In the letter, Buffett also praised famed investor John “Jack” Bogle, the founder of Vanguard Group and a pioneer in the index fund universe. Its dozens of subsidiaries include auto insurer Geico, railroad BNSF, a network of auto dealerships, retailers and electric utilities.
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Buffett, who told the cable television network that Berkshire had spent about $20 billion on stocks since just before the November 8 USA election, also said the US stock market was cheap with interest rates at current levels. “Ever-present naysayers may prosper by marketing their gloomy forecasts”.
Berkshire said it had previously classified such Treasury bills as cash equivalents, noting that they are highly liquid and not that sensitive to interest-rate changes.
The billionaire devoted a large section of his widely read Berkshire Hathaway shareholder letter to arguments against stock pickers that charge high management fees and fail to beat the broader market. His holding now puts around 2.5% of Apple’s shares under his control. “By our avoiding the issuance of Berkshire stock, any improvement in earnings will translate into equivalent per-share gains”. Net earnings were $24.07 billion in 2016 as compared with $24.08 billion in 2015.
Operating profit rose just 1 percent to $17.58 billion, despite January’s $32.1 billion purchase of aircraft parts maker Precision Castparts Corp, Berkshire’s largest acquisition. Berkshire also holds significant stakes in Coca-Cola, Wells Fargo, American Express, IBM, Apple and other companies.
Buffett continued to stress the concept of prevailing through temporary economic setbacks and thanked Berkshire’s Vice Chairman Charlie Munger for helping guide him through such times.
Apple shares were up 0.3% at 137.13 in the stock market today.
There was just one fearless soul willing to stand toe-to-toe with Buffett – Ted Seides, then co-manager of Protege Partners, an asset manager known for investing in multiple hedge funds. Insurance float (the net liabilities we assume under insurance contracts) at December 31, 2016 was approximately $91.6 billion. As a result, he realized $8 million from the sale.
Generally, the primary reason people look forward to Buffett’s letters is to see what nuggets of investment wisdom he’ll decide to share. “One word sums up our country’s achievements: miraculous”.
That package included a $15 million bonus on top of Abel’s $1 million salary and other compensation, Berkshire Hathaway Energy Co. said in a regulatory filing Monday.
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Stocks extended their rally last week, with the Dow Jones industrial average closing at a record high for an 11th straight trading session, the longest streak since 1987.
