Berkshire Hathaway’s annual meeting 2017 — as it happened

Berkshire Hathaway CEO Warren Buffett displays a pair of men's underwear for sale with images of himself before the Berkshire Hathaway annual meeting in Omaha

They call it the Woodstock of Capitalism. Some 30,000 shareholders in Berkshire Hathaway descend on Omaha, Nebraska, to hear from the company’s founder, Warren Buffett, along with his sidekick and vice-chairman Charlie Munger, at a day long event that includes the mother of all question-and-answer sessions, and the opportunity to shop till you drop at a bazaar featuring many of Berkshire’s subsidiary companies. The FT’s Eric Platt was on the ground (and up in the gods, in the press box of the CenturyLink Centre) to report on the day’s events.

A slight damper on the festivities. That is how Eric Platt reported Berkshire’s first quarter results, which were released on Friday ahead of the meeting. His report is here.

Insurance losses were a big part of the reason that the company missed Wall Street forecasts — but remember, Mr Buffett doesn’t give a hoot for Wall Street’s quarterly forecasts, and no doubt today he will remind investors to think for themselves and focus on the long term.

No cameras or recordings at the annual Berkshire meeting. While the company will be live streaming most of the event on Yahoo Finance, the annual video remains off limits.

Mr Buffett is known to have an eclectic group of friends, beyond the business and political spheres. Many of those friends appear in a shareholder video that precedes the closely scrutinised question and answer session with the Oracle of Omaha.

Among the greatest hits, former California governor Arnold Schwarzenegger, All My Children actress Susan Lucci, Bryan Cranston and Aaron Paul of Breaking Bad, Jaime Lee Curtis, and Rainn Wilson as Dwight Schrute from the US version of The Office.

In the video this year, Mr Buffett sang in a lovely ode to his number two:

“I pray each day,
For Charlie Munger.
Who needs the gym,
When you’re next to him?”

The question of succession is always top of mind for shareholders. Mr Buffett is 86 after all. Mr Munger – pictured below at the meeting – is 93.

Investors are keenly aware of the importance of Ajit Jain, who runs its insurance business. Those operations fuel Berkshire’s growth — its various entities collect premiums and Berkshire uses the difference between what it pays out for claims to invest in other businesses.

“Nobody could possibly replace Ajit,” Mr Buffett said.

But we have a terrific operation in insurance outside of Ajit and there are things that only he can do. But there are a lot of things that are institutionalised in our insurance business where we’ve got extraordinary management.

Ajit has made more money for Berkshire than I have. We’ve got the best property casualty insurance business and I don’t think anyone comes close.

A cute moment followed, after Mr Munger said that the company doesn’t have a lot of people like Ajit. “It’s hard to snap your fingers and find a couple billion dollars out of the air.”

Mr Buffett began to snap his fingers.

He also went on to warn shareholders not to read too much into which of Berkshire’s senior managers are given name checks in his annual letter.

Over the years he has lavished praise on the chief executives of BNSF, Matt Rose, Berkshire Hathaway Energy, Greg Abel, as well Mr Jain and others, and some readers judge their relative positions in the letter — and the word length of the praise — to be indications of where they are in the running to succeed Mr Buffett.

Don’t do that, Mr Buffett said.

I don’t actually think that much about how many personally get named. I would say this, we have never had more good managers than we have now, but it has nothing to do with succession.

https://twitter.com/EricGPlatt/status/860902893796429830

The last of the Berkshire shareholders have now trickled out of the CenturyLink Center, where Warren Buffett and Charlie Munger took more than four hours of questions. Throughout a boisterous session, including the grandstanding by one questioner who attracted loud boos from the thousands in attendance, Mr Buffett waxed contemplatively on the nature and purpose of capitalism.

His relationship with 3G Capital, which Berkshire invested alongside to take a controlling stake in Kraft Heinz, was the focus on repeated questions. He offered a steadfast defense of the group and its practices, which several shareholders indicated they believe runs counter to the values typically espoused by Berkshire.

Mr Buffett said that 3G was ready to buyout companies that “really needed change”. “Change is painful for a lot of people and I’d rather spend my days not doing that sort of thing.”

The job cuts that such change entails? That’s how capitalism gives us the productivity growth that enhances everyone’s living standards. “That’s why we live so well,” he said.

While Berkshire-and-3G’s last takeover attempt failed — Unilever rejected a buyout offer from Kraft Heinz — the Oracle of Omaha vowed that they stood ready for other multi-billion dollar acquisitions, something he reiterated today.

And he said that, over the next decade, he (or his successors) will deploy more capital in acquisitions or investment in Berkshire’s businesses, than he has in the entire 52 years at the helm.

With Berkshire’s cash pile standing at $96.5bn, it is surely only a matter of time until the next big deal.

This post originally appeared on Financial Times

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