nsucurrent.com March 17, 2018

New Republican tax cuts 'deliver' Warren Buffett a $29 billion check

25 February 2018, 12:14 | Ruby West

New Republican tax cuts 'deliver' Warren Buffett a $29 billion check

Warren Buffett visits the BNSF booth before the Berkshire Hathaway annual meeting in Omaha

As explained by Buffett, without the tax code rewrite, Berkshire would have added about $36 billion-a more typical year of standard gains for the company.

The "Oracle of Omaha's" famed annual letter to Berkshire shareholders has become a favourite in the investor calendar but it has attracted heightened interest this year amid rumours that the 87-year-old would unveil plans to step down.

"[Investing partner] Charlie [Munger] and I believe that from time to time Berkshire will have opportunities to make very large purchases", Buffett wrote.

The company posted a $29.11 billion gain in the latest-quarter related to changes in US tax law.

The long-time bull on U.S. companies and the economy issued his latest letter to Berkshire Hathaway Inc shareholders on Saturday.

The billionaire and CEO of Berkshire Hathaway highlighted a $29 billion tax gain for his company, bemoaned a lack of good deals and reminded his readers that owning stocks through low-priced index funds was the best way to build wealth over time.

In discussion acquisitions, Buffett said it was hard to find companies at the "sensible price" in 2017 as the stock market soared.

Berkshire was sitting on more than $109 billion in cash at the end of the third quarter of 2017.

Both are considered candidates to eventually replace Buffett, 87, as Berkshire's chief executive.

But he said the prices asked for businesses a year ago "hit an all-time high", and Berkshire will be looking for those available at "a sensible purchase price".

The iPhone maker, which wasn't even a Berkshire holding until the first quarter of 2016, has quickly grown to one of Berkshire's top stock holdings, if not its biggest.

Last year, however, was another good one for Berkshire stockholders, as the company's "A" shares rose almost 22%, vs. a gain of 19.4% for the S&P 500, a broad stock market index.

On Friday, Berkshire's Class A shares closed at $304,020.01, having risen above $300,000 a share for the first time ever in December on expectations that Trump's USA tax overhaul would pass into law.

Known to fans as "the Oracle of Omaha", Buffett, 87, has suggested U.S. stocks are probably the best bet over time, encouraging people to make easy choices and stick with them, eschewing high-fee fund managers, for instance.

"In America, equity investors have the wind at their back", he said.

Buffett in 2007 bet a founder of the asset management company Protégé Partners LLC $1 million that a Vanguard S&P 500 index fund would outperform several groups of hedge funds over a decade.

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