Introduction
Hello everyone, welcome to the C&K GO channel. This day, although we knew it would happen sooner or later, many people, like CK and me, didn't expect that Warren Buffett would announce at the 60th annual shareholders' meeting that Greg Abel would become the CEO at the end of this year. Even other board members except his children heard about it for the first time, and Greg Abel himself was also informed on the spot.
Post-retirement Arrangements of Warren Buffett
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Position Changes: After stepping down as CEO, Buffett will continue to serve as the chairman of Berkshire Hathaway until his son takes over.
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Office Routine: Buffett will still go to the office every day. Becky Quick, the host, asked Buffett and Greg Abel backstage. Greg Abel was surprised as he had no prior knowledge. Becky also asked if Greg's office would move. Greg said the office would always be in Omaha.
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Significance for Shareholders: For Berkshire Hathaway shareholders, the important news is that Buffett will still help find acquisition targets when there are market opportunities and will not sell a single share of his holdings, which is a temporary boost to the stock price.
Greg Abel's Ability and Challenges
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Abilities: Greg Abel, as the leader behind Berkshire's investment in Japan's five major corporations, has undoubted abilities. Buffett may value his in-depth understanding of Berkshire's complex industries.
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Challenges: The market is concerned about whether Greg Abel can have the ability to invest a large amount of funds in the future. This question was also asked at the shareholders' meeting. Greg Abel said that Berkshire has a good corporate culture and correct values. They will maintain Berkshire's reputation, regard cash as a strategic asset, and never rely on external institutions.
Different Views on Success
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Greg Abel's View: A girl asked Greg Abel how to be rich enough to own Berkshire's shares and what he values when recruiting people. Greg Abel emphasized the importance of hard work.
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Buffett's View: Buffett believes that maintaining curiosity and reading a lot are important. For him and Charlie Munger, investing is a fun game. Naval once said to do things that are like playing for you but work for others.
Tim Cook and Apple
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Buffett's Praise: Buffett highly recognized Tim Cook at the beginning of the meeting, which may be related to Berkshire's recent reduction in Apple's holdings and realization of a large amount of value-added profits. Buffett also mentioned that he listened to Apple's recent quarterly financial report, which is the only investment quarterly financial report he listened to.
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Concerns about Apple: CK believes that this may represent Buffett's concern about the remaining positions, especially in the current tariff situation. Tim Cook expects Apple's quarterly total revenue to grow by a low to mid-single-digit percentage, which is a relatively low growth rate. Whether Buffett's next move will be to continue to reduce his holdings remains to be seen.
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Views on Share Repurchase: Buffett mentioned that one of the reasons he did not make any share repurchases this year is the 1% share repurchase tax implemented in 2023. He also indirectly expressed his dissatisfaction with Apple's large-scale share repurchase and is now more inclined to dividend distribution or other investments.
Berkshire's Cash Holdings
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Not for Greg Abel: Buffett was asked whether the large amount of cash holdings was to give Greg Abel the maximum capital flexibility after his retirement. Buffett said he would not do anything noble for Greg Abel.
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Waiting for Investment Opportunities: Buffett believes that the recent stock market turmoil is nothing. He is still waiting for an investment opportunity that allows him to invest a large amount of funds.
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Cash Allocation: Buffett also answered the question of how much of the cash is used as insurance company reserves and how much can be used for investment. He said that they can spend up to 100 billion dollars on investment if there is a good opportunity.
Impact of Buffett's Retirement
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Stock Price Reaction: Berkshire's stock price has fallen by nearly 5% since the shareholders' meeting, indicating that Buffett's retirement still has a certain impact.
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Hope for the Future: CK hopes that after stepping down as CEO, Buffett will still sit next to Greg Abel and continue to attend shareholders' meetings to give more investment and life advice.
Conclusion
That's all for today's video. I hope it will be helpful to everyone. If you like this video, remember to subscribe and like it. I'm CK, and we'll see you next time!
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