Berkshire Hathaway Annual Letter to Shareholders 2021

Buffett reported that Berkshire made reasonable progress increasing intrinsic value in 2021, though he noted there was little major action during the year. The letter emphasizes that Berkshire's value rests on four core holdings: insurance (with $147 billion in float), Apple (5.55% ownership), BNSF railroad (100% owned, earning record $6 billion), and BHE (91.1% owned, earning record $4 billion). Buffett highlighted that insurance float—money held but not owned by Berkshire—has grown from $19 million in 1967 to $147 billion and has cost the company less than nothing to generate over 55 years. Buffett explained Berkshire's large $144 billion cash position as a consequence of difficulty finding investments meeting the company's long-term criteria, not a loss of appetite for business ownership. He noted that low interest rates have pushed valuations of all productive assets upward, making few opportunities attractive. During 2020–2021, Berkshire repurchased 9% of outstanding shares for $51.7 billion, increasing continuing shareholders' ownership stakes in all Berkshire businesses by roughly 10%. Over the 57-year period from 1965 through 2021, Berkshire's per-share market value compounded at 20.1% annually versus 10.5% for the S&P 500 with dividends, delivering an overall gain of 3,641,613% compared to 30,209% for the index.