As tens of thousands of Berkshire Hathaway shareholders flocked to Omaha over the weekend for the conglomerate’s annual meeting, they heard a mix of wariness and optimism from Warren Buffett, the company’s longtime C.E.O.
During hours of questions from investors, the Oracle of Omaha and his partner, Charlie Munger, talked about everything from the economy to the recent banking crisis and much more.
Buffett and Munger are feeling downbeat about a lot of things:
Echoing dour comments by Munger, Buffett warned of a continued economic downturn, thanks to higher interest rates and lower consumer spending.
Things could have been worse — “catastrophic,” even — if U.S. regulators hadn’t assured depositors of Silicon Valley Bank that their money was safe. But even Buffett was feeling wary about how much more fragile the banking system had become. “You don’t know what happened to the stickiness of deposits at all,” he said. “You can have a run in a few seconds.”
Buffett warned about the current level of government spending: “It’s madness to just keep printing money. It’s very hard to see how you recover once you let the genie out of the bottle, and people lose faith in the currency.”
Munger had a classic rejoinder to the fervor over A.I.: “I am personally skeptical of some of the hype that’s gone into artificial intelligence. I think old-fashioned intelligence works pretty well.”
But Buffett’s feeling upbeat about some companies. He had nothing but praise for Apple, saying it “just happens to be a better business than any we own.” (Tim Cook, Apple’s chief, was in attendance at the meeting.) And he talked up Occidental Petroleum, in which Berkshire now has a 20 percent stake — though he said he wouldn’t seek to buy the whole company.
Those mixed feelings reflect the picture at Berkshire itself, which reported a huge jump in first-quarter profits thanks to investment gains, but more muted results across its operating businesses. Gains at its Geico insurance division were partially offset by declines at its BNSF railroad, the Berkshire Hathaway Energy utility network and its retail operations, largely because of the economy.
Meanwhile, Buffett sold $13 billion worth of stock holdings during the quarter, apparently finding little of value in the market — other than Berkshire stock, of which he repurchased $4.4 billion worth.
And Buffett’s chosen successor shared more of the limelight. Greg Abel, who currently runs many of Berkshire’s noninsurance operations, drew more attention from investors eager to hear from the conglomerate’s future C.E.O.
– The New York Times
