That was nearly three times what Berkshire lost on the same instruments a year ago. Buffett has sharply criticized derivatives in general, but has said these particular contracts were safe and would ultimately be lucrative.
But Berkshire was hurt, like many other insurance companies in particular, by sharp declines in a broad range of market values. In a quarterly report to the Securities and Exchange Commission, Berkshire said the indexes covered by the contracts fell 11 to 23 percent in the quarter.
Berkshire reported a net profit of $2.28 billion, or $1,380 for each Class A share, compared with a year-earlier profit of $2.99 billion, or $1,814 a share.
Cash at the end of the quarter was $34.78 billion, down from $47.89 billion at the end of June. During the third quarter, Berkshire financed the purchase of the chemical maker Lubrizol and a $5 billion investment in Bank of America, which accounted for the decline.
Operating income rose across segments, except for the company’s finance business, where it fell slightly.
Profit in the insurance business rose as a rebound in reinsurance results offset sharp declines at the auto insurer Geico.
Earnings were also nearly 10 percent higher at Berkshire’s next-biggest unit, the Burlington Northern railroad, as revenue per car rose by more than 10 percent.
Article source: http://feeds.nytimes.com/click.phdo?i=25cb51a2620013237b9df5f5536a1185
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