Warren Buffett and Charlie Munger, the two legendary investors and leaders of Berkshire Hathaway, held their annual shareholder meeting on May 6, 2023. During the more than five-hour-long meeting, the duo discussed a wide range of topics, including their investment philosophy, the keys to their success, and their outlook on the markets.
Buffett and Munger expressed their continued optimism about Apple, with Buffett saying that consumers would be more likely to give up their second car than their iPhone. They also praised Microsoft, calling it a “fabulous company.” Additionally, Buffett lauded TSMC, saying that no other company can compare to its leadership position in the industry.
They also addressed the issue of succession planning at Berkshire Hathaway, with Buffett saying that the company has a plan in place but that he has no intention of stepping down anytime soon.
We have compiled 40 key takeaways from the meeting, covering topics such as Apple, Microsoft, TSMC, the Federal Reserve, AI, renewable energy, the US banking crisis, and Berkshire Hathaway’s succession plan.
Consumers would be more likely to give up their second car than their iPhone
Buffett at the meetingRead More
The Value Behind the Major Companies
01. Why Berkshire Hathaway Bought Pilot Over Travel Centers
Buffett explained why Berkshire Hathaway chose to purchase Pilot instead of Travel Centers, despite the former being more expensive. According to him, the location of Pilot stations is significantly better than Travel Centers, making it a more worthwhile investment.
The first stage is at a very good price, and the second stage, which was completed last year, was very advantageous for the seller because of Pilot’s excellent performance
Buffett at the meeting
Berkshire Hathaway first acquired shares in Pilot in 2017, and since then, the stock has been accounted for as equity. By early 2023, Berkshire Hathaway plans to purchase additional equity in Pilot, raising their ownership to 80%. This move will allow for full integration of Pilot’s earnings, assets, and liabilities into Berkshire Hathaway’s financial statements.
Comparing Pilot and Travel Centers is not entirely reasonable, as Pilot’s locations are much better. Buffett stated, “The reason why Berkshire Hathaway bought Pilot at a higher price than BP bought Travel Centers is that Pilot is a three-stage transaction. The first stage is at a very good price, and the second stage, which was completed last year, was very advantageous for the seller because of Pilot’s excellent performance.”
With this investment, Berkshire Hathaway is betting on the long-term potential of Pilot’s superior locations and strong performance, which is reflected in its decision to increase its equity stake.
02. Buffett aims to diversify distribution channels like Walmart
He expressed his admiration for Walmart’s distribution capabilities. Noted that while many of Berkshire Hathaway’s products are sold at Walmart, it’s important to have multiple distributors that possess Walmart’s level of expertise.
Buffett acknowledged that Walmart has done an excellent job with its distribution, but some products may be challenging to sell solely through the retail giant. That’s why diversifying distribution channels is crucial. By having multiple distributors with similar capabilities to Walmart, Berkshire Hathaway can reach a wider audience and potentially increase sales.
Diversification is a vital strategy for any business to reduce risks and expand its customer base. Buffett’s insight into the importance of having multiple distributors with strong distribution capabilities is a valuable lesson for businesses of all sizes. By taking steps to diversify their distribution channels, companies can increase their chances of success and long-term growth.
03. Love for See’s Candies Has Its Limits
Warren Buffett, the Oracle of Omaha, is known for his investment prowess and his love for See’s Candies. See’s Candies has a 101-year history, and it’s one of the brands owned by Berkshire Hathaway, the investment company chaired by Buffett. However, during a recent interview, Buffett admitted that the brand’s magic has its limits.
According to Buffett, the problem facing See’s Candies is not about opening new stores. He and Charlie Munger, Berkshire Hathaway’s vice-chairman, have made several attempts to globalize the brand, but they always hit a roadblock. Although See’s Candies has a charm that comes from its long history, that charm is not infinite.
In the highly competitive candy industry, it’s essential to innovate and keep up with the changing market trends. See’s Candies has to find a way to maintain its unique charm while adapting to the current market dynamics. Buffett’s comments suggest that the brand needs to reinvent itself to remain relevant in the long term.
04. Charlie Munger on the Challenges of the Film Industry
Charlie Munger, Vice Chairman of Berkshire Hathaway, shared his thoughts on the film industry and Disney. Munger pointed out that the film industry is a highly challenging and competitive industry. Munger cited an example, saying that before the pandemic, the industry had 70% of its business, but with the outbreak, foot traffic decreased. However, theaters cannot decrease the supply of films or other consumables.
The film industry faces a variety of challenges, such as piracy, high production costs, and limited revenue streams. Despite these difficulties, the industry has continued to innovate and evolve. With the advent of streaming services like Netflix and Amazon Prime, the industry has seen a shift towards digital distribution, making it easier for consumers to access content.
Disney, on the other hand, has been able to navigate these challenges and become a dominant force in the industry. Munger attributes this success to Disney’s ability to create quality content that resonates with audiences, as well as its strong brand and intellectual property.
05. Buffett Praises Microsoft’s Acquisition Tactics in Activision Blizzard Deal
Warren Buffett, the legendary investor and CEO of Berkshire Hathaway, praised Microsoft’s efforts in the proposed acquisition of Activision Blizzard. During an interview, when asked whether the sale of Activision Blizzard shares by Berkshire Hathaway would affect Microsoft’s acquisition, Buffett replied that all regulatory requirements by Berkshire Hathaway have been disclosed in the 13-F or 10Q files. He also added that Microsoft has been doing an excellent job, working closely with UK regulators to ensure the deal’s success.
Buffett cautioned, however, that success was not guaranteed, and it was not just a matter of spending more money. He also stated that he was uncertain about the deal’s final outcome. Even if the acquisition does not go through, it does not indicate any shortcomings in either Microsoft or Activision Blizzard.
Microsoft has been making waves in the gaming industry with its planned acquisition of Activision Blizzard, which would give it access to popular game franchises such as Call of Duty, World of Warcraft, and Candy Crush. The proposed deal, worth $68.7 billion, is the biggest in Microsoft’s history and is expected to boost its position in the gaming market.
The acquisition of Activision Blizzard would also help Microsoft in its efforts to expand its presence in the metaverse, a virtual world where users can interact with each other in real-time. Microsoft has been investing heavily in this space, and the acquisition would provide a solid foundation for its metaverse ambitions.
06. Buffett Highly Praised Apple – Why It’s Worth Investing In
Apple has been receiving a lot of positive attention lately, with Warren Buffett recently praising the company at a shareholder meeting. In fact, Apple has become a major holding in Buffett’s investment company, Berkshire Hathaway, with its percentage in their portfolio surpassing that of the energy sector.
At the meeting, Buffett remarked, “The percentage of Apple in our portfolio has exceeded that of the energy sector. Although our shareholding in Apple is not high, its weight is increasing every year. I may not understand mobile phones, but I can understand consumer habits. If consumers were asked to choose between giving up their phone or giving up their car, I think many would choose to give up their car.”
Buffett believes that although no one can predict the future, it’s important to understand consumer behavior and the potential impact on businesses. He also noted that they know what the correct price is and can make predictions based on consumer behavior and potential threats to the company.
Consumers would be more likely to give up their second car than their iPhone
Buffett at the meeting
With this level of confidence in Apple, it’s clear why many investors are considering investing in the company. Despite fluctuations in the market and uncertainty surrounding the future, Apple has consistently demonstrated its ability to innovate and adapt to changing consumer trends. Its strong brand and loyal customer base make it a solid investment choice for those looking for stability and long-term growth potential.
07. Buffett Thinks Investing in Apple is a Good Idea
In response to concerns about the investment in Apple being too risky, Buffett stated confidently, “Your dollars are safe.” This statement suggests that the investment in Apple is not only secure but also has tremendous potential for growth. Compared to businesses such as railroads, energy, and See’s Candies, Apple’s business model is superior.
Buffett goes on to explain that consumers have their preferences when it comes to spending money. Some are willing to spend $1,500 on a smartphone, while others would rather spend $35,000 on a second car. In his opinion, if consumers had to choose between giving up their iPhone or their second car, they would likely choose to give up the latter.
08. Buffett on TSMC’s Exceptional Leadership Position in the Semiconductor Industry
Buffett’s views on why Berkshire Hathaway made a rapid buy and sell decision with TSMC: the Taiwanese semiconductor giant, in just one quarter. During a Q&A session with Hong Kong’s RedWeek magazine, he emphasized that TSMC is one of the best-managed and most crucial companies globally, with an exceptional leadership position in the industry that is unlikely to change even 5 to 20 years from now.
According to Buffett, TSMC stands unrivaled in its sector, with no other firm coming close to its current position. He further praised the company’s 91-year-old founder and emphasized that TSMC is simply excellent.
Buffett on Electric Cars and Elon Musk
09. Buffett on Elon Musk: Overrated but Talented Genius
Warren Buffett was asked if he thought Elon Musk overrated himself. His response was that while Musk may have overrated himself, he is still an incredibly talented individual. Buffett goes on to say that Musk’s talent alone would have made him a genius, even if he didn’t overrate himself.
According to Buffett, Musk has a penchant for setting seemingly impossible goals and dreams of achieving greatness. This is where Buffett differs from Musk. Buffett prefers simple, high certainty jobs and doesn’t like the idea of too many failures. On the other hand, Musk is devoted to solving impossible problems and requires a level of obsession to do so.
Despite their differences, Buffett admits that Musk is a genius and that his IQ might be higher than 170. However, they both have different lifestyles and work ethics, with Buffett preferring a more laid-back lifestyle while Musk is known for his relentless pursuit of progress.
10. The Future of Electric Cars
When it comes to the automotive industry, they have shared their thoughts about the challenges that come with it. However, in recent years, they also see the potential for electric cars to succeed.
Buffett has mentioned that he and Munger used to think that the car industry is too difficult to make a profit. He cited the example of Henry Ford, who seemed to have the whole world at his feet, but 20 years later, his company was losing money. He also looked at General Motors’ annual report from 1932, which showed that they had 19,000 dealerships at the time, while the population was only about 120 million. Today, with a population of around 330 million people in the US, there are only about 18,000 dealerships for all car brands. This highlights the intense competition that American car companies face globally.
On the other hand, Charlie Munger sees the potential of electric cars to succeed despite the challenges and risks they bring. He acknowledges that the current cost and risks associated with electric cars are substantial, but he believes that they will eventually become successful. Munger also notes that Ferrari is in a unique position because of their brand appeal, but he generally sees the car industry as unattractive due to the large capital costs and risks involved.
Opinion on Technology and Energy Sector
11. The Skeptical Stance on New Technology and Energy
During a Q&A session with Singapore investors, Munger stated that although he witnessed highly automated processes in the BYD factory in China, he still believes that human labor may be better in many areas since AI cannot replace human talent. Buffett shares similar sentiments, acknowledging that AI can perform amazing tasks, but it still has limitations. For instance, current AI technology cannot tell a joke. While the intention behind AI creation was good, some things are beyond our control. While AI has the power to change the world, it cannot change human thinking and behavior.
12. Opportunities for Excess Returns May Be Decreasing, but New Technologies Will Create New Ones
The opportunities for earning excess returns may be relatively decreasing, but it doesn’t necessarily mean that there are no investment opportunities available. According to him, since 1940, new changes and developments in industries such as automobiles, industries, airplanes, and energy have emerged, and new things are constantly being introduced, which will eventually replace some existing technologies. Therefore, there will always be opportunities for investors to invest in new and emerging technologies.
It’s important to note that although there are new opportunities, investing in new technologies may come with risks. Investing in new technologies that haven’t yet been proven can be risky and could lead to losses. However, by carefully researching and analyzing the market trends and the technology, investors can find opportunities to earn higher returns.
Furthermore, Buffett’s statement emphasizes the importance of diversification in an investment portfolio. By investing in a variety of sectors and industries, investors can spread their risks and have the opportunity to gain from different growth areas.
13. Buffett on Berkshire Hathaway’s Investment in Renewable Energy
Buffett believes that investing in renewable energy can help solve environmental problems. Berkshire Hathaway Energy, the company’s energy division, has made significant investments in renewable energy. However, according to Buffett, the company’s efforts are still not enough to meet the growing demand for renewable energy.
Buffett’s comments highlight the importance of renewable energy and the need for increased investment in this sector. With the world’s growing energy needs and concerns over climate change, renewable energy has become an increasingly important area of focus. Investing in renewable energy not only helps address environmental issues but also offers a potential for significant returns on investment.
Berkshire Hathaway’s investments in renewable energy include wind, solar, geothermal, and hydroelectric power. The company has also invested in energy storage and transmission infrastructure to support its renewable energy initiatives. These investments are part of Berkshire Hathaway Energy’s goal to produce more renewable energy while reducing its carbon footprint.
Despite the company’s significant investment in renewable energy, Buffett acknowledges that there is still a long way to go. He believes that more needs to be done to transition from traditional energy sources to renewable energy sources fully. Berkshire Hathaway Energy continues to explore new opportunities to expand its renewable energy portfolio and make a positive impact on the environment.
14. The Next Warren Buffett: Hoping to Reduce Carbon Footprint by 50% by 2030
Greg Abel, Vice Chairman of non-insurance operations at Berkshire Hathaway, has expressed his views on the energy industry’s transformation and the company’s plans to reduce carbon footprint. According to Abel, the world is experiencing a revolution in the energy sector, and the company is keen to take advantage of this by creating different plans for each state of the United States with the help of its three public utility companies.
Berkshire Hathaway aims to integrate these plans and synchronously plan their objectives. By 2030, the company hopes to reduce its carbon footprint by 50% compared to 2005, which is a significant achievement in the public utility sector. Abel acknowledges that this is a challenging process, but they are determined to achieve it.
This initiative to reduce carbon footprint is part of Berkshire Hathaway’s corporate social responsibility and sustainability efforts. The company’s commitment to such initiatives sets an excellent example for other companies in the industry to follow.
Possible Financial Crisis?
15. The Butterfly Effect of Silicon Valley Bankruptcy on the World Financial System
The bankruptcy of Silicon Valley Bank has sent shockwaves through the financial world, and experts are predicting a butterfly effect that could have far-reaching consequences. Even Warren Buffett, a well-known investor, has called it a disastrous event.
Although the Federal Deposit Insurance Corporation (FDIC) insures deposits up to $250,000, Buffett believes this is a legal requirement rather than a reflection of how the United States typically behaves. He does not believe the government will let the debt ceiling cause chaos in the world, nor will they allow this bankruptcy to do the same.
However, he also believes that the FDIC will struggle to explain to the American public why only $250,000 is insured. This lack of transparency could lead to a loss of confidence in the financial system, causing a ripple effect throughout the world.
16. Buffett Expresses Concerns About Bank Runs
The fear of bank runs has always been contagious, and it is a situation that should not occur. In fact, his father lost his job in 1931 due to a bank run. However, the banking system has undergone significant changes in recent years. After World War II, as many as 2,000 banks collapsed in one year, leading to the establishment of the Federal Deposit Insurance Corporation, a very wise move at the time. Despite this, people still worry about bank runs in 2023, and this is not something that should be happening.
Bank runs occur when a large number of depositors withdraw their money from a bank at the same time, usually due to rumors or a lack of confidence in the bank’s ability to meet its obligations. This situation can lead to a liquidity crisis, causing the bank to fail. It can also have a domino effect, with other banks suffering the same fate as depositors withdraw their funds from them as well.
To prevent bank runs, the Federal Reserve has implemented various measures, including the lender of last resort, which provides banks with emergency loans during times of crisis. Additionally, the Federal Deposit Insurance Corporation insures deposits up to a certain amount, providing a safety net for depositors.
Despite these safeguards, it is important for people to be aware of the risks associated with bank runs. If you have concerns about the safety of your deposits, you can always consult with your bank or financial advisor to learn about the protections in place. As Warren Buffett suggests, bank runs are a situation that should not occur, and it is up to everyone to take steps to prevent them from happening
17. Multiple Changes in Margin Requirements by the Fed Increases Banking System Risks
The banking system is a critical component of the economy, and any risk that affects it can have far-reaching consequences. The margin requirement is one of the essential rules that regulate the banking system. This requirement mandates the amount of money that a borrower must deposit with the bank when taking out a loan. The margin requirement is set by the Federal Reserve, which has modified this requirement several times in the past.
According to Warren Buffet, the multiple changes in margin requirements by the Fed have increased the risk to the banking system. It is common knowledge that borrowers who take out a significant amount of loans can pose a risk to the banking system. When the margin requirements are modified, it can cause significant changes in the way banks operate. The changes can affect the ability of banks to lend money, their profitability, and the overall stability of the banking system.
The modifications made by the Fed have caused a ripple effect throughout the banking system, and the risks have increased. One of the primary reasons for this is that the changes have made it easier for borrowers to take out loans, which has led to an increase in the number of risky loans. The modifications have also made it difficult for banks to manage their risks effectively, which has increased the likelihood of defaults and bankruptcies.
18. Buffett: The Fed Cannot Solve Fiscal Problems
The massive liquidity injection by the Federal Reserve has led to serious inflation, prompting widespread criticism of the Fed’s negligence. However, Warren Buffett believes that the problem does not lie with the Fed. “They cannot solve fiscal problems, they are just doing their job. Cash is not trash,” he said.
They cannot solve fiscal problems, they are just doing their job. Cash is not trash
Buffett at the meeting
Despite Buffett’s optimism, Charlie Munger is less upbeat about the situation. He said that we paid a price during World War II. Every one of us, including school children and others, including myself, purchased what was then called war bonds, defense bonds, and savings bonds, etc. If the printing of money doesn’t stop, I cannot predict how much worse the macro environment will become.
19. American Banking Crisis: Maintaining Traditional Values in the Face of Innovation
The American banking crisis and the importance of traditional values in the industry. In his view, while there is room for innovation in banking, it must be grounded in the old-fashioned principles that have long been the foundation of the financial sector.
You have to have punishment for people who create problems. If they take risks that they shouldn’t have taken, the risk has to fall on them if you want to change the behavior of people in the future
Buffett at the meeting
According to Buffett, “There can be all kinds of new inventions in banking, but it needs to have old values. We don’t know what’s going to happen because there are a lot of things that can happen in the present situation. You have to have punishment for people who create problems. If they take risks that they shouldn’t have taken, the risk has to fall on them if you want to change the behavior of people in the future.”
20. Investing in Banks Can Be a Good Idea
If you follow sound banking investment principles and avoid risky activities, banks can be a very good investment. Back in 1969, Buffett and his partner Charlie invested $19 million in a bank. They had plans to own many more banks, but those plans were cut short by the Bank Holding Company Act of 1970.
Despite the setback, Buffett’s belief in the potential of banking investments remains strong. He recognizes the importance of conducting thorough research and analysis before investing in a bank.
21. Losing Confidence in Currency Is Not a Good Sign
Loss of confidence in a country’s currency can have dire consequences. Speaking about the current trend towards de-dollarization and quantitative easing, Buffett said, “The dollar is the reserve currency, and I don’t see any other currency replacing it. I don’t think anyone fully understands the current situation, except perhaps for Jay Powell (Chairman of the US Federal Reserve), but even he cannot fully control our fiscal policy. When the pandemic hit, no one knew how much money needed to be printed to solve the problem, and it wasn’t until it spun out of control. People can lose faith in their currency, and their behavior may change drastically. We cannot predict the outcome, but we do know it’s not a good situation.”
The dollar is the reserve currency, and I don’t see any other currency replacing it.
Buffett at the meeting
Buffett’s comments come amid a growing debate about the role of the US dollar as the world’s reserve currency and the possibility of a shift towards other currencies. Despite this, he remains confident in the dollar’s strength and warns against the potential dangers of losing faith in it.
Industries Following the Economic Cycles
22. Is Geico Insurance Still an Insurance Company?
Geico Insurance has been making headlines lately, with many questioning whether it still qualifies as an insurance company. Even Warren Buffett, a major shareholder in the company, recently stated that in the past 10 years, he hasn’t found a single insurance company he’d invest in, despite many publicly traded companies offering insurance-related services. Despite this criticism, we firmly believe that Geico Insurance remains a leading insurance provider.
While some argue that Geico is now more of a technology company than an insurance company, it’s important to look at the bigger picture. Buffett himself acknowledged that the company still has a lot of work to do in terms of technology, and in many ways, its strong performance during the first quarter of this year can be attributed to its continued focus on its core insurance services. As a government employee insurance company, Geico has performed exceptionally well in the first quarter of the year, largely due to a decrease in insurance reserves from the previous year and the busy season for auto insurance. Furthermore, the company has made significant strides in remote information processing, which has contributed to its overall success.
23. The Role of Berkshire Hathaway in Commercial Real Estate
When it comes to commercial real estate, Berkshire Hathaway has never been particularly active. This was the response given by Warren Buffett when asked about the severity of losses in commercial real estate and whether Berkshire Hathaway would become more active in this field.
According to Buffett, Berkshire Hathaway has never been heavily involved in commercial real estate and therefore would not be affected by negative factors such as bad loans. However, the problem of urban vacancy is very serious in many cities in the US and around the world, which can affect many people. While buildings may not disappear, the owners will change, and people always prefer to buy real estate without any claims on it.
Despite not being heavily involved in commercial real estate, Berkshire Hathaway has still managed to achieve success in the field of real estate through its subsidiary, HomeServices of America. This company has become one of the largest real estate brokerage firms in the US, with more than 45,000 agents and over 900 offices in 30 states.
HomeServices of America has also acquired several real estate companies, including Long & Foster Companies, which is the largest independent real estate company in the US. In addition, HomeServices of America has partnerships with major real estate companies such as Brookfield Asset Management and Realogy Holdings Corp.
24. Burlington Northern Santa Fe Railway Company: Challenges and Opportunities in 2022
The Burlington Northern Santa Fe Railway Company, owned by Berkshire Hathaway and headed by Warren Buffet, has faced several challenges over the years. In 2022, the company is focused on restoring its long-term operations in a safe manner.
When asked about the challenges and opportunities facing the company, Buffet stated that he closely monitors the team’s operational indicators, which include not only railways in the United States but also those in Canada. He emphasized that while 2022 has been a difficult year due to the pandemic and supply chain issues, the team has managed to overcome these challenges. However, the company still faces labor issues and other challenges.
The team’s top priority is to restore the railway’s long-term operations, rather than focusing solely on achieving specific operational targets within the next 20 years. The company is committed to providing sustainable, high-quality services to its customers in the long run.
Analyzing the Path of Investment: Lessons from Berkshire Hathaway
25. The Emotional Intelligence of Berkshire Hathaway: Investing Without Emotions
Unlike many other investors, Warren Buffett and his team at Berkshire Hathaway don’t make investment decisions based on emotions. In fact, they’ve never made a single emotional investment decision in their entire history.
While it’s important to be an emotional person in life, it’s essential to be emotionless when it comes to making investment or business decisions
Buffett at the meeting
According to Buffett, while it’s important to be an emotional person in life, it’s essential to be emotionless when it comes to making investment or business decisions. This is because emotions can clo6ud your judgment and lead you to make irrational decisions.
26. Berkshire Hathaway Creating More Than $500 Billion in Shareholder Equity
It has been incredibly successful at creating value for its shareholders. The strategy of investing in strong, well-managed companies and holding onto them for the long term. This approach has allowed the company to benefit from the compounding effects of strong business performance over time. Accordingly, the company has generated over $500 billion in shareholder equity and over $30 billion in operating income.
27. Limited opportunities for acquisitions
Berkshire Hathaway has accumulated more than $100 billion in cash. When asked if he is confident about holding onto this much cash, Buffett replied, “Why distribute cash? What we’re interested in and what we really like to do is buy great businesses.”
In the right situation, nobody can beat us
Buffett at the meeting
Buffett believes that his company can buy a $100 billion company for $50 billion or $75 billion, given the right circumstances. He said, “In the right situation, nobody can beat us. In 2008, I bought a lot of companies, and it will happen again. But the problem is, the opportunities for acquisitions are very limited. So, when a good company is up for sale, we need enough funds. However, our shareholders may sell their stocks too cheaply, and we cannot do anything to keep the stock prices steadily rising. We have enough money, and we are using what we have to make more money.”
28. The Investment Secret: Understanding Consumer Behavior
According to Warren Buffett, it’s about finding companies with a long-term, sustainable business model. Buffett doesn’t care about meeting quarterly budgets, he’s interested in companies that will have a bright future.
There are few great companies in the world, but Buffett has found some. For example, in 1966, when he tried to enter the department store business, he learned that creating designs on prizes was not a smart move. Instead, he realized that understanding consumer behavior was key to success. If you can understand what people want, you can create products and services that they will buy.
Buffett also believes that it’s not necessary to understand a company’s technological trends to profit from it. Instead, he focuses on consumer behavior and finds companies that meet the needs of their customers. This philosophy has served him well over the years.
Warren Buffett’s Successor
29. Who Will Succeed Warren Buffett at Berkshire Hathaway?
According to Buffett, Greg Abel’s main value as his successor is that he can do certain things better and manage more things. Ajit Jain will also give him some good advice, but Abel will be the one to make the final decision. However, Buffett also emphasized that they will need more talented people in the future to expand their business, and they will not let anyone who is not smart enough make decisions for the company.
It’s worth noting that Abel is currently Vice Chairman of Non-Insurance Operations at Berkshire Hathaway and has been with the company for over 20 years. He has a background in energy and has been involved in Berkshire Hathaway’s energy business since he joined the company.
30. The Success of Berkshire Hathaway: Not Frequently Changing Managers
Changing managers frequently can have a negative impact on a company. It can lead to instability, lack of direction, and loss of morale among employees. On the other hand, having a stable team of managers who are experienced and knowledgeable about the company can lead to better decision-making, increased efficiency, and a stronger sense of loyalty among employees.
Berkshire Hathaway’s success is a testament to the importance of stability and consistency in business. By keeping its outstanding managers for long periods, the company has been able to build a culture of excellence and a reputation for reliability. This has helped it to attract and retain talented employees, customers, and investors.
31. The Unmatched Status of Ajit Jain, Recognized by Warren Buffet
Ajit Jain, one of the top 10 global insurance managers, has earned the recognition and appreciation of the legendary investor Warren Buffet. Buffet has praised Jain’s unwavering commitment to improving systems rather than changing them, which has made him irreplaceable in his position.
Jain’s remarkable status is a result of his dedication and expertise in the insurance industry, which he has honed over the years. He has a unique ability to manage risk and make sound investment decisions, which has helped him to become a leading figure in the industry.
Buffet has had the privilege of interacting with Jain on a daily basis in the past, and he has always enjoyed their conversations. Although their conversations are not as frequent nowadays, Buffet acknowledges that Jain is a one-of-a-kind individual who cannot be replicated.
32. Buffett Visits Japan’s Top Five Trading Companies to Pave the Way for Successors
Buffett visited Japan and toured the country’s top five trading companies, citing his goal to pave the way for his successor. “Part of the reason I went there was to introduce Greg to those business partners. As for those companies, they were incredibly surprising,” Buffett said.
Greg added that “We do hope to have long-term opportunities to work with those companies. They are incredible investment opportunities and have always been great investment opportunities. I love the culture and history of these companies. Our two-day visit to the top five trading companies was fantastic.”
Berkshire Hathaway’s Future Outlook
33. Creating Shareholder Value and Promoting Social Well-being
During a Q&A session, Warren Buffett presented his vision for Berkshire Hathaway’s development one hundred years from now. He expressed his hope that the company will continue to be favored by its shareholders and promote social well-being, with access to unlimited capital and a large pool of talent. In his words, Berkshire Hathaway will become a model for others, much like Graham’s book, which has remained a bestseller and an inspiration since its publication in 1949.
34. Why Berkshire Hathaway’s Capital Will Continue to Outpace Most Companies in the Next 12-15 Years
The company will continue to have more capital than most companies in the next 12-15 years. According to Buffett, Berkshire Hathaway is considered an asset to the nation, not a liability. The company’s track record confirms this, and it can still invest a significant amount of money into the economy, creating more jobs.
Berkshire Hathaway is considered an asset to the nation, not a liability
Buffett at the meeting
Berkshire Hathaway is known for its shrewd investments and has a diverse portfolio of businesses. The company owns subsidiaries such as GEICO, Duracell, and Dairy Queen, to name a few. Berkshire Hathaway has been consistently profitable, and its stock price has been on the rise for years.
35. Berkshire’s Stock Buybacks Will Not Stop
Greg Abel, recently confirmed that the company will continue with the excellent stock buyback plan framework set by Warren Buffett and Charlie Munger. Abel stated that if the capital is sufficient and the stock is attractive, there is no reason not to increase the intrinsic value of a single share through buybacks, which will benefit both shareholders and the company’s operations.
Buffett himself has expressed confidence in Abel’s ability to make the same stock buyback decisions after he takes over. This news comes as Berkshire Hathaway recently announced a $6 billion buyback in the first quarter of 2023, bringing the total buybacks to $38.6 billion since the program’s inception in 2018.
Life Lessons
36. Warren Buffett’s Advice on Living with Clarity
Buffett believes that if you want your children to adopt certain values, you need to lead by example. By living according to those values and discussing them with your children from a young age, they will learn from you and adopt the same principles. Your willpower is also crucial in this regard.
To gain clarity on how to live your life, Buffett suggests writing your own obituary. This exercise will help you focus on what is truly important to you and what you want to achieve in life. By identifying your goals and priorities, you can then take reverse action to achieve them.
Taking reverse action means looking at your life goals and working backwards to create a plan to achieve them. This approach helps you to focus on the steps needed to reach your desired outcome. By taking the time to reflect on your life, you can gain the clarity needed to make better decisions and lead a more fulfilling life.
37. Warren Buffett Reveals Why He Hasn’t Written a Will at 93
Buffett revealed that he has not written a will despite his advanced age. In an interview, he explained that he has observed many wealthy families having issues with their estate planning, and believes that signing a will requires the understanding and advice of one’s children, which may vary greatly depending on their age.
According to Buffett, disclosing a will to one’s children too early can hinder their growth. While some parents keep their children completely in the dark about the contents of their will, others use it to control their children’s development. However, he believes that revealing the will too early, such as during their formative years, can make it difficult to alter in the future, and is a mistake that parents should avoid.
38. Munger’s Secret to Success: Learn for a Lifetime and Practice Gratitude
Munger stated that success is simple, such as spending money within your means and spending less than you earn. Additionally, he advised avoiding people and activities that drain your energy and to never stop learning and being grateful. Munger believes that if you can do all of these things, you will undoubtedly achieve success. However, if you are unable to do so, you will need more luck to succeed, but he cautions against relying solely on luck to determine your fate.
39. Buffett’s Secret to a Fulfilling Career
Buffett said, “There are no real difficulties in our business. We all love what we’re doing. I wake up in the morning excited to go to work. I get to work with a group of people I love and respect, and I have a commute of only about 5 minutes. It’s an ideal work environment, and there’s nothing better than that!”
40. Buffett’s Favorite Investment Book and Its Impact on Him
Buffett once again mentioned the positive influence that Benjamin Graham’s book had on his investment philosophy. In 1949, Graham wrote some very persuasive words in his book, “The Intelligent Investor,” telling me that the work I had been doing and loving for the past 8 or 9 years was all wrong. I read this book over and over again. Regardless of whether his ideas were correct or not, I really liked it and even occasionally checked the book’s ranking on Amazon. It has been consistently ranked around 300th or 350th on the bestseller list. Imagine trying to find another book that has such a lasting position in its field.