Omaha takes on Wall Street

8 May 2006

The billionaire downplayed expectations at his AGM. But he still believes the Berkshire Hathaway culture creates a longterm advantage. But it’s difficult to see how the "faith" uniting the conglomerate and its shareholders can survive the inevitable departure of its boss.

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On Saturday, some 24,000 shareholders turned up for the Berkshire Hathaway annual meeting in Omaha, Nebraska. At the meeting, Buffett hailed the important acquisition of Israeli toolcutting company, Iscar, which was announced Friday. He admitted that Berkshire was sitting on around $30bn of excess cash, but said he preferred that to doing dumb deals. Buffett said there was a low probability of his doing a $15bn deal in the near future though said he expected that in three years' time, Berkshire would have significantly less cash. However, he cautioned shareholders not to expect any more home runs on the investment front.

For more than five hours, Buffett and his vicechairman Charlie Munger answered questions and received expressions of gratitude from shareholders. At one point, an Indianborn shareholder rose to deliver a lengthy peroration to the Nebraskan billionaire's simplicity and generosity of character. Buffett, said the shareholder, was a great Swami; he looked forward one day to kissing his feet and receiving his blessing.

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