Sentiment Soaring in Omaha Ahead of Warren Buffett’s Annual Shareholder Fest

It wasn’t just the cloudless Nebraska-blue sky and 76 degree weather in Omaha today that had some of Warren Buffett’s 80-plus managers smiling. Just hours after the Labor Department reported the economy had created 211,000 jobs in the month of April, the doors flew open at the CenturyLink Arena and thousands of Berkshire Hathaway shareholders flooded in with their wallets open, ready to snap up products from Buffett’s myriad of companies. From Dairy Queen ice cream bars to 3 bedroom manufactured Clayton Homes, the Berkshire Hathaway annual “Woodstock for Capitalists” as it’s called is the only shareholder meeting on the planet that actually makes millions of dollars for the company.

When my flight touched down last night at Omaha’s Eppley Airfield, I recalled how 11 years ago when I covered the meeting for the first time 30,000 people from around the world showed up to hear Buffett and his Vice Chairman Charlie Munger opine for 6 hours on everything from how their individual businesses were performing to the economy to why they drink so much Coca-Cola. (Buffett is Coke’s largest shareholder, tipping the scales at 400 million shares.) This weekend, some 38,000 people will do the same, but millions around the world will attend electronically. The meeting’s so huge now, Buffett agreed to stream it live on the internet. 

Why? What’s so intriguing about a 86-year-old CEO and his 93-year-old best friend sitting on an empty stage taking questions? 

It’s the fact that the alchemy of their 55-year-long friendship has created one of the largest conglomerates in the world simply by following a very basic investment philosophy: buy best-in-class companies you understand, and never buy them when they’re overpriced. 

Brooks Running is one such company. Buffett purchased its parent company Russell and placed it under his Fruit of the Loom unit. But when he saw how brilliantly Brooks and its long-time CEO Jim Weber were capitalizing on the running craze, he made Brooks a separate unit. 

“Retail is having a very hard time,” Weber told me this afternoon from the CenturyLink floor. “But we don’t have brick and mortar stores so while yes, many athletic shoe chains have gone belly-up, we’ve managed to sell strongly online.” The economy is strong enough now that Weber is venturing into the Chinese market. He’s found a partner on the ground in China and is on the verge of leaving shoe tracks on the backs of Asian competitors’ sales starting in Beijing. Want an indicator the economy is performing better? Tomorrow during the 6-hour meeting, Brooks expects to sell 3,000+ special edition Ghost 9 running shoes stamped with the images of Buffet and Munger on the inner soles. They retail for $120 a pair.

OK, so $120 bucks isn’t exactly a massive stretch, but a $109,000 Clayton ‘Tiny’ home might be. CEO Kevin Clayton tells me the manufactured homes giant fully expects to bag some sales of the latest trend in lighter living. The 464-square-foot structure has a living room, a full kitchen with stainless steel appliances, a bathroom complete with a full-size shower bathtub, washer-dryer and cathedral ceilings. When I walked into the model Tiny home, I was immediately struck by the thought that it was way nicer than any living accommodation I had endured in college. Clayton says minimal living is a bona-fide trend now among millennials and even senior citizens who want a cozy home without the stairs and square footage. And the current economy? Clayton sold 42,000 homes last year. This year, they expect that number to hit 45,000.

I’m always fascinated to see the crowd that shows up in Omaha. A shareholder from Sydney, Australia stopped to say hello. He was making the trek for the first time and told me he had bought 8 shares for his children. That’s how people see Berkshire stock: as something to pass on to future generations. In 1964, when Buffett became the controlling shareholder of what was back then a failing textile company, Berkshire sold for $19 a share. Today, 52 years later, it closed at $250,000 a share. I’d say that’s a nice return. 

On Saturday, when he and Munger take the same stage that Queen, McCartney and Lady Gaga have stood upon, the rockstars of the business world will wow the crowd with their own maxims, opinions and plain-spoken theories on what works and what doesn’t when you’re trying to build wealth. They take questions from the crowd and from online submissions. Monday at 3pET on Fox Business, they’ll take questions from ME. They, along with Berkshire board member and Microsoft co-founder Bill Gates join me live for a no-holds barred conversation. It’ll be our 10th year in a row. No other network can claim that run. Wanna play “Stump the Billionaires”? Send me some questions you’d like to ask of Warren, Charlie and Bill. Tune in Monday to see if yours is chosen.

Liz Claman is the anchor of Countdown to the Closing Bell on Fox Business.