It’s been a week since Warren Buffett became “Chairman Emeritus” of Berkshire Hathaway — and I’m still not entirely sure what that means.
Ordinarily, the title of “emeritus” is reserved for someone who has stepped away from the job. It’s essentially a gold watch in word form.
But nothing about Buffett’s retirement has been ordinary. He has continued to come into the office every day and remained more involved in Berkshire’s portfolio than many would have expected — most notably by initiating and growing the Alphabet position into one of the conglomerate’s biggest.
Will all of that continue as Chairman Emeritus?
You could read the announcement — and Buffett’s short note to shareholders — either way. He writes, “I still have the best job in the world,” which, being in present tense and all, suggests he’s still clocking in at Kiewit Plaza every day. On the other hand, his closing line that “the company is in excellent hands and I look forward to remaining a shareholder alongside you” sounds more like a goodbye.
The Wall Street Journal filled in some — but not all — of the gaps in a profile of new chairman Howard “Howie” Buffett. It says Warren is still “mentally sharp” and “will remain involved in the company”. What “involved” means, though, goes unsaid. After all, that could simply be a reference to his continued presence on the board.
I want to believe that he will still be an ever-present around Berkshire HQ, suggesting new stock purchases and serving as a sounding board to CEO Greg Abel on potential deals (as was the case with the Taylor Morrison acquisition) — so I’m going with that.
Why make the change now? He fell and broke his leg in June and “one person close to him believed the time Buffett spent at home recuperating gave him an opportunity to contemplate the company’s future and the decision about when to step down.”
Chris Bloomstran offered the Journal a different take on Buffett’s motivation. It might be an effort at ending any lingering ambiguity over who’s really calling the shots at Berkshire. Ambiguity that Buffett may have unintentionally fueled with his comments about initiating the Alphabet stock purchases.
“I think Warren wanted to be crystal clear that Greg is making the capital allocation decisions,” he said. “He wanted to just eliminate any confusion about that.”
In his excellent analysis of the situation, The Rational Walk flagged a notable detail. Berkshire’s financial filings currently state that the CEO can repurchase shares “after consultation with the Chairman of the Board”. That was all well and good with Warren Buffett in the chairman’s seat, but makes much less sense in the Howard era.
So, when the next 10-Q arrives just over a month from now, I expect that boilerplate to be revised either to reference the Chairman Emeritus or to hand Abel full responsibility and oversight on share repurchases. The board could authorize a fixed-amount buyback program, as many companies do, but that doesn’t feel very Berkshire.
Warren has made it abundantly clear that his son’s role as chairman will be cultural, not operational, in nature. He has even likened Howard to an insurance policy that we all now hold but hope never to need. A backstop against cultural drift and bad actors, but not a decision-maker on the business side.
More news and notes from the Berkshire Hathaway orbit…
Berkshire Hathaway purchased 2.7 million more shares (~$212 million) of Lennar over the past week — and now owns 10% of the homebuilder. The buying started the day after Lennar reported disappointing Q3 2026 earnings. Net income fell from $591 million a year ago to $283.9 million now — a result that CEO Stuart Miller called “below expectations”. New home orders dropped 9% and Lennar also cut its full-year delivery target from 82,000-83,000 homes down to 80,000-81,000.
Earlier this month, Greg Abel told CNBC that the Taylor Morrison acquisition was made with the long run in mind — and I imagine the same thesis applies here. Not a bet on an imminent housing turnaround, but on the long-term survival of the American Dream and the houses that still must be built to make that possible.
“We don’t see any immediate recovery or any type of hockey stick [in housing],” said Abel. “It’s going to be a bumpy ride for a while.”
On last week’s earnings call, Lennar’s Miller made the bull case for his company.
“The fundamental shortage of housing in America has not yet been solved. It has not yet subsided. Demand is real, it is deferred, and it is building. When affordability returns through [lower mortgage] rates, we will be well positioned to capture it with the lowest cost structure, the fastest cycle time, the leanest finished inventory, and the cleanest land basis.” Until then, he admitted, “sometimes [even] the best companies are called on to defy gravity for some period of time”.
GEICO will make its Macy’s Thanksgiving Day Parade debut this year. The Berkshire-owned insurer’s float carries its most iconic characters — GEICO Gecko, Caveman, Caleb the “Hump Day” Camel, and Maxwell the Pig — traveling together on a classic American road trip to celebrate the parade’s 100th edition.
“There’s no bigger stage in America than Macy’s Thanksgiving Day Parade,” said chief marketing officer Arianna Orpello. “It’s the perfect place for the Gecko and some of his favorite friends from the past to meet fans in a whole new way.”
BNSF Railway vice president Jon Gabriel joined Bloomberg’s Talking Transports podcast to discuss how the railroad can grow its bread-and-butter intermodal biz. BNSF already handles more than a million more intermodal loads than its closest competitor — but it’s always hungry for more. “Today,” he said, “railroads handle somewhere between 10-12% of long-haul freight. That number can be considerably higher than that [if] customers convert freight from the highway onto our railroad.”
Gabriel noted that BNSF has been preparing for this moment for years — adding tracks to the Southern Transcon, building large intermodal facilities (with another on the way in Barstow, California), and cultivating a strong relationship with J.B. Hunt. Now, with diesel prices rising, he hopes to usher in an “era of intermodal growth”.
Maine news network WMTW ran a story on how one of Warren Buffett’s self-proclaimed worst deals continues to pay off for the state. In 1993, Buffett bought Dexter Shoe from owners Harold Alfond and Peter Lunder for $433 million, paid entirely in Berkshire stock. Despite the company’s sterling track record and strong management, cheap overseas competition gutted the shoemaker within a few years.
But as Berkshire flourished over the following decades, so too did the value of the stock Alfond and Lunder received. And, with it, they made a lasting impact on the lives of Mainers. The Harold Alfond Foundation funded a $500 college savings account for every child born in the state, while the Lunder family gave generously to the Maine Medical Center and Colby College.
Greg Powell, executive chairman of the Alfond Foundation, said Buffett often told him that the two families’ philanthropy eased the sting of the Dexter loss. “[Warren] would always say something like, ‘Well, I made a mistake in buying Dexter, but it’s good to know something great happened because of it.’”
Howard Buffett tends to keep a pretty low profile, but will soon make one of his first public appearances since being named Berkshire chairman. On September 30, he’s scheduled to speak at Central College in Iowa about his philanthropic efforts in war-torn Ukraine — but maybe we get a few comments on his new role, too.
This month’s transcript will go out to paid supporters early next week. In 2008, shortly after the release of The Snowball, biographer Alice Schroeder did a number of book signings and speeches at bookstores around the country. One such event — held, appropriately enough, in Omaha — was recorded and televised on C-SPAN. In it, Schroeder discusses what inspired her book, her relationship with Warren Buffett, and how some of his habits and traits rubbed off on her in the process.
So, if you’ve been on the fence about upgrading, there is no time like the present.
I didn't know the Dexter Shoe philantropy story, thank you!
Have a great weekend!