Buffett says Berkshire’s success is more about being ‘sane’ than ‘smart’ 2022-05-01 08:03:56


Buffett simply said that a file Berkshire Hathaway (BRKB) Strategy is about making rational decisions and investing for the long term.
Buffett said during a meeting Berkshire (puddles) investors.

Buffett shrugged off an interviewer’s compliments about how well he tuned in to the stock market. Buffett said he never knows what stocks or the economy will do in the short term.

He also joked that his bullish bets in the market often look bad at first, saying he spent a large portion of his net worth in 2008 during the Great Recession buying stocks at a “tough time…a really stupid time.” Berkshire has made investments in Goldman Sachs (p) And General Electric (GE)among other blue-chip stocks, before the market finally bottomed out in March 2009.

“We haven’t timed anything at all,” Buffett said, adding that the success of the company’s long-term “buy and hold” investment strategy is “simple.”

Charlie Munger, vice chairman of Buffett and Berkshire, lamented how speculators seem to have taken control of Wall Street. Munger described the casino-like atmosphere and Buffett described the market as a “gambling hall.”

Concerns about inflation but praise for Powell

Buffett did not elaborate on this year’s market volatility during the meeting. But he said inflation is a big problem, one that “fools almost everyone”.

He has given Federal Reserve Chairman Jerome Powell much plaudits for his actions to fight the economic crisis caused by Covid-19, although some argue that low Fed rates have helped fuel inflation pressures.

Buffett said Powell was a “hero” for being aggressive and cutting rates quickly at the start of the pandemic rather than sitting aside and “thumb sucking.”

Buffett also hinted that Berkshire could benefit from the selloff, saying the company is “dependent” on market behavior creating mispricing opportunities for the company.

Along these lines, Berkshire has made some aggressive moves at recent days. The company announced $11.6 billion purchase Insurance company the rich (s) In March and also recently revealed great dangers in an oil company Occidental Petroleum (OXY) The tech giant HP (HPQ).
Berkshire said in its earnings statement on Saturday that it increased its stake in chevron (CVX). The oil giant is now the fourth largest in Berkshire, lagging only apple (AAPL)And American bank (buck) And American Express (AXP).
Buffett also revealed during the annual meeting that Berkshire Hathaway has boosted its stake in the video game maker. Activision Blizzard (ATVI). Berkshire first invested in Activision in late 2021, by Microsoft (MSFT) announced plans in January to buy company for nearly 70 billion dollars.

Activision’s share price is lower than the proposed acquisition price. Buffett said he made the decision to buy more shares as an “arbitrage” bet that the deal would eventually go through.

The moves come just a few weeks after Buffett wrote in his annual letter to shareholders that he was having trouble finding shares to buy at attractive prices. But after the frenzy of buying Berkshire, its cash on hand fell from about $147 billion at the end of 2021 to about $106 billion at the end of the first quarter.

Why does the heart change? Munger, in his egregious manner, said that he and Buffett “found some things we’d rather have than Treasuries.”