The weekend of April 30, 2011 was an exciting one! I spent the weekend in Omaha, Nebraska at the Berkshire Hathaway Annual Shareholder meeting with Warren Buffett himself! Here are some of my favorite and biggest takeaways from the event.
To top off Berkshire Hathaway week at Narrow Bridge, I want to talk about the inspiration and enthusiasm from participating in the “Woodstock for Capitalists” in Omaha. Now that we have discussed dividends, leadership, and environmental policies, it is time to focus on something a bit more fun.
Sitting in the room with Warren Buffet, Bill Gates, Charlie Munger, the entire Berkshire board of directors, and countless millionaires, I turned to my friend and asked, “Do you think there is a higher net worth in this room than anywhere else on the planet right now?”
I have put a ton of time into my financial education. I have spent countless hours studying and analyzing investment opportunities, stocks, bonds, returns, interest rates, investor psychology, and a plethora of other finance concepts.
Going to the Berkshire meeting is evidence that what I am doing can work quite well. If you work hard, make smart investments, and stick to your principles, you can get rich. It really does work.
We took a couple of hours to head out to the Omaha airport to tour the NetJets exhibit. When I get so ridiculously rich that money is not an object, there will be only one way to travel.
We can all dream of great things, but only some of us will actually get there. I intend to be one of those people.
The difference between the perpetual dreamers and those that reach their goals is planning and action. I know some people with a great retirement plan: “win the lotto.” My retirement plan is to work hard and aggressively save so I can retire early.
Some people wait around for their million dollar idea. I have tried a few. One in ten entrepreneurs succeeds, so as far as I am concerned it is a numbers game. Take action and keep trying, while learning from your past, and you can do anything.
I saw a $7.5 million ring at Borsheim’s. I plan to never spend to that level of excess, but it would be great to have the ability to buy that for future Mrs. Eric. I saw a long line of private jets at the airport terminal. I want to be able to do that someday (sooner than the $7.5 million ring.)
I want to be able to live my dreams, and the Berkshire weekend is proof that I can do it. I will. Just keep watching.
Photo by Afrika Expeditionary Force.
Yesterday we talked about Berkshire Hathaway’s dividend policy, which is a forward looking discussion of Berkshire’s ability to generate a strong return. None of that will be possible, however, unless Berkshire Hathaway has strong leaders.
Berkshire Hathaway was built almost single handedly by Warren Buffet starting in the 1960s. When he returned to Omaha from school in New York, he managed the investments of his friends and family and used the capital dollars to build the company we have all come to know today.
Over time, his company grew and he added other staff, most notably Charlie Munger. The company now employs about twenty people in its main office on Farnahm Street in Omaha, Nebraska.
Warren Buffet is 80 years old. Charlie Munger is 87. These two brilliant men have led Berkshire Hathaway’s investment and acquisition portfolio to create unrivaled returns and value for long time investors.
They are old. They will not live forever.
It was long presumed that the next CEO of Berkshire Hathaway would be David Sokol, a Berkshire Hathaway manager that joined during the MidAmerican Energy Holdings acquisition. He was then put in charge of the turnaround of NetJets, another Berkshire company.
Sokol’s name hit the headlines in March, 2011 for his involvement in what appears to be an insider trade involving the acquisition of Lubrizol. He has since resigned from his position at Berkshire Hathaway and is under investigation by the SEC.
Warren Buffet is the Chairman and CEO of Berkshire, but those are big shoes to fill. At the annual meeting on Saturday, Buffet announced that the roles of Chairman and CEO would be split.
The next Chairman of Berkshire Hathaway will be Howard Buffet, Warren’s oldest son. Howard has been involved in the business for some time and is currently a Director for Berkshire Hathaway and Coca Cola. His past business experience and lifetime dedication to the company make him a prime candidate to succeed his father as Chairman. However, he does not have the operational knowledge and experience, in my opinion, to take over the CEO role as well. Warren agrees.
No one knows who will be next in line to helm one of the largest companies in the world. I imagine the current CEO of BNSF Railway, Matthew Rose, has a good shot. It is hard to know for sure today, which does leave some room for speculation.
Who do you think is next in line at Berkshire to be the CEO? Do you think Howard Buffet is a good choice for Chairman? Please share your thoughts in the comments.
Disclosure: I own shares of Berkshire Hathaway in my active and retirement portfolios.