“I’ll tell you why I like the cigarette business. It costs a penny to make. Sell it for a dollar. It’s addictive. And there’s fantastic brand loyalty.”

Warren Buffet is a legendary investor. His philosophy of carefully picking industries and companies that do well even in tough times and then sticking with them, has delivered huge rewards over the years to his Berkshire Hathaway company, originally a textile company but now basically an investment fund (often in the production of very basic goods), whose Class A shares have steadily climbed in value (he rarely splits the stock) from the original early 1960’s value of about $US 11 per share to $1000 by 1983, $10,000 by 1992 and $100,000 by 2006 – after which it’s really taken off, standing at $634,440 on March 28, 2024. The whole company is currently worth some $US 867 billion.

He has delivered a nearly 4,900,000% aggregate return for his company’s Class A shareholders over fifty years.

He’s also bluntly honest about his investments, once telling a journalist that he only invested in wind power because of the tax credits, “They don’t make sense without the tax credit”, and shrugging off guilting and shaming over tobacco investments with the comment I placed under the title of this post

All this makes him a legend in the investing world, so the following news should put all of us on notice:

Collectively, Warren Buffett and his top investing aides have overseen $56.09 billion in aggregate ne-equity sales since Oct. 1, 2022.

And it’s been done very quietly. Clearly Buffet does not want to spook the market. But clearly he also thinks it’s over-priced froth and doesn’t see much more upside.

The good news is that since he is a long-term investor he’s likely just expecting a downturn on Wall Street, after which he’ll dive back into the market to scoop up lower-priced shares in companies that have solid fundamentals in their business, revenues and profits. It’s doubtful that he’s giving up on America’s economy.

Although perhaps he hasn’t read the following, quoted from a boutique engine rebuilder in the USA, which explicitly details the myriad small ways in which the US economy is eating its seedcorn (full text below in case the account or this post vanish.

Due to the dwindling supply of quality machine shops and very poor quality aftermarket parts as well as a lack of people interested in learning the engine building and machine shop trades, I regret to inform our many followers and current as well as past customers that we will no longer be taking on any new engine build orders unless it is for a car we are restoring.

Since Covid, we have had to do rework on multiple engine builds due to poorly manufactured parts that failed during break in or machine work that was below our standards due to all the old farts like me dying off with no younger workers interested in taking their place. For example, rod bearings are now made too thin resulting in 390 and 401 crank grinds needing to be ground .0085, .0185 or .0285 under standard rod journal size yet all but one machine shop in the entire Phoenix area refused to do anything other than the standard .010, .020 or .030 grinds.

Even worse, when the one shop that will grind the cranks the way we tell them we need them loses their crank grinder to retirement in another year or two, they do not plan to replace him. Machine work that used to have a turnaround of 2-3 weeks now takes a minimum of 2-4 months due to an acute lack of people interested in learning machine work and doing manual physical labor. In fact, one engine block was at a machine shop for a year and when we got it back hey did such a poor sleeve job in one cylinder that it was not even useable so it is now a 250 lb paper weight.

About 15 years ago I nearly bought out an aging gentlemen’s machine shop and continue to regret not doing so due to the lack of availability of places to get the work done.

As for poor quality parts, Edelbrock aluminum heads are now such poor quality and filled with so much manufacturing machining slag that we have to completely disassemble them, reset the valve stem and spring heights and even sometimes have them resurfaced because the slag scratched the head gasket surface.

Similarly, there are only a couple of camshaft manufacturers remaining that harden their cams correctly and nearly all flat tappet lifters are now such terrible quality and inconsistent hardness that we are no longer willing to risk losing a cam due to poorly made cams and lifters. In fact, we now only use either rollers or custom ground flat tappets with Johnson made lifters from Howard or Herbert. For example, we have probably used 50 or more Summit cams over the past 15 years but the last 4 we used did not even make it through break in so they too are now off the list of acceptable quality parts as well.

So what does all of this mean?

We will honor whatever engines builds that are not part of a full restoration that we already have in the queue however we must warn all those who have been patiently waiting for their engines to be built that supply chain constraints in addition to rapidly declining parts quality along with a lack of qualified machine shop workers is resulting in our anticipated wait times to get an engine built often doubling in duration. And if anyone is tired of waiting and thinks they can do better elsewhere, we will fully refund their deposit and wish them well. What used to take a couple of weeks to get back from a machine shop can easily now take 2-4 months or more resulting in our overall engine backlog now being 15-18 months.

The bottom line is that custom engine building is on its way to becoming extinct and it won’t be too many more years before all of us old farts that currently do this work either retire and/or die off resulting in engine building within the collector car hobby becoming nearly impossible to find. And when you do find someone, don’t be surprised if they are backed out 2+ years or more and that they only want to do Chevy builds and know zero about our beloved AMC engines. “The times they are a changin’.