Berkshire Hathaway’s Conflicted Transparency

Berkshire Hathaway (BRK-A) reported its Q1 results last Friday after market close. Berkshire Hathaway is a unique combination of sophisticated complexity with a disarming transparency. No other company has ever come out and said their own press release does not contain enough information. Read this quote from the first paragraph.

“The limited information that follows in this press release is not adequate for making an informed investment judgment.”

No one else in the investing world has the “Balls” and credibility to make this work. The statement is as much a criticism of financial regulations regarding disclosure as it is a caution to investors who may be too lazy to read and truly think about all the issues.

Essentially Charlie Munger and Warren Buffett are focused on long term growth and capital formation. (Even if they do refer to themselves in the first person). They refuse to be swayed by short term quarterly results. While they are uber icons in their own right they are not the only business leaders who have plentiful credibility. Too many other CEO’s get caught up in the quarterly earnings game and disappear into the maze of accounting peculiarities needed to look good. Then the explanations become too overworked to be useful.

While Warren Buffett and Charlie Munger have clearly created tremendous wealth perhaps their real legacy will be straight simple talk.