I think Ukraine invasion is imminent, Russia has backed itself into a corner. There is no way they can walk back, without some major and serious concessions from US. They have already declared they want bilateral talks with US and they don’t care about EU or other NATO allies. (topic for another day: so much for EU).
I don’t think democrats can make any concession to Russia, already mid-term is extremely challenging between redistricting, inflation, and voters apathy towards democrats. If they make any concession to Russia, then they are completely doomed. Russia has to move now, they cannot keep all their forces on Ukraine border forever.
Now, ignoring all the macro thinks, what does it mean to Berkshire? How much of their “operating companies”, income will be impacted? What is the exposure on cat/ re-insurance? How much exposure they have to “energy”?
flight to quality and safe harbor.
For such a large firm, Berkshire is unusually US-centric in its distribution of operations.
In this context, that’s a good thing. It’s not as if they own a big Ukrainian bank.
Cyber attack insurance liability is the biggest direct risk to Berkshire that springs to mind.
The wording of many policies is not tight enough to allow the insurer to use the “acts of war” exclusion.
As shown in the recent Kraft ruling.
Such attacks are already underway, and could very plausibly “escape” to, or be aimed at, entities insured by Berkshire.
I could imagine the possibility of Berkshire losing $10bn this way.
At Berkshire’s size, that amounts to a very very bad quarter, not an existential crisis.
“mid-term is extremely challenging between redistricting” - Redistricting is a tailwind for the Democrats as things stand today.
less bad is not tailwind…
I’m not sure what you mean. There were the old set of maps. As of now, redistricting is showing a better set of maps for the democrats than the old set.
If redistricting improves things for the democrats versus the old districts, then redistricting is a tailwind for the dems.
I’m not sure what there is to argue about. The analysis I’ve read is that redistricting has benefited Democrats so far. If you think redistricting has been bad for the Democrats, feel free to post why.
My redistricting comments don’t really matter. I was just trying to clarify the facts as I understand them.
Regarding Ukraine, I’m sure everyone here hopes for the best from a humanitarian standpoint.
From an economic standpoint, it is hard for me to see how BRK is hugely affected absent larger economic issues. The stock price hasn’t reflected much concern about the situation so far. From a broader perspective, it probably depends on the nature of the sanctions. Russian oil and gas are hugely important. Everything else, not so much.
I watched entire speech and read a bit over this 3 day weekend. By no means that makes me an expert. One think is very clear, Putin doesn’t want NATO in his door-step. Whether you like him or not, if you view it from Russian point of view, Russia has some legitimate concerns. The cold war “was” sort of over, but NATO kept expanding it. It is stunning how far US is stretched militarily, Korea, Middle east, Afghanistan (at last that nightmare is over) all over Europe and then China.
US and allies have talked a lot but not clear beyond sanctions what else they can do? Europe still needs Russian energy. Oil prices may either go up or at least they have better support.
Now, Russia first starting with breakaway regions, but may escalate. What Russian actions means long-term for Taiwan & China.
US and west has to do some long-term cost calculation of continuing to use China as their manufacturing base. Some of the supply chain issues are also due to the bottlenecks in Chinese ports. The entire manufacturing sector, JIT, inventory management all will undergo some change.
For ex: Cleveland Cliff’s a steel producer, increasing fixed rate contracts with auto manufacturers. This is providing visibility to both, instead of anchoring the price to index.
I am yet to see US companies specifically talk about changes to inventory and manufacturing.