Warren Buffett 2019 Pre-Annual Meeting: Occidental Deal, Wells Fargo CEO, Charlie's Comments

Detailed timeline of Occidental-Anadarko financing. Last Friday Brian Moynihan (Bank of America CEO) called saying Occidental wanted to talk. Vicky Hollub called Saturday 9am, Buffett set 10am Sunday meeting. By 11am: $10B committed 'unequivocally come hell or high water' with no conditions. Vicky and Oscar Brown walked away with commitment even if '9/11 happened.' Called Munger at 9am Pacific time, instructed lawyers to work weekend with Cravath to close by Monday. Deal fundamentally 'bet on oil prices over time' not Permian Basin specifics - Buffett 'never been there' and 'wouldn't know what to do.' Amusing aside: NetJets planes can't be tracked unlike company planes, so anyone doing business with Berkshire should use NetJets for secrecy.

Charlie Munger told WSJ he wishes Tim Sloan still running Wells Fargo. Buffett confirms '100% behind Tim Sloan' as 'excellent banker' - learned of resignation day before announcement, would never have asked for it. Sloan resigned because 'he felt he couldn't be helpful under the circumstances that existed in Washington.' On why not hire 'Wall Street guy': 'plenty of people' or 'dozens' on Wall Street capable of running Wells, but 'they would be pinatas from now until the election time' facing questions from senators/congressmen 'using a hearing to make a statement.' They'd be 'poisoned in Washington and Wells doesn't need poison in Washington.' Notes owns JPM and Goldman stock - nothing against Wall Street, just 'political circumstances...wall street associated with banks associated with one that people can make political speeches about is just going to be poison between now and the election.'

Becky quotes Charlie Munger's WSJ interview slamming former Wells CEOs. On Dick Kovacevich: 'He never listened to anybody he never stops talking and he's full of himself he would not learn anything from anybody.' Buffett's diplomatic response: 'Dick expresses himself very forcefully Charlie expresses himself very forcefully and maybe the two don't mix that well.' Defends Kovacevich noting Wells 'came out of the panic better than I think any major bank' and saved Wachovia. On John Stumpf, Charlie said 'almost as bad but not so loud and persistent.' Buffett: 'I would say he was...as good and then you could follow the rest of it.' Buffett jokes about 'getting in shape' to clean up Charlie's comments next week at annual meeting.

On Apple earnings: 'I don't really have big expectations about quarterly earnings' even for Berkshire. Pleased with results but wasn't tracking against specific number. Results 'consistent with reason we own...50 billion dollars plus of apple I feel good about Apple.' Holdings unchanged except one manager with 'a little over one percent' Buffett doesn't track daily. Pre-announces 13-F will show Amazon purchase but 'it is not true to say that I am buying Amazon it's true to say that Berkshire is' - either Todd or Ted bought. 'I've been a fan and I've been an idiot forgotten...it's no personality changes taking place or anything it's somebody else's.'

Agrees with Powell that 'transitory lack of inflation' but adds 'I don't think our present conditions...can exist in terms of fiscal and monetary policy...I don't think they can coexist with really low inflation rates over time but I've been wrong on that for some time.' Core puzzle: 'I can't reconcile a 5% budget deficit in a world of low unemployment low interest rates negative interest rates in many countries...no economics textbook I know that was written in the first couple thousand years discussed even the possibility.' Expects change but 'I don't know when I don't know what degree I don't know what part' - 'in economics like other things you could never do only one thing...we will look back this period and be surprised that we didn't see what was coming next.' Strong Powell endorsement: 'nobody better to run the federal reserve...than Jay Powell I've had some experience with him in the past.'