Buffett/Berkshire - general news

[ValueMaven]

Also bought more Markel!!

[james22]

1 hour ago, ValueMaven said:

Also bought more Markel!!

 

Buy it all.

[crs223]

On 8/15/2022 at 10:09 PM, Xerxes said:

Does the fact that he is adding to Apple, an already large position, is an indication that he is implicitly thinking that the 10-year T-bonds have peaked. 

 

Who am i to read WEB’s mind… but hasn’t he said on several occasions that he doesn’t know which directions rates are headed?  A few months ago he said “I would have bought more AAPL if it dropped more”.  He was talking about AAPL share price dropping and not his guess about future interest rates.

[nwoodman]

4 hours ago, james22 said:

 

Buy it all.

....just not this decade.

[jbwent63]

16 hours ago, nwoodman said:

....just not this decade.

+1

[yesman182]

Sorry if this is behind a paywall. I wasn't aware that the investment gains might be taxed before the investments are sold. Seems complicated and silly.

 

https://www.barrons.com/articles/berkshire-hathaway-taxes-stock-gains-51661208553?mod=hp_LEAD_2

[Munger_Disciple]

58 minutes ago, erdospi said:

https://menafn.com/1104739712/Under-The-New-Tax-Law-Berkshire-Hathaway-Might-Owe-Billions-In-Stock-Gains

same article 

 

 I am willing to take the other side of this bet: there is no way Berkshire or other companies are going to pay tax on unrealized gains. The "book" income (of unrealized gains) already includes deferred taxes payable. So, govt will get its cut when the gains are realized. 

[gfp]

2 hours ago, Munger_Disciple said:

 

 I am willing to take the other side of this bet: there is no way Berkshire or other companies are going to pay tax on unrealized gains. The "book" income (of unrealized gains) already includes deferred taxes payable. So, govt will get its cut when the gains are realized. 

 

I agree.  First thing I thought when I saw that Barron's article everyone was freaking out about was, "not gonna happen."  Same with green energy production tax credits that result in a massively negative tax rate for BHE (not in jeopardy from this law).  

[nwoodman]

I personally think it is bad tax policy, if the article is correct.  If you took it to the extreme you would need an annual appraisal on all assets, just in case they varied in price.  We will see how it plays out.  

 

Definitely not the cheapest Berkshire has been recently but I will happily swap out a more fairly priced OXY for a slightly undervalued BRK for the long term.

[Munger_Disciple]

5 hours ago, gfp said:

 

I agree.  First thing I thought when I saw that Barron's article everyone was freaking out about was, "not gonna happen."  Same with green energy production tax credits that result in a massively negative tax rate for BHE (not in jeopardy from this law).  

 

Agree 100% regarding BHE. Moreover all insurers estimate their liabilities years and sometimes (in case of long tail business) decades before the contracts expire and "book" under-writing profits/losses per GAAP. Will the govt tax these too as soon as they are booked for GAAP purposes? Don't think so. 

[CassiusKing1]

If a company pays taxes on unrealized gains and those gains are later lost, does the IRS reimburse the company for those taxes paid on now lost realized gains?

[gfp]

Pilot made an investment in Kodiak Robotics (driverless truck start-up) and got a seat on the board -

https://www.prnewswire.com/news-releases/pilot-company-and-kodiak-robotics-partner-to-bring-self-driving-truck-services-to-pilot-and-flying-j-travel-centers-301611056.html

 

https://www.ttnews.com/articles/pilot-kodiak-partner-autonomous-truck-services

Edited August 25, 2022 by gfp

[scorpioncapital]

I am not sure if the attack on capital such as taxing unrealized gains or a wealth tax is inflationary or deflationary. Either way, it makes those investors living off capital far less well off - an endangered species.

[nwoodman]

56 minutes ago, scorpioncapital said:

I am not sure if the attack on capital such as taxing unrealized gains or a wealth tax is inflationary or deflationary. Either way, it makes those investors living off capital far less well off - an endangered species.

 

Yup, how do you increase the participation rate? This, but wait there’s more…

Edited August 26, 2022 by nwoodman

[Xerxes]

Apologies if already posted. About BYD

[ValueMaven]

@Xerxes Thank you.  Yes - most here are aware that this might have happened.  BYD has been a massive homerun for Berkshire.  Charlie loves BYD, but you can tell Warren is less so, and historically has defered to Charlie on the position.  I'd love for them to realize the $8B gain and blow it back into capex projects at BHE.  

[Spekulatius]

On 8/27/2022 at 10:59 AM, ValueMaven said:

@Xerxes Thank you.  Yes - most here are aware that this might have happened.  BYD has been a massive homerun for Berkshire.  Charlie loves BYD, but you can tell Warren is less so, and historically has defered to Charlie on the position.  I'd love for them to realize the $8B gain and blow it back into capex projects at BHE.  

Buffett is way less enthusiastic about China in general than Munger.

[wabuffo]

Charlie has also been selling part of the BYD holdings that DJCO owns for the past year or so.

 

Bill

Edited August 30, 2022 by wabuffo

[gfp]

Yep, Berkshire Hathaway Energy has started selling some BYD.  1.33 million HK shares so far.  Not terribly surprising and possibly a Greg Abel decision.  Maybe some of the capital could be used to repurchase BHE minority interest.

 

Happy Birthday Warren!  Seems like there is a hurricane and no electricity every year, so it's nice to have power for a change on 8/30 lol

 

 

Here is the filing:

https://di.hkex.com.hk/di/NSForm2.aspx?fn=CS20220829E00231&sa2=ns&sid=2508&sd=30/08/2021&ed=30/08/2022&sa1=cl&scsd=30/08/2021&sced=30/08/2022&sc=01211&src=Main&lang=EN&tk=ds

 

So it looks like they have sold about 6.3 million shares in total.  225m shares held for years, now showing 218.719 million held as a of a few days ago.  Could be lower today.

 

Interestingly, it looks like Berkshire Hathaway Energy has sold at least $220 million USD worth of BYD as of this filing date.  A bit more if the realized prices were higher.

 

 

By the way, BHE's BYD shares are held at a Nevada LLC called Western Investment Group.  Nevada has no state corporate income tax, which is why Apple holds substantially all of their investment dollars in a Nevada subsidiary.

Edited August 31, 2022 by gfp

[ValueMaven]

Really interesting.  Thanks for sharing that!

[gfp]

BHE is down to 207.14 million BYD shares (HK:1211).  For whatever reason the number of shares sold being reported by the press are consistently understated because of the way the filing form rules work for the HK exchange.

 

https://di.hkex.com.hk/di/NSAllFormList.aspx?sa2=an&sid=2508&corpn=BYD+Co.+Ltd.++-+H+Shares&sd=02/09/2021&ed=02/09/2022&cid=2&sa1=cl&scsd=02%2f09%2f2021&sced=02%2f09%2f2022&sc=1211&src=MAIN&lang=EN&g_lang=en&

 

 

Berkshire Hathaway Energy has realized at least $615 million USD in proceeds from selling BYD shares as of 9/1.  They have sold 17.86 million HK:1211 shares.

Edited September 2, 2022 by gfp

[ValueMaven]

Thank God!!  Let's hope they start getting more aggressive.  I think its a combo of Warren/Munger/Abel saying enough is a enough...think about it - the BYD gain alone is equal to 2yrs of BHE CAPEX ... it's been a massive homerun

Edited September 2, 2022 by ValueMaven

[jbwent63]

1 hour ago, gfp said:

BHE is down to 207.14 million BYD shares (HK:1211).  For whatever reason the number of shares sold being reported by the press are consistently understated because of the way the filing form rules work for the HK exchange.

 

https://di.hkex.com.hk/di/NSAllFormList.aspx?sa2=an&sid=2508&corpn=BYD+Co.+Ltd.++-+H+Shares&sd=02/09/2021&ed=02/09/2022&cid=2&sa1=cl&scsd=02%2f09%2f2021&sced=02%2f09%2f2022&sc=1211&src=MAIN&lang=EN&g_lang=en&

 

 

Berkshire Hathaway Energy has realized at least $615 million USD in proceeds from selling BYD shares as of 9/1.  They have sold 17.86 million HK:1211 shares.

There are so many things the press either gets wrong or is too lazy to figure out. Just another example of spending a little time, understanding how the rules work, and reporting proper information. It's unfortunate that the sale had to be telegraphed, and the value dropped so much as a result, but the gain is still huge and a big win for BHE.

[yesman182]

5 hours ago, jbwent63 said:

It's unfortunate that the sale had to be telegraphed, and the value dropped so much as a result, but the gain is still huge and a big win for BHE.

Yeah, did they not have the option to enter their shares into the trading block years ago? I understand that years ago they didn’t want to sell. Are the rules set up forcing someone to telegraph? 

[aws]

So what is the explanation for why the details of the sales are not reported? The link shows two sales totaling 3 million shares that have detail, but no explanation for the other decrease of 15 million shares from their reported holdings.