The Buzz In The Market: Warren Buffett!
The buzz in the market is about Warren Buffett: Yesterday, Warren and Bill Gates did an interview with Becky Quick of CNBC before talking to more than 30,000 shareholders gathered for Berkshire Hathaway’s annual meeting and both sessions were one of the main topics which people were talking about yesterday!
There is certainly some concern on whether Berkshire can continue with its success after its founder (now 82) and an implicit question in this regard was dodged by Buffet during his interview with CNBC. He highlighted company’s strong culture and repeated that while no name will been publicly announced, Berkshire’s board are “solidly in agreement” on who would become CEO if he suddenly died or were unable to do the job.
He also mentioned that he doesn’t like owning bonds right now, and he doesn’t think average investors should either. Instead, he advised individual investors to keep enough cash on hand to be comfortable if an unexpected event happens and instead, to put the rest in stocks.
Buffett said on his CNBC interview on Monday that bonds are a “terrible” investment at the moment and that owners of long-term bonds may see big losses when interest rates eventually rise.
The Heinz acquisition was also one of the topics which came up yesterday and the chairman of Berkshire mentioned that he expects Berkshire Hathaway (BRK.A) to own a stake in ketchup-maker H.J. Heinz Co. (HNZ) forever! and he doesn’t see the deal structure as an issue (Note: Berkshire partnered with a Brazilian investment firm named 3G Capital to seal the $23.3 billion deal).
The question rose as some investors recently questioned whether a deal that will give Berkshire a 50 percent stake in Heinz represented a change in Buffett’s investment style.
Before facing questions from his company’s shareholder, the 82 year old got a rock star treatment: Shareholders were snapping photos with their gadgets as they surrounded Buffett, and a team of security guards created a buffer around Buffett as he visited 200,000-square-foot exhibit hall.