E Berkshire Hathaway Annual Meeting Highlights

Berkshire Hathaway (BRK-A), (BRK-B), held its second virtual annual meeting on May 1 in Los Angeles so that Vice Chairman Charlie Munger could join Warren Buffett, CEO and Chairman. Vice Chairmen Greg Abel and Ajit Jain also shared the stage.

Here are a few highlights from the annual meeting:

First Quarter Results

Berkshire Hathaway reported first quarter operating earnings increased 19.5% to $7.0 billion with most business segments benefitting from the reopening of the economy.

Economy Went Off The Cliff

Warren Buffett described how the economy “went off the cliff” last March as the pandemic ensued. The economy was “resurrected in an extraordinarily effective way” by the rapid response of the Federal Reserve and Congress. On the liquidation of all of Berkshire's airline holdings earlier in 2020, Buffett has no regrets. "I still wouldn't want to buy the airline business." He did, however, concede Berkshire could have been doing more buying when stock prices dropped dramatically last March as the pandemic was taking hold. "Looking back ... definitely we could have done better things. Overall, I do not consider it a great moment in Berkshire's history. But also, we've got more net worth than any company in the United States ... and we've got $600 or $700 billion of generally good businesses."

person using macbook pro on black table

Image Source: Unsplash

Inflation

Fiscal and monetary policy responded to the pandemic in a way that was “incredible.” Buffett added, “It did a better job than either the Fed or the Treasury or anybody expected. This economy right now, 85% of it is running in super high gear, and you’re seeing inflation.” At Berkshire, Buffett noted, “We're seeing very substantial inflation. It's very interesting. We're raising prices. People are raising prices to us, and it's being accepted."

Apple

Buffett acknowledged that paring back about 4% of Berkshire's enormous Apple (AAPL) stake in last year's third quarter was "probably a mistake," and that Charlie, "in his usual low-key way," let Buffett know he thought it was a mistake. Berkshire continues to own about 5.3% of Apple with Buffett describing Tim Cook as one of the best managers in the world. Apple receives 99% satisfaction ratings on its products which are “incredible and indispensable.“

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