Warren Buffett revealed 2 big bets, defended his tax habits, and admitted several mistakes this year. Here are his 8 highlights of 2021.

Chevron and Verizon

Buffett started the year in style with his fourth-quarter portfolio update in February. He revealed a $4.1 billion stake in Chevron and a $8.6 billion position in Verizon, answering the question of which mystery stocks he had been buying in recent months.

Berkshire also trimmed the largest position in its portfolio, Apple, by 6%. Moreover, it halved its Wells Fargo holdings and exited JPMorgan, PNC, and M&T after slashing its positions in those banks in 2020.

The shareholder letter

Buffett published his annual letter to shareholders in February. The investor admitted to overpaying when he acquired Precision Castparts in 2016, trumpeted a bunch of Berkshire’s subsidiaries, and contrasted his long-term shareholders with the speculators flocking to trendy assets such as meme stocks and cryptocurrencies.

Here’s a round-up of the best quotes from Buffett’s letter.

 

The annual meeting

Buffett warned rookie traders not to get cocky, bemoaned the lack of bargains in the market, rang the inflation alarm, and admitted to buying “so-so” stocks during Berkshire’s annual shareholder meeting in May.

The investor also complained about the surge in people treating the stock market like a casino. Moreover, he acknowledged that trimming his Apple stake and selling Costco were likely mistakes, and suggested he avoided bailing out the “big four” US airlines by exiting his positions in them in April 2020.

Here are the best quotes from the Berkshire meeting.

The tax fracas

Buffett came under fire in June after ProPublica secured the tax returns of some of the wealthiest Americans, and reported the investor paid only $25 million in federal income tax between 2014 and 2018.

The Berkshire boss defended himself by noting that he’s pledged to give over 99% of his net worth to philanthropic causes, and has already donated about half of his Berkshire “A” shares since 2006.

 

 

The Gates Foundation

Buffett resigned as a trustee of the Bill & Melinda Gates Foundation in June. The investor explained that he was barely involved in the foundation’s work, and had already stepped down from all corporate boards except his own.

He also highlighted his annual donation of $4.1 billion in total to five charities, including the Gates Foundation.

Friendship with Charlie Munger

Buffett and his business partner, Charlie Munger, discussed their decades-long friendship in a CNBC interview that aired in June.

The pair sharply criticized Robinhood, and Munger called for tighter regulations on derivatives trading after Archegos Capital’s meltdown. Buffett underlined the immense contribution that Munger has made to his life.

Here are the best quotes.

Buybacks, cash, and stock sales

Berkshire’s third-quarter earnings underlined how hard it has been for Buffett to find bargain stocks and businesses this year. That has prompted him to stockpile cash and ramp up share buybacks.

The conglomerate sold a net $7 billion of stock in the year to September 30, revealed it was on track to repurchase a record $25 billion of stock this year, and grew its cash pile to an unprecedented $149 billion.

 

 

The Apple bet

Buffett’s biggest success this year might well be his Apple investment.

The investor plowed $36 billion into the iPhone maker between 2016 and 2018. The stock has surged by about a third this year, boosting the value of Berkshire’s stake to more than $150 billion as of mid-December.