1994: Has Berkshire considered a reverse split?

AUDIENCE MEMBER: First of all, my name is Al Martin (PH) and my wife Terry (PH) is here with me. And I appreciate the invitation to attend this meeting.

I was a little bit dubious and quite excited at that game Saturday night. I didn’t know which side was going to throw the game to the other one. But I did find out at the end.

The first question, actually, was somewhat answered, but not fully. Has the board considered a reverse split? My experience has been that —

WARREN BUFFETT: Would you like to make that a motion? There was a motion for a reserve — reverse split. (Laughter)

AUDIENCE MEMBER: I would say a two-for-one because if it were three or four-for-one I might end up with no shares. Or fractional shares.

But, anyway, my experience has been that all of the stocks that have split have gone down in the next two or three months or the next two or three years, including one which you are drinking, which is a flat Coke.

Also, I have observed Merck over the last several years to be hitting a low, which split three-for-one.

So, I think that, you know, the reasons for splitting stocks are to make it affordable. I found that every stock I ever bought was never affordable. I found the reason I bought it was because I couldn’t afford not to buy it.

So that’s a different philosophy, I guess, as somewhat shared indirectly with the boards running the stock.

The second question, which is — has to do with —

WARREN BUFFETT: Hope it’s as easy as the first question. (Laughter)

AUDIENCE MEMBER: Well, I didn’t want to wait for an answer of the first question for that reason, because it could be complicated and confusing and so forth.