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Warren Buffett's Berkshire Hathaway (BRK.B) boasts a record so good that it's made him one of the world's wealthiest people, with a $150 billion net worth.
Since 1965, Berkshire Hathaway has produced a staggering compounded annual return of 19.9%—nearly double the S&P 500. Buffett's returns are even more impressive because he generally avoided high-growth stocks, instead favoring value-oriented ones.
Related: Legendary fund manager makes bold stock market prediction
His success and knack for delivering folksy wisdom have made him one of the most influential portfolio managers of all time, as evidenced by the tens of thousands of people who flock to Berkshire Hathaway's three-day annual meeting every year.
Buffett has hosted the event, unofficially dubbed 'Woodstock for capitalists,' for over 60 years, and his comments during his marathon question-and-answer session are packed with interesting takeaways on markets, stocks, and the economy.
This year was no different, as Buffett took time on the stage to address the ongoing debate over tariffs and the escalating trade war.
Global trade war erupts as U.S. economy weakens
The U.S. economy was already showing signs of wear before President Donald Trump unveiled harsher-than-expected reciprocal tariffs on April 2, so-called 'Liberation Day.'
Unemployment had already begun climbing from its 2023 low of 3.4% even as sticky inflation crimped consumers' budgets, causing them to shift spending to essentials from discretionary items. The unemployment rate in April was 4.2%, according to the Bureau of Labor Statistics.
The slowing jobs market prompted the Fed to cut rates by 1% last Fall, but slowing progress in reducing inflation has since put the kibosh on rate cuts this year. PCE inflation, excluding volatile food and energy, was 2.6% in March, above the Fed's 2% target.
The dynamic has put the economy in a precarious position, likely worsened by widespread tariffs that have sparked fierce debate.
Tariff proponents argue they're the best tool for wrestling manufacturing back to America. Opponents say tariffs will increase prices, driving inflation higher, and sending our economy into a tailspin.
The reality may be in the middle, but much will depend on how trade negotiations with major trading partners, including China, pan out.
While President Trump paused most reciprocal tariffs for 90 days on April 9 to negotiate trade deals, he left in place:
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25% tariffs on Canada, Mexico, and autos.
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A 10% baseline import tax.
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A staggering 145% import tax on China.
What’s next for the economy is uncertain, but consumer sentiment is sagging, and data on manufacturing and services is worrisome.