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12 SMT007 MAGAZINE I JULY 2023 almonds purchased from See's Candies in the exhibit hall. See's Candies, by the way, is a Berkshire Hathaway company that reportedly sold more than 22,000 pounds of peanut brittle and chocolate during the shareholder meeting. In reference to the celebrated Buffett annual letter, here are some selected highlights and the sagacious advice from the duo that you might find of interest. The Numbers Nothing can beat tangible performance. Berkshire Hathaway ended the first quarter of 2023 with $130+ billion in cash or cash equiva- lents. e company's compounded annual gain was nearly 19.8% from 1965 through the end of 2022, compared with the 9.9% S&P 500. at is an overall return of 3,787,464% vs. 24,708% for the benchmark. Berkshire Hathaway's contributions to the U.S. Treasury via corporate income tax was $32 billion during the decade ending in 2021, which is almost a tenth of 1% of all money that the U.S. Treasury collected. Sustained Performance Buffett attributes their sustained perfor- mance to a dozen truly good decisions. Phe- nomenal success isn't about getting every deci- sion right, but about getting important deci- sions phenomenally right. In his storied annual letter, Buffet wrote, "e weeds wither away in significance as the flowers bloom. Over time, it takes just a few winners to work wonders. And, yes, it helps to start early and live into your 90s." He also attributes their impressive and sustained performance to "knowing" con- sumer behavior, meaning human psychology. In reference to the Buffett Annual Letter to Shareholders 1 , the secret sauce is to select good businesses. In 1994, Berkshire Hathaway completed its seven-year purchase of 400 mil- lion shares of Coca-Cola. e cash dividend the company received from Coke in 1994 was $75 million. By 2022, the dividend had increased to $704 million. Growth occurred every year— just as certain as birthdays. Artificial Intelligence Although impressed at generative AI's abil- ities to summarize legal opinions and take on other tasks, Buffett is worried about its poten- tial consequences. He said, "It can do all kinds of things, and when something can do all kinds of things, I get a little bit worried because I know we won't be able to uninvent it." He said he tinkered with ChapGPT when Bill Gates (who served on the BH Board of Directors for 15 years and is a close friend of Buffett) showed him how it worked. Buffett said, "It is very interesting. It can translate the Constitu- tion into Spanish in one second." He expects AI will change everything in the world, however, he doesn't think it will trump human intelligence. While AI can help screen for stocks that fall under certain parameters, or a set of criteria in three seconds, it has its limitations. AI probably won't tell you which stocks to buy." In response to a shareholder's question, Munger expressed skepticism on the future of AI and noted, "It will rapidly transform many industries. I'm personally skeptical of some of the hype in AI. I think old fashioned intelli- gence works pretty well."