YouSaid · the spoken record

Yun Li

lines on the record: 47
first: 2023-03-04
most recent: 2023-03-04
sittings or episodes: 1
sources: podcast

Every line below is reproduced as it was said and linked to the record it came from. Nothing here is summarised or generated. Directory · Search · Corrections

“Happy to do it again, and I really enjoyed the conversation. And yeah, hope to join you guys again. Thanks for having me.”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“Yeah. And Berkshire Hathaway itself, there are class A shares. They don't do stock splits, right? So if you look at the stock price, it's like almost half a million dollars. And I think Buffett said in the past that people can use Berkshire shares as a savings account. You just buy and hold for your lifetime and your money, what you put into it will compound. It will make you money. And I think that's also why it comes back to the buyback issue because he believes that his shareholders are long-term shareholders and they're not going to sell after stocks. And so I think that kind of speaks to the buyback thing too.”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“I think a lot of Warren Buffett's a lot of those returns are just from not selling. I'm sure there are people who bought Apple in 1995 and made 200% of it and were like, wow, I'm such a good investor, you know, but literally they know they could have made so much more if they just held. And I think to have that confidence to hold, you do have to really understand that. Yeah.”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“Good lesson. Yeah. And then he, I think when he buys something, he has to understand the whole industry. He has to understand the whole ecosystem and how the competition will shake out in the next decade or 20 years, you know. And I think when he said he made a mistake not buying Google, he didn't really understand how of a monopoly it would be, how, oh, he even said that he wasn't sure that if the search engine will have more competition. And right now it's a really popular issue, right? With different types of search engines coming up. And I thought that was interesting that he thought many, many years ago, you know, I don't know this Google thing. If Bing would take off, if other things would take off.”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“And Apple bought back its own shares, and then Berkshire bought it bought back its own shares. So you get the double compounding effect. Yeah, that's one lesson I learned from Warren Buffett is. When he says, Oh, I don't understand Google. He's read the annual report from Google 10 times. Like, he understands it better than most people, probably, you know, most people who own the stock of Google, but he just has such a high standard for understanding that you should have excess humility. And just because you can talk about it doesn't mean that you actually understand it. And that's a good lesson.”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“Increased your exposure to the technology and take advantage of the growth, especially the last bull market. It really only benefited growth stocks, right? The fang type of things, the fang stocks combined, they took over 20% of the stock market. And even though Warren Buffett got into Apple kind of late, but he still made so much money out of that single stock.”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“So, one of the investing managers bought Amazon a couple years ago. People were like, people were shocked. Oh my God, you're a value guy, you're buying Amazon. And who would have thought today 40% of his portfolio is Apple, right? And so at that time, he said, oh, I really missed out on Google. That was one of the biggest mistakes that he made just because they had some insight into Google because how much advertising money Geiger was paying. He was like, we had this insight, but we didn't really see the potential there. So he and Charlie Munger repeatedly have said that they've missed out on a lot of technology companies, that they really didn't really understand, but with the help of the younger guys, younger managers, they were able to”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“And Buffett, he sometimes he would admit that he's made mistakes in the past, right? And he said when he bought precision car parts, he said that was a big mistake. what he paid for Allegheny. And he said he overpaid that right. And then also famously when Berkshire”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“Noah was one of my not too many takeaways here, but I did love the section where he kind of reminisced about buying Berkshire Hathaway. And, you know, one of my favorite stories about just Berkshire and Buffett in general is that Buffett calls buying Berkshire Hathaway the dumbest stock or the biggest mistake that he ever made and has actually estimated that that purchase cost him about $200 billion in terms of Opportunity cost, which is just a funny little. Obviously, I think that's a little bit lighthearted, but it's just a funny, you know, kind of look at history.”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“Like craft times, Coca-Cola, that type of stuff. So, yeah, that's interesting. Hershey is one. And then, you know, him buying Occidental all right is not off the table. He can still do that. And he has been acquiring more and more. Now it's more than 20% of the company. And so there's another interesting fact. So if he does take over Occidental, he would have come full circle because the first stock he ever bought was cities service, preferred stock at the age of eleven. And 40 years later, city service was acquired by Occidental. And Occidentals now CEO Vicki Hollab used to work at City service, so it would have been crazy if that happened. Yeah.”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“So, yeah, there were always rumors about Warren Buffett's next deal, right? And I'm not sure if you know that there were some companies that track plane activities. So they would track which company executives they fly into Omaha. What does that mean? And I think two years ago or last year, they saw Hershey's jet landing in Omaha. I'm sure it is all speculation. It is all rumors, but I just thought that was interesting. And Hershey, you know, when you think about it, it makes sense, right? You know, Buffet, he likes a big consumer, well-known brand kind of like cam.”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“My final question for you about Berkshire is so no one knows what the big whopper is going to be or if the big, if there is going to be no big whopper, only really Warren Buffett, Charlie Munger. But I'm sure there might be rumors of what could be this. It could be that. What are the sort of whisperings about what the prize that Warren Buffett might be eyeing for the next big acquisition?”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“Will be finding a replacement for him because of the big responsibility he has across Berkshire's different aspects. So people are wondering if they are going to find a replacement CEO for Geico soon. So that's a question that I'm sure will come up during the annual meeting.”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“It's a really good question. Geico has been really underperforming, especially compared to progressive. Like you said, they are late. They didn't really do the telematics. I don't really understand what it is either, but I know they've been posting a full year of underwriting losses. And Buffet said in the letter this year, they're expecting a profit in the full year of 2023. So there might be a turnaround going forward. And another thing to note is that Geigo CEO is Ted Combs, who's also one of Buffett's investing lieutenants. So he not only runs Geigo, he also manages a portion of Berkshire's equity portfolio. And when he took the CEO position, Berkshire, he signaled that it would be a temporary position.”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“Thanks. Yeah, just on the car insurance front, I know that there was a time Geico made a lot of money from the float and that was a source of negative capital really. Can get capital at negative rates. But they might have lost a little bit of money, might not have done as well as folks like progressive because they use things like telematics, which I don't really understand, but it's technology to see, oh, this person is going too hard on the gas pedal. So we're going to increase their rates. And they were late to that. Do you have a sense of their plan to get back into the business? And Ajit Jane, who runs the insurance operations, remarkable track record. But is he up to date on telematics, which is kind of like a newer thing? He's closer in age to, you know, demographics.”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“Pay such high interest when it comes to making deals. Yeah, and also Berkshire has a myriad of different businesses from more capital intensive ones like railroads, energy to retailers and insurance companies. And then they employ so much employees, wage inflation, as we know, is very sticky right now. And inflation is taking a toll on Berkshire Hathaway's different operating businesses. And I think, but operating businesses, last quarter, it fell a little bit 8% compared to a year ago because of the hit it took from inflation and higher interest rates.”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“They are making very substantial return just by investing in risk free short term treasuries, right? Billions of dollars. And also there's another aspect which is that higher interest rates give Berkshire an advantage when it comes to deal making. Buffett and Berkshire, they didn't pull the trigger for the longest time there because the competition was getting really tough. They were competing with spags. They were competing with private equity. And because those people, they are borrowing money for free, interest rates were zero. And now interest rates are much higher. And Berkshire Hathaway have so much cash that they can tap into so much liquidity. They can, you know, it really gives them. When they go to negotiate for deals because his competition, private equities and others, they might have a hard time because they need to”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“It's kind of a combination, and that's something that people really wanted to hear him talk about inflation, not inflation interest rates, but he didn't. But I'm sure he will during the annual meeting. But interest rates are very important to investing, to asset prices. I think he said very famously a couple years ago, he said interest rates to asset prices is like gravity to the apple, right? Gravity to the matter. So there's really this gravitational pull on asset prices when interest rates are higher. And now, so two things. Interest rates, as you said, short-term treasury yields, some of them are yielding 5% right now, and Berkshire Hathaway having so much cash, I think, about $130 billion at the end of last year. And the majority of it investing in treasury bills.”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“I've got a question, which is people have characterizations about what level of interest rates and what direction they're going in are good for some companies. So a growth, an unprofitable technology stock rising interest rates are really bad for them. But a bank, they're really good for them. What is your sense of how rising interest rates affects Berkshire Hathaway? Because their insurance business takes in a ton of cash and they have hundreds of billions of dollars in treasury bills, which two years ago yielded nothing. And now yield close to five percent. Is that a good thing for Berkshire, a bad thing for Berkshire?”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, he generally doesn't like to comment directly on political issues, but the letters, especially during annual meetings, but the letters, it is a way for him to say things in his own way, to control the narrative, so to speak. And I think, as you said, he addressed the letter sort of to his business owners and shareholders, but he also include some political issues, some issues that have been politicized, like taxes and buybacks. So he's definitely talking to his critics, the naysayers, right? Not only to his admirers around the world. And yeah, so he, I'm trying to think what else, what other political issues he kind of addressed in the letter. Nothing really came to mind. Buybacks is the biggest hoppen issue there that he really addressed this time. We were all very surprised by the language he used.”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“I know this is kind of a broad question, but what's your kind of take having read a lot of these letters? Like, who is Buffett really talking to with his audience? Like, what is the point of him kind of opining on taxes and buybacks and all that stuff? Who is he trying to reach with that message?”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, absolutely. I think he started off this shareholder letter sort of thanking his sort of LPs in a sense for Bertrand Hathaway, the people whose money he is managing on behalf of. And that is who he says he has in mind when he's writing this letter. However, when you kind of look at his thoughts on stock buybacks, right, in that particular barb, a silver-tongued demagogue, you know, there's a very limited number of people that that could potentially refer to. And I look at his description of taxes, you know, a part of me thinks, hey, this is actually a very savvy guy. And he understands that it's a much broader base of readers than just the shareholders of Berkshire Hathaway.”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“And especially last year. And then that's a message he's been conveying to shareholders years after years, right? Bet on America, never bet against it, even during the pandemic at the height of COVID, his really key message to investors was that never bet against America because the country always prevails. We've been through wars, we've been through natural disasters, political chaos, we always prevail. We always thrive. And I think that portion of the letter is, that's my takeaway from that portion of the letter. Just he wants to say that I'm happy to pay my taxes. I'm betting on America. I'm benefiting from America, from capitalism. And that's what I have to say about taxes. I think that's, yeah, that's my takeaway.”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“Think taxes in general is a hot button issue for billionaires like Warren Buffett, right? And then so I think he wanted to address some of it. And I think the main takeaway I got from that section of the letter is that he said how he's happy. He's glad to pay taxes because Berkshire has benefited from the American tailwind as he put it. And he that's kind of him reaffirming that he is still a believer in the country.”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“Taxes. So he starts off this is the quote from the letter during the decade ending in 2021, the United States Treasury received about $32.3 trillion in taxes while it spent $43.9 trillion. So that's about a $10 trillion deficit or so over the last decade. I'm curious, like, what did you kind of take away? Is that a, you know, sort of a typical digression for Buffett? What do you think he really meant by this kind of passage? And, you know, how do you interpret him including that statistic in this letter?”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“Here, I think based in Seattle. And they've been very good friends over the years. And Lilu is the only person who's managed Charlie Munger's personal wealth other than himself. And then he introduced him to Alibaba, to Pindodu other Chinese stocks. And then, and BYD has done exceptionally well over the years. And I think Berkshire Steak has gone up by like 600% something crazy. And Berkshire, this last year has been trimming that steak, kind of ringing the bell on the bed a little bit, taking some profit. But I wouldn't be surprised if he bought more Chinese stocks or international stocks in general.”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, I think over the years, recent years, his appetite for international stocks has gone up, has gone bigger. You know, he bought into five Japanese trading companies either last year or the year before. I don't really remember, but it was a really big stake. And combined, they were among the top 10 holdings of Berkshire. And he revealed last year they bought a couple German companies. We still don't know what they are, but he said they bought some German securities too. And Berkshire was an early investor in BYD, the Chinese electric vehicle company. And Charlie Munger bought BYD because under the influence of his friend Li Liu, who is a manager.”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“And is there any whisperings of Yeah, so in Chinese equities have been from where they were a year or two ago, very depressed. And they're valuation people Might they be interested in getting into China? And if not, what does that say?”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“A big stake the stock took off, right? It went up by a lot of at least 10% in the fourth quarter. And maybe he thought, you know, we've got enough profit to take here. And of course, it went on to rally a lot more this year, which he kind of missed out on the biggest rebound there. But that's another story. So that's some of the reasons that I can think of him selling that steak.”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“The short run selling out of Taiwan Semiconductor. And as you mentioned, there's also political tension between China and Taiwan. I don't want to speculate there. Him buying such a big stake in Taiwan Semi was a vote of confidence back then in the third quarter. That's what people were saying. They were like, oh my God. Warren Buffett, he probably him and Charlie Munger, they have been bullish on China for the longest time. And people are saying he's not worried about any political tension buying such a stock. And now he sold it so quickly. I don't know what's going on there, if anything changes on the political front. But and also Taiwan semi after he bought the stock, after, you know, it was revealed that he took such a”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“What they were thinking about this sector, and he specifically said that it's really hard to time this sector to buy something because of the cyclical nature of the semiconductor industry. It ebbs and flows so much and it kind of moves in tandem with the economy because it's very cyclical. maybe they think the cycle is ending and they're a little bit negative of what's ahead in terms of the economy, in terms of the sector. Obviously, Buffett didn't really comment on any specific stock really in the letter. And I'm sure the question will come up in the annual meeting. But I wonder if that's kind of a signal of how slightly negative he is about the economy.”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, it's very rare. You know, he said, you know, Charlie, and we are not stock pickers. We are business pickers. They pick longer-term quality business and investing something for the long haul. It is very rare. Taiwan sent me the steak being in the billion dollar range. It's probably not from his investing managers, Ted Weschler and Todd Combs. It's probably Warren Buffett's buying. And I spoke to some of my sources. And something worth noting is that Charlie Munger did his annual meeting with Daily Journal a couple weeks ago. I don't know if you guys listened. There was a question about semiconductor and Taiwan semi specifically. And that gave me a little bit insight into.”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“Do you have a sense of why he got out of Taiwan Semi? As you said, very rare for Buffett to get in and get out of things. He is the ultimate buy and hold, the ideal duration for holding a stock is forever. I think he said exactly that. So for average trader, oh, I got into this stock. I got out of that stock, that's somewhat common. Buffett is not about that at all. He's a long-term investor. So for him to sort of buy it this Taiwan semiconductor and then flip it the next quarter, it says something. Is he maybe worried about U.S.-China relations, the Chips Act?”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“Fourth quarter, which is very rare for this, you know, he's the biggest buy and hold guy, right? So it's rare to see him get in and out of the position such sizable position that quickly. So he is actively trading, actively looking for bargains. So, I that's my suspicion right there”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“Below his average purchasing price. And, you know, he was really spot on. So the two biggest stock picks last year, Occidental and Chevron, two energy stocks. And guess what? Energy sector was the best winning, the biggest winner last year. Occidental was the biggest gainer in the S&P 500, right? And then, and now we're seeing this reset, this little correction this year, so he might get more shares in the energy sector, which is a very traditional value sector. And he's doing a lot of stuff. I mean, last quarter, he sold a significant portion of Taiwan semiconductor. I don't know if that stock is on your radar. He bought $4 billion of Taiwan semi in the third quarter, but sold most of it in the”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“I think he is haunting some targets right now, especially after this big sell-off we've seen last year and price asset prices have come down a lot, right? And then he's been touting this elephant-sized target for years. And people wonder, you know, if Allegheny was that elephant-sized deal? Probably not. Only $11 billion, right? And then he also, one of the biggest moves he did last year was buying a lot of occidental petroleum shares. He even got approval to purchase half of the oil company, right? And Berkshire stake is above 21% now. And I've talked to many people who think he is probably going to buy more occidental shares. And especially now the stock is”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“And what do you think his appetite is for acquisitions? He notably was somewhat on the sidelines during 2020 and that annual meaning of 2020 really was quite stark when he was announcing, you know, I don't know if the airlines can make it. And he sold all of his airlines at low prices. Then in 2021, there was a moment during, not during the letter, but during the annual meeting where he said, you know, we're actually finding, our companies can pass along prices. We're being charged more. And then we're charging more. And that was important sign for the global economy. What do you think Buffford has cooking right now? What is he thinking? Is he as worried about potential recession as many, some folks are? Or does he not think the way he's just focusing on finding the best quality distances? Is he seeing bargains? What do you think he's seeing? If the letter was completely unaudited and it was just his...”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“A reasonable multiple sometimes I think typically 11 times and then you get the intrinsic value. If it's trading 20% or more into that value intrinsic value, he tends to buy back shares. So he really thinks”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“Right, right. If an executive, if they buy back shares and you see executives immediately selling some of their stocks, that's not good, right? And we know Buffett is never going to sell any of his Berkshire steak. And also Buffett, he has his own calculation, his own formula when it comes to buying back Berkshire shares. So he only buys back, he said, what it makes sense, but he only buys back when Berkshire shares are trading 20% to its intrinsic value, right? And then he has his own calculation of intrinsic value, which is, you know, his investment plus cash plus the value of his different businesses. He has insurance companies, energy companies, railroads, retailers, all of that. You add that up. And then you apply.”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“Are keeping the stock price high so they themselves can sell or offsetting the effect of employee share-based compensation where a company is giving away like half a billion dollars in its shares and then it's buying them back. But it's not reducing the share count. The share count is remaining flat.”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, usually just for our audience. So when a company makes money, there are two ways it can return capital shareholders one is via dividends and the other is buybacks when they buy back their own share, reducing the number of shares. So you're absolutely right that the stock price tends to go up. There's upward pressure on the stock. However, I think Warren Buffett, he focuses much more on the, you know, he's all about businesses, not stocks. He's about the fundamental earning power. There are fewer shares. So the earnings per share goes up. So he's a defendant of the practice of buybacks, which he thinks is legitimate and can be good in some instances. However, tell us about the circumstances where Warren Buffett might think buybacks are bad. And I'll throw two hypotheticals at you. One is when a company buys back its own stock that is actually not undervalued but overvalued. And the other is one in which corporate executives”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, for Charlie Munger, Warren Buffett's partner, that type of language would be part for the course. But for Warren Buffett, that was definitely some very fiery language right there with Silver Top.”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“Back shares, you're essentially lowering the number of outstanding shares, right? Your share account goes down, so your stock price automatically gets a boost. And that might not be sustainable if you stop doing that, right? And then obviously Buffett disagrees with that. He thinks buybacks are beneficial to all shareholders because he said the math is simple. You know, share accounts goes down and then your interest in all different kinds of Berkshire businesses goes up. So it's beneficial to shareholders. So I thought the buybacks discussion was something that really jumped out to me.”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“Buffet found external opportunities in the market. He also did a big deal. He bought insurance company Allegheny for more than $11 billion. So he found other ways to deploy his mountain of cash. So he bought back way fewer shares. And buybacks have been under fire recently, especially among politicians. You know, it's kind of politicized. You know, critics, they think buying back shares, you know, companies, they think companies have better ways to use their cash for the long-term growth for the company, for example. You can use cash for to improve employee benefits for CapEx, upgrading your factories, your equipment, you know. And those are better for long-term growth as opposed to you.”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“As you said, I'm sure you read this wonderful quote in the letter, and I'm going to read it to you right now. So he goes, when you're told that all repurchases are harmful to shareholders or to the country or particularly beneficial to CEOs, you're listening to either an economic illiterate or a silver-tongued demagogue, characters that are not mutually exclusive. So really slamming the critics their very interesting language. So why is he defending buybacks right now? Berkshire in 2022, it was a record year of buybacks for Berkshire. They repurchased twenty-seven billion dollars in Berkshire shares. And then last year, 2022, it was much lower about $8 billion.”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“And Buffet, you know, he doesn't really like to talk about things that people want him to. And the message is kind of in the things that he doesn't address that he omits, which is interesting. But there are still some takeaways from this year's letter. And I think the biggest headlines, one of the biggest headlines we got this year was how he really defended stock buybacks and pushing back on critics.”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, the annual letter, it's been a tradition for six decades and always interesting, always very highly anticipated every year. And me as a reporter, it's always exciting, you know. You log on, you download the letter at AAM Sharp. Sometimes the website will crash. And then you finally get it and then you read it quickly from top to bottom. And sometimes I read it from bottom up just to see if there's any big news in terms of succession or retirement. Obviously not this time. And so it's very exciting always nice to hear what his takes are on market and on the economy. I do have to know though the letters have been getting shorter and shorter over the years. I've heard people say, you know, there's some disappointment and it's not as informational as they were before.”
2023-03-04 · Forward Guidance · Breaking Down Warren Buffett's 2023 Shareholder Letter | Yun Li · IDENTIFIED FROM THE TRANSCRIPT