By JOSH FUNK, AP Business Writer

OMAHA, Neb. (AP) — Billionaire Warren Buffett warned people not to think investing is an easy way to make a fortune as he answered questions at Berkshire Hathaway’s annual meeting Saturday.

Buffett said it can be tough to pick the long-term winners. He pointed out that in 1903 there were more than 2,000 car companies, and nearly all of them failed even though cars have transformed the country since then.

“There’s a lot more to picking stocks than figuring out what will be an incredible industry in the future,” Buffett said. “I just want to tell you that it’s not as easy as it sounds.”

Buffett has said that most people will fare better by owning an S&P 500 index fund instead of betting on individual stocks. He said many of the novice investors who jumped into the market recently and drove up the value of video game retailer GameStop are essentially gambling.

Buffett spent several hours Saturday afternoon at an online version of Berkshire’s annual meeting alongside vice chairmen Charlie Munger, Greg Abel and Ajit Jain.

Buffett said the policies of the Federal Reserve and the stimulus packages passed by Congress have done a tremendous job of propping up the economy because interest rates remain low, but it’s hard to predict what the long-term consequences of those policies will be.

Omaha, Nebraska-based Berkshire is sitting on $145.4 billion in cash and short-term investments because Buffett has struggled to find major acquisitions for the company for several years.

Investor Cole Smead said he would love to see the company get more active the next time the market swoons.

“We do not question whether Buffett and Munger have patience. That’s obvious. The question is do they have any aggression. That’s not obvious,” Smead said.

Buffett said he wants to invest more of Berkshire’s cash, but the current competition he faces from private equity and other investment funds has made it difficult for Berkshire to find reasonably priced acquisitions.

This was the second year in a row that the annual meeting was held online because of the coronavirus pandemic. This year’s event was moved outside of Omaha for the first time — to Los Angeles to be near where the 97-year-old Munger lives.

The meeting usually draws 40,000 to Omaha, filling a 18,300-seat arena and every nearby overflow room. No other company matches those crowds.

Author Bob Miles said he’ll miss “mingling with like-minded and self-selected shareholders” and talking with executives who run Berkshire subsidiaries who routinely spend part of the meeting in their company’s booth in the 200,000-square-foot exhibit hall that adjoins the arena. Berkshire companies like Geico insurance, See’s Candy and Fruit of the Loom sell their products to shareholders each year.

The fun of the meeting isn’t just for shareholders. Jim Weber, who runs Berkshire’s Brooks Running, said he longs for the chance to compare notes with fellow Berkshire managers at the one annual event that brings together the leaders of the decentralized conglomerate’s dozens of subsidiaries.

“We certainly miss that opportunity to connect with our peers,” said Weber, adding that he would likely watch some of this year’s event from a treadmill or stationary bike.

On Saturday morning, Berkshire reported its first-quarter earnings and said it made $11.7 billion, or $7,638 per Class A share, as the paper value of its investment portfolio rebounded. A year earlier, Berkshire reported losing $49.7 billion, or $30,653 per share.

The conglomerate said that besides the investment gains, profit also improved at all of its major divisions — including insurance, utility, railroad, manufacturing and retail companies — as the economy continued to recover from the pandemic during the first three months of this year.

CFRA Research analyst Cathy Seifert said she was surprised that Berkshire’s many economically sensitive businesses didn’t improve more given how much the economy has recovered, but that it looked like the company controlled costs well at its major divisions.

Buffett has long said Berkshire’s operating earnings offer a better view of quarterly performance because they exclude investments and derivatives, which can vary widely. By that measure, Berkshire’s operating earnings improved to $7.018 billion, or $4,577.10 per Class A share. That’s up from $5.87 billion, or $3,617.62 per Class A share a year ago.

The four analysts surveyed by FactSet expected Berkshire to report operating earnings of $3,792.36 per Class A share.

Berkshire continued its streak of major stock repurchases by investing $6.6 billion in its own stock during the quarter. The company spent $25 billion on repurchases last year. Seifert said investors will applaud the significant buybacks.

Berkshire Hathaway Inc. owns more than 90 companies, including the BNSF railroad and insurance, utility, furniture and jewelry businesses. The company also has major investments in such companies as Apple, American Express, Coca-Cola and Bank of America.

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