By Jonathan Stempel and Suzanne McGee
OMAHA (Reuters) -Warren Buffett warned of the perils of excessive tariffs, saying they should not be a "weapon" and that the United States would be more prosperous if other countries were.
Buffett spoke at Berkshire Hathaway (NYSE: BRKa )’s annual meeting on Saturday, after the conglomerate he built over 60 years showed it remained cautious about markets, allowing its cash stake to grow to a record $347.7 billion.
The 94-year-old billionaire, arguably the world’s most revered investor, had said very little about U.S. President Donald Trump’s tariff policies, which unsettled many investors and caused big declines in stock markets worldwide.
"Balanced trade is good for the world," and "trade should not be a weapon," Buffett said.
"I don’t think it’s a good idea to design a world where a few countries say, ha ha ha, we’ve won," Buffett added. "I do think that the more prosperous the rest of the world becomes, ... the more prosperous we’ll become."
But despite concerns about the direction of the U.S. economy and the country itself, Buffett retained his traditional optimism, saying criticism of policies and the people who make them is par for the course.
"We’re always in the process of change," he said. "I would not get discouraged.... We’re all pretty lucky."
NET SELLER OF STOCKS, AGAIN
Berkshire reported its cash stake with its first-quarter results, where insurance losses from January’s wildfires in southern California contributed to a 14% decline in operating profit to $9.64 billion.
Net income fell 64% to $4.6 billion, reflecting unrealized losses on stocks such as Apple (NASDAQ: AAPL ).
Berkshire’s cash stake grew from $334.2 billion at year-end. The company repurchased no stock for a third straight quarter, and was a net seller of stocks for a 10th straight quarter.
Buffett downplayed concern about Berkshire’s cash, saying the company "came close" to spending $10 billion recently, but that buying opportunities don’t come in an orderly fashion.
That should happen over five years, he said, but not necessarily tomorrow.
"We’re running a business which is very, very, very opportunistic," Buffett said. "We have made a lot of money by not being fully invested at all times."
When asked, Buffett did not address whether Berkshire was hoarding cash for Vice Chairman Greg Abel, his designated successor as chief executive, to invest.
Addressing another questioner, Buffett and Abel also strongly backed five Japanese trading houses--Itochu, Marubeni, Mitsubishi, Mitsui and Sumitomo--in which Berkshire has invested.
Both said the investments could last at least 50 years. "We’re building relationships," Abel said. "And we really hope to do big things with them."
Vice Chairman Ajit Jain, who oversees insurance operations, told another questioner that the Geico car insurer has made "rapid strides" upgrading technology to gauge driver behavior and price policies appropriately for risk.
LINING UP TO HEAR BUFFETT
Berkshire’s share price has so far weathered a turbulent period for markets, rising 18.9% this year while the Standard & Poor’s 500 was down 3.3%.
For many, Berkshire’s diverse portfolio of businesses offers a mirror into the broader U.S. economy, which shrank for the first time in three years in the first quarter.
Berkshire’s portfolio includes the BNSF railroad, Geico insurance, energy businesses, real estate brokerage HomeServices and Fruit of the Loom underwear.
Buffett’s speaking voice was higher-pitched and thinner than at recent annual meetings, but there was no sign of age as he deftly handled questions from some of the tens of thousands of attendees.
How Berkshire will fare after Buffett departs is also on investors’ minds, including many who lined up in 40-degree weather (4 degrees Celsius) long before doors opened at 7 a.m. to the downtown Omaha arena where the meeting was held.
Some arrived very early.
"Warren is getting old so I wanted to seize the opportunity," said Wang Yu, who flew from Guangzhou, China to see Buffett and said he lined up at 11 p.m. Friday night. "His ideas are simple but you want to immerse yourself in the moment."
Paul Seward, a commercial banker from Florence, South Carolina, said he showed up at 3 a.m. It was his first Berkshire meeting.
"With Buffett’s age, I wanted to pay my respects and experience it in person," he said. "If I was going to come, I wanted to be here early and go all in."