Mr Buffett also renewed his defense of Brazilian private equity firm 3G Capital, which with Berkshire has a controlling stake in food company Kraft Heinz Co, where it has built on its reputation as a ruthless cost-cutter. Buffett was forced at the investor meeting this weekend to defend rate hikes by NV Energy. The crowd was smaller than last year’s 50th anniversary meeting but still dwarfs any other corporate meeting.
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For the first time ever, Berkshire Hathaway live streamed the meeting over the internet.
Buffett warned shareholders that Berkshire’s size _ more than 90 companies and investments _ will make it hard to continue delivering exceptional returns.
Yahoo did not have an immediate estimate of how many people watched the meeting online.
Mr Buffett also emphasized his worry that derivatives could cause major risks for most of the world’s largest banks if markets were disrupted.
Berkshire Hathaway shareholders have overwhelmingly rejected a resolution calling for the company to write a report about the risks climate change creates for its insurance companies.
Buffett has said operating earnings offer a better view of quarterly performance because they exclude investments and derivatives, which can vary widely. “I don’t try to make money off the movie”, Buffett said.
Concerns are mounting in boardrooms across the US about the populist rhetoric dominating the Republican and Democratic races.
As Geico and other subsidiaries have conglomerated to form an increasingly disparate collection of businesses, Buffett said it’s “very, very unlikely” that an activist investor group someday would succeed in breaking Berkshire into parts in an effort to unlock hidden value.
During the financial crisis, Buffett bet the asset management company Protege Partners LLC US$1 million (RM3.8 million) that the S&P 500 will outperform a portfolio of hedge funds over the 10 years through 2017. Buffett said he’s not anxious about that holding or a smaller investment in Bank of America Corp.
He said American Express would remain “under attack” from alternative payment methods, but he was confident in his stake.
But policy makers do have to be careful not to raise US interest rates too far ahead of Europe and Japan because of unintended consequences of the imbalance, Buffett said.
Buffett takes a hands-off approach to managing all the companies Berkshire owns, allowing the individual CEOs wide latitude unless he’s aware of a problem that needs his attention. “It’s packed, incredibly packed”, first-time attendee Steve Peters, from nearby Papillion, Nebraska, said.
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Berkshire’s BNSF railroad in January reduced its spending plan for the year, and this month it put 4,600 workers on furlough in response to declining cargo traffic. But he reassured shareholders that Berkshire would prosper regardless of who is elected.
