Buffett to Disclose More on Derivatives; Tilson Ups Berkshire Stake

Warren Buffett says he will give more information on Berkshire Hathaway’s much discussed derivative bets in the company’s end-of-year-report, Reuters is reporting. The derivatives contracts call for the firm to pay out billions to purchasers if, by certain dates starting in 2019, four different market indices fall below agreed-upon levels. Rumors that Berkshire’s liabilities for the contracts could be more than previously thought caused the firm’s stock to plunge — and its credit default swap rates to surge — last month.

Buffett isn’t expressing worry about the deals, however, nor is hedge fund manager and Kiplinger’s columnist Whitney Tilson. Tilson tells Reuters that his fund (T2 Partners) doubled its stake in Berkshire as the company’s stock fell. “The market is so panicked that even the most respected investor in the world can see the stock in his company fall more than 30 percent on no news, other than on rumors that are clearly false based on the disclosures he’s made,” Tilson said.

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