NOT AS EASY AS IT SOUNDS: BUFFETT TO FIRST-TIME INVESTORS

Warren Buffett is feeling much better since “the economy went off a cliff ” last March. He admits he might be even happier if he had used that opportunity to invest some of the $145 billion of cash Berkshire Hathaway Inc has been hoarding.

“Looking back, definitely we could’ve done things better,” Buffett said, because many businesses sprang back astonishingly fast. That was thanks to the Federal Reserve’s extraordinary actions early on, which Buffett praised, and the relief checks that went to Americans, he told virtual listeners of his company’s annual shareholder meeting Saturday. Investing is “not as easy at it sounds,” he added, words of caution to the new generation of investors using commission-free apps such as Robinhood that encourage a casinolike trading experience. Buffett, who at 90 is still a voracious reader of companies’ annual reports, is looking forward to reading Robinhood Markets Inc’s document when it files to go public.

Berkshire revealed that it sold stocks again last quarter, bringing the total net value of equities it has dumped since the outset of the Covid-19 pandemic to more than $12 billion. The benchmark S&P 500 index returned about 26 per cent over that span — double what Berkshire shares did. And as Apple Inc gained 80 per cent, becoming a $2 trillion company, Berkshire sold some of its Apple shares. That was a mistake, Buffett said, to which his longtime business partner Charlie Munger resoundingly (if halfjokingly) declared, “Yes!” The two say they’ve never had a fight in their sixty-plus years working together, but in that moment their cute claim seemed slightly less plausible.

Though visibly older, Buffett was much more chipper this year, partly because he was reunited on stage with Munger, 97, who didn’t take part in last year’s virtual meeting because of

Covid travel risks. Alongside them were the two executives seen as the next “Warren and Charlie”: Greg Abel, who oversees everything noninsurance at Berkshire, and Ajit Jain, who Buffett called a “symphony conductor” of the insurance operations. Their presence seemed to set up the formal succession announcement shareholders have long dreaded and long expected; however, it didn’t come.

Buffett may not be ready to step aside just yet, but the billionaire also isn’t ready to jump back into the dealmaking game — SPACS have ruined it for him. These controversial investing machines, driven by a mandate to make splashy acquisitions in a hurry, could easily outbid a bargain-seeking Buffett. “It’s a killer,” he said.

“When the competition is playing with other people’s money, they’re going to beat us. That’s a different game.”

“Godawful” is the adjective Munger used for SPACS, though that may be a step up from calling them “s—t” earlier this year. Other choice words he sprinkled throughout the event were “deeply wrong,” “immoral” and “disgusting” — whether in regard to SPACS, Robinhood or Bitcoin. What’s strange is that when it comes to climate change, diversity and Big Tech’s monopoly power, Buffett and Munger’s attitude is that they almost don’t see what the big deal is. It’s what makes the nonagenarians seem out of touch with the issues important to millennials and today’s youth — something that may be of greater consequence than just favouring value stocks over growth.