OtherHi, I'm CNBC producer Katie Kramer.
OtherToday on Squawk Pod, succeeding the great Warren Buffett.
QuestionerThe shoes to fill are tough on all fronts.
OtherGreg Ael, the new CEO of Berkshire Hathaway, joins us for his first major interview since taking over from the Oracle of Omaha on January 1st. Ael on the Berkshire Companies investment portfolio and the $370 billion plus cash pile. We really view that as an opportunity.
QuestionerPlus, in a move befitting Buffett himself, this new CEO isn't too concerned about his paycheck.
QuestionerSo, you're basically taking all of your take-home pay and putting it into shares of Bergkshire.
Greg AbelYes. And the Y is really important.
QuestionerBig shoes to fill and a big promise.
Greg AbelI'm committed to doing this every year.
QuestionerYour entire salary.
Greg AbelMy entire salary as long as I'm the CEO.
OtherAll that and more coming up today. It is
OtherAll that and more coming up today. It is Thursday, March 5th, 2026. Squawkpod begins right now.
Becky QuickGood morning everybody. Welcome to Squawkbox right here on CNBC. I'm Becky Quick along with Joe Kernen and Andrew Ross Sorkin. Andrew, good morning. It's good to see you.
Andrew Ross SorkinMorning from Washington DC, but you can't tell right now because it's like boggy bottom behind me. This is typically where you see the capital right behind us. You know this shot. Wow. Joe was just sitting in this chair before I think about a week and a half ago and uh here we are in
Joe Kernenwell anyway may maybe the father.
Becky QuickWe'll take your word for it. Hopefully it's there.
Andrew Ross SorkinWe we didn't miss anything.
Joe KernenYeah.
OtherThe clerk will report.
OtherSenator from Virginia, Mr. Kaine moves to discharge SJRES 104 to direct the removal of United States armed forces
Otherremoval of United States armed forces from hostilities within or against the Islamic Republic of Iran that have not been authorized by Congress from the Committee on Foreign Relations.
OtherMr. President,
OtherSenator from Virginia,
OtherI ask for the yays and
OtherMr. Johnson. No. Mrs. Capito, no.
OtherOn this, the yays are 47, the naysay are 53. The motion to discharge is not approved. The Senate voting down an effort to stop America's involvement uh in the Iran war. The vote on the so-called war powers resolution was 47 in favor to 53 opposed. It was largely along party lines. Passage would have meant senators would have a say before future US attacks. The House is set to vote on a resolution today. Uh even uh Senator Federman who voted uh no on it. Ran Paul went the other way and voted yes on it. But uh the the Federman was pointing out this is this is all for
Questionerpointing out this is this is all for show because he has 60 days uh from from the beginning of before anything. So it was just done to register um disapproval uh at this point and and nothing was going to happen and it wouldn't happen anyway and it wasn't going to pass. But certainly within Congress's right uh to do this and they've done it in the past for different um for different operations. It goes back the only time we've declared war uh in the last 100 I guess World War II was the last time that there was actually a declaration of war. And there were a couple of uh incidents with Obama u guys where you still had a a something that was passed after um 9/11 that allowed for anyone even remotely concerned with that. You could you could make the case that I still have the authority to do something with that. Libya uh less so and then some
Questionerthat. Libya uh less so and then some previous I mean think about it Korea Korean war never declared the Vietnam war never declared it's it's u it is and and as it's remember when we talked about strategic am am am am am am am am am am am am am am am am am ambiguity for Taiwan the writers of the constitution they said one thing in article one and another thing in article two and it it's there is some ambiguity the commander-in-chief has has the right to command the military as he sees fit. Yet, Congress has to weigh in on actually declaring war. So, both sides have always been able to to find enough wiggle room to to do exactly what's happening.
OtherThe document has stood the test of time.
QuestionerYeah. Yeah. They were they were pretty savvy or they didn't know exactly how to
OtherWell, how can you anticipate what's going to be happening 250 years in the future?
QuestionerRight. Exactly. 250.
OtherRight. Exactly. 250.
OtherRight. Exactly. 250.
OtherExactly. Right.
OtherExactly. Right.
OtherExactly. Right.
OtherAll right. Right. In the meantime, the
OtherAll right. Right. In the meantime, the
OtherAll right. Right. In the meantime, the CEO of Anthropic still trying to reach a deal with the Pentagon on use of his company's AI. The Financial Times says that Anthropic chief Dario Amodi has been speaking with an under secretary of defense in an effort to define how the Pentagon could use the company's technology. An agreement could mean that Anthropic avoids the designation of supply chain risk. Reuters is reporting that Emodi has spoken about this situation in recent days with Amazon CEO Andy Jasse and others. Separately, in a letter that was shared with CNBC, a group of former defense and intelligence officials and policy experts called for Congress to investigate the Pentagon's decision to designate Anthropic as that supply chain risk. And without naming Anthropic, a tech industry group whose
OtherAnthropic, a tech industry group whose members include Nvidia, Google and Anthropic voiced concern to the defense department over that supply chain risk designation. In the meantime, the FT reports that OpenAI is looking to add to protections to its own agreement that was reached recently with the Pentagon. That deal has faced criticism from OpenAI employees and CEO Sam Alman admitted that in his words the timing of that deal looked both opportunistic and sloppy and there is fallout kind of on all sides of this. It's a continuing conversation. We've been having the discussion here all week on set um going back and forth about what should happen. We brought it up yesterday with Treasury Secretary Bessant. just this idea. It's one step to say you're not going to use the techn technology. It's quite another thing to say that this is a supply chain
Otherthing to say that this is a supply chain risk which means that defense uh that anybody who's a contractor to to the government can no longer use that technology as well.
OtherAnd there's nothing close sorcin I mean for for what it's used for uh in in this context there's there's nothing and it's we're still using it right even though we say we're not we still are right. No, look, the the we're going to be using the defense department is going to be using Anthropic, I imagine, at least for the next six months as they get offboarded uh and maybe onboard other models. In this particular moment, yes, Claude and and the product that Anthropic provides is probably the quote unquote best product. Having said that, it's possible in two months from now that the next version of of what OpenAI is doing will be the best version of it. may be that Google is the best version
Questionermay be that Google is the best version of it. But interestingly to me, the backlash uh that's happening inside OpenAI and the fact that OpenAI plans to and if already hasn't effectively requested basically the same protections that uh that Dario at Anthropic was requesting, I think throws this whole thing up into a question. So when you hear Treasury Secretary Besson say we can't have companies telling us what to do. Well, if if that's true, then why are we signing up deals with Open AI? I think ultimately, and this is where I I think Sam Alman is is right, u you know, you don't want effectively CEOs to be making the decisions necessarily about how uh how and what these products can or cannot do. Having said that, you know, and you've probably heard the analogy many times, if you're going to manufacture a vehicle and it happens to
Questionermanufacture a vehicle and it happens to have a button inside the vehicle that's under development, uh, and you know that if you hit the button, it does terrible things or you're a healthcare company, you create a drug that mostly does good things, but maybe does some terrible things. The question is whether you should be selling the either selling that product at all or if you're going to, it should probably come with restrictions.
QuestionerYeah, we were talking yesterday. I understand the the the you know, you don't want perhaps the security of all Americans being, you know, looked at, but don't we already have autonomous weapons that we're using? Isn't Isn't that sort of what I mean, not necessarily just drones, but okay, so we want them and we're okay with it, but we don't want them being too good. I don't I don't understand. Don't we want the best autonomous weapon that? We just got
Questionerbest autonomous weapon that? We just got to admit it. We want killing machines that work for war and and we want to give our soldiers the best we have.
QuestionerRight.
Questioner>> Sure. But the product >> if the founder of the company is telling you that the product doesn't work.
Questioner>> Well, that's a different that's a different story.
Questioner>> No, but that No, that is the story. That is the story. If you if you talk to Dario, he will tell you that they are trying to make the product work. They want the product to work, but there are still You talk about hallucinations. You know, we have these conversations about how good or bad AI is. In this particular moment, it is unclear >> whether the product will work the way it's supposed to work all of the time. And if you're in the business of killing other people, I would hope that you would only want to use a product in
Questionerwould only want to use a product in which the company could stand behind the actual product that component part. If you believe that that's there may be other reasons that you remember how many times in the past defense contractors just had this you know there was a backlash culturally against ever doing supporting even I don't think that that's I don't think that's what's what's the issue here and first of all I don't think that's the issue here and I think the I know that but I think the secondary issue and maybe it's really the first issue here is one of personalities and of politics I mean unfortunately ely that's to me where this has gotten really all bollocked up. We're talking about supply chain risk and this and that, but ultimately if you understand Emil Michael at the Department of War and you understand where Dario is and you look at the
Questionerwhere Dario is and you look at the politics of both of those uh both of those folks, you look at the politics of the of the Secretary of the Treasury yesterday and some of the things that have been said over the years and and even where Open AI is, it all makes a lot more sense than the underlying argument about what's allowed and what's not allowed because effectively Open AI is trying to do exactly what that the thropics doing anyway.
QuestionerAnd and andrew, I will also say earlier this week we had Alex Harstre on with this. He is a veteran. He's now involved in in investing in all sorts of defense companies and beyond. His point was that the language of Silicon Valley is so different than the language of the defense department and that they end up talking over each other in some ways too. But it is easy to comment on the nomenclature
Questionerto comment on the nomenclature difference between Silicon Valley and the military-industrial complex. So when the Pentagon talks, the Pentagon is a command and control culture.
QuestionerHe thinks if you can boil this down and maybe um get to the point where you have other intermediators who are kind of helping you talk this through, you might be able to reach some sort of agreement. And I wonder if that's why, as the FT is reporting, Dario Modi is talking to Andy Jasse and others. um about exactly what this is.
OtherWell, look, the reason he's talking to Andy Jasse is Andy Jasse is one of their largest investors. That's that's why he's talking to Andy Jasse,
Questionerbut he also has a better idea. I think Andy Jasse of how to talk to the government in some of these ways too
Otherto some degree. But but I would argue, by the way, Emil uh grew up in Silicon
Questionerby the way, Emil uh grew up in Silicon Valley. I mean, the the guy who is negotiating this deal, the one who has been on Twitter saying what he's been saying about anthropic and the like, >> worked at Uber. This is to me this is not a conversation about people talking past each other or something else. These people know each other. They know each other and don't like each other. That that's what's happening here. Well, that happens too. U Well, so we we all can agree that we want the best AI operated autonomous weapons that we can possibly get. We we but we definitely don't want them like >> we don't No, we don't. Right. But we don't want the weapons to be launched and then come back and hit the place they were launched. Correct. That would be bad. That would be bad. >> Okay. >> You want war games. >> We want We want them to work. >> War games. I don't know if you remember
QuestionerWar games. I don't know if you remember the math we brought.
QuestionerIt's a moral question. Do you want the I mean, think about the nuclear arsenal. Do you really want to make things like that that can ever be used?
QuestionerSo,
Questionerwell, or that can be used without a human.
QuestionerWell, that was the uh the think of the neutron bomb. Leaves all the buildings.
QuestionerJust kills people.
QuestionerWell, um we're a business show, but these things matter. Cheese will be next.
OtherComing up, for the first time in some 60 years, Bergkshire Hathaway has a new leader. CEO Greg Ael joins us for his first sitdown interview since succeeding famed investor Warren Buffett earlier this year. And he came out of the gate with an 18page shareholder letter. No pressure.
QuestionerPresident Lincoln said, "Yes, this letter is very long, but I didn't have time to make it shorter."
QuestionerAnd I use that to everyone cuz everybody would be texting me. I'm halfway through. But so far it's going well.
Other>> Squawk Pod. We'll be right back.>> This is Squawk Pod from CNBC.>> Stand Becky by in three, two, one. Cure, please.
Becky Quick>> Good morning everybody and welcome back. We have some breaking news right now coming from Berkshire Hathaway. The company has just filed a form for an 8K. And joining us to talk about those topics and his first letter to shareholders after taking the reigns from Warren Buffett is Berkshire Hathaway CEO Greg Ael. Greg, welcome. It is great to see you this morning.
Greg Abel>> It's great to be here. Good morning, Becky. Morning, Joe.
Becky Quick>> Yeah, we we really appreciate you coming on set. We have so much to talk about. But let's jump in with the news that is just crossing the wires and that's what's coming from the 8K. That's the
Questionerwhat's coming from the 8K. That's the big headline here that Bergkshire Hathaway has begun repurchasing shares of the common stock under the previous policy that had been out there before. How many shares are you buying back? Why are we hearing about this?
Greg AbelYes. So, we've had a long-standing policy that uh when the intrinsic value as we see it and computed on a conservative conservative basis when it exceeds our market price, Berkshire has always acquired shares. That's been our LA long-standing policy. We highlighted that in the 10K and in my letter that that remained in place and we've just recommenced yesterday. So the the point being we see value the intrinsic value exceeds the current market value and we started uh recommence purchasing and we felt it was important to communicate to our shareholders, our partners, our owners that with the transition
Questionerowners that with the transition uh of leadership and that this is the uh of leadership and that this is the first time we're purchasing shares. It was important to let them know we've recommenced.
Questioner>> Yeah. The last time that you had bought back shares was May of 2024. Um, Bergkshire shareholders have long realized that it might be Charlie maybe or Warren talking to each other kind of figuring what they thought was a fair value for the price of things. Did you talk to anybody about it or you looked at it and you thought this is a good time to be buying back?
Greg Abel>> No, absolutely talked to Warren. So how we how I approached it was obviously looking at the value
Greg Abel>> um having a view of intrinsic value consulted with Warren relative to the value and the timing of is it ready to are we ready to recommence and the and the thought there was after the consultation we filed our 10K we there's
Otherconsultation we filed our 10K we there's a 70 uh a 48 hour cooling off period Monday and Tuesday and we commence purchasing on Wednesday morning.
QuestionerHave you been looking at this for a long time?
WarrenUm, we look at it continuously.
QuestionerWhat are the three top things that that would make you think that is it something to price the sales? Is it what jumps out as as as a signal that these the intrinsic value is not recognized by the share price? Which thing?
WarrenWhat what we always look at is what are the economic prospects of each of our companies in Bergkshire.
QuestionerMhm.
WarrenAnd we look at that over the long term. Is it a gut feeling more than are there numbers where you say okay this hit you know 80% of book this part of Berkshire or something like nothing
Questionerit's really just looking at the economic opportunities that exists within Berkshire and are we comfortable that
QuestionerBerkshire and are we comfortable that the value proposition is very strong and we're doing it on behalf of obviously our shareholders and owners. We have to view this as value that we're creating value for our shareholders long term. So if the stock goes up from from the announcement or from the buybacks, how long how long would you do this? How how much will you keep doing it until it remains the case that you feel it's it's underval? You can do as much as you want.
Greg Abel>> Correct. As long as our intrinsic value exceeds the market value again conservatively determined, we'll continue to repurchase. But the one thing we have never done is we don't disclose the amount, the timing or the computation. But we did feel this time it was important because of the change in leadership that we should
Questioner>> not even ballpark it.
Greg Abel>> So we're not going to we're not going to
QuestionerSo we're not going to hear from hear something like this from you again. We won't know when you're in the market buying back.
WarrenThis is a a a one-time event to let our
QuestionerIt's a 20 billion buyback and we we're halfway through. We won't know anything.
WarrenCorrect.
QuestionerIs that a reasonable number? Could it be a it could be a lot more at Birkshire?
WarrenIt's completely dependent upon the intrinsic value. Okay.
QuestionerAnd and how that equation remains in place. So Bergkshire shares up until a minute ago were down maybe 1% over the last year. Market's been up. You guys have $373 billion in cash as of the last filing. Correct. I guess you're looking around and it tells you that this is something that makes way more sense to you than buying other things, other stocks, but making other purchases.
WarrenExactly. We always look at effectively
Greg AbelExactly. We always look at effectively three buckets when we're allocating our capital. We have our existing businesses uh deploying capital back into those both uh for their current operations and incremental opportunities that really exists every day and we're constantly challenging ourselves are we thinking about that properly as you highlighted Becky there's also do we acquire stock uh and and when we're looking at companies do we acquire whole companies also
Greg Abelum and then there's the do we acquire equities other equities and we as we've highlighted we always look at That is very similarly to buying 100% or 2%. And then the third bucket where we deploy our capital is share repurchases. Each of those with the amount of capital we have are uh can be done independently. So when we're purchasing our shares, it's not taking away from any the other
Otherit's not taking away from any the other decisions.decisions.decisions.
Questioner>> Okay. We're going to come back to this>> Okay. We're going to come back to this>> Okay. We're going to come back to this line of questioning and some of theseline of questioning and some of theseline of questioning and some of these issues here. But before we do, I want toissues here. But before we do, I want toissues here. But before we do, I want to talk about another form that you put outtalk about another form that you put outtalk about another form that you put out today, too. That's a form four. It maytoday, too. That's a form four. It maytoday, too. That's a form four. It may not jump out as people as being asnot jump out as people as being asnot jump out as people as being as significant as I think it is, but in itsignificant as I think it is, but in itsignificant as I think it is, but in it you say that you are buying 21 class Ayou say that you are buying 21 class Ayou say that you are buying 21 class A shares. This is the disclosure of thatshares. This is the disclosure of thatshares. This is the disclosure of that $15.3 million. What's the significance$15.3 million. What's the significance$15.3 million. What's the significance behind that purchase?behind that purchase?behind that purchase?
Greg Abel>> Yes. Um>> Yes. Um>> Yes. Um and and the significance is if you lookand and the significance is if you lookand and the significance is if you look at my 2026 compensation that I'llat my 2026 compensation that I'llat my 2026 compensation that I'll receive this year. What what we've donereceive this year. What what we've donereceive this year. What what we've done is and what I've done is taken the afteris and what I've done is taken the afteris and what I've done is taken the after tax dollars of approximately $15.3tax dollars of approximately $15.3tax dollars of approximately $15.3 million and reinvested it or purchasedmillion and reinvested it or purchasedmillion and reinvested it or purchased Berkshire shares with the after taxBerkshire shares with the after taxBerkshire shares with the after tax dollars.dollars.dollars.
Questioner>> All of the extra tax>> All of the extra tax>> All of the extra tax >> all the after tax dollars. basically>> all the after tax dollars. basically>> all the after tax dollars. basically taking all of your take-home pay andtaking all of your take-home pay andtaking all of your take-home pay and putting it into shares of Berkshire.
Greg Abelputting it into shares of Berkshire.
QuestionerYes. And and and the why is really important. Um one, as we've always highlighted, absolute alignment with our shareholders, our partners, our owners is critical. I already have some shares, but the goal was to continue to demonstrate alignment with them. two, as the CEO, I absolutely obviously believe in Bergkshire with with the transition from Warren and I I inherited a company that has an incredible foundation. I believe in its, you know, future, the opportunities that exist there. So, I was very excited to use my after tax proceeds and my compensation, as you highlighted, all of it, and effectively do it as we came out of the blackout period. Now, there is another part to this that's really important because I really view this more as a a plan or an approach. Um, I'm committed to doing
Greg Abelapproach. Um, I'm committed to doing this every year going forward.
QuestionerYour entire salary.
Greg AbelMy entire salary as long as I'm the CEO, and I touched on it in the in the letter. I hope it's 20 years, but I will do that. So, we'll file our 10K. Um, I'll write the letter and after the 48 hour cooling off period,
QuestionerI'll purchase 15.3 million next year, whatever it is after tax dollars. I love I love the Midwest, but I was kidding you when you walked in. I said, "It's your first move. You're you're going to Miami. You're going to move to headquarters Miami."
Greg AbelBut now I understand leaving in stay in Omaha. What are you going to spend your money on anyway? Might as well buy some B. You got nothing to do. You're going to go out watch some cows or something. That's free, isn't it?
QuestionerThere's nothing better than Bergkshire. And it's what I do every day. I wake up,
WarrenAnd it's what I do every day. I wake up, you know, thinking about Bergkshire. I go to sleep thinking about Berkshire.
QuestionerGreg, if you decide to splurge on on your compet, it's like you're looking around. It's like, ah, I'm going to buy your stuff.
QuestionerWhat I think is interesting about this, Greg, is that you are effectively taking home less pay than Warren Buffett was when he was taking home $100,000. That was the salary that he took. It was had to be the lowest pay in all of corporate America. Did he come up with this plan?
Greg AbelNo. this was completely myself and and by that I just mean I I wanted that alignment again believe in Berkshire and the and the thought being that um it did evolve like I said okay I'm going to do it this year and then shortly thereafter I thought well no I'm going to do this every year
Questionerand it's best just to tell the world and
Warrenand it's best just to tell the world and over that period of time it'll be hundreds of millions of dollars
Questionerright
Warrenof of my after tax dollars just like our shareholders
Questionercan't imagine I I can't imagine anybody any other corporate leader doing this. I can't imagine myself.
WarrenI I I'm not worried about how you're going to do on this either. So,
Questionerwell, I believe in Bergkshire, but it is interesting, Becky, and Joe, you're touching like um to me, of course, it's a logical thing to do when you're leading the company. And there's other leaders and CEOs that do the oneoffs every once in a while,
Questionerbut to take all your after tax dollars and to do it on a recurring
Questionersomething similar with vers stock, I I'm with you. I'm an owner. I'm an owner and I I
QuestionerYou did not take your entire
Questionergot a couple hundred shares.
QuestionerDid not take your entire Greg. What did
QuestionerDid not take your entire Greg. What did Warren say about this? What did the board say about it?
Greg AbelUh both were obviously very supportive. Warren very much had your reaction that uh no one else in corporate America does this and said and the other thing is that this is so Bergkshire because one thing we we do not do at Bergkshire across any of our businesses or with our executives we don't have equity stock programs
Questionerright
Greg Abelwe don't have option programs
Questioneryou've never been given a share of Berkshire ever
Greg Abelcorrect
Questionerso the whole idea is our shareholders our owners use their after tax dollars to by Berkshire, I'll do the same. So,
Greg Abelso Warren acknowledged immediately the alignment with our values and uh I highlighted this to our our Berkshire board in our February board meeting and they were just absolutely supportive of it obviously.
Otherit obviously.
Questioner>> Greg, Andrew's got a question as well.
Questioner>> Yes, Andrew.
Andrew Ross Sorkin>> Hey, Greg, it's great to see you. I applaud it too, but I just just to contextualize it um because we talked about selling shares. Am I wrong back in 2022 that that you sold Bergkshire Hathaway Energy and collected effectively $870 million? I by the way, which I also applaud, but I just contextually what's going on here in terms of your total to total compensation and what's going into this.
Greg Abel>> Correct. So, so Andrew, uh, back in the summer of 2022, uh, there was the decision to sell, uh, B, my Berkshire Hathaway Energy stock that had really accumulated going back to 1992, I think, is is the duration of uh, those holdings and and obviously we had built the energy company. were acquired by Berkshire in 2000 and then in 2022 monetized it and again with a very
Questionermonetized it and again with a very similar concept I took a portion of those proceeds on an after tax dollar basis and purchased Berkshire stock.
Greg AbelYeah, I bought I'll just say I bought a heck of a lot more than 21 shares.
Questioner21 shares that cost $730,000.
Greg AbelOh, that's right. Oh, that's right. But no, you're right. You're right. It's this was 32.
QuestionerGreg, let's talk through some other issues that $373 billion that you had on cash as of the last filing. Do you see other opportunities? Are you looking for a big elephant, elephant hunting as Warren always said he was doing?
Greg AbelRight. So, I touched on it a little bit earlier, but um the 373 million and billion a billion, sorry. Thank you. Um and fortunately it's a billion. Um you know we really view that as an opportunity and so we do continue to look across the different investment options that exist
Greg Abeldifferent investment options that exist out there and there really are options. We're looking at these different buckets and looking for the right opportunity. But there is no need to um obviously we want to deploy the capital into areas that we see long-term value creation for our shareholders. But the goal isn't to just take down the
QuestionerI guess my question is do you see value out there in the market right now? Are things expensive as you weigh them or do you see pockets of opportunity? A as as
Greg Abelwe see opportunity, you'll see the capital deployed and we're deploying it in certain areas across our businesses, across certain repurchases of our shares, across other equity opportunities, but the re the repurchase of our own shares is a great example is that uh Warren and I were just talking about discussing this yesterday. Uh you we wish we could purchase more shares of
Warrenwe wish we could purchase more shares of our shares, but the intrinsic value has to be there. So if you go back o over all the years that we've been purchasing shares, if we could acquire more, that's a great use of our capital, but it has to meet that intrinsic value.
QuestionerBut that's what I'm kind of getting at. You are now the person who's going to be responsible for deploying all of this capital. I I guess Ted Ted Wesler is there. He's going to be he's has 6% he's managing his money and the manage money that Todd Combmes was managing before, too.
Greg AbelFor sure.
QuestionerBut what is your view of the market at this point? It's something we ask of Warren all the time. Do you think things are expensive? If you think Bergkshire shares, uh, you're going to buy back some, but you're not going to deploy everything. You'd love to buy back more, but it's not cheap enough. What do you
Questionerbut it's not cheap enough. What do you think when you look at the overall market?
QuestionerYeah, I mean, obviously, we've commented on our shares.
QuestionerWe file our uh where we highlight what we've acquired and and what we've disposed of, you know, regularly. Um, you know, and and we have some activity there, but it's not significant.
QuestionerYeah. Are you I I guess are you reading through 10Ks and 10 Q's constantly and thinking
QuestionerI'm looking for ways to deploy this or are you looking at things a little differently than maybe because you're such an operator?
QuestionerI'm an operator but I love businesses and I love reading.
QuestionerYeah.
QuestionerSo I do the same thing. I'm I'm going through K's Q's. I'm looking at their what are they saying about their businesses? I'm looking at the industries that we we traditionally look at and and incrementally to make sure
Questionerat and and incrementally to make sure one have a thorough understanding of theone have a thorough understanding of theone have a thorough understanding of the industries what businesses stand outindustries what businesses stand outindustries what businesses stand out there. It doesn't mean it's uh anthere. It doesn't mean it's uh anthere. It doesn't mean it's uh an immediate that there's an immediateimmediate that there's an immediateimmediate that there's an immediate value proposition there to acquire itvalue proposition there to acquire itvalue proposition there to acquire it but that doesn't mean or a portion ofbut that doesn't mean or a portion ofbut that doesn't mean or a portion of the business but it doesn't mean itthe business but it doesn't mean itthe business but it doesn't mean it won't be there a month from now or threewon't be there a month from now or threewon't be there a month from now or three months. So I view of it a lot ofmonths. So I view of it a lot ofmonths. So I view of it a lot of preparation waiting for when we see thatpreparation waiting for when we see thatpreparation waiting for when we see that opportunity that the the value existsopportunity that the the value existsopportunity that the the value exists within a a specific opportunity.within a a specific opportunity.within a a specific opportunity.
Questioner>> You said you talked to Warren yesterday.>> You said you talked to Warren yesterday.>> You said you talked to Warren yesterday. How often do you talk to Warren Buffett?How often do you talk to Warren Buffett?How often do you talk to Warren Buffett?
Greg Abel>> Yeah, Warren and I pretty much he's in>> Yeah, Warren and I pretty much he's in>> Yeah, Warren and I pretty much he's in the office every day. Uh so we'rethe office every day. Uh so we'rethe office every day. Uh so we're talking every if I'm in Omaha, uh we'retalking every if I'm in Omaha, uh we'retalking every if I'm in Omaha, uh we're always connecting. If I'm traveling likealways connecting. If I'm traveling likealways connecting. If I'm traveling like I was yesterday, uh I often check in uhI was yesterday, uh I often check in uhI was yesterday, uh I often check in uh just to just to catch up on what he'sjust to just to catch up on what he'sjust to just to catch up on what he's seeing, what he's hearing, what am Iseeing, what he's hearing, what am Iseeing, what he's hearing, what am I feeling. Uh so if it's not every day,
QuestionerGreg, would would you do these large positions in like S&P bets that that Warren has done at times in the past? He sold a lot of puts, brought in billions of dollars in premium back in the uh the early 2000s. You've made some mac Warren used to make macro calls or at least hedging uh calls on the overall indices, not just individual stocks. Would would that continue with you?
Greg AbelI mean, if we see the right opportunity, yes, but it's not it's not a strategy.
QuestionerHe hasn't done it as much lately, I don't think, has he? But he I don't think he ever lost any money on any of those things. Did he ever? Well, not that I'm aware of, but I mean, as we all know, these financial markets have become more fine-tuned and and those opportunities, excuse me, may or may not exist going
Otherexcuse me, may or may not exist going forward. I where there's that you canforward. I where there's that you canforward. I where there's that you can see an opportunity and we would uhsee an opportunity and we would uhsee an opportunity and we would uh pursue or deploy capital. But if we sawpursue or deploy capital. But if we sawpursue or deploy capital. But if we saw an opportunity that that made sense toan opportunity that that made sense toan opportunity that that made sense to us, absolutely.us, absolutely.us, absolutely.
Questioner>> How about you remember back in the>> How about you remember back in the>> How about you remember back in the financial crisis when major companiesfinancial crisis when major companiesfinancial crisis when major companies would say, "Our can you?" and he'd say,would say, "Our can you?" and he'd say,would say, "Our can you?" and he'd say, "Yeah, I'd be glad to step in. Here's"Yeah, I'd be glad to step in. Here's"Yeah, I'd be glad to step in. Here's what you'll do." U 12%what you'll do." U 12%what you'll do." U 12% preferred stock convertible into Yeah. 8preferred stock convertible into Yeah. 8preferred stock convertible into Yeah. 8 10 Goldman blue chip companies that that10 Goldman blue chip companies that that10 Goldman blue chip companies that that I mean it was like a no-brainer. If II mean it was like a no-brainer. If II mean it was like a no-brainer. If I could have done it, I would havecould have done it, I would havecould have done it, I would have mortgaged the house and and gotten thosemortgaged the house and and gotten thosemortgaged the house and and gotten those terms if I could have. Would you do thatterms if I could have. Would you do thatterms if I could have. Would you do that again?again?again?
Other>> Absolutely. We look>> Absolutely. We look>> Absolutely. We look >> Yeah. Let me think about it. You can>> Yeah. Let me think about it. You can>> Yeah. Let me think about it. You can have some time if you want. Youhave some time if you want. Youhave some time if you want. You >> No, we don't need to pause on those. and>> No, we don't need to pause on those. and>> No, we don't need to pause on those. and and uh you know we still it it's not aand uh you know we still it it's not aand uh you know we still it it's not a distress time but we still receive thosedistress time but we still receive thosedistress time but we still receive those calls even today. Warren receives them
Greg Abelcalls even today. Warren receives them myself maybe not in a distress situation and we look at them we evaluate them but we're always prepared to act and we'll act decisively and quickly.
QuestionerCan you act the same way Warren did which would be to do a a deal for tens of billions of dollars um and basically get it done in three days
Questionerwithout necessarily telling the board until after the deal had been cut. Um
Greg Abelwell within that period of time we we we have a very good um process in place between Lauren and I and our board as to how we'll act as we have in the past and we'll act very decisively and quickly.
QuestionerSo you can do a big deal without
Questionerapproval. Well I would always um we we
Greg Abelhave certain parameters where I would make sure for example our lead director is aware of what we're doing. Okay. But it does allow me to um act and act uh
Otherit does allow me to um act and act uh quickly.quickly.quickly.
QuestionerOkay. Um what about the idea of a dividend? That was something that Warren Buffett's never been a fan of. Would you potentially give a dividend back to shareholders if you don't see other opportunities in the market?
Greg AbelYeah. And that's really, as you know, we we have our dividend policy in place and the and the thought and it's reviewed and approved by our board again on an on an annual basis and one that Warren has put forward every year. And we've we've maintained that that we will retain a dollar if we see the opportunity to create more than a dollar for our shareholders. And that's been the test. And we uh and as long as we meet that test, we would continue to hold the dollar because we believe we can create value for our shareholders long term. Now, incremental to that, we do see the repurchases as an opportunity
Questionerrepurchases as an opportunity effectively to deploy uh uh to return capital to our shareholders >> instead of dividends. You're basically saying,
Warren>> well, it's part of it. So, if we didn't meet that test, we'd do a dividend. But we do constantly look at the repurchase.
Questioner>> I don't think I've That's more than I think I've heard from Warren and Charlie in the past. Just the idea if you didn't meet that test, you'd do a dividend. Is that something you see in the near future?
Warren>> Uh, we don't see it in the near future because we we're clearly meeting the test as we see it,
Questioner>> but we've always stated if we don't meet that test, that's the time.
Questioner>> So, basically what you're saying is no change.
Warren>> Correct.
Questioner>> Okay.
Questioner>> Could you ever see a time?
Questioner>> Would you rather?
Questioner>> Warren a lot of technology. He may not have been the first person there, but he
Questionerhave been the first person there, but he he finally did enter and he entered bighe finally did enter and he entered bighe finally did enter and he entered big Apple, other other uh companies. IsApple, other other uh companies. IsApple, other other uh companies. Is there any chance that some type ofthere any chance that some type ofthere any chance that some type of blockchain new technology cryptoreated?blockchain new technology cryptoreated?blockchain new technology cryptoreated? Maybe not maybe not Bitcoin itself,Maybe not maybe not Bitcoin itself,Maybe not maybe not Bitcoin itself, maybe not, you know, Ether or ormaybe not, you know, Ether or ormaybe not, you know, Ether or or anything like that, but but a companyanything like that, but but a companyanything like that, but but a company that builds out a blockchain thatthat builds out a blockchain thatthat builds out a blockchain that suddenly all the tokens are moving on.suddenly all the tokens are moving on.suddenly all the tokens are moving on. this it it it looks like the future.this it it it looks like the future.this it it it looks like the future. Would that ever be a possibility or orWould that ever be a possibility or orWould that ever be a possibility or or crypto would never be a word you'd seecrypto would never be a word you'd seecrypto would never be a word you'd see on a on a Berkshire?on a on a Berkshire?on a on a Berkshire?
Warren>> I I don't think you'll see crypto>> I I don't think you'll see crypto>> I I don't think you'll see crypto >> ever any>> ever any>> ever any >> you know ever is a long time you never>> you know ever is a long time you never>> you know ever is a long time you never say never but I just don't see it. Whatsay never but I just don't see it. Whatsay never but I just don't see it. What I do see is that when it comes toI do see is that when it comes toI do see is that when it comes to technology again from a even from antechnology again from a even from antechnology again from a even from an operational perspective where we'reoperational perspective where we'reoperational perspective where we're seeing how we use it uh the impact it'sseeing how we use it uh the impact it'sseeing how we use it uh the impact it's having it does allow us to develophaving it does allow us to develophaving it does allow us to develop strong views and a better knowledge basestrong views and a better knowledge base
Greg Abelstrong views and a better knowledge base around certain companies that are technology companies or how we're using the technology. So technology will always be on the table and and looking at uhat uh
Questionerso it could include some type of blockchain.
Greg AbelUh, no. We I don't know like because I haven't seen anything that would make sense that there's a value proposition where you see the asset and how it produces value.
QuestionerSome people think it's going to dis intermediate the entire banking uh industry. You don't want to just watch while
Greg Abelwe'll be happy with our hard assets and the and the company own at that time.
QuestionerBut not gold. What about gold miners? I don't How about airlines? Where where's where are you on that now? Remember how many times Warren's been in and out of Oh my god. I'm in them. I'm out of them. I know this is one of your favorite topics. We're very happy that we own
Greg AbelWe're very happy that we own NetJets and the service it provides to uh its great customers.
QuestionerGreg, let me ask you a couple of quick news uh questions. First of all, back in January, Berkshire filed an SEC registration for the potential resale of up to 99.99% of the Craft Hines holdings that you own. Uh, more recently, you did say that you supported Craftine CEO, the decision to pause on that planned split of the company. Have you made a decision about what to do with that investment?
Greg AbelUh, well, we did announce, as I said, support for Steve pausing it.
QuestionerYeah.
Greg AbelUm, and just for a little bit of background, as you know, uh, when they first said they were going to split, we didn't, uh, we we expressed concerns with it.
QuestionerYou were vocal about it, right? because they did when they brought Craft and Hines together, the
Questionerbrought Craft and Hines together, the whole idea was that there'd be a lot of synergies, a lot of opportunities, and then they announced and and it's, as I highlight in the letter, it's been a disappointing investment. There's no question. At the same time, to break them apart when they're facing a lot of challenges and haven't resolved a lot of their issues yet, we had concerns with that, including now adding disenergies to it. So, for Steve to come in and say, "We're pausing it." there's opportunities within Craft Heights to fix things and get the business back on track and then he'll evaluate things. We thought that was absolutely the right approach and we filed our registration straight statement. Um really to be in a place that if we ever did sell we'd be able to but it's not that we're going to take any immediate action currently.
QuestionerOkay, good. Um, another issue this week
QuestionerOkay, good. Um, another issue this week S&P said that it may own it may cut Pacific Core Utility, which is a Bergkshire owned utility to junk because of the wildfires and the lawsuits that have been resolved about it. This is another issue you touched on in your letter to shareholders. I think in the letter to shareholders, you basically said, uh, you accept responsibility for wildfires, but you're going to fight unjustified claims in court. And you think that this is one of those situations, correct?
Greg AbelSo, uh, any anytime we're responsible for something, we're willing to take absolute responsibility for it and and resolve such matters. Um, but there is a delicate balance and it goes well beyond wildfires in the utility industry. The wildfires are very specific to the West and we've seen them some challenges in Texas and the Midwest
Greg Abelsome challenges in Texas and the Midwest that, you know, it's not a an issue just to the west, but you can see it it creeping. What we see is a bigger issue in the regula in the uh utility industry and that is does the regulatory compacts continue to exist and by the regulatory compact I mean we deploy capital into these businesses we we receive a return that's reflective of us taking a certain amount of risk
Greg Abeland the minute they start expanding that risk to be pretty much anything including things you're not responsible for we're saying that's that wasn't the investment thesis. That's not the relationship that existed.
QuestionerJust to put some context to this, th this came after a February 25th ruling where an Oregon jewel jury awarded $35 million to 16 plaintiffs. That's about $19 million per plaintiff. Those plaintiffs blamed Pacific for not
Otherplaintiffs blamed Pacific for not turning off the electricity.
QuestionerRight. and and and there were lessons learned because if you look and that's we're saying well the ones where we clearly uh caused the fire for not turning off the electricity we're taking responsibility for those. Um but separately there were a number of fires there and this gets beyond but but there is one area and one fire we we we're pushing back and it represents more than 60% of the claims. It was a lightning strike and and we're just saying we're not responsible for that. We're sorry absolutely that these people's lives have been impacted. We feel for them, but that's not the utilities responsibility to take on those costs and obligations. So, that's where we're drawing the line.
QuestionerAnd you guys know the insurance business pretty well, I think, don't you? You know when you're covered, things you
Questionerknow when you're covered, things you need to cover, and things that you can't run a business, >> right? And it goes back to that regulatory compact. That's not part of we we didn't sign up for that. Um,
Other>> this this was your first letter that you wrote. It was a long one, 18 pages or so. Um, it was >> that AI.
Other>> No, but I will say on the length I've had, that's the first response I get from everybody when they text me as they're reading it.
Other>> Geez, this is really long. I'm halfway through. And I I use this quote back to him and it won't be a perfect quote, but I Lincoln, President Lincoln said, "Yes, this letter is very long, but I didn't have time to make it shorter."
Other>> And I use that to everyone because everybody would be texting me, "I'm halfway through, but so far it's going well." And I text them that that quote every time.
QuestionerI mean, you're stepping into some pretty big shoes. Warren's been riding that lever for 60 years, and it's something that had a huge following. was a tough letter to write.
Greg AbelAbsolutely. So, those are there's those the shoes to fill are tough on all fronts, but Warren's an exceptional communicator and how he does it. So, to take the letter and really want to make sure we're communicating to our again to our owners and shareholders that's something that they would value it. It it was not easy. Yeah,
QuestionerI I've told Warren of all the listen the responsibilities transferred are great. But as far as the work and the task I had to do, that was the toughest to sit down and make sure uh that that was done at least from my perspective. Well, uh and and unfortunately when I when we were discussing it, he said, "And the
Questionerwere discussing it, he said, "And the second letter doesn't get any easier."
OtherSo, you have that to look forward to.
QuestionerYeah. Exactly. That's not what I wanted to hear.
OtherIt's every year
Questionerand it'll come fast, too. It's like you just finish it.
OtherIt's like t like like taxes.
QuestionerBut you know what? When you
Otherknow when you do write it, it's like everything or when you prepare for something,
Questionerit's valuable.
OtherI I had to reflect on a lot of things and then
Questionerwhen you're done, it's just leading into it. It's
Otherit's leading into it. Right. Exactly.
QuestionerGreg, very quickly, operating income was down in the fourth quarter more than 29%. That was largely because of weakness in the insurance business and as underwriting profits were down I think close to 50%. Um what what happened?
Greg AbelYeah. So in the fourth quarter which then translated for the 12-month results
Greg Abelthen translated for the 12-month results is that yeah our insurance results were down. You can see a lot of capital coming into the industry. we're going to we or our team uh Jetton and his team will continue to apply the discipline that um the price and the risk have to be right for us to write a policy. So as we back out of that with capital coming in, you'll see those results uh be what they are relative to uh how much capital we deploy into it. Um so that had a significant impact. And then the other piece of that is we did across our non-insurance businesses take a $ 1.555 billion um impairment
Greg Abeland that was across four of our businesses and realistically smaller businesses and challenged industries. If it had been any of our major businesses I would have touched on it but it really related to four of our smaller businesses again in
Questionerfour of our smaller businesses again in in industries that we see as challenged.in industries that we see as challenged.in industries that we see as challenged. Okay, Greg Ael, uh, the new CEO atOkay, Greg Ael, uh, the new CEO atOkay, Greg Ael, uh, the new CEO at Bergkshire Hathaway, sitting down withBergkshire Hathaway, sitting down withBergkshire Hathaway, sitting down with us for the first time today. We reallyus for the first time today. We reallyus for the first time today. We really appreciate it, Greg, and we look forwardappreciate it, Greg, and we look forwardappreciate it, Greg, and we look forward to seeing you at the annual meeting.to seeing you at the annual meeting.to seeing you at the annual meeting. So, it's not Kraton anymore, is it? IsSo, it's not Kraton anymore, is it? IsSo, it's not Kraton anymore, is it? Is it? Do you have a a team that you likeit? Do you have a a team that you likeit? Do you have a a team that you like in the in March Madness is coming? Andin the in March Madness is coming? Andin the in March Madness is coming? And
Greg AbelAbsolutely.
QuestionerI'll be I'll be I'll be cheering forI'll be I'll be I'll be cheering forI'll be I'll be I'll be cheering for Let's just say, Joe, as you touched onLet's just say, Joe, as you touched onLet's just say, Joe, as you touched on earlier, all the Midwest teams.earlier, all the Midwest teams.earlier, all the Midwest teams.
Joe KernenAll the Midwest teams.All the Midwest teams.All the Midwest teams.
Greg AbelAll of them.All of them.All of them. All of them. We've we've got, you know,All of them. We've we've got, you know,All of them. We've we've got, you know, my wife's from Iowa State. I I havemy wife's from Iowa State. I I havemy wife's from Iowa State. I I have allegiances with Nebraska because my Iallegiances with Nebraska because my Iallegiances with Nebraska because my I mentioned earlier my one grandgmentioned earlier my one grandgmentioned earlier my one grandg grandfather was born in Unadilla,grandfather was born in Unadilla,grandfather was born in Unadilla, Nebraska. I've always followed the cornNebraska. I've always followed the cornNebraska. I've always followed the corn Oscar. You name it. I've got a spectrumOscar. You name it. I've got a spectrumOscar. You name it. I've got a spectrum of teams and and my family reminds me ofof teams and and my family reminds me of
Questionerof teams and and my family reminds me of that. Pick a team.that. Pick a team.that. Pick a team.
QuestionerIowa State was looking good and then I>> Iowa State was looking good and then I>> Iowa State was looking good and then I bet on them and that's they were numberbet on them and that's they were numberbet on them and that's they were number four I think. Yeah, they lost the lastfour I think. Yeah, they lost the lastfour I think. Yeah, they lost the last two games I think.two games I think.two games I think.
Joe KernenYeah, they've had a rough couple games.>> Yeah, they've had a rough couple games.>> Yeah, they've had a rough couple games. Hopefully they find it. But I it's beenHopefully they find it. But I it's beenHopefully they find it. But I it's been a pleasure to be on. Thank you, Becky.a pleasure to be on. Thank you, Becky.a pleasure to be on. Thank you, Becky. Thank you, Joe. And uh just great beingThank you, Joe. And uh just great beingThank you, Joe. And uh just great being here.here.here.
Becky QuickDon't be a stranger. Yeah. Great to have>> Don't be a stranger. Yeah. Great to have>> Don't be a stranger. Yeah. Great to have you back. Thank you.you back. Thank you.you back. Thank you.
QuestionerThank you.>> Thank you.>> Thank you.
OtherWe'll be right back.>> And that's it for Squawk Pod today.>> And that's it for Squawk Pod today.>> And that's it for Squawk Pod today. Thanks for listening. Squawkbox isThanks for listening. Squawkbox isThanks for listening. Squawkbox is hosted by Joe Kernan, Becky Quick, andhosted by Joe Kernan, Becky Quick, andhosted by Joe Kernan, Becky Quick, and Andrew Ross Sorcin. Tune in weekdayAndrew Ross Sorcin. Tune in weekdayAndrew Ross Sorcin. Tune in weekday mornings on CNBC at 6 Eastern to get themornings on CNBC at 6 Eastern to get themornings on CNBC at 6 Eastern to get the smartest takes and analysis from our TVsmartest takes and analysis from our TVsmartest takes and analysis from our TV show right into your ears. Followshow right into your ears. Followshow right into your ears. Follow SquawkPod wherever you get yourSquawkPod wherever you get yourSquawkPod wherever you get your podcasts. Have a great day. We'll meetpodcasts. Have a great day. We'll meetpodcasts. Have a great day. We'll meet you right back here tomorrow.you right back here tomorrow.you right back here tomorrow.
OtherWe are clear. Thanks, guys.