Warren Buffett Discusses AI, Economy, and Apple at Berkshire Hathaway Annual Meeting
Warren Buffett, CEO of Berkshire Hathaway, faced a barrage of questions about his successor at the company's annual meeting. Buffett had previously announced that he would be stepping down from his role as CEO, but did not disclose who would be taking over the position. Investors and shareholders were eager to hear more about the matter, but Buffett did not offer any concrete answers. Instead, he focused on other topics such as artificial intelligence (AI) and the economy.
Buffett expressed his skepticism about AI, stating that while it can change everything in the world, it cannot change how men think and behave. He drew a parallel between AI and the atomic bomb in terms of unknown, long-term consequences, and questioned whether it was good for the world that the ability to create AI had been unleashed. His long-time business partner, Charlie Munger, also expressed skepticism about the technology, stating that “old-fashioned intelligence works pretty well.”
Buffett also discussed the state of the economy, warning that the “incredible period” for the US economy was coming to an end. He stated that the majority of Berkshire's businesses would report lower earnings this year, attributing the expected downturn to a wider economic decline. Munger added that the more difficult economic environment would make it harder for value investors, who typically buy stocks that look cheap compared to the intrinsic value of the businesses. He advised value investors to get used to making less money.
Despite these warnings, Buffett remains bullish on Apple, which is now Berkshire's top equity holding, making up almost 40% of its portfolio. Buffett has been buying the company's stock since 2016 and has been a long-time supporter of CEO Tim Cook and the stickiness of the company’s products, including the iPhone. He stated that the iPhone was an extraordinary product, and that consumers were willing to pay $1,500 for a phone but would give up their second car before giving up their iPhone.
Overall, while investors and shareholders were eager to hear more about Buffett's successor, he focused on other topics such as AI, the economy, and Apple. His skepticism about AI and warning about the economy may cause concern for some investors, but his bullishness on Apple and the loyalty of its customers may offer some reassurance.
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