“Warren Buffett Drops Truth Bomb on Trump While Celebrating Berkshire’s Big Win!”
In his annual letter to shareholders, Warren Buffett celebrated Berkshire Hathaway’s remarkable success, reflecting on its transformation from a struggling textile firm into a global powerhouse over the past 60 years. While highlighting the company’s growth, he also took a moment to offer some advice to former President Donald Trump.
Buffett reassured investors about Berkshire’s future, praising his chosen successor, Greg Abel, as a capable leader ready to seize investment opportunities. He promised that Abel would continue the tradition of writing annual shareholder letters, maintaining transparency and insight for investors.
Unlike past milestone anniversaries, Buffett kept his personal reflections brief, though Berkshire plans to release a special 60th-anniversary book detailing key lessons from its history. One major takeaway: Berkshire’s tax contributions have skyrocketed—from paying zero corporate income tax before Buffett took over in 1965 to a staggering $26.8 billion in 2023, more than any U.S. company, including tech giants.
While Buffett generally avoids political commentary in his letters, he made an exception this year, urging the government to spend wisely. “Thank you, Uncle Sam,” he wrote. “Someday, Berkshire hopes to send you even larger payments. Spend it wisely. Take care of those who, through no fault of their own, get the short straws in life. They deserve better.”
His message reinforced his long-standing belief in fiscal responsibility and social support, underscoring the need for a stable economy driven by both wisdom and vigilance.
Buffett’s Subtle Yet Powerful Message
A Massive Cash Pile for Future Moves
When Greg Abel eventually takes over, he’ll have an extraordinary war chest at his disposal. Berkshire Hathaway now holds a record $334.2 billion in cash—nearly double the $167.6 billion it had a year ago. This growth comes after selling large portions of its Apple and Bank of America holdings while continuing to generate billions from subsidiaries like Geico, BNSF Railroad, Dairy Queen, and See’s Candies.
Despite this massive cash reserve, Buffett did put some money to work last year, spending $3.9 billion to acquire full control of Berkshire’s utility business and $2.6 billion to buy the remainder of the Pilot truck stop chain. He also increased investments in five major Japanese conglomerates, with total spending on these firms reaching $13.8 billion over six years—now valued at $23.5 billion.
Even with all this cash, Buffett remains reluctant to issue dividends, believing reinvestment will yield better returns. Some analysts, however, interpret his cautious spending as a bearish stance. Investor Bill Smead put it bluntly: “Buffett is bearish as hell but won’t admit it,” suggesting the legendary investor sees U.S. stocks as overvalued. Others, like Gabelli Funds’ Macrae Sykes, argue that Berkshire’s cash hoard is a major strategic advantage, giving it the firepower to seize opportunities at scale when the time is right.
Strong Profits Despite Softening Results
Berkshire’s 2024 performance exceeded Buffett’s expectations, even though 53% of its 189 companies reported lower earnings. Higher interest income and strong insurance profits helped offset weakness elsewhere.
Headline profit numbers can be misleading due to market fluctuations in Berkshire’s stock holdings. Instead, Buffett recommends focusing on operating earnings, which surged to $14.5 billion ($10,102 per Class A share) from $8.5 billion ($5,878 per share) the previous year—far surpassing analyst estimates.
Still, some experts are concerned. Edward Jones analyst Jim Shanahan sees softness in Berkshire’s businesses as a worrying sign for the broader economy, warning that profits could decline further in 2025, especially with expected insurance losses of at least $1.3 billion from California wildfires.
Changes at the “Woodstock for Capitalists”
Buffett’s age is subtly shaping Berkshire’s famed annual meeting. The 94-year-old investor announced that this year’s event in May will be shorter, with Q&A sessions wrapping up by 1 p.m.—several hours earlier than usual. He also revealed he now uses a cane, humorously admitting it helps prevent him from “falling flat on my face.”
For the first time, the meeting will not feature its traditional humorous opening film, filled with celebrity cameos and Berkshire ads. However, Buffett assured attendees there will still be plenty of opportunities to shop from Berkshire’s many businesses at the event’s exhibit hall in Omaha.
Even as change looms, Buffett’s influence remains undeniable—both within Berkshire and across the investing world.