A letter a day!

A letter a day!

Letter # 75 2021

Key learnings:

1. Many people perceive Berkshire as a large and somewhat strange collection of financial assets. In truth, Berkshire owns and operates more U.S. based “infrastructure” assets classified on their balance sheet as property, plant and equipment than are owned and operated by any other American corporation.

“That supremacy has never been our goal. It has, however, become a fact.”

2. Buffet has talked and time and again praised Ajit Jain who looks after the insurance portfolio of Berkshire. He hired Ajit when he had no experience at all relating to insurance.

“Much of our huge value creation in insurance is attributable to Berkshire’s good luck in my 1986 hiring of Ajit Jain. We first met on a Saturday morning, and I quickly asked Ajit what his insurance experience had been. He replied, “None.” I said, “Nobody’s perfect,” and hired him. That was my lucky day: Ajit actually was as perfect a choice as could have been made. Better yet, he continues to be – 35 years later.“

3. Buffett is known to teach and interact with a lot of university and school students. He advices them never to stop their quest even when they actually find a job.

“Talking to university students is far superior. I have urged that they seek employment in (1) the field and (2) with the kind of people they would select, if they had no need for money. Economic realities, I acknowledge, may interfere with that kind of search. Even so, I urge the students never to give up the quest, for when they find that sort of job, they will no longer be “working.” Charlie and I, our selves, followed that liberating course after a few early stumbles. We both started as part timers at my grandfather’s grocery store, Charlie in 1940 and I in 1942. We were each assigned boring tasks and paid little, definitely not what we had in mind. Charlie later took up law, and I tried selling securities. Job satisfaction continued to elude us. Finally, at Berkshire, we found what we love to do. With very few exceptions, we have now “worked” for many decades with people whom we like and trust. It’s a joy in life to join with managers such as Paul Andrews or the Berkshire families I told you about last year. In our home office, we employ decent and talented people – no jerks. Turnover averages, perhaps, one person per year”