Monday, May 3, 2010

As close to a Transcript of the 2010 Berkshire Hathaway Shareholders Meeting as you're likely to find (BRK.A; BRK.B)

UPDATE II May 5: "Better than "As Close to a Transcript of the 2010 Berkshire Hathaway Annual Meeting": 2010 Berkshire Hathaway Annual Meeting Notes (BRK.B; BRK.A)"

UPDATE: "Omaha World-Herald Coverage of the 2010 Berkshire Hathaway Annual Meeting (BRK.B; BRK.A)"

From MarketBeat:

Live Blog Of Berkshire Hathaway Shareholders Meeting

  • The meeting begins with a short movie that was put together specifically for the meeting. Buffett's daughter, Susie, oversees it. Buffett and Munger will appear in it, and try to be funny. They also typically run a lot of ads for Berkshire -- owned car insurer Geico, and sneak in one or two for Berkshire's Helzberg diamonds. We're a captive audience.

  • The movie opens with a clip from the Secret Millionaire's Club. It's a cartoon that's designed to teach children good spending habits. Buffett is a main character in the series, and he did his own voice. The snippet we're seeing also has Bill Gates and Charlie Munger in it. It's online at SMCKids.com

  • Now we're getting a rousing song about Burlington Northern. Shots of the countryside. Sunsets. Berkshire bought the railroad for $27 billion, his largest deal ever, in February.

  • The video is a series of short clips. Now we're seeing a shot of Buffett interviewing Henry Paulson at an event in Omaha earlier this year. Buffett is citing a quote from President George W. Bush that Paulson included in his book. "If money doesn't loosen up, this sucker could go down." Buffett describes this as "being like the Gettysburg address -- short and to the point."

  • This video is set to last about an hour.

  • When the question-and-answer session starts, it will work like this: there are microphones throughout the arena and in some overflow rooms. Half the questions will come straight from shareholders who were selected by lottery just a few minutes ago. The other half will come from a panel of three journalists picked by Buffett. They've been collecting questions via e-mail for about six weeks, since Buffett gave their addresses out in his annual letter to shareholders. The people at the microphones usually ask questions about the economy or investing -- or something that's way out of left field -- and the reporters are supposed to pick questions that are specifically about Berkshire.

  • Buffett is able to entice some serious talent for this movie. We just had a clip of the Desperate Housewives talking about him around the poker table. One of them says: "He owns a fleet of jets." Another says: "don't let it fool you. They're all rentals." It's an inside joke for the crowd here. Berkshire owns NetJets, which sells fractional shares on small jets.

  • The Desperate Housewives clip ends with the Edie character going out to find Warren. "Love trumps money, my ass," she says.

  • Next Desperate Housewives segment has Edie returning to the poker table. She couldn't find Warren, but she's come back with Charlie. She's pretty affectionate. The other housewives are appalled.

  • I knew they'd have this Geico ad: it's the one with Warren Buffett dressed up as Axl Rose.

  • Wow. Warren really can't sing. The crowd in the arena loves it.

  • I was wondering if this would happen: a clip of Buffett testifying before Congress is playing now, as it has been in the past. It’s one of Buffett's more famous quotes: "Lose money for the firm, and I will be understanding. Lose a shred of reputation for the firm, and I will be ruthless.” That line — or another one about how he tells employees to never do anything in business that they wouldn’t want to end up on the front page of the newspaper — were included in nearly every article I read that previewed the meeting.

  • The quote about reputation – and, for that matter, the quote about the front page of the newspaper -- carry new meaning this year. Buffett, who has long decried Wall Street's "casino" mentality, has held a massive stake in Goldman Sachs since 2008. His ties with Goldman go back for a long time. He’s done business with them for decades. And he’s often told the story of visiting their offices when he was a child.

  • Now, of course, the SEC is suing Goldman for fraud related to the assembling and marketing of a mortgage-backed security and this week it emerged that the Manhattan district attorney's office was conducting a preliminary criminal probe into its mortgage trading activities, causing Goldman's shares to tumble. Buffett will surely face questions about it, and told the Journal this week he's ready to answer them. Munger, who's always substantially more blunt than Buffett, said that, while Goldman did nothing illegal, the firm was engaged in "socially undesirable" activities.

  • This will be the second year in a row that Buffett's gone with the half-and-half arrangement for questions. Before, all the questions came from the floor, and there was no lottery. If you wanted to ask a question, you had to line up outside the Qwest Center hours in advance and sprint to one of the microphones when the doors opened at 7 a.m. Of the switch to the new format, Buffett wrote last year: "At age 78, I've concluded that speed afoot is a ridiculously overrated talent."

  • Movie set to end in about five minutes.

  • The three journalists that will ask questions on the panel: Becky Quick of CNBC, Andrew Ross Sorkin of the New York Times and Carol Loomis of Fortune. Loomis is a long-time friend who helps Buffett draft his annual shareholder letters.

  • Buffett is speaking live on stage now.

  • Buffett is speaking about the first quarter performance.

  • Buffett says Berkshire companies '`picked up steam'' in first quarter.

  • Berkshire profit was $3.6 billion in the first quarter, reversing loss of $1.5 billion in prior year.

  • Buffett says Berkshire first-quarter operating earnings were $2.2 billion, compared with $3.2 billion a year earlier as economy improved.

  • Buffett addresses the Abacus, Goldman Sachs deal. Speaking of ACA, Buffett says "hard for me to get terribly sympathetic" for ABN Amro. There has been "misreporting" on the nature of Goldman's Abacus deal, Buffett said. The bonds included in Abacus "all went south very quickly," he added....MUCH, MUCH, MORE


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