Warren Buffett’s ‘Woodstock for Capitalists’ goes global

Warren Buffett: Questioned by shareholders.

The legend that is Warren Buffett spread in an even wider arc around the globe at the weekend, as the iconic Berkshire-Hathaway annual general meeting streamed live on the internet for the first time.

Viewers were able to see the 85-year-old billionaire and his co-director Charlie Munger, 92, sit through up to seven hours of questions from shareholders and journalists on topics ranging from value investing to the global economy, Brexit, the White House race and the pair’s philosophy on life.

Buffett organised the webcast through Yahoo Finance “to reach more people than ever in key financial centres and to bring the energy and excitement of what happens in Omaha to an informed audience around the world.”

The Yahoo share price, which has experienced challenging trading in recent times, jumped 8% on the news.

But, with an estimated 40,000 shareholders descending on the Midwest city over the weekend, it looks unlikely that the ease of online viewing will ever top the opportunity of rubbing shoulders with ‘the Sage of Omaha’ for his ever loyal supporters. 

Buffett, himself, has described the annual gathering as ‘Woodstock for Capitalists,’ and has seen famous faces like Bill Gates, Tiger Woods and George Clooney making the pilgrimage in the past.

Interestingly, none of this might have come to pass had Buffett decided to follow his initial instinct in 1965 and sell his stake in the then struggling textile company.

Annoyed at being offered 12 cents a share less than what had been agreed, he instead responded by buying the entire enterprise. 

Today, Berkshire is spread across a vast empire of energy, insurance, manufacturing, transportation and retailing, through 90 companies with a market value of over €350bn.

Up to 1996, the crowds at the AGM measured less than 10,000 — a situation that transformed when the company issued its lower-priced, second tier B share, currently costing $147.60, on the New York Stock Exchange.

The A share, backbone of many an investment house portfolio, currently trades at $221,430. Both shares are up over 10% on the year, compared to just a 2% gain for the S&P 500. 

Many of Berkshire’s biggest stock holdings — Kraft Heinz and Coca-Cola — are outperforming the general market, but offset somewhat by weakness in Wells Fargo bank.

Buffett has proven himself a witty and wise performer at the Omaha gathering over the years, mixing straight-talking economic logic with sly humour to entertain the throngs.

However, he has admitted to suffering chronic shyness in his younger days — an impediment he overcame through a Dale Carnegie course.

“Even then, I chickened out of my first appointment,” he informed.

His comments on life and business are the stuff of industry legend at this point, including this observation on motorbike owners: “I don’t know if Harley Davidson stock is worth $30, but I do like a business where customers tattoo the company’s name on their chest.”

One of Buffett’s highlights from this year: “[There is] far more money made by people on Wall Street through salesmanship abilities rather than investment talent.”

Politically, the two directors support opposing sides. Buffett, a Democrat, has already declared his support for Hillary Clinton in the race for president. 

But while Munger tends toward a Republican ethos, he is no fan of Donald Trump, saying he “was not morally qualified” to take over the White House. 

Despite that, Buffett said Berkshire “will do fine” whoever enters the White House early next year.

Berkshire has spent big on acquisitions in recent years, including Heinz Kraft, Burger King, Burlington Northern Santa Fe railroad and aircraft components maker Precision Castparts. 

The latter deal, worth $37.2bn, was Berkshire’s biggest ever, and Buffett has hinted that 2016 will see more of the same.


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