5 minute speed reading! Buffett’s shareholders’ meeting is all here

“Stock God” explains why they have continuously reduced their holdings in Apple.

On May 4th local time, the annual Berkshire Hathaway shareholders meeting was held in Omaha, where Warren Buffett, the “stock god”, appeared with Vice Chairman Greg Abel and Insurance Business Head Ajit Jain.

The host city CHI Conference Center was fully booked, and it is worth mentioning the presence of entrepreneurs such as Bill Gates and Apple CEO Cook on site. At the meeting, the “Omaha prophet” spoke eloquently, not only about cash reserves, artificial intelligence, and Apple, but also about Munger’s past and Berkshire’s future. Here are some wonderful answers from Buffett at this shareholder meeting.

((“Buffett Attends Shareholders’ Meeting (Source: First Financial Live Broadcast)”,)

Why reduce holdings in apples

According to the financial report, as of March 31, approximately 75% of Berkshire’s total fair value was concentrated in Apple, Bank of America, American Express, Chevron, and Coca Cola, unchanged from the previous quarter.

The two consecutive quarters of reducing holdings have attracted attention from the outside world. Since its first opening in 2015, Buffett has repeatedly praised the leadership and market dominance of this iPhone manufacturer. As the holding weight exceeds 50%, many investors have expressed concerns that Apple’s proportion in Berkshire’s investment portfolio is too large.

When asked why Berkshire reduced its holdings in Apple,

Cash reserves reach a new high

At the end of the first quarter, Berkshire’s cash reserves reached a historic high of $182 billion.

Controlling risk remains crucial. “Having a large amount of cash reserves is a good thing when things go wrong. Under current conditions, I don’t mind establishing a cash position at all. When I examine other options, availability in the stock market, and the composition of what is happening around the world, we find it very attractive,” he said.

Buffett revealed that he is not interested in small acquisitions and will only choose opportunities he likes when it comes to large acquisitions, and only strike at the right time. If I set my previous goals now, I may not be able to find so many opportunities and there may not be enough attractive investment targets for me to allocate assets and see if there are any changes afterwards.

The position of the US dollar and US bonds is stable

When asked whether he was worried about the risk of rising debt levels, Buffett said that US treasury bond were acceptable for a long time because there were not many alternatives.

Meanwhile, Buffett believes that,

Buffett’s view is the same as before, he once said that he will never short the United States. At last year’s shareholder meeting, when the United States faced the risk of debt default, he reiterated his confidence in the government and Congress, and pointed out that even in concerns about the debt ceiling, the US dollar is unlikely to be replaced as a reserve currency.

In fact, with the Federal Reserve raising interest rates by 525 basis points this round, Berkshire has invested a lot of cash reserves in US treasury bond bonds. Buffett previously disclosed that he would buy three month and six month US treasury bond bonds every Monday, and the yields of the two bonds remain above 5.3%.

Selection of investment direction

Buffett said,

Buffett compared investing in BYD with investing in Japanese companies, and said, “The investment in BYD is similar to our previous investments in Japan: we quickly invested in 5 companies in Japan, and you rarely see us making such investments overseas in the United States.”

Regarding India, Buffett expressed that he is paying attention and believes that there are many opportunities in India, but the question is whether there is any advantage in his understanding of India. “Does India have those investments that we really want to participate in?”

Buffett revealed that Berkshire’s next big deal may not be outside the United States. If you insist on investing in the United States, it is unlikely to make major mistakes. “I understand the rules, weaknesses, and strengths of the United States, and my understanding of other cultures is not very good. But fortunately, I don’t have to do this.”

Coexistence of opportunities and risks in artificial intelligence

Although there are artificial intelligence targets in his holdings, including Amazon, Buffett stated that he is “completely unaware” of this, but it does not mean that this technology is not important.

Buffett gave an example of artificial intelligence fraud, which is a common scenario in the United States. If this kind of fraud is allowed to spread unchecked, it will become the fastest growing industry in history. Buffett added, “I do believe that it has enormous potential for benefits and enormous potential for harm – I just don’t know the outcome.”

Buffett subsequently stated that any labor-intensive industry may be threatened by artificial intelligence. There are many deep topics worth discussing about artificial intelligence, and it may be too early to discuss its impact now.

Recalling Munger

Before the shareholders’ meeting began, Berkshire aired a short film paying tribute to Charlie Munger. At the end of the video, Buffett referred to Munger as “the architect of Berkshire.”.

In the investor questioning session,

Recalling the past, Buffett said that Munger always followed his instructions, but only twice did he not. One time is to invest in BYD, and the other time is to invest in Costco, the opening investor. Buffett believes that Munger is right in investing in both companies at crucial moments.

Retirement may not be far away

This meeting is the 60th shareholder meeting held by Berkshire since the 93 year old Buffett took over in 1965.

Today, Berkshire is a giant company with a market value of over $850 billion, with dozens of businesses including BNSF Railroad, Geico Auto Insurance, and Dairy Queen, among others, with investment assets exceeding $300 billion.

Buffett said he has no plans to resign, “I feel good,” and joked that he should not accept a four-year contract. However, age cannot be avoided.

In fact, Berkshire’s succession plan is already quite clear. Abel will serve as the CEO of Berkshire’s post Buffett era, overseeing Berkshire’s non insurance business. Jia is expected to continue operating insurance business, while Todd Combs and Ted Weschler are expected to be responsible for investment business.

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