NEW YORK (Nettavisen): Over the weekend, investment guru Warren Buffett (92), who is director of the investment company Berkshire Hathaway, and deputy chairman Charlie Munger (99), gave a speech and held a longer press conference in connection with the company’s annual meeting and general meeting.
– The most important thing from Buffet
A total of around 40,000 shareholders participated, and what they heard was not only positive.
– This is the most important thing Warren Buffett said on Saturday, and it is not good news for the economy, writes CNBC.
Warren Buffet, who is also called the “Oracle of Omaha”, says that he believes the “extraordinary period” of excessive consumption as a result of the stimulus experienced with the Covid pandemic is now over.
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Buffett described the pandemic era, with interest rates at rock bottom and government spending soaring, as the most extraordinary period for business since World War II.
The 92-year-old warned at the same time that this boom is now over, and that the American economy is going to have a downturn this year, writes Insider.
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– Must get rid of goods
The multi-billionaire also says that several of his companies now have overflowing warehouses that they have to get rid of by carrying out sales.
– It is a different climate now than it was six months ago. And a number of our managers were surprised, says Buffett.
– Some of them had too much stock on order, and then it was suddenly delivered, and people were not in the same state of mind as before. Now we are starting to have sales in periods that we didn’t need to have sales in before, says Buffet.
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He said that in connection with the pandemic, they experienced an extreme period where consumers splashed out with money, which in turn led to many managers at his subsidiaries overestimating the demand for certain products, writes CNBC.
Buffet says it all became a question of just getting goods into the stores. The customers almost bought anyway, and they didn’t wait for a sale to happen.
– If you couldn’t sell them one thing, they found something else, says Buffett.
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– Lower earnings this year
Now the situation is completely different, according to Buffet, and he now envisions a drop in income for many of his businesses as a result of an economic downturn.
– When it comes to the general economy, the feedback we are getting is that the majority of our businesses will actually report lower earnings this year than last year, says Buffet.
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The investment company Berkshire Hathaway is seen by many as a barometer of America’s economic health because of the range of businesses that the company owns. They also have a number of subsidiaries, such as Borsheims Fine Jewelry, Brooks Running, Duracell, See’s Candies, Dairy Queen, clothing company Fruit of The Loom, as well as Nebraska Furniture Mart.
Berkshire, which had about $130 billion in cash and bonds at the end of the first quarter, has according to CNBC fared well so far this year, and can point to operating income that rose 12.6% in the first quarter.
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Boasting of Apple
Berkshire Hathaway’s overall earnings also rose sharply, thanks in part to the rise in its stock portfolio, of which Apple makes up the bulk.
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Because even though Berkshire owns a load of companies like Geico and BNSF Railway, there is one company that surpasses them all, according to Buffet, and that is Apple.
– It is simply a better company than any of the ones we ourselves own, says Buffet, who, according to Insider, emphasized how indispensable the iPhone and other Apple products have become for consumers.
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Berkshire has a huge stake in the company, with around $150 billion in Apple stock, making it the most valuable investment in its portfolio.
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– Get rid of “the toxic” people
During the annual meeting, deputy chairman Charlie Munger was also present, and he gave the following advice and warning to everyone who is looking for success: Get rid of “the toxic people” in the company.
– Life’s great lesson is to get them out of your life – and do it quickly, says Munger.
Munger’s advice is to get rid of the toxic manager or employee if their behavior does not seem to change.
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Munger’s “big lesson in life” is to cut out “the toxic people” who can be an obstacle on the way to success, writes Insider.
He also says it is crucial to have the right employees, who behave.
– It’s very easy to spend less money than you earn, and invest wisely, and avoid toxic people, toxic activities, and try to keep learning throughout your life. If you do all these things, you are almost certain to succeed. If you don’t, you’re going to need a lot of luck, says the 99-year-old.
The 99-year-old says one should not live beyond one’s means, not accumulate credit card debt or invest recklessly.
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– Dead without friends
During the annual meeting, Warren Buffet also said something similar, when he pointed out that people must recognize that other people can manipulate them, and that they must avoid falling into the same pattern themselves.
– I have never known anyone who was initially kind, and who died without friends. And I have known many people with money who have died without friends, says Buffet.
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Buffett further emphasized the importance of finding the right partner in life.
– If you make the right decision when it comes to your spouse, then I think you’ve won the game, says Buffet.
– Will rush to the bank
Buffett also commented on the turmoil in the financial environment in the US, and says it would have been catastrophic if Silicon Valley Bank had been allowed to go under. The 92-year-old also said that Americans should not worry about their bank deposits, or debt chaos as a result of Congress not reaching an agreement to raise the US debt ceiling.
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– If the government allows people to lose the money they have put in the bank, then it will cause people to rush to banks all over the country, which will disrupt the global financial system. This is not how the US is going to behave, just as it is not going to let the debt ceiling create unrest around the world.
US President Joe Biden met on Tuesday with congressional leaders, including Republican Kevin McCarthy, in an attempt to prevent the state from running out of money soon. Biden is “absolutely confident” that the US will not default on its national debt. It “is not a possibility”, said Biden, according to NTB
Warren Buffet criticizes both politicians, federal authorities and the media for creating fear.
– A lit match can be turned into a fire, or it can be blown out, says Buffet, who is clear that Berkshire will be ready and contribute if a financial crisis hits the American economy.
– We want to be there if the banking system temporarily stops in one way or another. It shouldn’t, I don’t think it will, but I think it can, says Buffet.
2023-05-10 20:12:26
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