1997 Berkshire Hathaway Annual Meeting (Full Version) | Summary and Q&A

Summary

Warren Buffett and Charlie Munger conduct a meeting for Berkshire Hathaway shareholders. They discuss various topics, including stock market risk, the future growth of Berkshire Hathaway, and their investment strategies.

Questions & Answers

Q: How will the meeting be conducted?

The meeting will be conducted with a script written by the speechwriter for Saddam Hussein. It will be followed by a Q&A session where Buffett and Munger will answer shareholder questions.

Q: How many microphones are there for the Q&A session?

There are 12 microphones placed around the meeting venue for shareholders to ask their questions.

Q: How will the questions be organized?

Shareholders should go to the microphone nearest to them, and someone will arrange the questions in the order they were asked. Questions from shareholders outside of North America will be given priority in the afternoon session.

Q: Are there any shareholders present from outside of North America?

Yes, there are shareholders from South Africa, Australia, Brazil, England, France, Germany, Greece, Hong Kong, Ireland, Iceland, Israel, Saipan, New Zealand, Saudi Arabia, Singapore, Sweden, and Switzerland.

Q: How many shareholders from Nebraska are present this year?

There are an increased percentage of shareholders from Nebraska this year. However, it is important to verify their claims with a driver's license due to some people falsely claiming to be from Nebraska.

Q: Who are the directors of Berkshire Hathaway?

Warren Buffett, Charlie Munger, Howard Buffett, Susan Buffett, Walter Scott, Malcolm Chase III, and Kim Chase are the directors of Berkshire Hathaway.

Q: How many shares of Berkshire Hathaway are outstanding?

As of the record date of March 7, 1997, there were 1,025,078 Class A shares and 815,015 Class B shares outstanding.

Q: How are votes cast for the election of directors?

Proxy cards have been submitted, and proxy holders will cast votes according to the instructions received. Shareholders who wish to vote in person can request a ballot.

Q: Who are the proxy holders for this meeting?

Walter Scott Jr. and Mark D. Hamburg are the proxy holders for this meeting.

Q: How many votes were cast for each nominee for director?

As of the last Friday before the meeting, more than 1 million votes were cast for each nominee, exceeding the majority for all Class A and Class B shares.

Q: What happens after the business meeting adjourns?

Warren Buffett will respond to questions related to Berkshire Hathaway's business, but that do not require action at the meeting.

Q: Are there any other items of business to discuss before adjourning?

Mr. Walter Scott Jr. will present a motion to adjourn the meeting, and it will be voted on by voice vote.

Q: How many shareholders have held Berkshire Hathaway longer than Warren Buffett and Charlie Munger?

The Chase family has been shareholders since the 1920s, and some other shareholders may have held shares longer than Buffett and Munger.

Q: Is Warren Buffett planning to write a book?

Buffett mentioned that he has nothing to add to what he has already said, and there is no need for him to write a book. He also prefers to focus on future business opportunities rather than past achievements.

Q: Can shareholders whose stock is held in street name make recommendations for donations?

In general, shareholders whose stock is held in street name cannot participate in the donations program. However, Class A shareholders held by beneficial owners can participate.

Q: Can Warren Buffett define his definition of stock market risk?

Buffett and Munger approach investing by considering business risk rather than stock market risk. They focus on the fundamentals of a business and its capital structure to assess risk. The stock market is seen as an opportunity to buy or sell at advantageous prices.

Q: How does Buffett's definition of stock market risk differ from the standard definition?

Buffett disagrees with the standard definition, which equates volatility with risk. He believes that volatility provides opportunities for long-term investors and should not be seen as a measure of risk.

Q: How does Berkshire Hathaway approach investing in businesses with high risk?

Berkshire Hathaway tries to avoid businesses with inherently high risk unless they are the low-cost producer or there are other favorable factors. They focus on businesses that have low risk or can transform risk into opportunity.

Q: Has volatility in the stock market affected Berkshire Hathaway's investment approach?

Volatility in the stock market does not affect Berkshire Hathaway's long-term investment philosophy. In fact, they prefer higher volatility as it creates more opportunities for mispricing in the market.

Q: How does Berkshire Hathaway view stock market volatility?

Buffett and Munger see stock market volatility as an advantage for long-term investors. They believe that it provides opportunities to buy or sell at favorable prices, and they welcome volatility as it creates more opportunities for profitable investments.