Warren Buffett shocked an arena full of shareholders when he announced Saturday that he wanted to retire by the end of the year.
Buffett said he would recommend it to Berkshire Hathaway's board of directors, and Greg Abel should become CEO by the end of the year.
“I think it's time for Greg to become the company's CEO office at the end of the year,” Buffett said.
Abel has been Buffett's designated successor for years, and he has managed all of Berkshire's non-insurance operations. But it is always assumed that he will not take over until Buffett dies. Previously, the 94-year-old Buffett had always said that he had no retirement plan.
Buffett made the announcement at the end of a five-hour question-and-answer period, but had no questions about it. He said the only board members who knew it was coming were his two children, Howard and Suzy Buffett. Abel sat on the stage next to Buffett, without warning.
Many investors said they think Abel will do a good job with Berkshire running Berkshire, but how good he will be in investing in Berkshire's cash. Buffett also pledged to invest his wealth in the company on Saturday, and supported him.
“I had no intention of selling a part of Berkshire Hathaway (zero),” Buffett said. “The decision to keep every share is an economic decision because I think Berkshire's prospects will be better than mine under Greg's management.”
Thousands of investors at the Omaha Arena brought a long applause to Buffett for his 60-year leadership of the company.
CFRA research analyst Cathy Seifert said it would be difficult for Buffett to make this decision.
“It might be a very difficult decision for him, but it's better to leave on his own terms,” Seifert said. “I think I'll try to maintain the 'business' environment in Berkshire. That's still certain.”
Buffett warned earlier that Trump's tariffs are harmful
Earlier, Buffett warned on Saturday about the terrible global consequences of President Donald Trump’s tariffs, while telling thousands of investors that “trade should not be a weapon” at his annual meeting, but there is no doubt that trade could be an act of war. ”
Buffett said Trump's trade policy increases the risk of global instability by infuriating the rest of the world.
“It seems to me that when you have 7.5 billion people who like you very much, it's a big mistake, and you have 300 million people who are shocked by their performance,” Buffett said.
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Buffett said it would be better to maintain a trade balance between countries, but he believes Trump’s broad tariffs with him are not the right way. He said that if more countries prosper, the world would be safer.
“We should seek to trade with the rest of the world. We should do our best, and they should do our best,” he said.
Buffett said that since his birth, the United States has been undergoing revolutionary changes and an equal commitment to all, until a few years later. But anything that happened today changed his long-term optimism about the country.
“If I were born today, I just kept on negotiating in the womb until they said 'You might be in the United States.'
Market turmoil does not bring huge opportunities
Buffett said he just couldn't see many of the price-up investments he knew today, so Berkshire sat on $347.7 billion in cash, but he predicted that one day Berkshire will “berkshire suffer” bombing we will have the opportunity to bomb the opportunity for us to have cash. ”
Buffett said it has caused headline turmoil in the market recently after Trump announced “really nothing” last month. He dismissed the recent market decline as he saw three periods in the last 60 years of managing Berkshire's stock when it halved. When the Dow Jones industrial average was from 240 born in 1930 to 41 days during the Great Depression, he cites the Jones industrial average, which is a real significant decline in the market. Currently, the Dow Jones industrial average is $41,317.43.
“It's not a dramatic bear market or anything,” he said.
Buffett said he hasn't bought back any of Berkshire's shares this year because they don't seem to be bargaining either.
Chris Bloomstran, an investor who president of Semper Augustus Investments Group, told the Gabery Investments Conference on Friday that the financial crisis may be the best thing for Berkshire as it will create opportunities to invest at attractive prices.
“I'm sure he's praying for the trade war to get worse. He won't say that publicly, but Berkshire needs a crisis. I mean Berkshire thrives in the crisis.”
Berkshire Conference attracted thousands
The conference attracts about 40,000 people a year and they want to hear from Buffett, including some celebrities and well-known investors. This year, Hillary Rodham Clinton also attended the meeting. Clinton is Buffett's last publicly supported candidate, as he has evaded politics and any controversial topics in recent years because they fear it will hurt Berkshire's business.
Haibo Liu even spent the night outside the arena, queuing up on Saturday mornings. Liu said he was worried that this year might be Buffett's last meeting since he was 94, so he would be attending the second meeting as a priority.
“He helped me a lot,” said Liu, who set out from China. “I really want to thank him.”
Worry about replacing Buffett
Linda Smith, 73, first got to know Warren Buffett and Berkshire Hathaway, when she rented a house from her sister Doris, who had been a graduate student at DORIS Smith in Washington, D.C., and said Doris bought See See See from Berkshire shortly after Berkshire and told her she had to buy stocks.
Smith couldn't buy it right away because a stock priced at about $3,400, which was the same as her earnings as a graduate student. But once she graduated from college, she took advice from her friends and started saving to buy some stocks that are now sold for $809,350.
Over the years, Smith estimated that she might have attended about 20 annual meetings – often bringing a friend.
“I really like listening to Warren Buffett, especially everything that happened this year,” Smith said.
Buffett has long said he has no retirement plan because he likes to figure out where to invest in Berkshire to too much money. He plans to continue working until he dies or can do nothing. But even though he did use the crutches, he was still in good health and he cut the Q&A of the conference by several hours this year.
“I think even if he dies, these businesses will retain their value,” Smith said while surrounding the 200,000-square-foot exhibition halls filled with booths from Berkshire companies like BNSF Railroad, Geico Insurance, Perot Truck Tost, Duracell Patteries, and more. “I expect my stock to fall for a while, but good business and good people will come back,” she said.
But Smith and thousands of others will definitely miss the sound of rationality after Buffett left. Buffett has led Berkshire for 60 years.
Buffett said Greg Abel, the vice chairman who has overseen all of Berkshire's non-insurance operations, will take over as CEO when he leaves.
Shareholders such as Steven Check who operates check capital management are not particularly worried about inheritance, because Abel has proven that Berkshire's business is largely operated. Buffett said Abel might even be more hands-on than him and get more managers from Berkshire's company.
“I think we're going to get more hands-on managers, which could be a good thing,” the check said. But he said Abel also knew that those managers enjoy the freedom to run the business and Abel wouldn't do anything to shut them down.
