Warren Buffett’s Shareholder Letter Highlights: Dead Birds, Nudist Camps, Venereal Disease
Warren Buffett, after rather rashly announcing his imperviousness to financial meltdown back in October, has seen his fortunes dive, and now he’s had to admit that his Berkshire Hathaway investment vehicle had its worst year ever last year. He did so in his annual letter to shareholders, and it’s a cracker.
Buffett unleashes some weapons-grade craziness throughout. “By yearend, investors of all stripes were bloodied and confused, much as if they were small birds that had strayed into a badminton game”, he notes at the outset. Continuing the bonkers similies, he doesn’t seem too enamoured with the US Treasury – “Economic medicine that was previously meted out by the cupful has recently been dispensed by the barrel. These once-unthinkable dosages will almost certainly bring on unwelcome aftereffects” – but is looking forward to new clients at car insurers GEICO: “As we view GEICO’s current opportunities, Tony and I feel like two hungry mosquitoes in a nudist camp.” Perhaps best of all is his warning over the dangers of derivatives dealing: “Participants seeking to dodge troubles face the same problem as someone seeking to avoid venereal disease: It’s not just whom you sleep with, but also whom they are sleeping with.”
He repents for his sins in betting on ConocoPhillips when energy prices were at their peak, but he shrugs all this off, talking up Berkshire’s “Gibralter-like position” and saying “America’s best days lie ahead”. He spends a lot of time verbally fellating his various managerial teams, getting especially loved-up at the mention of his insurance managers: “Why do I love them? Let me count the ways.”
Buffett’s tendency towards gnomic burbling also gets an airing, coining these humdingers: “When investing, pessimism is your friend, euphoria the enemy”; “Our advice: Beware of geeks bearing formulas”; “Beware the investment activity that produces applause; the great moves are usually greeted by yawns”. You can almost hear the sound of chisel on stone as Buffett’s disciples note down this “wisdom”.
He also references Mae West, Jimmy Stewart and Gone With The Wind – I love how you can picture him relaxing in his Omaha homestead, mixing a Snowball and slipping on the Andrews Sisters, before a conference call in the morning explaining what the internet is.
And he finishes up by promoting his “Woodstock for capitalists”, the Berkshire AGM. The whole thing sounds like a creepy Buffett theme park, where you can gorge yourself on Buffett-condoned products, like the “i-house”, Ginsu knives and NetJets planes, and you get a little insight into the fervency of Buffet’s followers when he describes the procedures for his Q&A session: “There has been a mad rush when the doors open at 7 a.m., led by people who wish to be first in line at the 12 microphones available for questioners. This is not desirable from a safety standpoint”.
He even keeps the entertainment old-school, with a blindfolded chess player, classic cars and, of course, a magician. But he hasn’t forget something for the thrusting young bucks: “The future will be represented by a new plug-in electric car developed by BYD, an amazing Chinese company in which we have a 10% interest”. Buffett’s representative of the future is something that represented the future back in the mid-90s, and yet he’s worth $62bn. Go figure.
Posted by Ben Beaumont-Thomas in Hot Money | March 2, 2009 11:37AM |