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At last check, Berkshire owned a 7.4% position in Mitsubishi, so tangentially on topic.
What is it that Buffet likes about these Japanese companies?

Interview with CEO of Mitsubishi Heavy Industries America
https://veriten.com/stream/cobt-181/

Wide range set of topics. Japan is a resource scarce country. Post Fukushima, only nine out of original fifty five nuclear plants are now operating. Future of nuclear in Japan uncertain. Why wind and solar don't work in Japan. LNG, renewables, hydrogen, gas turbines, nuclear and carbon capture.

Quote (paraphrasing): U.S. has enough underground pore space to store 400 years of U.S. CO2 emissions. Mostly in old oil and gas fields. Hmmm...

Mitsubishi partners with Exxon on Carbon Capture technology.
https://corporate.exxonmobil.com/news/news-release....

What is it that Buffet likes about these Japanese companies?
Interview with CEO of Mitsubishi Heavy Industries America ...

Just for the record, Berkshire is a shareholder of Mitsubishi Corp, which has almost nothing to do with Mitsubishi Heavy. At least not this century.
If I am not mistaken, neither one owns more than 1% of the other, and there is no common governance.
Indeed, Mitsubishi Corp is far more related to Berkshire than it is to Mitsubish Heavy : )

That doesn't mean that the Heavy CEO's comments aren't valuable and insightful, but his firm isn't a Berkshire investee.


As for what Mr Buffett likes about the Japanese trading firms, I think it mostly comes down to pretty simple
* They have been around for 150 years and make money almost every year, so they're pretty likely to make a lot of money in future, in a near-perpetual manner
* They were apparently pretty cheap when purchased
* They are big...it was a way to deploy a big chunk of capital at a price with a margin of safety
* They have dividends, giving more cash to head office to deploy rationally

At the fancy end of the spectrum:
* the money to invest was largely borrowed at near zero rates, in a way that also gave a currency hedge.
They tend to remain profitable measured in yen when there is a big drop in the yen, something not impossible.
* These firms do a lot of M&A. It's quite possible Berkshire might get some deal flow--opportunities to deploy yet more capital at good rates somewhere in the capital structure of some future deal.

Jim

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