I’ve never understood the fascination with Buffet and Berkshire Hathaway. It’s basically a type of mutual fund in that they constantly buy companies — but they don’t pay a dividend to the investors. Where’s the cash that the acquisitions throw off? If the parent company owns above a certain percentage of a subsidiary, the dividends back to the parent are taxed at a low rate, or not at all. So — where’s the cash?
Anybody who thinks Buffet is “all that” needs to read Benjamin Graham. When I taught college classes, I recommended that all students study two books: the Holy Bible and the Intelligent Investor.
The dividends go back into investments. Not everyone wants dividends. Have you looked at the performance of Berkshire B?
They don't pay dividends because dividends are taxable income. One need not pay taxes on unrealized capital gains. BH has some $34 Billion in cash.
“I’ve never understood the fascination with Buffet and Berkshire Hathaway.”
Becoming the most successful investor and richest man in the world gets peoples attention. 22% per year compounded over 40 years is pretty good.
Yes, its mostly (but not totally) Graham-Dodd investing, but I think the low dividends are due to his being able to find better uses of the money via re-investment.