Buffett’s Berkshire Hathaway boosted by US economic rebound
Berkshire Hathaway, led by Warren Buffett, is reaping the benefits of the US economic recovery, with the conglomerate's manufacturers and retailers rebounding well in the second quarter. Berkshire Hathaway Inc., founded by Warren Buffett, is benefiting from the United States' economic resurgence. After being struck severely by the pandemic that swept the United States last year, the conglomerate's collection of manufacturers and merchants rebounded in the second quarter. That group of companies generated the company's second-highest quarterly profit since statistics began in the middle of 2009, contributing to a 21% increase in Berkshire's total operating profit for the time. In a phone interview, Jim Shanahan, an analyst at Edward Jones, said, “It's all of the other old economy, manufacturing, service, retailing, transportation sectors that really truly reflect the broad economic recovery driving this performance this quarter.” “There's a housing angle here, and I believe that was a big contribution this quarter.” Berkshire Hathaway has grown into a multi-billion-dollar corporation with a presence in areas such as insurance, energy, and retail. However, the company's exposure to a broad segment of the US economy impacted on it last year, with companies like See's Candies being forced to lay off workers at the onset of the shutdowns. The future looks to be brighter now. Berkshire stated in a regulatory filing Saturday that “many of our companies earned considerably greater profitability throughout the first half of 2021 compared to 2020, which included severe unfavourable effects from the pandemic.” “Our manufacturing, service, and retail companies earned more in 2021 than they did in 2019, thanks to increasing consumer demand in several of our sectors.” During the quarter, Berkshire's group of building-products firms was a significant source of strength. Earnings at those companies increased by over 40%, thanks to a surge in house development in the United States. The strength of such firms, combined with the difficulty of challenging them through technology, makes them a good element of Berkshire's compass, according to Tom Russo, a Berkshire composition.