This is why Warren Buffett will never invest in Microsoft

The afternoon Q&A session of the Berkshire Hathaway 2018 Annual Shareholders Meeting began with a seemingly simple question as to why Buffett’s Berkshire Hathaway has never invested in — or purchased — Microsoft.

But the question itself was loaded — Bill Gates sits on the Board of Directors of Berkshire Hathaway and is known to be a very close friend of Buffett’s.

The best books, according to Bill Gates
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The best books, according to Bill Gates

When Breath Becomes Air 

Gates' review: "I’m usually not one for tear-jerkers about death and dying—I didn’t love The Last Lecture or Tuesdays with Morrie. But this book definitely earned my admiration—and tears." 

Photo credit: Amazon

I Contain Multitudes 

Gates' review: "In the end, I Contain Multitudes is a healthy corrective. Yong succeeds in his intention to give us a “grander view of life” and does so without falling prey to grand, unifying explanations that are far too simplistic."

Photo credit: Amazon 

The Heart 

Gates' review: "When Melinda recommended the book to me, she said, “It’s different from most of the books you read.” And that’s true—but part of the reason for that is that it’s different from most books."

Photo credit: Amazon 

Homo Deus: A Brief History of Tomorrow 

Gates' review: "Harari’s new book is as challenging and readable as Sapiens. Rather than looking back, as Sapiens does, it looks to the future. I don’t agree with everything the author has to say, but he has written a thoughtful look at what may be in store for humanity."

Photo credit: Amazon 

Hillbilly Elegy: A Memoir of a Family and Culture in Crisis

Gates' review: "Through deeply personal stories like these, Hillbilly Elegy sheds light our nation’s vast cultural divide—a topic that has become far more relevant than Vance ever dreamed when he was writing this book." 

Photo credit: Amazon 

Born A Crime: Stories From A South African Childhood 

Gates' review: "In fact, Noah’s mother emerges as the real hero of the book. [...] If my mother had one goal, it was to free my mind,” he writes. Like many fans of Noah’s, I am thankful she did."

Photo credit: Amazon 

A Full Life: Reflections At Ninety 

Gates' review: "A Full Life feels timely in an era when the public’s confidence in national political figures and institutions is low. It is true that President Carter made unforced errors during his time in office. But when you read this book and have a chance to meet him in person, you can’t help but conclude that Carter is a brave, thoughtful, disciplined leader who understands the world at a remarkable level and who has improved the lives of billions of people through his advocacy for human rights and global health."

Photo credit: Amazon 


It seems as though transacting a business deal between both companies would be a no-brainer, especially given Microsoft’s unparalleled success, as Buffett bluntly answered the ‘Why’ question with:

“In the earlier years, it’s very clear … the answer is stupidity!”

Buffett, however, continued on with an even more honest explanation: It’s hard to conduct business with friends without people assuming there is information being passed around under the table.

Buffett talked about the dangers and potential implications of teaming up with Gates, especially with how it could possibly be perceived in the media and amongst other companies:

“It would be a mistake for Berkshire to buy Microsoft because if something happened a week later or month later … both Bill [Gates] and I would incorrectly be a target of suggestions … I try to stay away from a few things just totally because the inferno would be drawn that I might’ve talked to somebody about something. I’ve told the fellows, Ted [Weschler] and Todd [Combs] for example, that there’s just a few things that are off the list, because there would be a lot of people that wouldn’t believe us if something good immediately happened … both that and my stupidity have cost us a lot of money!”

It seems as though there are some caveats to having friends in high places!

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