In the first Berkshire Hathaway AGM for three years, Warren Buffett made clear his focus on businesses that ‘do things’ hasn’t slipped, with some major new investments revealed.
Warren Buffett ensured the Omaha faithful were not disappointed on Saturday, as the first in-person Berkshire Hathaway (NYSE:BRK.B) annual meeting since the pandemic heard some typically forthright views from the billionaire stock-picker.
Buffett’s strongest comments were reserved for Wall Street and its creation of a ‘casino culture’ where investors are encouraged to take risky bets rather than investing.
The Sage of Omaha told thousands of investors returning to the annual event in Nebraska: “Wall Street makes money, catching the crumbs that fall off the table of capitalism. [It doesn’t] make money unless people do things.
“It's much better [for Wall Street financiers] to have somebody that's going to trade 20 times a day and get all excited – just like pulling the handle on the slot machine.”
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Cryptocurrencies got similar treatment after Buffett said he would not buy all of the bitcoin in the world for $25: “I wouldn't take it, because what would I do with it? I would have to sell it back to you one way or another. It isn't going to do anything."
Buffett, who is 91 and has run Berkshire Hathaway since 1965, prefers investments at the heart of the US economy, including the Duracell battery manufacturer, iPhone maker Apple (NASDAQ:AAPL) and food giant Kraft Heinz (NASDAQ:KHC), as well as American Express (NYSE:AXP) and Bank of America (NYSE:BAC).
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The moves were disclosed just a couple of months after Buffett wrote to shareholders to complain about a lack of investment opportunities. That changed in February with the acquisition of a 14.6% stake in Occidental Petroleum Corp (NYSE:OXY) and the purchase of insurer Alleghany (NYSE:Y) for $11.6 billion in Berkshire's largest deal for six years.
Berkshire spent $51 billion overall in the first quarter, meaning its cash pile fell $40 billion to $106 billion. But in a year when the S&P 500 has fallen by more than 10% since January, Berkshire’s shares are up by more than 6% so far.
This continues the outperformance seen since 1964, with Buffett recently reporting compound annual growth of 20.1% in the period up to 2021, compared with 10.5% for the S&P 500. The company owns more than 90 businesses, including railroad and manufacturing operations.
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