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Berkshire Hathaway Inc. (Berkshire) is a holding company owning subsidiaries engaged in a number of business activities. The most important of these are insurance businesses conducted on both a primary basis and a reinsurance basis. Berkshire also owns and operates a number of other businesses engaged in a variety of activities. Berkshire’s insurance and reinsurance business activities are conducted through over 60 domestic and foreign-based insurance entities. In March 2008, it acquired 60% of Marmon Holdings, Inc. (Marmon). In November 2008, White Mountains Insurance Group, Ltd. (White Mountains) completed its exchange with Berkshire of runoff businesses. Berkshire exchanged about 95% of its interest in White Mountains for 100% of a White Mountains subsidiary, whose holdings consist of Commercial Casualty Insurance Co. and International American Group Inc.

Business Overview

Buffett has achieved Berkshire's success by a combination of superior underwriting and investments in companies with durable competitive advantages. However, Buffett himself has cautioned investors about the hindrances of Berkshire's enormous size and the difficulties achieving the same out-sized returns going forward. Also, because Berkshire has a significant number of insurance policies as well as significant investments in many different sectors including banks and manufacturing firms, its portfolio and the company's profits are exposed to risk in the event of prolonged and widespread economic downturn. Warren Buffet's successor as the head of Berkshire after Buffet's eventual departure has not yet been announced, and has caused concern about whether the company will continue to outperform the market.

Berkshire Hathaway's performance in 2009 has fallen dramatically from its historical performance, generally due to the market collapse that began with the 2008 Financial Crisis. Further complicating the matter were the long term put options on the S&P 500 (SPX), FTSE 100 Index (FTSE), Dow Jones Euro Stoxx 50 Index (SX5E), and the Nikkei 225 Index (N225) Buffett sold in March of 2008. Buffett has since admitted the move was a mistake, and the subsequent decline in global markets has forced Berkshire to post losses on its financial statements; however, since the options are European style options, the company does not actually have a cash loss.

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Investments
Equities – beneficial ownership

This includes some of the companies where a Berkshire Hathaway stake is 5% or more of the outstanding stock, as reported in the last proxy statement SEC filing, and the latest annual report. In order of percentage stake:

* Burlington Northern Santa Fe Corp. (100%),
* Wesco Financial Corporation (80%),
* Moody's Corporation (19.1%),
* USG (19.0%) ,
* The Washington Post Company (18.2%),
* American Express Co. (13.1%),
* Wells Fargo (9.2%),
* Gillette (9.1%),
* The Coca-Cola Company (8.6%).