Warren Buffett’s Berkshire Hathaway hosted its annual shareholder meeting on Saturday. Buffett discussed inflation and the pandemic, and revealed he boosted his Apple stake last quarter. Follow along for live updates from the meeting. Loading Something is loading.
Warren Buffett’s Berkshire Hathaway hosted its annual shareholder meeting in person this weekend for the first time in two years. Insider was live at the event, which attracts tens of thousands of people from around the world, and has been heralded as “Woodstock for Capitalists.” Scroll down for our live blog on what Buffett, his partner Charlie Munger, and the rest of the Berkshire team said.
Buffett, perhaps the most famous bargain hunter in the world, has struggled to find deals over the past two years. Stocks marched to record highs, private equity firms and special-purpose acquisition companies (SPACs) bid up the price of acquisitions, and Berkshire’s rising stock price made the shares less enticing to repurchase.
However, Berkshire has boosted its buying this year. It plowed about $7 billion into Occidental Petroleum stock in 11 days, snapped up $4 billion of HP shares, and struck a deal to acquire Alleghany for $11.6 billion in under two weeks.
Buffett’s company reported first-quarter earnings before the meeting on Saturday. It revealed that it plowed a net $41 billion into stocks, slashing its cash pile by 28% to $106 billion. It also slowed share repurchases to $3.2 billion, marking its lowest level of buybacks since the first quarter of 2020.
Berkshire owns scores of businesses including Geico, See’s Candies, and the BNSF Railway, and holds multibillion-dollar stakes in Apple, Coca-Cola, Kraft Heinz, and other public companies.
Buffett is widely expected to discuss Berkshire’s latest purchases, and comment on the concerns roiling financial markets including rampant inflation, rising interest rates, Russia’s invasion of Ukraine, and continued supply chain disruptions due to the COVID-19 pandemic.
Read more: Warren Buffett is on a long-awaited buying spree. 7 experts break down why the investor spent $23 billion on a trio of big-ticket purchases.
Here’s our live blog of Berkshire’s annual shareholder meeting:3:30 p.m.: Buffett ends the Q&A session. Thanks for following along.
3:20 p.m.: Buffett underscores the value of stock buybacks, and jokes he would buy all of Berkshire if enough people were selling. He emphasizes that share repurchases should only be made at a compelling price.
2:57 p.m.: “In my life, I try and avoid things that are stupid, evil, and make me look bad in comparison to someone else,” Munger says. “Bitcoin does all three.”
Munger added that bitcoin is “stupid” because he expects it to go to zero, “evil” because it undermines the integrity of the US financial system, ” and makes other countries l”ook foolish” compared to China, which has banned it.
2:51 p.m.: Buffett takes aim at bitcoin after being asked whether he’s changed his mind about it. The investor says that if the crowd offered him a 1% stake in all the farmland in the US, or all the apartment houses in the US, he’d write them a check.
“If you told me you owned all the bitcoin in the world and you offered it to me for $25, I wouldn’t take it,” Buffett says. “What would I do with it?”
Buffett was reiterating the difference between productive assets, which grow in value over time, and an asset like bitcoin that relies on somebody else paying more for it. The investor adds that lots of people have made money moving bitcoin around without creating any more.
“Certain things have value that don’t produce something tangible,” he says, giving the example of a great painting or a pyramid that will grow in value over a long time. “Assets, to have value, they have to deliver something to somebody and there’s only one currency that’s accepted.”
Buffett adds that anyone who thinks the US government would let another currency replace the dollar “is out of their mind.”
“It’s got a magic to it, but people have attached magic to lots of things,” Buffett says about bitcoin, comparing it to an insurance company masquerading as a technology business.
2:50 p.m. Buffett recalls Munger once contesting an insurance claim by suggesting they multiply its size by 10 times to make it worth his while to fight the case. He got a return check for the full amount by return mail, Buffett says.
2:34 p.m. Buffett discussed his strange offer of $848.02 a share for Alleghany, which was $850 minus the fee Alleghany paid to Goldman Sachs to advise on the transaction. He recalls balking at paying millions of dollars for a fairness opinion in the late 1970s, and successfully convincing two investment banks to provide one for $60,000 each.
Berkshire paid the same two banks $110,000 each to provide a fairness opinion on a second deal a few years later, representing a steep discount to the market rate. Buffett emphasized that somebody ends up paying the advisory fee, and he loathes spending large amounts of money to cover it.
2:29 p.m.: Buffett underlines the difficulty of setting accounting standards that work for every company. He recalls a Salomon Brothers executive telling Buffett decades ago that the company couldn’t balance its assets and liabilities following a merger, and joked that he was happy he was informed of that after he testified to Congress, not before.
2:19 p.m.: “We’ve had a lot of inflation and it was almost impossible not to have it,” Buffett said, given the vast amount of money pumped into the US economy. However, he notes that if the Fed hadn’t stimulated the economy in the spring of 2020, everyone would be a lot worse off.
“It happened on a scale we’ve never seen before,” Munger said. “They drowned the country in money for a while.”
2:13 p.m.: Buffett notes that predictions of the death of cash are premature, as the amount of US dollars in circulation has soared to north of $2 trillion in recent years. The investor says it’s inevitable that if you pump huge amounts of money into the economy, it will inevitably drive up prices. In other words, quantitative easing has fueled inflation.
2:11 p.m.: “The government has sent out lots of money to people,” Buffett says, referring to the Treasury and Federal Reserve’s efforts to stimulate the economy.
2:09 p.m.: Buffett notes that some Berkshire businesses have faced higher costs during the pandemic, and they’ve passed them on to customers in the form of higher prices. People have money and they want to buy, he says, pointing to demand at Nebraska Furniture Mart.
2:07 p.m.: “I look at Berkshire as a painting, and it’s unlimited in its size, and I get to paint what I want,” Buffett says about his long-term vision for the company.
2:01 p.m.: “It’s our job to figure out what businesses we want to be in,” Buffett says, adding that he and Munger believe they can do that job better than almost anybody, or they wouldn’t be doing it.
1:52 p.m.: Buffett decided to make some news, and revealed he’s boosted Berkshire’s stake in Activision Blizzard — which was established by one of his deputies last year — from 2% to 9.5%.
Buffett determined the video-game maker’s stock was too far below Microsoft’s offer, and decided to bet the transaction would close and the stock would rise to the deal price, generating a profit for Berkshire.
1:29 p.m.: “It’s getting very peculiar,” Munger says about the influence of technology on corporate America, noting shareholder meetings could be hold virtually in the future, and index funds have grown more and more dominant. He says that things always change, and not always in ways you like.”
1:26 p.m.: Buffett compares the idea of imposing earnings targets on the bosses of Berkshire subsidiaries, to taking cash out of a register and promising to put it back. He argues it would be a slippery slope to ask his lieutenants to hit certain numbers.
1:21 p.m.: “The ideal shareholder group we can have, is the group we have today,” Buffett says, comparing Berkshire to a church with loyal parishioners.
1:13 p.m.: “Inflation swindles the bond investor, it swindles the person who keeps their cash under their mattress, it swindles everybody,” Buffett says, in response to a question about whether inflation swindles the equity investor. The investor notes that if businesses don’t require more capital, it can just raise prices, they’re likely to struggle to raise prices enough to offset their rising costs.
“The best protection against inflation is still your own personal earnings power,” he reiterates.
1:08 p.m.: “Lobbying is really distasteful,” Buffett says, recalling he once lobbied for a candidate and ended up in a room with lobbyists for cigarette companies who “didn’t care about Nebraska.” “It made you want to throw up,” Buffett said.
“Berkshire is not a weapon, don’t use it muscle money out of anybody else,” Buffett says, recalling the advice he tells the bosses of Berkshire subsidiaries.
1:05 p.m.: Buffett complains the media writes headlines attributing Berkshire stock purchases to him, when it may have been his deputies, Todd Combs and Ted Weschler.
1:01 p.m.: Buffett reflects on speaking out about political issues, and noted that he risks angering people and spurring them to punish his companies, and therefore Berkshire employees and shareholders. He’s “decidedly backed off” from saying something controversial that will be attributed to Berkshire, and have somebody else bear the consequences.
1:00 p.m.: “We’ve sold 15 boats so far, get ’em while they last,” Buffett says, referring to Forest River, a Berkshire subsidiary that partnered with Jimmy Buffett to create a Margaritaville-style pontoon boat.
12:49 p.m.: It’s worth recognizing how strange this event really is. A 91-year-old investor, not a rock star or evangelical preacher or sports team, has filled out a stadium in Omaha with thousands of people. They’ve made the trip to become better investors, hear an expert’s take on what’s going on in financial markets, and reconnect with a community of like-minded people.
Tom Gayner, the CEO of Markel, a Berkshire-like conglomerate, said at an event on Friday that attending the annual meeting was like “going to church on Sunday,” and he enjoyed reminding himself of the basics of value investing .
John Rogers, co-CEO or Ariel Investments, said at the same event that he was hoping Buffett would provide some reassurance to investors that the US economy is strong and resilient.
11:55 a.m.: We’re breaking for lunch, and will be back with our live coverage at 1 p.m. CT.
11:55 a.m.: “Is it wise to criticize?” Buffett asks. “Probably not, but I can’t help it,” Munger quips.
11:53 a.m.: Buffett and Munger are chatting about illusions. This will probably be one of the last times the public will see this pair, aged 91 and 98 respectively, enjoy this type of banter and witty repartee.
11:47 a.m.: Buffett, perhaps channeling SoftBank CEO Masayoshi Son, projects an illusion that can be seen as either two faces or a vase, then another one showing both a rabbit and a duck in one image.
He notes that as a teenager, he had been investing the wrong way, focusing on technical analysis of stock charts instead of seeing himself as an owner of a business.
11:46 a.m.: Buffett reflects on his early passion for investing, noting he tried shorting stocks and wrongly focused on picking stocks that would go up, instead of buying pieces of businesses.
11:38 a.m.: “New managements will just be custodians of a culture that’s embedded. The owners believe in it, the people that work there believe in it.”
11:36 a.m.: “Berkshire is built forever. There is no finish point,” Buffett says. He adds that his company’s executives aren’t waiting around for retirement or looking for other jobs, as they’re exactly where they want to spend their lives.
11:31 a.m.: “I could have spent 10,000 hours trying to become a heavyweight boxed, but I don’t think I would have felt very good at the end of the 10,000 hours,” Buffett jokes. He says a weaker dollar won’t affect someone who’s the best doctor around.
11:26 a.m.: Buffett and Munger are asked what the best stock to own during an inflationary period is. Buffett answers that the best solution is to be the best you can at something, as people will pay for an excellent doctor, or singer, or baseball player.
“The best investment by far is anything that develops yourself,” he says, adding it isn’t taxed.
Munger says if your financial advisor tells you to put all your money into bitcoin, “Just say no.”
11:24 a.m.: On another note, Insider visited the “Berkshire Bazaar of Bargains” on Friday, where dozens of Berkshire businesses showcased their wares, and their bosses chatted with shareholders. Here’s a look inside the shopping event.
11:21 a.m.: Abel reveals Berkshire’s energy, railroad, and other non-insurance businesses face billions of cyberattacks, and fend off threats “every second of every day.”
11: 14 a.m.: Berkshire’s boss reflects on the “very, very fortunate development” that the US invented the atomic bomb during World War II before any other countries.
Jain chimes in to say that he’s unable to gauge Berkshire’s exposure to a nuclear event. “It’s very difficult for us to estimate how bad it can be,” he says.
Berkshire’s insurance boss notes that he’s “fairly positive” that regulators and the courts would put insurers on the line to pay nuclear damages, even if they were excluded in insurance contracts.
11:08 a.m.: Buffett is asked how a nuclear attack could affect Berkshire’s insurance business, and Abel is asked whether BHE has taken steps to harden its security in light of Russia’s invasion of Ukraine.
“It is a very, very, very, very dangerous world,” Buffett says, underscoring that the “world is flipping the coin everyday” as to whether one person or another destroys the planet.
11:07 a.m.: “I don’t even look at what I did when I was young because it would embarrass me, Munger says.”
11:05 a.m.: “You ought to be a better person in the second half of your life than the first,” Buffett says, referring to people who won the “ovarian lottery” by being born in the US, and have learned from their mistakes.
11:02 a.m.: “People are charging for skill and delivering closet indexation,” Munger says, explaining that fund managers do the same thing to avoid underperforming their peers and the market. He called the phenomenon “ridiculous.”
10:58 a.m.: “Take away the management fees and I’d bet on the monkeys,” Buffett says about financial advisors trying to time the market, referring to the idea that a lot of financial advice is equivalent to monkeys throwing darts at a dartboard.
10:55 a.m.: “I totally missed” the opportunity to buy when the pandemic tanked markets in the spring of 2020, Buffett says. The investor was roundly criticized for not deploying some of Berkshire’s huge cash pile at that time, and fund managers including Bill Ackman were surprised and disappointed not to see Buffett snap upo the bargains available.
10:51 a.m.: “Ajit is responsible for adding more value to Berkshire than the total net worth of Progressive,” Buffett says.
10:32 a.m.: Buffett reveals Berkshire bought some more Apple stock in the first quarter. Berkshire reported its Apple stake was worth $159 billion at the end of March.
“We actually bought a little more Apple in the first quarter and Apple bought out some of the other shareholders,” Buffett said.
10:29 a.m.: “If they do it at the right price, there’s nothing better than buying their own business,” Buffett says, endorsing sensible share repurchases.”
10:26 a.m.: Buffett says stock buybacks aren’t complicated, making an analogy to owning a lemonade stand and buying out a partner at a good price for the remaining owners. He notes that Berkshire’s ownership of American Express has soared from about 11% to 20% due to the credit-card giant’s stock buybacks, without Berkshire spending a penny.
10:23 a.m.: “We would never sell an operation like that, never,” Buffett says about one of his German investments. “I’m looking at you Greg,” he quips, referring to Abel succeeding him as CEO.
10:21 a.m.: An audience member asks if Berkshire would proactively look to buy overseas businesses. Buffett says they bought a few German securities and increased some of their Japanese holdings, confirming his comment in a recent interview that Berkshire had been active in Germany.
10:18 a.m.: “I think we’ve made more because of the crazy gambling. I think it’s made it easier for us,” Munger says.
Buffett notes that he depends on mispriced businesses to make money.
10:17 a.m.: Munger bemoans the excessive speculation and gambling in markets, saying it’s no more of a victory for capitalism than playing dice.
10:14 a.m. Many people were trading Occidental “in some crazy way” that allowed Berkshire to buy such a large amount of stock in a matter of days, Buffett says. The investor calls out the sale of highly risky, three-day call options.
“I don’t think we’re smart, I think we’re sane,” Buffett says. “And that’s the main requirement in this business.”
10:07 a.m.: “We’ve got people who know nothing about stocks being advised by stockbrokers who know even less,” Munger says, underlining the amount of “casino activity” in markets, and computers trading against other computers.
10.04 a.m.: The Berkshire CEO adds that he bought into Occidental after reading its earnings-call transcript and approving of CEO Vicki Hollub’s strategy.
10.02 a.m.: Buffett notes that the amount of short-term trading in the stock market enabled Berkshire to deploy about $7 billion on Oxy stock in a matter of days. “Essentially it was a gambling parlor, and the people that were making money, they were gamblers,” Buffett says about the state of the market at that time.
10 a.m.: Buffett flashes up a breakdown of Berkshire’s recent Occidental purchases, highlighting that it amassed the roughly 15% stake in the space of 11 days.
9:52 a.m.: Buffett is asked what changed between the publication of his annual letter on February 26, and the flurry of purchases (Occidental Petroleum, HP, Alleghany) over the next few weeks. Munger says they found assets that were more attractive to hold than Treasury bills. Buffett recalls receiving a letter from Alleghany CEO Joe Brandon a day earlier, and setting up a meeting with him a few days later.
Buffett adds that the Alleghany deal wouldn’t have happened unless Brandon had emailed him.
“A few stocks got very interesting to us,” Buffett says. “The market has been extraordinary. Sometimes it’s quite investment-oriented, and other times it’s almost totally a casino, it’s a gambling parlor, and that existed to an extraordinary degree in the last couple of years, encouraged by Wall Street.”
Buffett notes brokers “make a lot more money when people are gambling than when they’re investing.”
9:48 a.m.: “If you ever buy a bank, and there’s only two banks in town, hire some extras to stand in line in front of the other bank,” Buffett jokes, underscoring how bank runs can cause panic and put banks out of business.
9:46 a.m: “We were not very, very far away from having something that might have been a repeat of 2008 or even worse,” Buffett says, referring to liquidity tightening in the spring of 2020, when the pandemic struck the US.
9:40 a.m.: “We will always have a lot of cash,” Buffett says, after Berkshire’s equity buying helped cut the company’s cash pile by 28% to $106 billion last quarter.
9:37 a.m.: Buffett shares a breakdown of Berkshire’s stock-buying activity, showing the company spent $41 billion on stocks between February 21 and March 15 — including $4.6 billion on March 4 — and another $11 billion during the rest of the quarter. He appears to suggest that Berkshire didn’t repurchase any shares in April.
9:35 a.m.: Buffett says he’s already writing next year’s annual letter in his head, and approaches it as if he’s explaining how his business is doing to his sisters.
9:31 a.m.: “We didn’t know what was going to happen with the pandemic, we didn’t know what was going to happen with the economy,” Buffett says, referring to his thinking in the spring of 2020. “We feel very good” about Berkshire’s position today, he adds.
9:29 a.m. Buffett puts a screenshot of Berkshire’s first-quarter earnings on the big screen, saying there are no big surprises.
9:27 a.m.: The Berkshire boss thanks his shareholders for trusting him with their savings, and underscores how important he feels it is that every shareholder receive information at the same time.
9:22 a.m.: Buffett reveals that from noon to 5pm on Friday, 12,000 shareholders visited the exhibit hall and “spent money on anything we could think to sell them.” See’s set a record for the Friday shopping day, he says.
9:18 a.m.: In classic fashion, Buffett and Munger have three boxes of See’s Candies on display between them, and the pair have cans of Coke and Diet Coke respectively next to them.
9.15 a.m.: The lights come up, revealing Buffett, Munger, and the heads of Berkshire’s insurance and non-insurance operations, Ajit Jain and Greg Abel.
8:30 a.m.: Buffett kicks off his meeting with a 45-minute video, featuring ads for Berkshire-owned companies such as Geico and Brooks Running and key investments such as Apple.
It also includes multiple skits. In one, Munger appears with characters from “The Office,” Desperate Housewives,” and “Breaking Bad.” In another, Buffett is turned away from his own meeting and carried off by security, then returns dressed like Jimmy Buffett and gets turned away again.
Moreover, there’s a remix of Bruno Mars’ “Uptown Funk” (Berkshire Hatha-lujah!) showcasing the bosses of Berkshire’s dozens of businesses.