Warren Buffett surprises by slashing Berkshire Hathaway’s longtime Apple stake in second quarter

Warren Buffett surprises by slashing Berkshire Hathaway’s longtime Apple stake in second quarter
An attendee holds a cardboard cutout of Warren Buffett, chairman and CEO of Berkshire Hathaway Inc., inside the CHI Health Center during the Berkshire Hathaway annual shareholders meeting in Omaha, Nebraska, on May 4, 2024. (Bloomberg via Getty Images)
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Updated 04 August 2024
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Warren Buffett surprises by slashing Berkshire Hathaway’s longtime Apple stake in second quarter

Warren Buffett surprises by slashing Berkshire Hathaway’s longtime Apple stake in second quarter
  • He has trimmed the Apple stake over the past year and has recently also sold off some of his stock in Bank of America and Chinese EV maker BYD while doing very little buyin

OMAHA, Nebraska: Billionaire Warren Buffett slashed Berkshire Hathaway’s massive Apple stake in a move that could prove unsettling for the broader stock market — both because the investor is so revered and because there had been little positive financial news lately.
Just two years ago Buffett called the stock one of the four giants of his conglomerate’s business alongside Berkshire insurance, utility and BNSF railroad businesses that it owns outright. That gave investors the impression that Buffett might hold onto Apple indefinitely as he has with the Coca-Cola and American Express shares he bought decades ago.
However, he has trimmed the Apple stake over the past year and has recently also sold off some of his stock in Bank of America and Chinese EV maker BYD while doing very little buying.
As a result, Buffett is now sitting on nearly $277 billion in cash, up from what was already a record $189 billion just three months earlier.
“This could could alarm the markets especially given the news from last week” with weak tech earnings, a disappointing jobs report and uncertainty about the future of interest rates, Edward Jones analyst Jim Shanahan said.
Buffett has consistently lavished praise on Apple CEO Tim Cook, who attended Berkshire’s annual meeting in Omaha in May, and talked about the way consumers are feverishly devoted to their iPhones and don’t like to switch. He did trim more than 10 percent of Berkshire’s Apple stake in the first three months of this year when he sold off more than 116 million shares, but the sale disclosed Saturday was a much bigger move.
Wedbush tech analyst Dan Ives said in a research note that he thinks “Buffett is a core believer in Apple and we do not view this as a smoke signal for bad news ahead.” Apple remains the largest investment in Berkshire’s portfolio by far — more than double its Bank of America stake.
Ives said he thinks the recent tech sell-off is only a temporary distraction from the industry’s long-term boom.
Berkshire didn’t give an exact count of its Apple shares in Saturday’s report, but it estimated the investment was worth $84.2 billion at the end of the second quarter even though shares soared over the summer as high as $237.23. At the end of the first quarter, Berkshire’s Apple stake was worth $135.4 billion.
Shanahan estimates that Berkshire still holds about 400 million Apple shares.
Still, while CFRA Research analyst Cathy Seifert said she looks at the Apple sale more as responsible portfolio management because the tech giant had become such a large portion of Berkshire’s holdings, it does look like Buffett may be preparing for a downturn.
“This is a company girding itself for a weaker economic climate,” Seifert said.
Berkshire reported a small drop in its bottom-line earnings because of a drop in the paper value of its investments. The company said it earned $30.348 billion, or $21,122 per Class A share, during the second quarter. That’s down from $35.912 billion, or $24,775 per A share, a year ago.
Buffett has long cautioned investors that it’s better to look at Berkshire’s operating earnings when judging its performance because those figures exclude investment gains and losses which can vary widely from quarter to quarter.
By that measure, Berkshire’s operating earnings grew more than 15 percent to $11.598 billion, or $8,072.16 per Class A share, from $10.043 billion, or $6,928.40 per Class A share, a year ago. Geico led the improvement of Berkshire’s businesses while many of its other companies that are more sensitive to the economy reported lackluster results.
The results easily topped the $6,530.25 earnings per share that four analysts surveyed by FactSet Research predicted.
Berkshire owns an assortment of insurance businesses along with BNSF railroad, several major utilities and a varied collection of retail and manufacturing businesses, including brands like Dairy Queen and See’s Candy.


Thousands left queuing to vote in Namibia after scheduled polls close

Thousands left queuing to vote in Namibia after scheduled polls close
Updated 13 sec ago
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Thousands left queuing to vote in Namibia after scheduled polls close

Thousands left queuing to vote in Namibia after scheduled polls close
  • The vote could usher in the desert nation’s first woman leader even as her party, the ruling SWAPO, faces the strongest challenge yet to its 34-year grip on power
  • SWAPO’s candidate and current vice president, Netumbo Nandi-Ndaitwah, is being challenged by IPC leader Panduleni Itula, a former dentist and lawyer

WHINDHOEK: Logistical issues on Wednesday left thousands of Namibians waiting in queues to vote in pivotal presidential and legislative elections, some for up to 12 hours, with polling stations staying open hours later than planned.
The vote could usher in the desert nation’s first woman leader even as her party, the ruling South West Africa People’s Organization (SWAPO) faces the strongest challenge yet to its 34-year grip on power.
Some voters told AFP they queued all day, blaming technical problems that included issues with voter identification tablets and insufficient ballot papers.
“It’s absolutely disappointing,” said Reagan Cooper, a 43-year-old farmer among the hundred or so voters outside the town hall polling station in the capital Windhoek.
“The voters have turned out, but the electoral commission has failed us,” Cooper told AFP.
In the face of criticism from all the political parties, including SWAPO, the Electoral Commission of Namibia extended voting hours for “no specified time,” according to Windhoek region ECN head Rakondjerua Kavari.
Voting was halted for an hour at the Windhoek town hall site due to a lack of ballots, with applause welcoming the delivery of more waking sleepy, seated voters around 11:30 pm.
The last voter there cast his ballot more than four hours after the scheduled closing time — 9:00 p.m. (1900 GMT) — and vote counting then began almost immediately.
According to Namibia’s electoral law, those in queues before polls are scheduled to close should be allowed to vote.
Petrus Shaama, chief officer of the ECN, said it was obligated to ensure voters could cast a ballot.
But the main opposition party, the Independent Patriots for Change (IPC), blamed the ECN for the long lines and cried foul play.
“We have reason to believe that the ECN is deliberately suppressing voters and deliberately trying to frustrate voters from casting their vote,” said Christine Aochamus of the IPC.
Armed with folding chairs and umbrellas to cope with the slow-moving lines and blazing sun, many Namibians spent half the day waiting to vote.
At one polling station inside the University of Science and Technology in Windhoek, hundreds of people were still in line at 9:00 p.m. despite some having arrived at 6:00 am, an hour before polls opened.
Polling site managers told AFP that problems with tablets used to check voters’ identities using fingerprints included untimely updates, overheating and dead batteries.

SWAPO’s candidate and current vice president, Netumbo Nandi-Ndaitwah, was one of the first to vote and called on Namibians “to come out in their numbers.”
An estimated 1.5 million people in the sparsely populated nation were registered to vote.
SWAPO has governed since leading mineral-rich Namibia to independence from South Africa in 1990 but complaints about unemployment and enduring inequalities could force Nandi-Ndaitwah into an unprecedented second round.
IPC leader Panduleni Itula, a former dentist and lawyer, said Wednesday he was optimistic he could “unseat the revolutionary movement.”
Itula, 67, took 29 percent of votes in the 2019 elections, losing to SWAPO leader Hage Geingob with 56 percent. It was a remarkable performance considering Geingob, who died in February, had won almost 87 percent five years before that.
Namibia is a major uranium and diamond exporter but not many of its nearly three million people have benefitted from that wealth.
“There’s a lot of mining activity that goes on in the country, but it doesn’t really translate into improved infrastructure, job opportunities,” said independent political analyst Marisa Lourenco, based in Johannesburg.
“That’s where a lot of the frustration is coming from, (especially) the youth,” she said.
Unemployment among 15- to 34-year-olds is estimated at 46 percent, according to the latest figures from 2018, almost triple the national average.
First-time voter and environmental health student Sophia Varela, 24, told AFP she was “hoping for change” and “jobs for the youth.”

For the first time in Namibia’s recent history, analysts say a second voting round is a somewhat realistic option.
That would take place within 60 days of the announcement of the first round of results due by Saturday.
“The outcome will be tight,” said self-employed Hendry Amupanda, 32, who queued since 9:00 p.m. the night before to cast his ballot.
“I want the country to get better and people to get jobs,” said Amupanda, wearing slippers and equipped with a chair, blanket and snacks.
Marvyn Pescha, a self-employed consultant, said his father was part of SWAPO’s liberation struggle and he was not going to abandon the party.
“But I want SWAPO to be challenged for better policies. Some opportunistic leaders have tarnished the reputation of the party, they misuse it for self-enrichment,” the 50-year-old said.
While lauded for leading Namibia to independence, SWAPO is nervous about its standing after other liberation-era movements in the region have lost favor with young voters.
In the past six months, South Africa’s African National Congress lost its parliamentary majority and the Botswana Democratic Party was ousted after almost six decades in power.
 


Taiwan holds air, sea drills as China keeps up pressure

Taiwan holds air, sea drills as China keeps up pressure
Updated 15 min 18 sec ago
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Taiwan holds air, sea drills as China keeps up pressure

Taiwan holds air, sea drills as China keeps up pressure
TAIPEI: Taiwan’s military deployed aircraft, ships and air defense missile systems in a drill on Thursday, as its defense ministry reported the detection of two Chinese balloons near the island.
China and Taiwan have been ruled separately since 1949, but Beijing considers it part of its territory and has refused to renounce the use of force to bring the island under its control.
Beijing regularly deploys fighter jets, drones and warships around Taiwan, and occasionally balloons, as it keeps up military pressure.
The early morning exercise was aimed at testing “the response and engagement procedures of air defense units,” Taiwan’s Air Force Command said in a statement.
“Various types of aircraft, ships, and air defense missile systems were deployed from 5:00 am to 7:00 am,” the statement said, without providing details.
The last time the Air Force Command held such drills was in June, a month after Taiwan President Lai Ching-te took office.
Taiwan’s defense ministry reported Thursday it had detected two Chinese balloons over waters north of the island.
The balloons were spotted on Wednesday afternoon in two locations about 111 kilometers (69 miles) northwest and 163 kilometers north of Keelung City.
That follows the sighting of a Chinese balloon on Sunday over the same waters.
Along with the two balloons, 13 Chinese military aircraft and seven navy vessels were spotted around Taiwan in the 24 hours to 6:00 am on Thursday, the ministry said.
Taiwan lives under the constant threat of a Chinese invasion and has ramped up defense spending in recent years to strengthen its military capabilities.
The island has a home-grown defense industry but also relies heavily on arms sales from Washington, which is Taiwan’s most important partner and biggest provider of weapons and ammunition.
Taiwan has described the balloons as a form of “grey zone” harassment — a tactic that falls short of an act of war.

LVMH chief Bernard Arnault to testify in France spy trial

LVMH chief Bernard Arnault to testify in France spy trial
Updated 28 November 2024
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LVMH chief Bernard Arnault to testify in France spy trial

LVMH chief Bernard Arnault to testify in France spy trial
  • Arnault is not accused of any wrongdoing in the trial after paying a 10 million euro settlement in 2021 to close a criminal probe into LVMH’s role in the case

PARIS: LVMH Chairman and CEO Bernard Arnault is set to testify at a Paris court on Thursday in the trial of France’s former spy chief Bernard Squarcini, a case that has cast light on the lengths to which the world’s biggest luxury group has allegedly gone to protect its image.
Squarcini, who headed France’s counter-intelligence services from 2008 to 2012, was later hired by LVMH as a security consultant, during which time he allegedly illegally collected information on private individuals and violated privacy laws while helping the company fight counterfeits and monitor left-wing activists planning to target the company with protests.
He is also charged with leaking classified information, interfering with justice and peddling influence.
Squarcini’s lawyers did not immediately respond to a request for comment.
Arnault is not accused of any wrongdoing in the trial after paying a 10 million euro settlement in 2021 to close a criminal probe into LVMH’s role in the case.
He has said that the recruitment of Squarcini was conducted by Pierre Gode, his longtime right-hand man at LVMH who died in 2018, and that he was unaware of information allegedly collected by Squarcini, according to court documents.
However the two-week trial has thrust the billionaire into the spotlight at a time when his sprawling luxury empire is already navigating a downturn in the industry and a reshuffling of top management.
LVMH paid Squarcini’s consulting firm Kyrnos 2.2 million euros for services including allegedly searching the background of individuals suspected of counterfeiting luxury goods.
He also allegedly monitored Francois Ruffin, a French activist who is currently a politician, and members of his left-wing publication Fakir as they planned to disrupt an LVMH shareholder meeting and prepared their satirical, documentary film “Merci Patron.”
The film, which won the French Cesar award for best documentary in 2017, follows a family that lost their jobs at a supplier to LVMH.
Bernard Arnault’s lawyer did not immediately respond to a request for comment.


Adani allegations shine spotlight on India’s clean energy conundrum

Adani allegations shine spotlight on India’s clean energy conundrum
Updated 28 November 2024
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Adani allegations shine spotlight on India’s clean energy conundrum

Adani allegations shine spotlight on India’s clean energy conundrum
  • The problem is that India’s states are unprepared for the rapid rise in renewable generating capacity, lack adequate transmission infrastructure and storage

NEW DELHI: Bribery allegations against Adani Group founder Gautam Adani have highlighted the growing problem India’s renewable energy developers face in finding buyers for the power they generate.
While India’s central government wants to shift away from polluting coal-fired generation toward solar and wind, officials say state government-owned power distribution companies responsible for keeping the lights on have dragged their heels over striking renewable purchase deals. US authorities allege that Indian billionaire Adani conspired to devise a $265 million scheme to bribe Indian state government officials to secure solar power supply deals, after one of his companies was unable to secure buyers for a $6 billion project for several years.
The Adani Group has denied the charges.
The conglomerate is not alone in facing increasingly long delays in signing up buyers for the renewable electricity capacity which is now being developed in coal-dependent India — the world’s third-largest emitter of greenhouse gases.
Coal accounted for 75 percent of India’s power generation during the year to the end of March, with renewables such as solar and wind, but not including hydro-electricity, making up about 12 percent.
India is still more than 10 percent short of its much-publicized pledge to add 175 gigawatts (GW) of renewable power by 2022.
That has led the federal government to ramp up bidding for renewable projects to meet an ambitious 2030 target of increasing its non-fossil fuel capacity to 500 gigawatts (GW). In the five years to March 2028 it plans to tender for more than four-times the capacity of renewable energy projects it commissioned in the preceding five.
To push states to help meet India’s overall goal, New Delhi in 2022 introduced so-called renewable purchase obligations (RPOs), which mandate that states increase clean energy adoption so that the national share doubles to 43.3 percent in March 2030.
Honouring these RPOs would require 20 of the 30 provinces monitored to more than double the share of green power in their electricity mix, a February report by government think-tank NITI Aayog showed.
The problem is that India’s states are unprepared for the rapid rise in renewable generating capacity, lack adequate transmission infrastructure and storage and would rather rely on fossil fuel for supply than risk “intermittent” renewables.
The challenges were stark in the case of Adani Green, India’s largest renewable energy company, which took nearly 3-1/2 years to strike supply deals with buyers for the entire 8 gigawatts (GW) of solar power capacity it won in a tender widely publicized as the country’s biggest.

DEMAND POOL
Yet setting targets for tenders and issuing contracts is “meaningless” so long as interest from power distribution companies is so low, said R. Srikanth, energy industry adviser and dean at India’s National Institute of Advanced Studies.
And the allegations against Adani are likely to result in a further renewables slowdown, as low-cost finance from foreign investors may become more difficult to secure, Srikanth said.
A change in the way some tenders are run has exacerbated delays in the time it takes to complete renewables projects. The tender won by Adani Green was the first major contract issued by state-run Solar Energy Corp. of India (SECI) without a state-guaranteed Power Purchase Agreement (PPA).
When announced in June 2019, SECI said buyers were guaranteed, but it withdrew the provision from the deal signed a year later.
SECI’s chairman told Reuters last month that a three-fold increase in tendering of renewable projects has left 30 GW of projects for which bidding is complete, but without buyers.
“You can’t expect the states to respond and start signing three times the power supply agreements,” R P Gupta told Reuters in an interview, adding that a “demand pool has to be created” and states had to be “sensitised” to renewables.
Brokerage JM Financial said that it now takes 8 to 10 months to sign power supply deals after a contract is awarded.
By comparison, companies that were awarded contracts between July 2018 and December 2020 needed around three months to strike supply deals, SECI data showed.
“The sudden surge in bids, large pipeline of projects under construction, mismatch in power demand and bid-pipeline ... and constraints in timely execution of projects are leading to delays in signing,” JM Financial said.
Renewable energy projects have also seen cancelations, with about 4 percent-5 percent of all tendered projects annulled, and backlogs in transmission infrastructure development, Gupta said.
One solution, said Rakesh Nath, former chairman of India’s Central Electricity Authority, would be knowing how much power buyers want before projects are bid for.
“Taking buyers into confidence before inviting bids may minimize delays in signing power supply agreements,” he said.


‘Anti-woke’ Americans hail death of DEI as another domino topples

‘Anti-woke’ Americans hail death of DEI as another domino topples
Updated 28 November 2024
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‘Anti-woke’ Americans hail death of DEI as another domino topples

‘Anti-woke’ Americans hail death of DEI as another domino topples
  • Conservative activists hailed 2023 as a landmark year in America’s never-ending culture wars

WASHINGTON: America’s largest private employer, Walmart, is the latest name to join a list of US businesses and institutions rethinking programs to bolster minority groups as support for progressive policies erodes.
Walmart said it will phase out the terms “diversity, equity and inclusion” (DEI) and “Latinx,” end supplier diversity programs, shutter a racial equity center and pull out of a prominent gay rights index.
The announcement comes in the wake of similar moves by a string of prestige brands — from Ford, John Deere and Lowe’s to Harley-Davidson and Jack Daniel’s — reflecting a backlash against so-called political correctness in American public life.
The rightward shift is credited in part for populist Donald Trump’s White House comeback and for laying the groundwork for a 2023 Supreme Court ruling ending affirmative action in college admissions.
DEI initiatives aim to right historical discrimination but conservatives have long criticized them as unfairly targeting white people, particularly men, as well as being performative “virtue-signaling.”
Anti-DEI activist Robby Starbuck, who lobbied Walmart before its announcement, celebrated the “biggest win yet for our movement to end wokeness in corporate America” and noted that the company’s stock had risen 2.1 percent.
“Our movement is a force in the market. Go woke, go broke actually has meaning now,” he posted on X.
Starbuck, 35, told AFP in an interview before Trump’s November 5 victory over Democrat Kamala Harris — who was criticized for previous “woke” policy positions — that ordinary Americans were sick of inclusivity and diversity policies at US companies.
“People are entitled to their views, and we need to have a system that creates equal footing for everybody and doesn’t force any one ideology down everybody’s throats,” he said.
Emboldened by Trump’s campaign pledges to end “wokeness,” conservative groups have been filing numerous lawsuits targeting corporate and federal programs aimed at elevating minorities and women.
Trump himself focused mostly on political correctness that he says is infecting the nation’s classrooms, promising executive orders to cut federal funding schools pushing critical race theory and “transgender insanity.”
The president-elect has surrounded himself with anti-woke allies of all stripes, including his incoming deputy policy chief Stephen Miller, whose America First Legal group has targeted corporate diversity.
The military has been the main target of anti-woke crusaders in the US Congress, who argue that racial justice education and an obsession with climate change have made the troops go soft and driven a recruitment slump.
Republican lawmakers who spent much of the last congressional session locked in a war with Pentagon leaders on political-correctness were rewarded with Trump’s pick to lead the defense department’s workforce of three million — anti-DEI Fox News host Pete Hegseth.
Conservative activists hailed 2023 as a landmark year in America’s never-ending culture wars, when the conservative-majority Supreme Court ended affirmative action in university admissions, reversing a major gain of the 1960s Civil Rights Movement.
Conservative groups pounced on the ruling to fight all manner of diversity programs in court.
And in March, the University of Florida ended DEI programs and related jobs as part of Republican Governor Ron DeSantis’s offensive against “woke ideology” — joining campuses in around a dozen other states.
Workers are divided on the merits of DEI, with a slowly-growing share saying their company pays too much attention to the issue — 19 percent in an October Pew Research Center poll compared with 14 percent in the same survey in February 2023.
But a new poll of 1,300 employees from business think tank The Conference Board, showed a robust 58 percent indicating that their organization devotes the appropriate level of effort on DEI.
“Leaders should focus on what really matters for their workforce amid the noise, as these initiatives are crucial for attracting and retaining current and future talent,” said Allan Schweyer, the group’s principal Researcher for human capital.