The Responsible Investor
Berkshire Hathaway Annual Meeting
I had the pleasure of attending this year’s Berkshire Hathaway Annual Meeting in Omaha during the first weekend in May. Dave Bromelkamp invited his older brother Mike, Saul Baumann, and me to join him on the trip to eastern Nebraska.
The Annual Meeting (which most people call a "festival") is unlike any other event I've attended. This mid-sized Midwestern city becomes a destination for investors worldwide, and the entire town focuses on the Annual Meeting. Every local I encountered on Thursday, from my Uber driver to the restaurant employees to the hotel front desk staff, asked if I was in town for "Berkshire Weekend." It's easy to see the locals' pride in Warren Buffett, Charlie Munger, and the Berkshire Hathaway company.
On Friday, the day before the Annual Meeting, Berkshire Hathaway hosts their subsidiary companies in a huge ballroom where attendees can shop and learn more about their products. The best way I could describe the atmosphere in the convention center that day was a combination of the Minnesota State Fair and the Mall of America. There were thousands of people milling about, trying to take advantage of the sweet deals, catching a glimpse of a celebrity, or finding one of the dozens of CNBC cameras to achieve their 15 minutes of fame. The biggest celebrity we saw during the weekend was Bill Murray leaving the meeting Saturday. Many attendees weren't even shareholders but Nebraskans who bought tickets to gain access to the shopping deals being offered. My favorite booths in the convention center were Dairy Queen offering $1 dilly bars (D.Q. is a Berkshire Hathaway company), and the bookstore. The bookstore had 20 books for sale that were some of Warren and Charlie's favorites. They also had various authors there signing books for the attendees.
Dave had attended an Annual Meeting in years past, and I remember the first thing he told us was that the Annual Meeting is like a high-level MBA course covered in the span of eight hours. He was not wrong. On Saturday morning, we got into a line with thousands of other people at 6:00 am with our coffee in hand to wait until the doors opened at 7:30. There were multiple people near us in line who had attended 10+ Annual Meetings. They said this year's event was the biggest crowd they've ever seen. Warren Buffett and his long-time business partner Charlie Munger are 92 and 99, respectively. There's good reason to believe that they only have a few more of these meetings left in their lifetimes.
The two business titans humored and entertained the audience for a full eight hours, which is remarkable given their advanced ages. They touched on some of Berkshire's lines of business, spending a lot of time discussing Berkshire Hathaway Energy — a utility company. They are investing heavily in renewable energy, specifically in wind power. It was interesting to hear their perspective and talk about the challenges of sustainable energy. They said it's difficult to navigate the local rules and regulations when adding wind farms because every state and county is different. They said that the adoption of wind energy is very regional, noting that in Iowa, citizens seem more open to adding wind farms than citizens in Nebraska. One of the biggest challenges remains to figure out how to move energy once wind farms or solar panels create it. They both agreed that sustainable energy is a huge opportunity; they are investing more in this type of energy generation than any other utility company.
Another thing that struck me during the meeting was the contrasting viewpoints between the two business partners. On almost every subject — the U.S. national debt, artificial intelligence, the future of America, etc. — Warren was noticeably more optimistic than Charlie was. Even with all the turmoil in the world, if he could be born in any country and at any point in history, Warren said he would undoubtedly choose to be born in America today. On the other hand, Charlie gave noticeably brief responses to most of the questions. When asked how to live a happy and successful life, Charlie's answer was short and to the point — "Expect less moving forward into the future."
What resonated with me most was what great planners Warren and Charlie have been throughout their careers. They have amassed significant wealth and fame by meticulously planning their every move in their personal and business lives. A big topic of discussion was their own business succession and estate planning. Warren noted that he only updates his estate plan with input from all his kids. He wants everyone to be on the same page regarding his wishes when he does pass away. He has been planning for his eventual death for the past 20+ years and has managed to avoid significant family conflicts. Planning is an important role that a financial advisor plays in the lives of their clients as well. Financial advisors aim to help their clients plan for their future so they can live a meaningful and fulfilling retirement—preferably without any major family conflicts.
I am wrapping up the blog post with two of the best quotes these two icons shared. When offering advice on how to live a successful life, Warren said, "You should write your obituary and then try to figure out how to live up to it." Charlie's advice was simple, "Avoid toxic people and toxic activities. Get them out of your life as fast as you possibly can."
Learn more about Derek Van Calligan
Hello! I’m Derek, a wealth advisor and director of investment research at Allodium Investment Consultants, located in Minneapolis, MN. I am passionate about helping individuals and families build holistic financial plans to help them reach their goals. When I’m not helping our clients make investment decisions, I enjoy spending time in the mountains in Colorado—skiing, fishing and hunting with my wife, Kelly, and my dog, Hank. I am also an active church member and volunteer at Big Brothers Big Sisters and Junior Achievement.
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