Stock Market

Raamdeo: What I took away from Buffett’s shareholder meet

In essence, Warren Buffett is the ultimate bottom-up stock picker — buying companies not worrying if, in his own words, “the market would shut down for the next 10 years”.

But given the extraordinary macro developments that have taken place over the past few years, such as the crude collapse and the emergence of negative interest rates in many developed economies, there were plenty of macro subjects discussed at Berkshire Hathaway’s annual shareholder meeting.

Value investor and long-time Buffett watcher Raamdeo Agrawal who is just back from Omaha paying obeisance to the legend, says the Oracle had a unique take on the subject of negative rates.

“He said that if markets price in negative or zero interest rates for the long term, risk assets will be priced much more higher,” Agrawal, Joint MD at brokerage firm Motilal Oswal, told CNBC-TV18 in an interview.

Buffett’s comments on zero rates, arguably hypothetical, do not tie in with his USD 60-70 billion cash position at Berkshire, which has been reeling under the policy.

But Buffett¬†is not one who gets bogged down by what’s happening around in the world, says Agrawal.

“He will play micro and will continue to buy stocks if they are trading below their intrinsic values.”

Interview transcript to follow.