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And they shall turn away their ears from the truth, and shall be turned unto fables.

2 Timothy 4:4

By Alex Crippen | CNBC | Jul. 1, 2010

Warren Buffett's annual gift of Berkshire Hathaway Class B shares to the Bill and Melinda Gates Foundation is worth about $1.6 billion dollars this time around.

That's an increase of 28 percent from the value of last year's gift, even though Buffett is donating roughly one million fewer shares.  Berkshire B shares are up almost 35 percent over the 12-months since Buffett's previous donation.

In a 2006 letter to Microsoft's Chairman and his wife, Buffett outlined a long-term schedule that has him donating five percent fewer shares each July, when compared to the previous year.

But Buffett told them "you can reasonably expect the value of Berkshire shares to increase, in an irregular manner, by an amount that more than compensates for the decline in the number of shares that will be distributed."

So far, that's turned out to be true for every year except 2009.

  Buffett's Annual BRK.B Stock Gifts to Gates Foundation
  Number of Shares Share Price At Time of Gift Market Value Pct. Change
2006 25,000,000 $60.86 $1,521,500,000  
2007 23,750,000 $74.28 $1,764,150,000 +15.9%
2008 22,562,500 $79.98 $1,804,548,750 +2.3%
2009 21,434,375 $58.48 $1,253,482,250 -30.5%
2010 20,362,656 $78.81 $1,604,780,939 +28.0%
TOTALS 113,109,531 $70.27 $7,948,461,939  
Adjusted to reflect 50-for-1 stock split in January, 2010

With this year's installment, Buffett has given the Gates Foundation 22.6 percent of the 500 million shares he earmarked four years ago, representating almost all of his vast personal fortune.  Total market value at the time of the donations: almost $8 billion.

Buffett and Gates want their fellow billionaires to follow their lead, recently telling Fortune magazine they're actively urging everyone on the Forbes list of the 400 wealthiest Americans to pledge at least 50 percent of the net worth to charities.

Economics | Article Views: 2566