For Omaha, a small city in the central United States of 490,000 people, one in 44 the size of Beijing, there's nothing more to look forward to than may.
Berkshire Hathaway has a tradition of holding shareholders on the first Saturday of the month, a tradition that has continued for more than half a century, with the exception of the last two years when the general meeting has been held online due to the pandemic.
Attendance has been increasing, with only a few hundred people attending at the earliest, and this year, at least 40,000 people flocked here from all over the world. Although the entrance time at the conference site is 7 a.m., there are already people waiting outside the door at 4 a.m. – the sooner people who enter the venue can grab a seat in the front row, the closer they can get to the 92-year-old.
It's hard to imagine that such a lengthy conference full of investment jargon and financial knowledge could garner such a wide range of attention — except that its protagonist is Warren Buffett.
Over the years, relying on unique and precise investments and huge returns, Buffett has been referred to as the "oracle of Omaha", or more generally , the "god of stocks". He may be the only person in the world who has ever been the richest man in the world solely by investment, and in recent years he has been one of the 5 richest people in the world.
Many see the conference as a "pilgrimage," and like the religious shrines, Omaha is seen as the mecca of the investment community. One attendee told the media that many people come every year, and everyone is more of a believer in value investment, "Many times as to how he answers, it is no longer very important." ”
Some critics unceremoniously refer to Buffett's shareholder meeting as more like a sermon, and these shareholders who come from all over the world will seize the time to find everything about Buffett in Omarhali in the 3-day meeting, eating ice cream at DQ, drinking Coca-Cola, buying Hisits candy (Buffett said he prepared 11 tons of candy for the convention), going to Buffett's frequent steakhouse for lunch, and buying Berkshire's peripheral T-shirts and underwear at the venue. Of course, be sure to take a spin before going to the house where Buffett has lived for 64 years.
Buffett called the shareholders' meeting the "Woodstock Festival of the Capitalists," the largest festival of all time, held in the summer of 1969 and considered one of the most pivotal nodes in the history of pop music.
In a way Buffett did. Berkshire Hathaway is the only company to hold such a large shareholder meeting every year, and Buffett is the only CEO to write a long shareholder letter to shareholders every year (buffett's letter to shareholders has nearly 1.5 million words based on the number of words translated by the Chinese of the calendar year).
It may be rare in business history to have a conference of such impact.
A
Buffett is destined to face more controversy this year than in previous years.
In Berkshire's first-quarter 2022 earnings report released before the shareholders' meeting, the company's net profit fell to $5.4 billion, down nearly 50% from $11.71 billion in the same period last year and also below analysts' expectations of $6 billion.
But much of those losses came from Berkshire's stock portfolio — unlike popular belief, Berkshire is not just an investment firm, but also has multiple physical businesses in confectionery, retail, rail, homewares and jewelry sales. In the first quarter, Berkshire lost $1.58 billion on its books due to equity investments.
The capital market in 2022 began with chaos and anxiety, the Russian-Ukrainian conflict broke out, the epidemic rebounded again, the US CPI (Consumer Price Index) in March hit a record high, and inflation almost peaked. Even Buffett himself lamented at the shareholders' meeting that inflation had robbed almost everyone. He said no one knows how much inflation will eventually reach, not even next month.
"One of the best investments is to develop yourself," Buffett has always done by avoiding investors' questions about which stocks to choose to avoid inflation at the moment. He's not as unguarded as Musk, the new idol of today's young people. At the same time as Buffett's shareholder meeting, Musk is answering users' investment questions on Twitter, and an American technology media outlet says musk is becoming the new "oracle of Omaha".
Musk
Buffett has made unusually large-scale investments over the past 3 months. In his February Letter to Shareholders, he also lamented that he hadn't found much to buy, but in the next three weeks, he spent more than $40 billion on stock, the highest deal in years.
In March, he wholly acquired alleghany Corp, an insurer, for $11.6 billion, a deal expected to close in the fourth quarter and is expected to be Berkshire's largest acquisition in nearly six years. In addition, he bought more than 10 million shares of Hewlett-Packard shares, and increased his holdings in Western Oil and Chevron. That has shrunk Berkshire's funding from $146.72 billion three months ago to $106.26 billion at the end of the first quarter.
But Buffett has clearly paid off. After the disclosure of his massive purchase of HP stock, HP shares rose 15%, the biggest increase of the year, and Buffett made more than $600 million in a single day book profit.
"Because we've found something more attractive than bonds, it's that simple," Charlie Munger said in response to investor questions. "The environment in the world is often changing rapidly," Buffett added. He explained why he bought the insurance company, saying he had been following the company for nearly 60 years, and that a former Berkshire ceo who had recently served as ceo sent him an email that he quickly finalized after meeting with the company.
He also attacked the current speculative climate in the capital market, saying that the stock market is like a casino. Of course, he hasn't forgotten Bitcoin — he says he'd rather spend $25 billion on an apartment or farm than $25 — and Buffett has always been a staunch opponent of bitcoin, seeing it as worthless.
There are also things outside the company's business that plague Buffett. Some shareholders see Berkshire lagging behind rivals in developing plans to reduce carbon emissions, demanding that Buffett reform his views and details on climate risk.
Berkshire's shareholder, the California Civil Service Pension Fund, was unhappy with him for being both CEO and chairman of the company and tried to remove him as chairman. The California Civil Service Pension Fund is the nation's largest state public pension fund, but given buffett's roughly 32 percent of Berkshire's Class A shares and 16 percent of Class B stocks, the proposal is unlikely to pass, and both classes of shares in the California Civil Service Retirement Fund hold less than 1 percent.
Munger spoke vehemently of the proposal at a shareholder meeting, saying, "There are people who have never run any commercial companies, don't know anything, and I don't think it's overwhelming to be chairman and CEO at the same time." ”
B
When introducing Omaha, the official U.S. travel website GoUSA said that Omaha means "people who go against the wind or against the current", a place that can turn old things into new trends, and "cowboys can also be independent rock stars".
In this sense, Warren Buffett is very much in line with the temperament of the city. His family has lived here since his great-grandfather, and in 92 years Buffett has never left the city except to go out to study. His first job was at his father's securities firm, where he worked as an investment salesman, and he has been in the investment industry ever since.
Unlike the current investors who are often active in the headlines, Buffett's investment logic is not sexy at all, even a little boring and tedious, but he is indeed the one who can "turn old things into new trends".
He prefers "cheap" stocks, which he thinks are undervalued in real value. His best-known investment motto is long-term investing, with some of Berkshire's stocks held for decades. Buffett, for example, has been investing in American Express since 1994 and has been investing in American Express for 28 years and remains one of Berkshire's five largest holdings today.
In his decades-long investment career, Buffett has rarely favored the hot technology stocks of the moment, with the rare exception of Apple, which does not hold Amazon, Microsoft, Google or Tesla stocks that have soared in recent years. It wasn't until 2019 that Berkshire participated in an IPO subscription for the first time.
But in recent years, Buffett's portfolio has begun to see new faces. At the end of last year, he made a rare investment in the game company Activision, and continued to increase his holdings after Microsoft announced the acquisition of Activision, as evidenced by Hewlett-Packard earlier this year.
Some reports have compared Buffett to Catherine Wood, known as wall Street's "tech queen", Catherine's preference for disruptive and innovative technology companies, and her ARK Invest is mainly investing in artificial intelligence, robotics, DNA and blockchain technology, which people call "the female version of Buffett".
Catherine Wood
One of her best-known investments was to bet heavily on Tesla when the market was not optimistic about Musk, and its earnings multiple was as high as 690%. However, Catherine has suffered a lot of losses due to the continuous decline in technology stocks recently, and the ARK Invest fund has fallen by more than 60% from last year's high.
Buffett's robust and sophisticated investment style has allowed him to leapfrog cycles many times in his history, and Berkshire Hathaway has achieved an annualized return of 20% over the past half-century, surpassing the S&P 500 index in the same period and being regarded as a miracle of compound interest.
During the 2008 global economic crisis, he published the famous article "I Am Buying America" in the New York Times, which included a widely circulated sentence, "I am afraid when others are greedy, and I am greedy when others are afraid." At this year's shareholders' meeting, he mentioned this article again.
Buffett bought a lot of stocks during that time — that's when he started betting on BYD — and it was later discovered that he had made more than $10 billion from the crisis.
In March this year, Berkshire Hathaway's Class A stock price exceeded $500,000 for the first time, with a market value of more than $730 billion, becoming the only non-tech company among the 10 companies with the highest market capitalization in the United States, and Buffett returned to the top 5 of the global rich list, he is one of the few people in the top ten of Bloomberg's rich list to achieve positive wealth growth this year, and The number one Musk has shrunk by $21.8 billion due to the repeated fluctuations of Tesla's stock price.
"Buffett is the tortoise that won the rabbit," John Buckingham, a fund manager at the wealth management firm Kovitz, said in an interview with the media, "Value investors just walk slowly, yes, David Portnoy and Catherine Wood have their days, but a lot of people see investment as a casino." The key is to be patient and accept fluctuations. ”
In recent days, Berkshire's stock price has fallen back below $500,000.
C
This may be Buffett's last shareholder meeting as the protagonist. He is 92 years old this year, and at the shareholders' meeting, he quipped that he and Munger were over 190 years old combined.
In an April interview, he spoke about the inconvenience of age, saying that he "sometimes forgets other people's names and doesn't read as fast as before," as if it were an "aging machine" because his hearing is also declining. But he later added that he "felt great and full of fighting power."
A few days ago, Glide, a charity that has worked with Buffett for many years, announced that this year will be Buffett's last charity lunch. Buffett's charity lunch has been held for 20 years so far, and in the past two years it has been suspended due to the epidemic, and Glade did not say why it was suspended.
Berkshire shareholders fear Buffett's departure, fearing that Berkshire will not be able to repeat the glory of buffett's time, and buffett's chosen successor, Greg Abel, has yet to gain the trust of people — he is not as contagious as Buffett and gives fewer media interviews.
Abel, a 59-year-old accountant, has worked for Buffett for more than 20 years, where he is responsible for Berkshire's non-insurance businesses, including energy, railroad and retail. In 2018, he was promoted to vice chairman of the company. At this year's shareholder meeting, he sat on Buffett's left hand side.
Buffett has three children, the eldest daughter Susan is in charge of charity work in a foundation, the second son Howard runs a farm in Illinois, and the younger son Peter is a musician, and they are unlikely to take Buffett's class.
At this year's shareholder meeting, Buffett still did not announce plans to step down. He said in a previous interview that he loves his current job, calling it "the most interesting job in the world." He keeps a regular schedule, gets up at 7 a.m. every morning, then watches some news from the capital markets, and sets plans for today's stock trading before the market opens at 8:30 a.m.
Buffett has been at the helm of the company for more than half a century, and the way he manages the company has barely changed in decades. One report said Buffett managed Berkshire the same way he did more than 50 years ago.
Unlike the complex compensation that Internet companies set for executives today, he receives a fixed salary from the company every year, and has hardly changed over the years, it has been $100,000, there is no bonus, and his personal assets mainly come from the Berkshire stock he holds.
"I can do this job as well as I always did," Buffett said. He didn't deny Greg Abel in that April interview as his successor, but said, "He [refers to Greg Abel] isn't warming up yet, so I'm still working overtime." ”
Buffett wants people to believe that nothing will change, "even if I'm gone, the corporate culture won't change much, and the shareholder relationship won't change much." ”
"Berkshire is not going to end," he said at the shareholders' meeting.