1 / 7Despite the recent meltdown in stock markets, Warren Buffett believes the sell-off hasn’t been ‘dramatic’. In response to a question at the Berkshire Hathaway AGM, the Oracle of Omaha said that the correction has not been as steep as it has been past. He still believes that there are more opportunities to make money from stocks and that he wouldn’t pick real estate over equities.
2 / 7While Ajit Jain, Vice Chairman of Insurance Operations, admitted that artificial intelligence could be a ‘real game changer’, Berkshire Hathaway has not made any big bets yet. “The individual insurance operations do dabble in AI and try to figure out what is the best way to exploit it. But we have not yet made a conscious, big-time effort in terms of pouring a lot of money into this opportunity. And my guess is, we will be in a state of readiness — and should that opportunity pop up, we’ll be in a state where we profit,” he added.
3 / 7Automobile insurer Geico, the biggest part of Berkshire’s broader insurance unit, is bracing for a fundament shift with the advent of self driving cars. “Most of the insurance that is sold and bought revolve around operator errors. The new self driving cars are more safe and are involved in fewer accidents and there, less insurance will be required. We at Geico will be ready to provide for liabilities from product errors and errors in construction,” Jain explained at the AGM. FILE PHOTO: Tesla Model 3, REUTERS/Mike Blake
4 / 7The global market for currencies is in a flux since the start of the tariff war initiated by US President Donald Trump. The US dollar, considered to be the world’s safest currency has lost over 7.78% value since the start of the year. Does Warren Buffett think the greenback will recover? ““Fiscal policy is what scares me in the United States, because it’s made the way it is and all the motivations are to doing a lot of things that can cause trouble with money. But that’s not limited to the United States, it’s all over the world,” Buffett said.
5 / 7Given the rising risk aversion, should investors move to more certain, fixed income investments to protect their capital? “Paper money can see its value evaporate if fiscal folly prevails. In some countries, this reckless practice has become habitual, and, in our country’s short history, the U.S. has come close to the edge. Fixed-coupon bonds provide no protection against runaway currency,” according to Warren Buffett.
6 / 7Ajit Jain also highlighted that the entry of private equity firms has made insurance a competetive business. “We used to do a fair amount in this space, but in the last three, four years, I don’t think we’ve done a single deal,” he said. FILE PHOTO SOURCE: Shutterstock
7 / 7Will Buffett stop investing in Japan stocks if the Bank of Japan were to raise interest rates? “In the next 50 years … we won’t give a thought to selling those,” was his answer.
Based in New York, Stephen Freeman is a Senior Editor at Trending Insurance News. Previously he has worked for Forbes and The Huffington Post. Steven is a graduate of Risk Management at the University of New York.