The 2022 Berkshire Hathaway Meeting

Walking around Omaha, there are reminders of the old West. In the Old Market district, the cobble stones remain, but the old style saloon bars are gone. In their place there are fancy restaurants and bars. There are sculptures of old Omaha, stagecoaches cast from bronze. The railroad is still there, but the original station has been converted into an art gallery.

Every year in late April or early May, thousands converge on Omaha from across the USA and from further field. Whilst some of them might be coming partially to enjoy the old West and Nebraska steaks (and I include myself in that category), the vast majority are coming purely for the annual Berkshire Hathaway shareholders meeting. The 2022 meeting was held on Saturday, the first in person meeting since 2019. It’s a somewhat unique event in investing. Yes, there are countless financial events every year, but this is the only one which seems to have the feeling of a festival. For hours, Warren Buffett and his business partner Charlie Munger answer questions from shareholders about the firm and also more general questions regarding investing. This year Greg Abel and Ajit Jain from the management team also joined them on stage for part of the time. So what were the key takeaways from this years meeting??

By and large, Buffett was sceptical of the notion of being time markets, a topic he's touched on many times before. He noted that he failed to spot the opportunity in March 2020. That being said, a questioner did note that he has been fortuitous on many occasions where he did time his investments well. On the topic of inflation, Buffett was equally sceptical that it was possible to predict for example what inflation would be in the coming month or so.

I would nevertheless argue that ultimately predicting these macro variables is a relative exercise. Trying to predict inflation is difficult particularly as you extend your horizon, and it's something that Turnleaf Analytics, which Alexander Denev and I co-founded, is doing by leveraging techniques like machine learning and alternative data. Ultimately, you can profit from forecasts, not necessarily by getting the number perfectly correct several months out (which is going to be exceptionally hard!). Rather it is about trying to do better than the market and its consensus...

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