Buffett embraces Erica Kane, mocks mortgage mess

By Jonathan Stempel Reuters - Saturday, May 3 07:49 pm

OMAHA, Nebraska (Reuters) - It's part of Warren Buffett's job not just to answer questions from many of the 31,000 people at the annual meeting of Berkshire Hathaway Inc . He also has to entertain.

Especially if the entertainment involves Susan Lucci, one of America's best-known soap opera stars.

Part of the roughly one-hour movie preceding this year's meeting, produced by Buffett's daughter Susie, showed a clip of Buffett's recent cameo on the soap opera "All My Children." Buffett, who plays himself, visits Erica Kane, portrayed by Lucci, who is in prison on an insider trading charge.

The movie included faux news reports about his leaving Berkshire, which the 77-year-old has run since 1965, to swap jobs with Lucci.

So at the start of the meeting, instead of Buffett emerging with Berkshire Vice Chairman Charlie Munger, Lucci came out.

And she promised change.

"The first thing we need to change is our dividend policy," she said. "I have never heard of anything so cheap and so unfair to our shareholders." Berkshire hasn't paid a cash dividend since 1967.

She then urged Berkshire to give weekly guidance on earnings, and to pay directors more than $900 (456 pounds) a year. That let directors -- including Microsoft Chairman Bill Gates, worth $58 billion -- to jump up and roar approval.

Buffett, Berkshire's chairman and chief executive officer and the world's richest person with $62 billion according to Forbes magazine, then emerged.

"The deal is off," he told Lucci. "My show is Berkshire Hathaway, and my role is to run it.... 'All My Children' can't do without you. I can't do without Berkshire."

He urged Lucci to go to Borsheim's, a Berkshire-owned jeweller that has struggled with declines in the housing market and consumer confidence "pick out anything you would like -- and charge it to Charlie." She then hugged Buffett and Munger.

MOCKING MORTGAGE MISTAKES

The movie itself included others including the actress Jamie Lee Curtis and the voice of former CBS News anchorman Walter Cronkite.

It also depicted Munger running for president under the "Financial Independence Party" -- promising to fight global warming with Dairy Queen Blizzards, and fix health care by downing See's candies. Berkshire owns Dairy Queen and See's.

And it included two haughty-sounding British speakers on a fake talk show mulling the U.S. housing and mortgage crisis.

In one case, they debated the name of a safe-sounding Bear Stearns hedge fund that collapsed, the High-Grade Structured Credit Strategies Enhanced Leverage Fund, "Well, that sounds very good, doesn't it?" the host asked.

Liquidity problems led Bear to agree in March to be bought by JPMorgan Chase & Co at a rock-bottom price.

Before the meeting, Buffett trekked around a hall filled with booths for many of Berkshire's roughly 76 companies.

He snacked at Dairy Queen, posed with the Geico Corp gecko mascot, and visited a Clayton Homes house selling for $69,500 -- about half the price of a Berkshire Class "A" share.

Karen Horn, a Dairy Queen franchisee from McPherson, Kansas, has served Buffett at the meeting for three years.

"He asked for his orange-vanilla bar, which he always gets, the same thing, and then he said, 'I believe I owe you a dollar,'" she said.

(Editing by Eric Walsh)

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