(Update) RationalWalk has a much more comprehensive piece on Berkshire Q1 results.
(Original) News from San Jose Mercury News. Quote:
Berkshire says it sold 13.7 million of its 79.9 million shares of ConocoPhillips during the first quarter to generate a loss that can offset past capital gains taxes.
More details from its Q1 earning report (PDF). Again quote:
…Investment losses from other-than-temporary impairments for the first quarter of 2009 predominantly relate to Berkshire’s investment in ConocoPhillips common stock. The market price of ConocoPhillips shares declined sharply over the last half of 2008. In the first quarter of 2009, Berkshire sold approximately 13.7 million shares of ConocoPhillips and sold additional shares in April. Although Berkshire expects the market price for ConocoPhillips shares to increase over time to levels that exceed original cost, Berkshire may sell some additional shares before the price recovers. Sales in 2009 were or may be in anticipation of other investment opportunities, to increase overall liquidity and to carry back realized capital losses to prior years for income tax purposes…
It’s never merely about taxes. Buffett must think there are more attractive opportunities somewhere else (Wells Fargo, US Bancrop, just speculating because he said he would buy those two banks if he is allowed to do so). He also said he will put all his money in Wells when it’s sold under $9.
Disclosure: yours truely also sold some COP shares yesterday and today; and I have not phoned Buffett before my action 🙂