I’m a little sad that I didn’t make the pilgrimage to Omaha this year for the Berkshire Hathaway Annual Meeting. Now that we know for sure that this was Warren Buffett’s final Q&A session as CEO of the business that became his life’s work, I regret not being there for the final session. I guess it’s possible that Warren will still be on the stage next year, answering questions as Chairman, if he continues to serve and continues to have the stamina, but it won’t be the same.
So thanks, Warren, for a lifetime of education in common-sense investing, and for opening your Annual Meeting to the world to inspire millions of other investors. And thanks for stepping aside with grace and good humor — I know the grace and humor come naturally to you, but stepping down on your terms, before perhaps being forced from the stage someday by Father Time or by a reluctant Board, was surely the best thing you could have done.
In celebration, I thought I’d share some thoughts of mine from the last couple pilgrimages I made to Omaha — I was never the “have to be at the meeting every year” guy, but I found the trip to be a valuable reset and flew out to Nebraska every few years, and I usually shared some thoughts with the Stock Gumshoe Irregulars afterward. What follows are some thoughts from the last couple meetings I attended, compressed and cleaned up a little bit.
This is from what I write a couple years ago, after attending the 2023 Berkshire meeting:
My goal is to be a rational long-term investor, and to find companies that I can hold for long periods of time, with the likelihood that they will grow and become more valuable, compounding in value and growing my family’s wealth. That’s not the only investing I do, of course, I am prone to occasional bouts of speculation, but that’s the goal. Get rich slowly, and enjoy learning about fascinating businesses along the way.
Sadly, doing this work that I love, writing for our readers about hype-filled promises of wealth from the manipulative world of investment newsletter marketing, is not a great way to set myself up for success on that front. You become what you study, your world is shaped by the things you read and think about every day. The more I write about the gargantuan promises of the tempters, the more my brain scooches over into thinking their marketing-based world might be real… and that’s a recipe for disaster.
The antidote? Coming out to Omaha once every year or two, and listening to Warren Buffett and Charlie Munger (and Tom Gayner at Markel), and bathing in the long-term rationality of it all. That’s not the only antidote to the poison of “what will win this second” investment thinking, of course, but it’s a good one. It’s annoying to get here, it’s far away and expensive, but that alone fortifies the mindset that it’s important. And sitting in an arena of 30,000 people, all of whom are leaning forward to pick up every last word from a couple nonagenarians, certainly helps.
Not everybody has to fly across the country to get a mental reset, but, well, some of us are more thick-headed than others.
One thing that is always fascinating to me, when visiting this city, is how little direct impact Warren Buffett makes as a citizen of Omaha. He is a local celebrity, of course, and tourists do drive by his (modest) home and gawk at its average-ness on Berkshire weekend, but he doesn’t really do anything interesting… he gets more attention on CNBC than he does from the local news in Omaha. And in the same vein, Berkshire has essentially no footprint in Omaha in terms of the city’s visible identity, except on this one weekend a year when tens of thousands of acolytes are wandering around downtown and paying 3X hotel rates. Berkshire Hathaway does own some big-name Omaha businesses, including the Omaha Herald (though I’d say that was just an attempt to save the newspaper), but fellow local billionaire Walter Scott, Jr., Warren’s friend and classmate, and a small partner with Berkshire on their original purchase of MidAmerican Energy 20 years ago, was far less wealthy but made a much more visible philanthropic and business impact on the city (he passed away in 2021). His Kiewit corp., a major construction company, has its names on several public spaces in town, parks and museums and the like, and until the building was sold to Blackstone recently, losing the Kiewit Plaza name, he used to be the landlord for Berkshire’s headquarters (it’s indicative of how little interest Warren has in commercial real estate that Berkshire has never built anything flashy in his hometown, or owned its headquarters building… though I do kind of wish someone had asked Warren on Saturday how he feels about writing rent checks to Blackstone and working in Blackstone Plaza every day).
And Berkshire Hathaway is by far the largest company headquartered in this town, among many household names, but you wouldn’t know it. You’ll see the towering buildings with major insurance company names on them downtown, there’s now even a large Markel building in Omaha to accompany Mutual of Omaha and Woodmen Insurance and others, but you won’t see a big Berkshire Hathaway billboard or tower, and you won’t even see their name on their headquarters building (which, to be fair, houses just a few offices and 20 or so people).
And there is a big railroad presence here, but it’s Union Pacific, probably the closest rival to Berkshire’s BNSF Railroad (which is actually headquartered down in Texas).
There are no Berkshire parks or hospitals or convention centers (lots of Kiewit ones), and despite his love of sports, Buffett didn’t slap his name on the new baseball stadium for Creighton, or the new hockey arena for University of Nebraska Omaha, or even on the new buildings for the business schools at any of the local universities. The only thing that I’ve noticed that bears the Buffett name in town is the Buffett Cancer Center at the University of Nebraska hospital, and I think that was named by one of Warren’s relatives.
Warren has pushed wealthy people to give away their money with the giving pledge, and he’s to be admired for it, but unlike every wealthy philanthropist I can think of, he doesn’t want to be at all involved in dispensing the largesse — he’d rather give it away to someone else who can spend it wisely, like the Gates Foundation or others, and he continues to have very little interest in establishing his legacy as anything other than a business leader.
Or maybe it’s fairer to say that this is just the continuation of 70 years of unceasing focus on investing, the only thing he has ever really been interested in. It seems Warren is just content to do exactly what he has been doing since he was a kid, trying to win the game of buying and building businesses, and he doesn’t ever want to play a different game, no matter how much he considers it worthwhile. Buffett strikes me as a brilliant person in many ways, but his gift is not necessarily in his IQ or his capacity to assess a company’s financial health in a five-minute phone call (though his memory for numbers and processing speed are incredible, still)… it’s in his singleminded pursuit of business knowledge, and his patience in being not just willing, but happy to sit in his office and read 10Ks, newspapers and trade journals all day, just waiting for his phone to ring and give him an opportunity to put some of Berkshire’s vast accumulated cash to work. He throws in a game of bridge now and then, and talks to Charlie Munger and other friends, but even now, in his 90s, he tries very hard to not do anything that takes him away from that singleminded pursuit of the next great investment for Berkshire. I don’t know if it made him a great dad or a great husband or a great pillar of the local community, things that matter more to a lot of other people, but it certainly helped to make him a great investor.
And this is what I wrote after the meeting the year before, in 2022:
I must confess: when I make my every-few-years pilgrimage to Omaha for the Berkshire Hathaway Annual Meeting and the Markel Brunch, I often find myself musing on the plane ride home, “why on earth do I ever buy anything other than these two companies?” They’re not glamorous, they don’t often outperform the market over a given year or two, but the steady compounding of these businesses under the surface, their shareholder communications, the relatively low risk, and the trustworthy way in which they operate and grow over time inspire a huge amount of faith and goodwill… and lead to a very loyal and long-term shareholder base.
And that’s important. Over time, it can be really important. Tom Gayner at Markel realized that early on, when he was the fresh-faced kid trying to shake up Markel’s investment portfolio and he urged Steve Markel to go to Omaha with him — at the time, about thirty years ago, Markel had a long operating history in the insurance business but had only been public for about five years, and the company had a market capitalization of about $65 million (Berkshire was around $8 billion), but he and Steve wanted to build something like Warren Buffett had built in Berkshire Hathaway… and Gayner knew that the people who were most likely to understand that and be interested in it were people who already owned Berkshire, and it was easier to find them at the Berkshire meeting than to try to talk them into a visit to Markel’s home base in Richmond, Virginia.
That was true then, but it’s also true that the Berkshire meeting of 30 years ago was far different than the meetings today. Warren Buffett was certainly already a legend 30 years ago, he was already on magazine covers as the “Wizard of Wall Street”… but the scale was far different. In 1990, about 1,300 shareholders attended — a ludicrous record high at the time, filling the Orpheum Theater in Omaha and a half dozen nearby hotels. That was early on in what became a festival, they did have “shopping days” at a couple of their local businesses, Nebraska Furniture Mart and Borsheim’s, and I believe that was the first time they brought in a See’s Candy cart for the shareholders — See’s Candy was one of the early companies bought out by Berkshire in the early 1970s, not long after Berkshire became the sole focus of Warren Buffett.
It was already beginning to look a little unusual back then, the fact that the CEO would sit on a stage and take questions for hours was a novelty, and the big crowd of 1,300 visitors was getting some attention, but it wasn’t anything like the scale we see today — this year, there were at least 40,000 people in town, the 18,000 seats at the local basketball arena were filled almost to the rafters to hear Warren and Charlie, and the shareholder shopping experience included both those traditional Nebraska Furniture Mart and Borsheim’s visits, but also a vast exhibit hall packed with the major subsidiaries, including Forest River RVs, Clayton Homes modular houses, Justin Boots, Brooks sneakers, a Dairy Queen, heck, you could even try your hand at driving a virtual BNSF train or painting a wall in the Benjamin Moore booth. And the biggest and busiest of the booths was See’s Candy, which Warren remarked brought in 11 tons of chocolates for the crowd. As Warren said in his introductory remarks, “we brought in everything we could think of to sell to you”… and the shareholders (and customers) ate it up.
Partly that growing size is just a function of the number of shareholders — Berkshire was an insular club in 1990, there was only one class of shares, and they had never split those shares (as they have never split today), so each share was around $7,000 and there weren’t all that many people who owned them.
Buffett didn’t authorize the creation of Class B shares until 1996, which began to really open up ownership to more people (including me, I didn’t buy my first B share until 2005). Warren loved the idea of the price of the shares continuing to climb, helping discourage trading and encourage long-term partners, but as the price of Berkshire approached $30,000 in the 1990s, the shares began to be bought up by Unit Trusts and Closed-End Funds who could then say they offered a cheaper way to own Berkshire, and Buffett was unhappy that smaller investors were being taken advantage of by the management fees of those Trusts — the compromise was the creation of a Class B share that would be worth 1/30th of an A share, with each one at the time costing about $1,000, still among the highest-priced shares in history but within the grasp of most investors. The size of the shareholder meeting ballooned with all those new shareholders finally able to buy in, and in 1997 more than 10,000 people made the trek to Omaha.
A few years later, Berkshire’s largest-ever investment (at that time) brought another big reset — in order to make the acquisition of the Burlington Northern Santa Fe railroad work out for everyone, particularly for tax reasons, the acquisition was done partially in shares, something Buffett generally loathes… and that was only feasible if they brought the Berkshire share price down. Buffett has still never split the Class A shares, which now approach $500,000 each (and have more voting rights), but the deal was done with Class B shares, and they were split 50:1 — so that’s how we got to today’s situation, with millions of holders of B shares, which are in the S&P 500 index, and with each B share valued at 1/1,500th of an A share. And that’s largely why a record 45,000 people came to town for the 50th anniversary meeting in 2015. They started live-streaming the meeting online after that, but the Berkshire meeting still brought something like 40,000 shareholders to Omaha this year as they resumed the in-person meeting after a two-year hiatus… and you still have to show up at the gates of the arena at 4am if you want to get a good seat (or, if you’re a big hedge fund honcho, have your lackeys do it for you).
In some ways this looks like a cult to outsiders — it seems a little silly, with the Charlie Munger rubber duckies and the tons of chocolate and the Warren Buffett boxer shorts, and it is, but it’s also an intentional community. Being in that group, meeting and talking to other shareholders who have owned Berkshire for years or decades, sometimes creating generational wealth along the way, helps to instill that feeling of being a real partner in the enterprise.
The overriding themes of the Berkshire Hathaway meeting are culture and trust. And it’s emblematic of how hard it is to build either of those things in the public markets that they have committed shareholders who want to meet with management and with other shareholders to build and reinforce a community of investors.
And that, really, is the way in which Markel is most like Berkshire Hathaway. I was struck by how much the Markel Brunch has grown in just the seven or eight years since I first attended, and Gayner made the point that the number of attendees over the years had pretty closely tracked with the share price of Markel — from the half-dozen people they gathered in 1991, when the shares were around $12, to about 1,500 today as the shares sit near $1,300. We shouldn’t overstate the draw, I suppose, partly that’s because the Berkshire meeting brings so many people to town, and some of them are curious about this little upstart (you are supposed to register and be a Markel shareholder to attend, but they don’t check at the door and they really welcome everyone. And feed you pretty well). But even if it’s just getting some of the reflected glow of Berkshire, that matters — those are the people you really want as long-term shareholders.
In my experience, there are not many annual meetings of big corporations that are “real.” Other companies are not often genuinely focused on communicating with and building a community of committed shareholders, and educating those shareholders about the business they own — most corporations are required to hold some kind of annual meeting, but they are generally just an opportunity to vote on some proposals and stamp some forms for the year, with most of the votes collected by mail (and most investors not voting at all, with very few actually showing up in person), and without much actual talk from the company about the conditions of the business or the strategy for the future.
The fact that 1,500 or so people will now show up just to ask Markel Co-CEO’s Tom Gayner and Richie Whitt questions, much like a couple thousand folks showed up to ask Warren and Charlie questions 30 years ago, is a great sign. The shareholder base self-selects, and people to some degree buy in to the “Markel Way” in much the same way that they buy into Berkshire’s midwestern charm and Buffett’s investing wisdom. This post-Berkshire brunch is not actually Markel’s Annual Meeting, they’re trying to turn that into more of a gathering as well, for the first time this year it will be at a 6,000-seat concert venue in Richmond (next week), but it’s their best opportunity to connect with investors and share their story and their culture. And importantly, Markel also cycles their leadership and their employees through this meeting, bringing them to Omaha to meet shareholders… and, not coincidentally, to attend the Berkshire meeting and get a real sense of why building a trustworthy and shareholder-oriented culture is important. They always start the Brunch by introducing the dozens of headquarters employees who are in the room, as well as the executives of companies that Markel Ventures has bought in recent years, and those executives also reinforce that culture when they describe what led them to sell to Tom Gayner and crew. Building and reinforcing a strong corporate culture is one of the biggest challenges for a growing company, and Markel’s focus on people really brings that to the fore. A strong culture and a committed shareholder base that thinks of themselves as owners feeds back on the employees as well, it’s a virtuous circle — and it helps to keep the company focused on the long term.
The strength of that culture and the “Markel Way” does not mean, however, that Markel is really like Berkshire. The structures of the companies are somewhat similar — you have an insurance company at the core, which creates a “float” of investment capital that can be used to generate investment returns from growing portfolios of stocks and bonds, and 17 years ago Markel also launched Markel Ventures to begin using some of their excess capital to acquire wholly-owned businesses, like Berkshire has done, starting with a few local companies in Virginia and gradually expanding to what are now some large national companies.
But there’s only one Warren Buffett and one Charlie Munger, and they’ve been doing this for close to 70 years. Tom Gayner is a much more cautious investor than Warren Buffett, he essentially dollar-cost-averages into reasonably valued stocks, gradually building a fairly concentrated portfolio of strong companies over time but not really making big bets like Warren does. Gayner doesn’t have Buffett’s DNA, or the history and experience of a stock-obsessed whiz kid whose early investment partnership returned almost 10X as much as the Dow Jones Industrial Average in the 1950s and 60s before Warren shut it down. Markel’s portfolio might beat the market over time, and it’s never particularly high-risk, but it’s not going to show stupendous returns like Berkshire did in its earlier decades, when the company was much smaller and Warren Buffett was finding wildly undervalued stocks and first earning his reputation as the “Oracle of Omaha,” and Markel also does not have the massive “tentpole” public stock “forever holdings” that Berkshire does, like Apple or American Express or Coca Cola. Gayner is not going to make big moves in any given quarter like Warren Buffett just did, spending $50 billion on a few big acquisitions and a somewhat surprising arbitrage play (more on that in a minute).
On the Markel Ventures side, Gayner and his small team can move almost as quickly as Berkshire and make near-handshake deals with the companies they acquire, and a lot of the deals they make are pretty similar to the companies Berkshire was buying 30 years ago, when Berkshire was about the size that Markel is today… but it’s not quite as fast and personal, Gayner isn’t making these deals by himself, over the phone on the weekend, like Buffett occasionally has, and the scale is much smaller at this point (most of the companies they acquire are small enough that they don’t even disclose the purchase price).
On the insurance side, Richie Whitt has overseen a growing empire of mostly specialty insurance operations around the world, but he’s no Ajit Jain — when someone wants to run a contest that has a billion-dollar prize, like Quicken Loans did with its NCAA tournament contest last decade, Berkshire is pretty much the only company that will cover that kind of thing, and Markel doesn’t have anything approaching the vast customer-focused insurance business at GEICO. Markel is also just coming out of a five-year period of underwhelming underwriting results, including dealing with a bad acquisition in Markel CatCo that is currently being shut down.
But Markel does have a corporation built on trust, they do think of themselves as building a great company for their owners, and they do have somewhat of a partnership at the top — when Tom wants to buy a new Venture company, he first checks with Richie for some perspective… when Richie wants to buy an insurance business, he first checks with Tom. At least, until next year — Richie Whitt is not yet 60, but he just announced this week that he’ll be retiring by next March. They have genuinely been Co-CEOs over the past six years, both focused on the work of building a company, but when Richie steps down Tom Gayner will assume the solo role of CEO for the holding company, and the heads of Markel Ventures and Insurance will report to him (Gayner will remain the Chief Investment Officer as well).
So you can see echoes of Warren Buffett and Charlie Munger in the halls of Markel, even though the people themselves are not as avuncular, or as obviously exceptional, and even if they’re not as radically decentralized as the Berkshire holding company (Markel’s headquarters are outside Richmond, where they have three fairly large suburban office buildings and at least many hundreds of employees, mostly connected to the insurance business, though they do have ~20,000 employees at their operations around the world — Berkshire’s headquarters are in Omaha, where they have about 30 employees in one floor of an office tower who loosely oversee companies with 372,000 employees around the world). They are, however, far younger — Tom Gayner is 56, though he have both been at Markel for about 30 years, and he considers himself to be the fourth generation of Markels, in spirit, even though he isn’t part of the Markel family. Presumably the folks stepping up into their roles to lead various divisions will also be fully indoctrinated in the “Markel Way” that sets the culture of the company, but there’s always the risk, of course, that they’ll make a mistake in transition and put the wrong person in charge of something. Steve Markel, grandson of the founder, is still the Chairman of the Board and is only 71, and his cousin Anthony Markel, who’s 78, is also on the board, they were the family operators who ran the company for many years after the 1986 IPO, in partnership with Alan Kirshner until they passed the CEO torch to Richie and Tom in 2016. The family seems less visible in the company these days as Gayner has really become the public face of Markel, but that’s just my impression.
Berkshire shareholders have been waiting for years for the massive cash balance that accumulated over several years of this wild bull market to finally be put to use, so the big news out of the Berkshire meeting was the rapid deployment of cash in the first quarter — we already knew about much of it, since there were filings made at the time for some of the transactions, and some made at the market close on Friday before the meeting, but we didn’t really know the big picture until Warren shared, and it turns out that Berkshire, mostly because of a few buys by Warren Buffett, spent about $50 billion buying shares in the first quarter of 2022. That’s pretty massive — it’s not a single headline acquisition, but it’s still a lot of money, putting roughly a third of their cash hard to work in short order.
Most of that spending went to acquisitions in the energy space — Chevron (CVX) has come almost out of nowhere to become a top-four holding of Berkshire now, along with Apple (by far the biggest), Bank of America and American Express… and, as we already knew, Warren also significantly increased his stake in Occidental Petroleum (OXY), which was already a meaningful holding, and agreed to acquire fellow insurance conglomerate Alleghany Corp (Y) in his biggest full-company acquisition in many years. He also sold some stuff on a smaller scale, reducing some holdings in pharmaceutical companies, and he slowed the buybacks of Berkshire Hathaway shares way down from the elevated level at which they were buying their own shares last quarter, probably mostly because Berkshire shares rose substantially and became less of a bargain.
His stance toward buybacks during the Annual Meeting was kind of interesting, and reminds us of the degree to which he considers Berkshire to be a partnership, with valuable long-term shareholders whose trust he has cultivated for decades, and often for generations as Berkshire shares have passed down to the children and grandchildren of his early investors. He talked about how Berkshire is happy to buy back chunks of shares when they become available in the market, but that the way he sees it, buybacks are also a way to get rid of shareholders… and he doesn’t really want to get rid of any of his committed shareholders if they’re not itching to sell. Sort of an odd acknowledgement that improving the economics of each Berkshire share is a focus of Warren’s, but simply causing the share price to rise is not necessarily important to him, at least not in any short period of time.
I like to attend the Berkshire meeting partly because it’s a good reset — and I also re-listened to the excellent Buffett biography on the plane to further bury myself in Berkshire.
Warren Buffett is a brilliant guy, despite the fact he’s clearly slowing down — he has a capacity to absorb and remember numbers like almost nobody else — but it’s not brilliance or a high IQ that led him to be the greatest investor of the American Century… it’s an almost superhuman ability to focus on fundamentals and long-term compounding, display extraordinary patience, and avoid emotional entanglements with his financial decisions, even when those decisions became huge over time. We are all our own worst enemy, and Warren might have lost out on a lot in his life because of his relentless fascination with numbers and financial statements (he was not a particularly engaged parent, he has never wanted to try a new kind of food or visit another country or sightsee, or even really to spend any of his billions… he just liked the mental challenge of earning them), but what he was able to do was apply consistent rationality and discipline to his almost encyclopedic knowledge of the financial reports of American business, from the time he was ten or eleven years old, to become wealthy, which was his sole focus beginning around the age of five.
Even before Buffett began to really understand and invest in insurance, and the magic of the float that eventually brought so much leverage to his investing acumen, he was an incredible investor — a devotee of Benjamin Graham and his “value investing” strategies well before anyone else really spent any time actually looking at “value.” In his pre-Berkshire partnership, his returns were almost 10X that of the Dow Jones Industrial Average (the S&P 500 didn’t exist yet), but one key was patience — his partners had to buy in, and they didn’t have to pay any management fees (Warren earned only what we’d now call “carried interest” — he took 25% of the gains above a certain level, I think the level was 4-6%), but they did have to agree to only be updated once a year. The Annual Letters to the partnership in the 1950s were not as folksy as the letters that began in the late 60s, when he had returned his partners money in despair of ever finding more “deep value” ideas and had turned his focus to a few stocks that he held onto, including Berkshire Hathaway, at the time one of his largest investments and a failing textile company in New England… but the idea was similar: I’ll tell you the stories of my successes and failures, but I’ll only do it once a year. He prized focus above almost everything else, and updating worried investors about each rise or fall of the market was a way to lose that focus — and, worse, to waste time on something that didn’t matter at all.
And yes, I see the irony there — writing to you about my investments every week, often in foolish and overwhelming detail, is a way to short-circuit investment returns. The more you obsess about the short term moves up and down of individual shares, the more you feel the unproductive urge to act.
And, amazing though it may be, Warren still LOVES this stuff. He loves to tell stories about investments, he loves to find ways to buy things that will compound his (and our) capital over time. He even still loves the mechanics of finding mispriced opportunities, though there are not so many of them that are large enough to move the needle in his portfolio of a few hundred billion dollars. The other “news” from the meeting surprised me more than anything else, and that was the udpate that he had expanded on the small Activision Blizzard (ATVI) investment that one of his managers had bought last Fall, and turned it into a 9.5% position in the company as an arbitrage bet in the first quarter as Microsoft tries to acquire that video gaming giant. As with any merger arbitrage deal, he’s essentially betting something like $6 billion on the deal going through, assessing that the probability was high enough to be worth the risk, given the steep discount at which the shares trade to the takeover price.
Bill Gates was at the meeting, though not in the front row with the Berkshire board members this time (he stepped down from the Board of Directors a few years ago, when he was the focus of controversy for some personal misbehavior at Microsoft), and we don’t know how friendly the two are today (Buffett’s estate is still largely going to the Gates Foundation), but Warren probably didn’t really need any inside info from Bill Gates to be tempted — he used to love clever arbitrage bets when he and Charlie were digging through small merger deals and assessing probabilities in the 1960s and 70s, and he saw a rare arbitrage opportunity in a deal that was big enough to be worth his time, with the shares trading more than 20% below the takeover price, and couldn’t resist. Warren doesn’t know any better than anyone else whether the government might stop the deal, or what other problems could emerge, but he does know, as we all know, that Microsoft wants to close the deal and Microsoft has more than enough cash, so those risks, at least, don’t exist. Again, strict rationality tied to financial statements — not to worries about how everyone might feel about Activision and its terrible HR problems or the shifting tides of sentiment at the Antitrust Division at the Department of Justice.
It is pretty amazing that Berkshire was able to quickly spend $50 billion buying stock, mostly in just a few weeks, despite the fact that he and Charlie complained several times during the meeting about the extreme extent to which the market has become a casino, obsessed with speculation. Though they did crow about how nice it was to benefit from that casino behavior and the rampant trading — with the main example being that the wild trading volumes meant they were able to buy about 25% of the free-floating shares of Occidental in a couple weeks, without impacting the share price or drawing much attention. They actually own about 15% of the shares now, in addition to the preferred stock and $5 billion of warrants that Warren bought to help Occidental acquire Anadarko a few years ago, so in total they could have roughly 24% ownership if those warrants get exercised… but about 30-40% of the stock is held by index funds and therefore not really part of the available share base, so it is indeed remarkable, and a signal about how much liquidity and computerized trading can obscure, that they bought that many shares without tipping their hand to the market. It must have reminded Warren a bit of his first couple decades as an investor, when disclosure requirements were few and he was sometimes able to acquire half of a company’s shares without anyone noticing.
*****
I’ve still got my Charlie Munger rubber ducks, and my Warren Buffet Squishmallow, and as they smile at me from my desk I hope they’ll continue to remind me to think slowly and rationally, even when the world seems crazy. Greg Abel and Ajit Jain might have a hard time filling the CHI Health Center next year, and in fact it wouldn’t surprise me if Ajit Jain retires pretty soon, leaving some big shoes to fill… but hopefully the Berkshire culture of meeting in person and celebrating patience and rationality will persist.
I’ll write some more soon about Greg Abel and the company he’ll be taking over on January 1, though there wasn’t a lot of “new news” out of the meeting other than Buffett’s surprise retirement announcement (and, I suppose, the update that Berkshire Hathaway didn’t do anything with their cash in the first quarter other than let it continue to pile up, so it’s now a “war chest” of $348 billion), and we’ve also got some news out of Markel this weekend that I’m thinking through right now, so I’m sure that will come up in our next Friday File… but for now, I’ll just feel a little sad that I missed Warren’s last meeting, and thankful for the things he taught me.
