OMAHA, Neb. — At the start of the Berkshire Hathaway BRK.B,
annual meeting on Saturday, chairman and chief executive officer Warren Buffett wasted no time speaking to the question of the company’s aging leadership. He noted, in fact, that the combined age of he and vice chairman Charlie Munger was roughly 190 years — and that it was only appropriate that shareholders “see them in person.”
The obvious implication: Buffett understood that the Berkshire faithful might need reason to feel assured in their faith.
For many shareholders, Buffett, 91, and Munger, 98, proved they were more than capable of not only retaining control of the company, but also continuing to steer it in a profitable direction. Shareholders pointed to how the two men held court in their usual humorous way, answering questions for several hours and offering their opinions on a range of topics.
And, of course, they pointed to Berkshire’s recent track record: In a year in which the S&P 500 SPX,
has dropped by more than 13%, Berkshire is up more than 7%.
“I love these guys,” said Jack Berdan, a shareholder from San Clemente, Calif., who was attending the meeting for the first time.
Mitchell Hockenbury, a financial professional and shareholder from Kansas City, Mo., who has been a meeting regular through the years, singled out Buffett’s command of a range of topics during the daylong affair. “Warren has not lost a step,” he said.
Others were slightly more skeptical, pointing to how Buffett, always known for talking at length, went on longer than usual.
“He’s not as sharp. There have been several answers that were rambling,” said Ron White, a shareholder from Oklahoma City, Okla., and another previous attendee.
Buffett made clear that he believes Berkshire, a company that owns and invests in a wide range of businesses, from insurance entities to a candy company, is positioned to embrace a future without him. He pointed to the company’s disciplined approach as being one that will remain in place.
“You’ve got a board of directors that understands our culture,” he said.
Buffett did note, however, that some things might change when Berkshire vice chairman Greg Abel, his successor-in-waiting, takes over. Specifically, he said the board may not give him the same degree of carte blanche in making decisions.
“They’ll put some more restrictions” on him, Buffett said.
The meeting, long celebrated as a kind of “Woodstock for capitalists” with a range of social activities and shopping opportunities beyond the large shareholder gathering at the CHI Health Center arena, was the first held in-person since 2019. The past two years the meeting was done as a virtual affair, owing to the pandemic.
“It really feels good to be back,” Buffett said at the beginning.
As always, shareholders gave Buffett and Munger a platform to sound off on just about anything. A chief topic was Berkshire’s purchasing spree in recent months, including its acquisition of Alleghany Corp. and its buying more shares of Activision Blizzard Inc. ATVI,
Buffett said Berkshire “will always have a lot of cash” on hand, particularly so it can be nimble when opportunities arise.
Buffett and Munger also expressed their skepticism about cryptocurrency repeatedly throughout the event. Responding to a query from a young investor, Munger said, “When you have your own retirement account and your retirement advisor suggests you put all your money in bitcoin, just say no.” He doubled down on the comments later, simply calling digital assets “stupid” and “evil.”
Munger, who’s known for his amusingly curt remarks, also had a few choice things to say about the financial industry. “People who know nothing about stocks (are) being advised by stock brokers who know less,” he remarked at one point.
A contentious point of the meeting involved a proposal for Berkshire to have an independent chairman, stripping Buffett of one of his dual roles. As chair and CEO, Buffett is essentially his own boss, leading some to question whether that poses an inherent conflict.
Munger called such an idea “the most ridiculous criticism I ever heard.” He added that it’s as if the ancient Greek hero Odysseus returned home only to be told by someone they didn’t “like the way you were holding that spear when you won that battle.”
The proposal was voted down soundly by shareholders, along with other measures, including one that would require Berkshire to issue a yearly assessment of how it’s managing issues related to climate change.
Those looking for investment tips from Buffett and Munger might have taken special note of a question from a shareholder, who asked if there was a stock worth buying right now as a hedge against inflation.
Buffett didn’t answer the query directly and instead said the best way to protect yourself against inflation is to simply “be exceptionally good at something,” so your talents and services are always in demand regardless of which way the financial wind blows.
David Applegarth, a meeting attendee from Boston, said Buffett missed an opportunity and could have offered a much more apt response.
“We were surprised he didn’t say to buy Berkshire Hathaway stock,” Applegarth said.
MarketWatch reporters William Watts and Christine Idzelis contributed to this story.
Credit: www.marketwatch.com /