Mr. Buffett presided over his 51st Berkshire annual meeting in Omaha, Neb., where he and vice-chairman Charlie Munger fielded five hours of questions on such matters as Coca-Cola’s sugary drinks, lower shipping volumes on the BNSF railway, risks from derivatives and who might succeed Mr. Buffett as chief executive. Valeant’s aggressive accounting tactics and practice of pushing up prices on newly acquired drugs has hurt the company, putting it into the crosshairs of other prominent investors. Over the weekend around 40,000 people gathered in Omaha, Nebraska to see investment legend Warren Buffett.
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Although the in-person audience seemed somewhat smaller this year – there were some empty seats in the CenturyLink arena, and foot traffic in the adjacent convention center seemed less congested – the total audience this year was no doubt a record.
For the first time ever, Berkshire Hathaway live streamed the meeting over the internet.
Buffett said he was urged to invest in Valeant in the past, but decided against it because he felt the business model was seriously flawed, and experience suggested that any short-term positives would be offset by the long-term negatives.
Yahoo did not have an immediate estimate of how many people watched the meeting online.
Berkshire owns 400 million shares of Coke, about 9 percent of the company. “The company is not a sewer”.
The attention was a bit more intense than Precision Castparts executives were used to from industrial trade shows, but Jay Khetani said joining Berkshire has been great so far.
Swedish rescue workers say that an apartment building fire has forced the evacuation of more than 150 people as the blaze raged on the top floor, spreading from end to end along the 60-meter (200-foot) long building.
“It’s still a potential time bomb in the system”, Buffett said.
In many ways, Buffett forecast a trend with his bet. He said he believes global warming is an important issue but ultimately doesn’t think it poses a threat to Berkshire’s insurance businesses.
At the meeting, says Hull, Buffett admitted that “size can be the enemy of performance”, in response to mentions of Berkshire being a massive conglomerate.
“Costco was a very, very, very valuable co brand to have for American Express, but that value wasn’t limitless”, he said.
Ackman said Munger was “wrong to indict the entire company”.
Buffett eventually got down to brass tacks on the climate change report, telling activists at the meeting he is standing firm on his decision to nix the climate change report resolution.
He also attacked investment advisers and other “helpers” who collect fees and commissions from investors, saying pension funds, insurance companies and individuals would be better off putting money in low-priced mutual funds that simply follow the overall stock market, known as index funds. “And no consultant in the world is going to tell you, ‘Just buy an S&P index fund and sit for the next 50 years, ‘” Buffett said.
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“Now that may sound like a bad result for hedge funds, but it’s not a awful result for the hedge fund managers”, Buffett said to laughter at the event held in Omaha.
