Warren Buffett on How to Protect Against Inflation

Inflation swindles almost everybody – stock investors, bond investors…

We’ve all heard about Warren Buffett, the 91-year-old multibillionaire known for his friendly demeanor, modest style of living in Omaha, and remarkable ability to create wealth. How does he make so much money? How does Warren and his long-time associate, Charlie Munger (who is 98), choose their investments?

Buffett and Berkshire Hathaway

Warren Buffett is chairman of Berkshire Hathaway, a multinational conglomerate holding company. What does this mean? Well, in simple terms, the company invests in or owns a variety of other corporations that make products sold all over the world. For perspective, Berkshire Hathaway is so large that it files a 30,000+ page Federal income tax return.

In the 1950s, Berkshire, which made linings for men’s suits, and Hathaway, a cotton milling company, merged. Buffett began investing in Berkshire Hathaway in 1962, becoming its Chairman and CEO in 1970. Munger is Vice Chairman. The company abandoned the textile business in 1985.

In the early 1990s, Buffett began to focus on actually owning companies, and today Berkshire owns quite a few. In fact, Berkshire has 100% ownership in over 60 major companies, the majority share of several other major publicly-traded companies and minority holdings in dozens more.

One of Berkshire’s biggest known ownership segment is in the insurance industry and the company owns GEICO, General Re and several smaller insurers as well. Berkshire also owns the large Burlington Northern Santa Fe Railroad, along with a trucking company and national auto dealer chain.

Additionally, Berkshire owns and operates quite a few power plants, natural gas lines, hydroelectric dams, wind farms, and solar projects.

Top 10 By Number of Shares

By looking at a list of the Top 10 Buffett publicly-traded companies (by number of shares), one can get a sense of what Buffett likes. However, keep in mind that while Bank of America is the #1 holding by number of shares – Apple is the top holding by market value – worth an incredible $157.5 billion at the end of 2021.

Here are the Top 10 Warren Buffett-owned publicly traded-stocks by number of shares, as of December 31st.

  • Bank of America, 1.01 billion
  • Apple, 887.1 million
  • Coca-Cola, 400 million
  • Kraft Heinz, 325.6 million
  • Verizon, 158.8 million
  • American Express, 151.6 million
  • U.S. Bancorp, 126.4 million
  • Nu Holdings, 107.1 million
  • Bank of New York Mellon, 72.4 million
  • Kroger, 61.4 million

As Buffett has said, “Our appetite for owning so many businesses increases our chances of finding sensible uses [for our cash].”