Dispatch from Omaha: People may call Warren Buffett an “oracle” but he’s the first person to admit when he gets something wrong.
Every year, the financial world tunes into Omaha to listen to the oracle — Warren Buffett.
The legendary investor hosted his annual Nebraska summit this past weekend and shared his predictions for the future, as well as colorful commentary on world affairs and how they may impact the market. He also discussed the future of his famed investment Berkshire Hathaway.
Berkshire Hathaway earned $16 billion since the last time the crowds met in Omaha in 2016, Fortune reported. His winning investments? Apple, Charter Communications, American Express and Wells Fargo.
Here are highlights from the summit, dubbed the “Woodstock of Capitalism” by the finance press.
Talking Tech: Apple and IBM
In an industry full of big talkers, Buffett is famously modest.
“I make no pretense whatsoever of being on the same level as some 15-year-old (who has) an interest in tech,” he said. “I’ve gained no real knowledge on tech, well, since I was born, actually.”
“It is the nature of market systems to occasionally go haywire in one direction or another.”
Buffett is no stranger to investments in technology. He praised Apple’s continued growth and profits, praising “huge” customer loyalty to the iPhone.
“It’s a very, very, very valuable product to people that build their lives around it,” he told CNBC. “And that’s true of 8-year-olds and 80-year-olds.”
Buffett raised eyebrows when it was announced that he had sold two thirds of his stake of IBM earlier this year.
“It’s harder to predict in my view,” he said. “How much price competition will enter in something like cloud services.”
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Worried about the market going down? Warren Buffett is right there with you. His tried and true plan? Buy good stocks and stick with them.
And most importantly, hold on during turbulent times.
“It is the nature of market systems to occasionally go haywire in one direction or another,” he said. “When the rest of the world is fearful, we know America is going to come out fine.”
Getting it wrong
People may call Buffett an “oracle” but he’s the first person to admit when he gets something wrong. His big miss? Amazon.
“I did not think (Jeff Bezos) could succeed on the scale that he has … I underestimated the brilliance of the execution,” he said. “It always looked expensive … and I never thought he would be where he is today.”
A smart investor knows that no one gets it right every time, even the “oracle.”
A nod to Vanguard
It’s hard to believe there was a time before index funds. Buffett took some time to honor Jack Bogle for making investment cheaper for the masses.
“It was not in the interests of Wall Street to have the development of index funds, because it brought down fees dramatically,” he said.
Good ideas may not always get respect right away, especially when they go against the grain.
“He was the subject of some derision [on Wall Street]. And now we’re talking trillions when we get into index funds,” he said. “Jack… has put tens and tens and tens of billions into [the] pockets [of investors].”
Berkshire after Warren Buffett
In addition to dispensing wisdom and straight-talk, Buffett, now 86, talked about Berkshire Hathaway’s survival in the event that he passes on to the big trading floor in the sky.
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Can Berkshire Hathaway survive without Warren Buffett? His response was a combination of humor and pragmatism.
“If I die tonight, the stock would go up tomorrow,” he said. “There’d be speculation about breakups. Some of the parts might (temporarily) sell for more than the whole.”