The 2024 annual meeting of the Berkshire Hathaway shareholders came to a close at 1:30 AM IST on the 5th of May, with the Oracle of Omaha, Warren Buffett being cheered loudly by the shareholders after he addressed their queries. It was the first AGM without his long-time counterpart and close friend, Charlie Munger, who passed away last year, and the spotlight was naturally on Vice Chairpersons Greg Abel and Ajit Jain.
Let’s take a look at the ten key highlights from Warren Buffett’s Berkshire Hathaway annual meeting –
1. On Succession: Greg Abel to be in charge of investment decisions
Putting rest to speculations, Warren Buffett said Greg Abel, 61, who will be taking over the CEO job at Berkshire Hathaway, will control Berkshire Hathaway’s investing decisions, including its stock portfolio, after him.
“I think the responsibility ought to be entirely with Greg. The responsibility has been with me, and I farmed out some of it, and I used to think differently about how that would be handled, but I think the responsibility should be that of the CEO,” said Buffett, as quoted by CNBC.com.
Abel, vice chairman of the non-insurance operation, whose name was revealed as Buffett’s successor at the shareholder meeting in 2021, has been managing a significant portion of Berkshire’s investments, including energy and retail.
2. Berkshire trims investment in Apple
Berkshire Hathaway trimmed its stake in Apple for the second consecutive quarter as it reduced its investment in the tech-giant Apple by around 13 percent in the first quarter.
Berkshire sold about 10 million shares of Apple, or 1 percent of its stake in the tech firm, in the last quarter of 2023. Berkshire again sold about 116 million Apple shares, or 13 percent stake in the company, in the first quarter of the current year.
Nevertheless, at the end of the January-March quarter, Apple was Berkshire’s biggest holding. Buffett said the stake sale was for tax purposes, and Apple may remain Berkshire’s largest holding at the end of the year.
3. I enjoy managing people’s money: Warren Buffett
“I enjoy managing money for people who trust me. It is a good feeling to be trusted. Charlie felt the same way,” says Warren Buffett.
4 Warren Buffett on sustainability of US debt
“US debt will be acceptable, but we need to see if inflation is let loose in an unsustainable manner. Volcker was the man for the crisis. It wasn’t the quantity that was offered that was the threat, it was the fiscal deficit. The focus is on the Fed but the fiscal deficit should be focused on. Powell doesn’t control fiscal policy but that is where the trouble will be,” says Warren Buffett.
5. AI scamming the next big “growth industry”
Warren Buffett believes that artificial intelligence (AI) scamming could be the next big “growth industry”.
At Berkshire’s annual meeting, Buffett highlighted the potential of AI for scamming people due to its ability to create convincing fake images and messages. Scammers could use this technology to trick people into sending money by making fake pleas for help, like pretending to be a family member in trouble.
“When you think about the potential for scamming people, if you can reproduce images that I can’t even tell, that say, ‘I need money,’ as your daughter, ‘I just had a car crash, I need $50,000 wired.’ I mean, scamming has always been part of the American scene, but this would make me, if I was interested in investing in scamming, it’s going to be the growth industry of all time,” CNBC quoted Buffett saying so.
6. The entire stake in Paramount sold at a loss
Taking 100 percent ownership of the decision, Buffett said Berkshire sold the entire stake in Paramount Global at a loss.
Berkshire owned 63.3 million shares of Paramount at the end of 2023 after cutting about a third of its stake in the company in Q4 last year.
7. Positive about India
Buffett appeared positive about India. He said there were “loads of opportunities in a place like India”. Berkshire, however, does not have immediate plans for large investments in other countries, Buffett said.
8. How does Warren Buffett decide when and how to exit positions?
‘There are various reasons to exit positions, one is when you need money, though that doesn’t happen very often with us. It used to happen on every decision when I was 20 years old,’ says Buffett .
9. Warren Buffett on investing opportunities now, considering the market returns
“There have been times when I have been awash with opportunities that I could have invested everything by the nightfall, and there are other times when the year goes… when we haven’t seen anything that makes the needle move. Now, we have made small acquisitions during the year.” “Sometimes, Greg and I look at acquisitions ourselves where we think the managers don’t necessarily have the same equations in mind. We never regret missing something that we didn’t understand.”
10. With S&P 500 now becoming tech-heavy, would Buffett advise investing in an equal-weight index rather than market-cap weight index?
“I revise my will every 3 years or so when I get little thoughts from time to time. The one thing I haven’t changed is that my wife gets left a huge amount of money. It won’t make one bit of difference to her whether she beats the S&P 500 or anything else. All I want to leave is plenty of money that will take care of way beyond what she’ll ever spend, and at the same time give her as much peace of time as possible, so that she doesn’t have to worry about beating the S&P 500. The main thing is that she feels that she’s in a financial position that she doesn’t even need to think about it,” says Warren Buffett.
