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Annual Letter to Berkshire Shareholders (2019) [pdf]

berkshirehathaway.com

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Re: Annual Letter to Berkshire Shareholders (2019) [pdf]

#41

Post by wyxuan »

colsmit wrote: post #39
peatfreak wrote: post #35

After reading all the positive comments about BRK in this thread I came across this article: https://www.nasdaq.com/articles/hypocrisy-berkshire-hathaway... For somebody with little knowledge of financial services (i.e., me), how would you recommend that I interpret this?

The BRK official position on Valeant is that they take advantage of sick individual's life-or-death need for drugs to price gouge them since purchasing decisions are not made on price (medication is "price inelastic"). Clayton homes is criticized for having bad or misleading loan terms. BRK (and many financial services individuals I know personally) often see just about any loan term as fair as long as no-one was for…

Criticisms on valeant don't seem fully justified. Sure valeant had questionable business practices in the past, but they've changed due to law enforcement. Plus, the other criticisms can be applied to almost every pharma company

Re: Annual Letter to Berkshire Shareholders (2019) [pdf]

#42

Post by nodesocket »

“Shareholders having at least $20 million in value of A or B shares and an inclination to sell shares to Berkshire may wish to have their broker contact Berkshire’s Mark Millard at 402-346-1400. We request that you phone Mark between 8:00-8:30 a.m. or 3:00-3:30 p.m. Central Time, calling only if you are ready to sell.”

$BRK.B holder myself — What is this? Is this essentially if you have a big enough position you can sell us your shares directly for a better price than on the open market? Doesn’t that seem unfair to retail/small investors who have to trade on the open market?

Re: Annual Letter to Berkshire Shareholders (2019) [pdf]

#43

Post by empath75 »

bravura wrote: post #12
trcollinson wrote: post #9

Earlier quoted context omitted.

I'm missing your point here. Do you not like marriage analogies? Or you don't think his analogy and very well known life experience doesn't apply (he has an interesting personal experience with marriage)? Or do you think most of the people who read his letter have no background in marriage? I find the analogy very appropriate and well stated. Much like a marriage he can't just give back a portion of an entity he's in…

I guess what’s strange to me is not the idea that, as you become more committed to a person you discover their flaws and the relationship gets worse. That seems self evident to me and seems to be a common theme both in theory and in practice. But how many marriages resolve with discovering the person is way better than you imagined? I’m not familiar with this, either through the idealism of poetry or romantic movies,…

observing marriages and watching movies about marriages probably tells you as much about marriage as watching movies about computers and watching people type on computers will tell you about programming.

Re: Annual Letter to Berkshire Shareholders (2019) [pdf]

#45

Post by nabla9 »

peatfreak wrote: post #35

After reading all the positive comments about BRK in this thread I came across this article: https://www.nasdaq.com/articles/hypocrisy-berkshire-hathaway... For somebody with little knowledge of financial services (i.e., me), how would you recommend that I interpret this?

Last Week Tonight with John Oliver had episode about those practices including Clayton Homes. https://www.theguardian.com/culture/2019/apr/08/john-oliver-...

The point of the story is that

1) Mobile homes are horrible investments. They go rapidly down in value. “cars go down in value. Mobile homes go down in value. It’s a car you sleep in.”

2) Private equity groups such as the Carlyle Group, TPG and Blackstone now own large tracts of mobile home park and collect big fees.

3) Loans for the houses have large interest rates. They have to be. If you sell a product and give a loan that goes down in value very fast, only way to do that is to charge big interest because the risks are also big. Poor people don't have other collateral.

This kind of rent seeking form land and loans where poor people pay and pay means that people stay poor. This would be a job for government. Provide cheap rented land and basic infrastructure and cheap mobile housing.

Re: Annual Letter to Berkshire Shareholders (2019) [pdf]

#46

Post by unlinked_dll »

nodesocket wrote: post #42

“Shareholders having at least $20 million in value of A or B shares and an inclination to sell shares to Berkshire may wish to have their broker contact Berkshire’s Mark Millard at 402-346-1400. We request that you phone Mark between 8:00-8:30 a.m. or 3:00-3:30 p.m. Central Time, calling only if you are ready to sell.” $BRK.B holder myself — What is this? Is this essentially if you have a big enough position you can…

I'm guessing they have a number of shares they want to buyback and it's simply not worth their time trying to wrangle them from investors with less than $20 million worth

Re: Annual Letter to Berkshire Shareholders (2019) [pdf]

#48

Post by otherme123 »

nodesocket wrote: post #42

“Shareholders having at least $20 million in value of A or B shares and an inclination to sell shares to Berkshire may wish to have their broker contact Berkshire’s Mark Millard at 402-346-1400. We request that you phone Mark between 8:00-8:30 a.m. or 3:00-3:30 p.m. Central Time, calling only if you are ready to sell.” $BRK.B holder myself — What is this? Is this essentially if you have a big enough position you can…

Selling 20 millions would cost you a little fortune in broker fees. In turn BRK are buying back and paying brokerage. It makes sense to sell directly. And I don't think you get a better price than the market even selling 20M, you just sell at market price.

This saves money to YOU, the shareholder, so you should be happy with it.

Re: Annual Letter to Berkshire Shareholders (2019) [pdf]

#49

Post by yuy910616 »

arbuge wrote: post #32
yuy910616 wrote: post #15

Any book recommendations for someone who would like to learn more about GAAP, accounting, operational earnings, and/or how to evaluate stocks?

I think the recommendations you're getting here to read Buffett's letters, The Intelligent Investor, etc. are good, but if you're completely new to accounting, I think starting with more basic texts would be a better idea. Two that I liked and still refer to from time to time are How to Read a Financial Report by John A Tracy and Financial Statements: A Step-By-Step Guide to Understanding and Creating Financial Repor…

awesome. I'll check them out. thank you

Re: Annual Letter to Berkshire Shareholders (2019) [pdf]

#50

Post by sethev »

danfoxley wrote: post #44

From the bottom of the first page in the report: Overall Gain – 1964-2019 .................................................... Berkshire: 2,744,062% S&P: 19,784% Huh? 2 million percent vs. 19k ?

Yeah, people who invested any money in Berkshire in 1964 are very rich now (if they didn't sell). People who invested in S&P in 1964 are not as rich.
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