Buffett: Don't bank on big returns

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Warren Buffett's Letter to Shareholders is out:

http://www.berkshirehathaway.com/letters/2007ltr.pdf

Here is a Fortune article about it:

Buffett: Don't bank on big returns

He chides investors who expect their portfolios to see double-digit growth, and says Berkshire's success has been so great that it is unlikely to see "outsized gains" in the future.

By Colin Barr, senior writer

Fortune -- Berkshire Hathaway had another excellent year in 2007, posting an 11% gain in net worth, CEO Warren Buffett said in Friday's annual report to shareholders. Berkshire has grown its per-share book value by a remarkable 21% annually since Buffett took the reins 44 years ago.

But as always, Buffett was quick to emphasize that past performance is no guarantee of future results. He predicts the Omaha-based company's insurance operations will be hit in coming years by narrowing profit margins and warned that gains at Berkshire - which operates businesses ranging from chocolatier See's Candy to private-plane timeshare company NetJets - will be constrained by the company's history of success.

"Berkshire's past record can't be duplicated or even approached," Buffett writes in the report, published Friday on the company's Web site at berkshirehathaway.com. "Our base of assets and earnings is now far too large for us to make outsized gains in the future."
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http://money.cnn.com/2008/02/29/news/companies/berkshire_annual_report.fortune/index.htm