal]

Yea, they’re all elitist, hypocritical pieces of shit. They genuinely believe their duty to the world is “make rules” for everyone. When there’s a capitalism event, it’s their “duty” to “inspect and critique” it.

[Marco Van Basten]

1 hour ago, cubsfan said:

 

I guess Helmut never heard of Paivi Rassanen... Of course the good German does not seem to understand the irony in what he says: there is no censorship and everyone has to follow our rules.  

[Spekulatius]

15 minutes ago, Marco Van Basten said:

I guess Helmut never heard of Paivi Rassanen... Of course the good German does not seem to understand the irony in what he says: there is no censorship and everyone has to follow our rules.  

I agree here. Sarah Rogers is right fighting this fine on X. It makes no sense and is counterproductive for Europe to do this.

 

FWIW, Helmut is Austrian.

Edited December 7, 2025 by Spekulatius

[Loss Horizon]

8 hours ago, Dalal.Holdings said:

Did you disprove any of those three things I said? The gap between the U.S. and EU has grown since the 1990s, long before Trump.

 

I realize it's much easier to accuse us of being fascists though.

 

Everyone is a fascist when put in the right environment.

 

I don't see a reason to argue, I know all the talking points very well. "Immigrants", "transgenders and gender studies", "welfare state", "bureaucracy", "overregulation", "lack of technology and innovation", "bad politicians" - that one has no limits, "censorship and lack of freedom of speech", "laziness", "liberals", "eco terrorists", "green agenda", "Islam", "socialists", "economy stagnation", "Covid Hoax", "free riding on US defense", "replacing of white Europeans with people with darker skin". There is probably more coming up every day, people are very inventive.

 

I have of course my view on some issues. However none of them ever took any attention from Warren Buffett and Charlie Munger, whose company is in the name of this forum. I don't know why it's here.