Re:Berkshire Hathaway’s stock price is too high for Nasdaq c...
by LorenPechtel on Wednesday May 05, 2021 @03:09PM
(#27054283)
It's not a matter of trusting one's fellow Berkshire owners. It's a matter of keeping power in the hands of those he trusts to follow his strategy. I trust his running of the company far more than I trust my fellow shareholders (I also own some BRK.B.)
I own B shares. It doesn’t bother me that I have fewer voting rights because I trust my fellow Berkshire owners. So there’s little barrier to entry in merely owning a small stake in Berkshire’s economic output.
Second, if you want to argue there’s a barrier to entry for voting purposes, that also doesn’t make sense: you need to have a ton of ownership in any stock to make a difference in ownership as an outside investor. It doesn’t matter if the share price is $1 million or $10 if I need $50 million in share value to make a dent in voting.
Third, Buffett has stated that he doesn’t want to split shares because he wants to encourage long-term owners. There’s a lack of liquidity in A shares; I’ve heard usually only about 1,200 trade a day. He, and I’m sure many other Berkshire shareholders, want their fellow shareholders to think like long-term owners of a private business, especially for shareholders with a lot of voting influence. A high share price and its corresponding low liquidity encourages that.