The Rational Walk has published several hundred articles regarding Berkshire Hathaway. This archive displays all articles related to Berkshire except for In Search of the Buffett Premium, a research report published in 2011. In addition to browsing the list of articles, you may also search for a specific topic within the archive by using the search box below. A separate archive exists for coverage of other companies. Berkshire is sometimes mentioned in the Rational Reflections weekly newsletter which has a separate archive.

So much for the conspiracy theories!  Moody's, which is 20% owned by Berkshire Hathaway, today downgraded the long term issuer rating of Berkshire two notches from Aaa to Aa2, and the Issuer Financial Strength (IFS) rating of most of the insurance subsidiaries one notch from Aaa to Aa1.  After taking this action, Moody's declared Berkshire Hathaway's ratings outlook to be "stable".  For those who have signed up for a free account with Moody's, the text ...
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Earlier this week, I wrote about Berkshire Hathaway's equity portfolio results for Q1 2009.  I based this analysis on the positions listed in the Form 13F report that institutional investment managers must file with the SEC each quarter.  Form 13F includes shares of foreign issuers only if those shares are held as ADRs that trade on a United States stock exchange.  Shares that trade on foreign exchanges are not reported on this form.  See question 40 ...
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Charlie Munger's annual letter to shareholders of Wesco Financial Corporation was published on March 27.  Wesco Financial is a publicly traded company that is 80 percent owned by Berkshire Hathaway.  Charlie Munger is Berkshire Hathaway's longtime Vice Chairman and also serves as Chairman and President of Wesco Financial.  Compared to Warren Buffett's letters to shareholders of Berkshire Hathaway, Charlie Munger's letters to Wesco shareholders tend to be much more brief but nonetheless provide important insights from one ...
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Despite a rally in March, the overall stock market was down sharply during the first quarter of 2009 with the S&P 500 posting a decline of 11.7% and the Dow Jones Industrial Average declining 13.3%.  At their low points of the quarter, both the Dow and S&P 500 were down in excess of 25%.  Berkshire Hathaway's stock portfolio has suffered large market declines during the quarter as well.  Let's take a look at Berkshire's holdings ...
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Berkshire Hathaway sold $750 million of three year 4 percent notes today priced to yield 282 basis points more than Treasuries of similar maturities based on several news stories published today.  Berkshire Hathaway Finance Corporation has issued the debt to provide funds for the Clayton Homes subsidiary for purposes of mortgage origination.  I wrote about Clayton homes earlier this month and noted the company's admirable track record related to its lending practices and the low ...
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Over the past month, I wrote a few posts regarding potential arbitrage opportunities available due to discrepancies between the relative valuations of Berkshire Hathaway's Class A and Class B shares.  The arbitrage opportunity identified in these posts has now been entirely eliminated as a more "normal" relationship between the Class A and Class B shares returned.  Let's revisit what took place over the past month and the implications for the notion that the market for ...
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In a widely anticipated move, Standard & Poor's today revised its outlook on Berkshire Hathaway from stable to negative.  Standard & Poor's reaffirmed Berkshire's AAA rating for now.  This action follows the March 13 downgrade of Berkshire by Fitch Ratings which I wrote about earlier this month.  Ever since the Fitch action, there has been intense speculation regarding whether Moody's and Standard & Poor's would make a similar move.  Let's examine the reasoning used by Standard ...
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GEICO has announced plans to begin selling auto insurance in Massachusetts following the implementation of reforms that eliminate price regulation by the state and permit companies to set their own rates.  With GEICO's entry into the Massachusetts market, the company will now offer auto insurance in all fifty states.  The auto insurance reform introduced by Governor Deval Patrick one year ago has encouraged several other insurers including Progressive, to enter the state.   When Progressive entered the ...
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At a time when the newspapers are full of stories about predatory lenders, irresponsible homeowners, and the terrible impact of foreclosures on the national economy, it is refreshing to read about a home builder that largely avoided the housing meltdown.  The qualities of the company and its customers can serve as a case study demonstrating the positive outcomes that occur when all parties to a transaction attempt to operate with a sense of accountability and ...
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The steep market declines over the past year have left many state and local governments struggling with severely underfunded pension plans.  The Wall Street Journal reported today that several states and municipalities are considering extreme measures to address pension shortfalls.  For example, New Jersey is considering a bill that will allow municipalities to defer payment of half of their annual pension bill for a full year.  Pennsylvania's state employee and pubic teachers pension funds have ...
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Berkshire Hathaway and Swiss Re have finalized the terms of the funding arrangement initially announced on February 5, 2009.  While the main elements of the deal have been known for some time, this is a good opportunity to revisit the terms of the arrangement and the overall nature of this investment. Berkshire Takes 3 Percent Stake in January 2008 In January 2008, Berkshire Hathaway took a 3 percent stake in Swiss Re and also agreed to ...
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Fitch Ratings has downgraded Berkshire Hathaway's Issuer Default Rating to AA+ from AAA and downgraded Berkshire's senior unsecured debt rating to AA from AAA.  Fitch has affirmed the AAA rating on Berkshire's insurance and reinsurance subsidiaries.  The outlook for all rated entities is currently "negative".  The press release (ironically distributed by BusinessWire, a Berkshire Subsidiary), may be found at this link.  Let's take a closer look at the reasoning employed by the Fitch analyst to ...
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Warren Buffett has a long standing reputation for not making stock recommendations, particularly in cases where Berkshire holds positions. I believe that this long standing policy has been in place primarily for two reasons, each of which has been very important to his success and reputation over time. First, Buffett obviously does not want to tip his hand if he is interested in buying or selling a stock. Second, Buffett knows that a large number ...
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Last month, I wrote about potential opportunities to profit from pricing discrepancies between Berkshire Hathaway Class A and Class B shares.  While the arbitrage opportunity was reduced significantly by February 26, it has re-emerged again more recently.  If someone holding A shares decided to sell one A at the close this afternoon, he could have purchased 31.69 B Shares.  This is short of the record high figure of 32.26 on February 20, but still a ...
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