Berkshire Hathaway's Q1 accounts are out. And they aren't pretty:
- A net loss of 1.4 bn $.
- "Core business" actually managed a decent 1.8 bn $ profit. Unfortunately, 3.2 bn $ were lost on "investments and derivatives" (including the infamous "high-yield default contracts", the stuff that killed AIG).
- Unfortunately, the 1.4 bn $ isn't the whole story: Including various stuff that didn't go through the p+l (again "investments and derivatives"), net equity was down a massive 6.5 bn $.
In other words, shareholders lost 6.5 bn $, or 6 % of net equity.
However, we are asked to note that from March 31 to May 7, the market value of the equity portfolio rallied, and achieved a gain of 5 bn $. So as of May 7, the "non-p+l" stuff is at break-even again, and "only" the regular 1.4 bn $ loss remains.
That's a relief. So only 1.4 bn $ are gone after all.
Well, hopefully only 1.4 bn $. Because the report also mentions that Berkshire experienced further (unquantified) losses under its high-yield credit default contracts.
( Previous post on Berkshire Hathaway's 2008 results )
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