Trump tax cut fuels record profit for Buffett's Berkshire

Buffet said that a dearth of "sensible" valuations led it to close nearly no takeovers of companies in 2017, adding that "price seemed nearly irrelevant to an army of optimistic purchasers". Unlike many tech conglomerates, which had parked their cash overseas, Berkshire Hathaway's cash was in America.

American tycoon Warren Buffett has played down speculation that he is putting in place plans to step down as boss of conglomerate Berkshire Hathaway, insisting that he has "never felt better".

"No company comes close to Berkshire in being financially prepared for a $400 billion mega-cat", he wrote in the letter, adding: "Our unparalleled financial strength explains why other [property/casualty] insurers come to Berkshire - and only Berkshire - when they, themselves, need to purchase huge reinsurance coverages for large payments they may have to make in the far future". The Omaha, Nebraska-based company reported a jump of 87% in net annual income to $44.94 billion from the previous year.

To find Buffett's full shareholders' letter, go here.

"He didn't say a lot about succession".

Greg Abel and Ajit Jain joined Berkshire's board in January and took on additional responsibilities.

Berkshire's other businesses, which include BNSF railroad, a number of electric utilities and an assortment of manufacturing and retail businesses, helped offset the insurance losses. Many investors consider Abel, a decade younger than Jain, the frontrunner.

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Buffett is synonymous with Berkshire Hathaway.

"Almost 90% of our investments are made in the United States", Buffett writes in the letter to shareholders.

The Oracle of Omaha made a winning 10-year bet with Protégé Partners in December 2007 that the S&P 500 would outperform a basket of fund of hedge funds. One of Buffett's favorite charities, Girls Inc. of Omaha, received $2.2 million as a result of the bet.

Succeeding in the stock market requires the discipline to act sensibly when markets do insane things. A willingness to look unimaginative for a sustained period - or even to look foolish - is also essential.

Buffett said it is a "terrible mistake" for investors with long-term horizons - among them, pension funds, college and endowments and savings-minded individuals - to measure their investment "risk" by their portfolio's ratio of bonds to stocks.

Berkshire also owns clothing, furniture and jewelry firms.

Turning to investments, Berkshire's Apple holding was up to $28.2B at year-end, second only to Wells Fargo at $29.3B.

  • Darren Santiago