[0:00]
WarrenOkay, if everyone will please take their seats. This is my 60th annual meeting, and it's the biggest, and I think it'll be the best yet. And I would, before I start, I'd like to give you a few figures from yesterday, because we set all kinds of records. Yesterday, we had 19,700 people that joined us in the afternoon between noon and 5 o'clock, and that was up from 16,200, which was a previous record the year before. And in every aspect, we set records. C's Candy did $317,000 against 283,000 the year before. And most of these were limited by capacity. I mean, there were lines there throughout the total day. Brooks did $310,000. It was an all-time record sales day for them. And I think they have close to 3,000 runners lined up for Sunday. Which is a lot of people to get up. I think we've had 2,200, and 2,400 before, but 3,000. And that doesn't count me, and it won't count me. And I could go up and down the line. Jazz Wars, around 250,000, double the previous years. They just sell as fast as they can sell. Most of most, every place had. And had people lined up at the cash register sometimes for a lot longer away than wish we had. But we'll learn the game eventually. And it goes on and on. Every company said records. And there's no way of knowing how many people we have here. Today, we have people listening in around the world. But I think we're setting, we'll probably set records in a great variety of ways. And I would, we're going to have, in a minute, we'll get to the question and answer, but I'd like to first introduce our directors. And I'm Warren Buffett, and I was born in bread right here in Omaha. We have Greg Abel. He was born and bred in Canada. And we have a Jeet Jane who was born and bred in India. So we have a very diverse group and in the audience and I will introduce them alphabetically and if they'll stand as I introduce them. And I know it'll be an effort but withhold your applause till the end so that so that we can get through the list, but we'll start alphabetically with Howard Buffett. How I would you stand and withhold the applause. It'll go to his head. Susan Buffett, we have Steve Burke, Ken Schenall, Chris Davis, Sue Decker, this is our lead director, Charlotte Diamond, Tom Murphy, Tom Murphy Jr., Ron also. and I'll have a few, when we finish, I'll have a few more things to add about him. Wally White's and Merrill Whitmer. And with that, you've got our all-star cast.
[4:50]
WarrenAnd Ron, if you don't mind standing, I would like to point out that Ron, they finally got through an age director thing at Berkshire. I think we had five that were over 90 here not so long ago, but we put in the highest just, or Sue tells me anyway, that it's the highest age limit that any of the company she checked out came up with, but Ron has been on the board for 28 years and been associated with Charlie Munger at Munger tolls for many years beyond that and has been around a variety of times of crisis and joy and disappointments and surprises and everything else at Berkshire and there's been a bit invaluable help to us. So I think I'd like to give a special hand to Ronaldson. And I think I'll do something else that isn't done usually at annual meetings, but I haven't had a chance. I listened to him on Thursday afternoon. It's the only It's the only investment quarterly call that I listen to, but I listen to Tim Cook, and I understand, and it'll be tough for me to see him from up here, but Tim Cook, there he is. I'm somewhat embarrassed to say that Tim Cook has made the Berkshire a lot more money than I've ever made Berkshire Adway, so I hate credit should be given to him for, for him for, I knew Steve Jobs. briefly. And Steve, of course, did things that nobody else could have done in developing Apple, but Steve picked out Tim to succeed, and he really made the right decision. Steve died as young, as you know. And nobody but Steve could have created Apple, but nobody couldn't, but Tim could have developed it like it has. So on behalf of all of Berkshire, thank you. There's a couple other people I'd like to thank. I don't do any work in terms of the show or anything else around Berkshire, but what you see today is the product of a lot of people at Berkshire. They forget, you know, they don't think of themselves as the one who's supposed to screw a light in and leave for somebody else and specialists to come along and do other things. the people of Berkshire put on this show every year. And, you know, our chief financial officer, and just everybody pitches in. It's a remarkable organization that way. But it's led this year in the last few years by Melissa Shapiro, and she's made this whole thing work. And then we got an idea. a while back, well, many years ago. Well, I'll take it all the way back. The 65 years ago, I met Carrie Solva's grandfather and his wife, well, they had nine children,
[9:15]
Warrenand Susie and I joined a group, and I don't look like the kind of guy that would join a playhouse group, but it turned out to be a great move in many ways. First of all, I enjoyed the plays. But beyond that, I met not only my father and an insurance company in Omaha, Bill Kaiser. But I also met Lumpkin Boys in France, so in one sort of accident when I was in my 20s, I came up with all kinds of good things. And in connection with Carrie, her father ran a company called Central States. And later on, we bought that company. And then her father ran the company. Her sister wanted to work for Berkshire some years ago. And then she decided to have a family and subsequently had four kids. So she left. But Carrie moved right in. And Carrie, And Carrie had amazing talents behind, just like a good many people do. They have talents you don't realize still. You give them some responsibility. And so 11 years ago, I asked Carrie to do a 50th anniversary book. Just use her imagination. And she never, she didn't need a check with me or do anything. She just, she never added her to the book. never published a book. She'd never dealt with the printers before. But she just went out and promptly put together this 50th anniversary book. And then this year, well, then Kerry, of course, got married and had three kids, so she had to leave us. But when we have a, we go to a baseball game once a year, and we invite some of our distinguished alumni like Kerry to join us. And And Carrie, even though she was raising three children, you may have met one or two of them in the last day or so, she volunteered to bring together a 60th anniversary book, which I asked for. And again, she took the whole thing, she just did it. She kept doing the things with her kids. And every now and then she'd... I'd ask her how it was going, and she told me how it was going. And so she put together the 60th anniversary book and got it done by, you know, maybe a week before the meeting because I gave her the assignment very late. And yesterday we sold, I think it was 4,000 plus 4,500 maybe, 4,400 maybe, 4, 4,400. We printed 8,400. We intended to print 5,000, but, so we sold 4,400 yesterday and we'll have 30, I guess, roughly 3,600 left out there today, and it's kind of a whimsical, but accurate, and she came out with just the book I hope she would come out with. And then as we went through. She was a publishing experience.
[13:35]
WarrenPerry wouldn't take a dime. I'd get her to name her. Her charity, Stevens Center, which takes care of homeless people, and does a great many other things. It's located about five or six miles from where we are here south. It's been doing a wonderful job. Her grandfather helped form it. Her husband has now joined the board. And we are selling 20 copies of, this is a commercial place, isn't it? We are selling 20 copies that we sold 10 prior to the meeting. That's all we let them sell. And we raised a few hundred thousand dollars doing that. I think we sold one for $100,000. But we limited that to 10. And the only difference in them, these, and the $25 version is that Carrie and I signed them. But we saved six for yesterday, and they brought $148,000, which is a pretty good average per book of about $20,000. And then I had them save four more. So this afternoon when we disbanded at 1 o'clock. You're right behind us that has all the goods in at the bookstore. They will sell the final four. And when we get all through, I'll match whatever we've raised for the 20 and we'll give the Stevens Center a boost, both in financially but also in awareness. So anyway, and when you look at that book, Kerry really did the whole thing. I mean, there's a lot of information in there, and she dug through it, and she came through a couple of times maybe to check a fact or two. But she got material from the Munger family. She just did a wonderful job, and I couldn't get her to take a penny for it. So I'm going to ask her to do a lot of other things in the future. Okay. Okay. With that, I think we've covered all the business, so we will move to Becky's questions that she's received from, I don't know how many she's received, but from all over the country and perhaps outside the country. And she's picked out a group of them, which she is not shared with me. And we will hold her. eight questions between Becky and the audience, which we have by zones. And with that, I will turn things over, Becky, for the first question.
QuestionerThanks, Warren. This first question comes from Bill Mitchell. I received more questions about this than any other question. He writes, Warren, in a 2003 fortune article, you argued for import certificates to limit trade deficits and said these import certificates basically amounted to a tariff. But recently, you called tariffs an act of economic war. Has your view on trade barriers changed, or do you see import certificates as somehow distinct from tariffs?
[17:43]
WarrenYeah, well, the import certificates were distinct, but their goal is to balance imports against exports. and so that the trade deficit would not grow in an enormous way. In fact, it would have, and it had various other provisions in it to help countries at that time, as they were called, to perhaps catch up a little bit. And they had a variety of aspects to them, but basically they were designed to balance trade. And I think you can make some very good arguments for the fact. that balanced trade is good for the world and the more balanced trade there is the better. It will continue to be better for cocoa to be raged in Ghana and coffee and Colombia and a few things. And over time, the American industry has gone from being an agricultural country. This was nothing but an ag country. I mean, virtually, And that was only 250 years ago. And we have become a very industrial country, and we did not want to make that a situation, in my view, where we ran greater and greater deficits, building up greater and greater debts against the country. So I designed this import certificate thing, which Charlie thought was a little rub, too much like a rub gold. I don't know whether that name is, but it's gimmicky, but it's certainly a lot better than anything, I think, than we're talking about now. And there's no question that trade can be an act of war. And I think it's led to bad things, just the attitudes that's brought out in the United States. I mean, we should be looking to trade with the rest of the world. world and we should do what we do best and they should do what they do best. And I don't think it—that's what we did originally. I mean, we were good at producing tobacco and cotton 250 years ago, and we traded it. And we want a prosperous world with eight countries with nuclear weapons, including a few a few that are what I would call quite unstable. I do not think it's a great idea to try and design a world where a few countries say, ha, ha, ha, ha, we've won, and other countries are envious. So my import certificate idea, which went no place, I think we've got extra copies, Rob, with not a great demand for the copies. And if you'd like, and write the office, I think we could, we could probably send you a copy of it. But the main thing to do is not use, trade should not be a weapon. And the United States, the United States, we've won, I mean, we have become an incredibly important country, starting from nothing.
[21:36]
WarrenTwo hundred fifty years ago, there's nothing than anything like it. And it's a big mistake, in my view, when you have seven and a half billion people that don't like you very well, and you have 300 million that are crowing in some way about how well they've done. And I don't think it's right, and I don't think it's wise. I do think that the more, the more prosperous the rest of the world becomes, it won't be in our expense, the more will become and will then the safer will feel and your children will feel someday. So that's, but don't, don't expect my import certificate idea to go down there with Adam Smith's wealth of nations or anything. Okay, let's go to Area 1.
QuestionerMr. Buffett, Mr. Abel and Mr. Jane, good morning. I'm S. T. John. I'm from Hong. I'm from Hong. Mr. Buffett and Mr. Munger did a very good and successful investment in Japan in the past five or six years. The recent CPI in Japan is currently above 3%, not far away from its 2% targets. Band of Japan seems very determined in racing race, while Fed, that ECB and other central banks are considering to cut them. Do you think BOJ, Bank of Japan, makes sense to proceed the rate hike? Will its planned rate hike deter you from further investing Japanese stock market or even considering to realize your current profits? Thank you very much for arranging this. greatest events every year. Finally, I wish you healthy always and keep holding this shareholder meeting. Thank you.
WarrenWell, I'm going to extend the same goodwill to Japan that you've just extended to me. I love the people of Japan determine their best course of action in terms of economics. It's an incredible story. And it's been about six years now, as you pointed out. I was just going through a little handbook. Three thousand Japanese companies in it. One problem I have is that I can't read that handbook anymore. The prints too small, but the, and here were these five trading companies. They have a special name for them in Japan, but they were selling it particularly. at ridiculously low prices. And so I spent about the year acquiring them, and then we got to know the people better and everything that Greg and I saw we liked better as we went along. So we got fairly close to the 10% limit that we'd told the company we would never exceed without their permission. And so we did ask them reasonably whether that limit could be relaxed. and it's in the process of being relaxed somewhat.
[25:42]
WarrenWe, I would, I would say that I'll speak for Greg beyond me, that I'll speak for Greg beyond me, that I'll, in the next 50 years, and I'll be running things then, we won't give a thought to selling those. I mean, they had, uh, and Japan's record been extraordinary, actually, in terms of, would tell you, Tim Cook would tell you that, iPhone sales there are about as great as any country outside of the United States. American Express would tell you that they sell a product very, very well in Japan, Coca-Cola that we do business. But then another big investment of ours, they do extraordinarily well in Japan. They have a number of habits in a civilization that operates differently than ours. And it's by far the biggest, they, this is the container they've always preferred. They're soft drinks and they have a whole different sort of distribution system there. But we have been treated extremely well by the five companies. They talk with Greg primarily. I went over there a year or two ago. Paul is than I am, so he's a, which isn't saying much, actually, but, uh. Very little. But he is, I don't know, how many times you think you've met with representatives of one company or the other?
Greg AbelYeah, when you think of the five, there's definitely a couple meetings a year, Warren. And I think the thing we're building with the five, five companies is, one, it's been a very good investment. We are really, as Warren touched on, we envision holding the investment for 50 years or forever, but I think we also are building relationships to do incremental things with each of those companies. And we really do hope to do big things with them globally. They bring different perspectives and different opportunities, and we see, and that's the, that's why we're building that long-term relationship with them. It's super long-term, and they have a much, they have a, They have different customs. They have different approaches to business. That's true around the world. And we don't have any intention in any way of trying to change what they've done because they do because they do it very successfully. And our main activity is just to cheer and clap. And that, I can still do it 94. So we will own those, you know, we will not be selling any stock. I mean, that is just, it's, that will not happen in decades if then. And my guess is that they will find things, because they cover the world pretty much, the five trading companies.
[29:31]
WarrenWe will find things occasionally. that for any individual company there, they may, in some way, be assisted by some, some help we bring to the situation. That will be an expanding relationship. It's too bad that Berkshire has gotten as big as it is because we love that position, and I'd like it to be a lot larger than it is. But even with the five companies being, they're very large companies, and they're large companies. in Japan. And we've got at market that, you know, in the range of $20 billion invested, but I'd rather have $100 billion than $20 billion. And that's the way I feel about it. Several other investments we have. But size is an enemy, a performance, good way. But Charlie always told me that having a few problems was good for me. I never quite understood that, but he, if you listen to immoralize, you would understand. And it's not an impossible problem at all. And the Japan, the Japan investment has just been right up our alley. Do you want to add anything on that term?
CharlieNo, I think you've touched it, but as you said, it's right up our alley. And I absolutely agree, Warren. believe we'll see some very large opportunities long term. And that's just been a great plus of that, that relationship.
WarrenYeah, I would say they want to, they would like to present us with opportunities. We would like to receive them. We've got the money. We both get along very well with each other. And they have different, they have some different customs than we have. They drink the number one Coca-Cola product. They drink over there something called Georgia coffee. So, I haven't converted them to Cherry Coke, and they're not going to convert me to Washington, Georgia Coffee. But it's a perfect relationship. I just wish we could get more like it. And I never dreamt of that when I picked up that little, it wasn't so little, it was about that thick but sometimes two companies to a page and a couple thousand pages, I believe, but it's amazing what you can find when you just turn the page. We showed a movie last year that about turn every page. And I would say that turning every page is one important ingredient to bring to the investment field. And I would say that turning every page is one important ingredient to bring to the investment field. And few people do turn every page and the ones that turn every page aren't going to tell you what they're finding. So you got to do a little of it yourself. Okay.
[33:14]
QuestionerThis next question comes from Advate Prasad in New York. He writes, today Berkshire holds over $300 billion in cash and short-term investments representing about 27% of total assets, a a historically high figure compared to the 13% average over the last 25 years. This has also led Berkshire to effectively own nearly 5% of the entire U.S. Treasury market. Beyond the need for liquidity to meet insurance obligations, is the decision to raise cash primarily a derisking strategy in response to high market valuations? Or is it also a deliberate effort to position Berkshire's balance sheet for a smoother leadership transition providing Greg Abel with maximum flexibility and a clean slate for future capital allocation decisions. And I will add one line from another shareholder, Mike Conway, who asks, are you encouraged you may see some fat pitches coming your way?
WarrenYeah. Well, I wouldn't do anything nearly so noble as to withhold investing myself just so that Greg could look good later on. Now, if he gets any edge of what I believe, I'll resent it. So the, no, the amount of cash we have is, we would spend, well, when, we came pretty close to spending $10 billion, not that long ago, for example, we'd spend $100 billion. I mean, and those decisions are not tough to make. uh when when something is offered that is that makes sense to us and that we understand and offers good value and where we don't worry about losing and the one problem with the investment business is that things don't come along in an orderly fashion and they never will. I mean, it isn't like every day, uh, you know, the, the long term record is sensational. But that is not a product. And I've been in, see, I've had 200 trading days, 80 years. I'm, you know, I've been 16 million trading days. I'd be kind of, I mean, 16,000 training days. It would be nice if every day you've got four opportunities or something like that. And, you know, you could, and they were expected to be equally attractive. You know, if I was running a numbers racket, you know, every day would have the same expectancy of that I would keep 40% of whatever the handle was. And so the only question would be is how much we transacted. But we're not running that kind of a business. And so we're running a business which is very, very, very opportunistic. And Charlie always thought I did too many things. He thought if we did about five things in our lifetime, we could,
[36:41]
Warrenwe'd end up doing better than if we did 50 and, and that we never concentrated enough. So that we would rather have, if we've got $335 billion now in treasies, we would rather have conditions that have developed where we would have like 50 billion or something like that. But that just isn't the way the business works. And we have made a lot of money by not wanting to be fully invested at all times. And we don't think it's improper, actually, for people who are passive investors, just to make a few simple investments and sit for their life, sit for their life. But we've made the decision to be in the business. So we think we can do a little better than that by behaving in a very irregular manner. But if you told me that I had to invest but roughly $40 billion a year coming in, and we start with $335, if you told me I had to invest $50 billion every year until we got down to $50 billion, that would be the dumbest thing in the world to invest in that manner. Things get extraordinarily attractive very occasionally. The long-term trend is up. Nobody knows. And I certainly don't know. Greg doesn't know. Ajeet doesn't know. Nobody knows what the market is going to do tomorrow, next week, next month. And nobody knows what business is going to do tomorrow next week or next month, but they spend all their time talking about it because it's easy to talk about. And, but it has no value. I've never found anybody I wanted to listen to on the subject. And the, on the other hand, I've found the leafing through things like that big Japanese book that I can't read anymore. The, that's a treasure hunt. And every now and then you find some And occasionally, very occasionally, but it'll happen again that I don't know when. It won't, it could be next week, it could be five years off, but it won't be 50 years off. You will have, we will be bombarded with offerings that we'll be glad we have the cash for. And it'd be a lot more fun of what would happen tomorrow, but it's very unlikely to happen tomorrow. Now, very, very unlikely to happen tomorrow. But it's not unlikely to happen in five years, and then it gets, the probability to get higher if you go along. It's kind of like death. I mean, if you're 10 years old, the chances that you're going to die the next day or low, it get to be 115 or something like that, it's almost a cinch. Particularly if you're a male. I mean, all the records are held by females in terms of age.
[40:09]
Warrenand I tried to get Charlie to have a sex change so he could test up. And he did pretty well for being a male, I'll put it that way.
OtherOkay. Station, Station 2.
QuestionerGood morning, Warren, Greg and Ajit. My name is Jackie Han. I'm from China and now working in Toronto, Canada. This is my eighth Berkshire Houseway meetings at this point. I've probably spent more time with you than most people spend on Netflix. As you may guess, coming from a Chinese family, we've always had a soft spot for real estate. So your question isn't why don't you own a house? It's why are you still buying stocks instead of more property? So here is my question. With today's high interest rates and a global uncertainty, do you still believe in being greedy when others are fearful? or the value investing facing new challenges in today's environment. Thank you.
WarrenYeah. Well, in respect to real estate, it's so much harder than stocks in terms of negotiation of deals, time spent, the involvement of multiple parties in the ownership. Usually when real estate gets in trouble so you find out you're dealing with more than equity holder. There have been times when large amounts of real estate have changed hands at bargain prices, but usually stocks were cheaper, but there were a lot easier to do. So more, real estate, it's totally enjoyed real estate transactions, and he actually did a fair number of them in the last five years of his life. You know, he was playing a game then. And it was an interesting game to him. But I think if he, you'd asked him to make a choice when he was 21, and he had to either be in stocks exclusively the rest of his life or real estate the rest of his life, he would have chosen stocks in a second. And there's just so much more opportunity, at least in the United States, there's so much more opportunity that presents itself in market than does in real estate and in real estate. state, you're dealing with a, usually dealing with a single owner or a family that owns maybe a large property, they've had a long time, maybe they've borrowed too much of money against it, maybe the population trends are against them, but to them it's an enormous decision. When you walk down to the New York Stock Exchange, you can do billions of dollars worth of business totally anonymous, and you can do it in five minutes, and the trades are complete when they're complete. In real estate, when you make a deal, a big deal with a distressed lender, you know, when
[43:37]
Warrenyou sign the deal, then you go into another phase. I mean, then people start negotiating more things and more things, and it's a whole different game and a different type of person to some extent enjoys the game. We, real estate deals that came our way in 2008 and 9, but we real estate deals that came our way in 2008 and But the amount of time that they would take us compared to doing something intelligent and probably better. And securities, there was just no comparison. I mean, in a real estate deal, every sentence is as important as a person and in stocks. If somebody needs to sell 20,000 shares of Berkshire or something and they call us, and the price is right, it's done in five. seconds and and it closes all the time that people who you certainly wouldn't want to have marry your daughter or that they behave well actually in in stocks partly that's because that they're probably having their their wires or phones or whatever it is recorded as to what they've said and everything but but the the the completion rate for working on anything in stocks is, if assuming you've got a meeting in the minds on prices, essentially 100% in real estate. It just begins when you agree on deals and that they take forever. So for a guy 94, it's not the most interesting thing to get involved in something where the negotiations could take years. We capability, there had been some huge failures in, in fact, if you go all the way back to Zekendorf in the 1960s, he was going to change the world and Century City out in California's a product of his. And if you go to Uris, if you go to, he was sitting on top of the world with the Uris buildings. trouble in that business. The banks usually don't want to recognize it, but that takes a long time to go through the bank processes. They just got through redoing the musk alone that he made it when he was buying it three years ago, the company that's now X. And, you know, three years to work out a transaction that, or you've got parties on both sides. that aren't ready to act, that we find it much better when people are just ready to pick up the phone and you can do hundreds of millions of dollars worth of business in the day. I've been spoiled, but I like being spoiled, so we'll keep it that way.
QuestionerOkay, Becky. This question comes from Sam England in San Francisco, and it's for Warren and A.G. As AI systems become more capable and harder to improve.
[47:14]
Questionerinterpret, how do you see that affecting the insurance industry's ability to assess price and transfer risk? Are there parallels to past disruptions Berkshire has navigated in underwriting or capital allocation?
WarrenOkay, Becky, and she's got about 100 points of IQ on me, and he's just going to be here this morning, so I'm going to let him answer the question first.
Ajit JainWell, there is no question in my mind that AI is going to be a real game. game changer and it's going to change the way we assess risk, we price risk, we sell the risk, and then the way we end up paying claims. Having said that, I certainly also feel that people end up spending enormous amount of money trying to chase the next new fashionable thing. We are not very good in terms of being the fastest or the first mover. Our approach is more to wait and see until the opportunity crystallizes, and we have a better point of view in terms of risk of failure, upside, downside. So right now, the individual insurance operations do dabble in AI and try and figure out what is the best thing to exploit it. But we have not yet made a conscious big-time effort in terms of pouring a lot of money into this opportunity. And my guess is we will be in a state of readiness. And should that opportunity pop up, we'll be in a state where we'll jump in promptly.
WarrenI would just add I wouldn't trade, I wouldn't trade everything that's developed in AI in the next 10 years for a G. So if you gave me a choice, that gave me a choice of having $100 billion to participate in an insurance, property casualty insurance business for the next 10 years. and a choice of getting the top AI product out of whoever's developing it or having a gene making the decision. I would take a gene any name. I'm not kidding about that.
OtherOkay, station free.
QuestionerHello. I'm Sean Siegel from Chicago, Illinois. Thank you for investing your time to you and the executive committee for putting on this meeting and for bringing together a diverse group of people in attendance under one roof. Out of all the companies that Berkshire Hathaway owns, there was one that you acquired, the Chicago-based company Portillo's Hot Dogs. How did you know that this would be a good fit for the overall company's portfolio?
WarrenWell, I'll have to ask Greg about that because I don't know anything about it. So maybe he bought it what I was looking the other way, but... I think I got to call a friend on this one.
[50:42]
WarrenYeah, I, we own a lot of companies, but I do like to think I know most of them, but the, it may be a subsidiary of a subsidiary in some way, but, but I really don't know a thing about it. I'm sorry, but that may be a good thing. I do know something about hot dogs, though, so yeah. And we do have a lot of companies in short. Chicago Warren. Yeah. Through Marman. And that's been a great opportunity where we've accumulated a variety of excellent companies under that portfolio. But as you noted, I don't believe Portillo's fault under that. Yeah. No, I look at the financial statements of about, yeah, perhaps 50 or 60 of our companies every month, but in the case of Marmon, for example, Marman itself owns over 100 companies. And it was the creature of, it was created by Jay Pritzker and his brother, Bob. And it was a remarkable company when we bought it, but it was highly diversified already, and then we've diversified it further. So it is something of a lot. But Berkshire within Berkshire. And we found that that's working. We go to his arrangement. It was interesting. Jay Pritzker was a workable manager, and there's various branches of the Pritzker family. So, you know, really goes back to A.N. Pritzker before Jay and so on. But in 1954, you know, it really goes back to A& Pritzker before J and so on. they changed the federal tax code very dramatically in the United States. It was quite a blow to me because I've been at Columbia and I'd been reading a J.K. Lassar book about the tax code and then they went and changed the whole damn thing, so I did. But 54 was a big year, a big change. Those years come every now and then like 1986 and you may see a big one of these days. And there was a company called Rockwood Chocolates in Rockwood Chocolate Bits, which we used to sell at the Buffett grocery store, and people made chocolate chip cookies out of them and everything. And then it turned out that Coco, which lately has had a big run to, Coco was five cents a pound in 1941 when LIFO was first allowed for, for it was five cents a pound. for insurance for for for the tax purposes at the rock which off company went into on the life old message so they they owned like 30 million pounds or thereabouts of cocoa and then cocoa took a run in 1955 and I just moved to New York and there was a provision in the new york and there was a provision in the new york and there was a provision
[54:24]
Warrencode that if you were in two or more companies and did certain things and you've been in them for five years and you got out of one of them that there would be no capital gains tax on life all inventory gains and tax rates were around 48% maybe 52% and so you there was this huge profit because because the the cocoa had gone up in price but that made it terrible for them in selling rock with chocolate bits because the price of retail of the chocolate bits did not match what was going on at wholesale something almost identical has been happening in the chocolate business recently Hershey Chocolate just came out and said they're going to have a bad quarter and we're paying $4 and 50 cents a pound for chocolate from cocoa because things are going on in West Africa that that make I think Coco prices go up dramatically. In any event, Jay Pritzker bought control of Rockwood, the chocolate company. And like I say, I was 24 or 5 years old, and they called a meeting to split off the two, one of the chocolate businesses in a way that would enable them to recognize the gain on this, these cocoa, beans without paying 50% roughly 50% federal taxes on the game. So I went to the meeting, which was in Brooklyn, and nobody was there. This is in the turn-every-page category, except one guy, and I was 24, and he was 29, and it was Jay Pritzker, and nobody had showed up at the meeting and it was kind of a crummy building they had, but they had a lot of cocoa there. And Jay just gave me a lecture, or a lesson, really, I should say, on the tax coat. And I made it with that, I could have gone to graduate school for years and never learned as much as he did. And then later, we actually bought the company, that rockwood company, but after he did some other things, became the basis for Marmon. And Marmon, among other things, developed the car that won the first Indianapolis Speedway race. And it invented the rear view mirror, which I'm not sure is a great advantage in economics or anything, but the guy that would, they used to have on the Indianapolis 500, they had two people in the car. One guy was to look back and see what the other people were doing, and the other guy was to drive the car. And our guy got sick. And so they invented a rearview mirror. So if you want to look at the kind of, you know, what's going on in the laboratories of Berkshire Hathaway, and we've got people working on things like the rearview mirror.
[57:42]
OtherA. Warren?
WarrenYep. I'm happy a friend did call. So that still works. Peter Eastwood, who runs one of our Berkshire subsidiaries. and does a great job of running it, a track down that Portellos is owned by a private equity firm called Berkshire Partners. So that was the basis of the question, but it's not associated with Berkshire. So we got to the bottom of that one. Yeah. Thank you, Peter. That's just a sample the way we operate around Berkshire. Okay. Becky.
QuestionerAll right. This question comes from Jessica Poon, who says, you've long been a strong believer in the American tailwind and the resilience of the United States, and history has proven you correct. Today, the U.S. appears to be undergoing significant and potentially revolutionary changes. Some investors are now questioning the concept of American exceptionalism. In your view, are investors being overly pessimistic about the U.S. economy? or is the country indeed entering a period of fundamental change that requires a reassessment from a new perspective?
WarrenWell, I would say that Jessica, who I believe is, it sounds as she is the step-granddaughter of one of our managers that I mentioned in the annual report may not be the same one. But in any event, America's been insignificant and revolutionary change, really ever since it was developed. I mentioned that, you know, we started out as an agricultural society. We started out as a society with high promises, and we didn't deliver out of very well. We said all men were created equal, and then we wrote a constitution and said blacks get three counted as three-fifths, and in an article two, you'll find male pronouns used 20 times and no female pronouns used. You know, it took till 2000, I mean, you know, 2000, or 1920, I should say, until the 19th, until the 19th Amendment was passed, saying, oh, yeah, we promised the women just back in 1776, and now we'll do something about it. And then we didn't do something about it for a long time. So we're always in the process of change. We'll always find all kinds of things to criticize. in the country. But the luckiest day in my life is the day I was born. You know, I was born in the United States. And at the time, about 3% of all the births in the world were taking place in the United States. And I'd like to say that I had something to do, you know, listen, sent messages out to my parents, for God's sakes, moved to the United States before I've born or anything.
[1:01:07]
WarrenBut I was just lucky. And I was lucky to be born bail. I was lucky to be worn white. And it was like all kinds of things. But it's been, if you don't think the United States has changed since I was born in 1930, it's been, we've gone through all kinds of things. And we've gone through great recessions. We've gone through world wars. We've gone through the development of atomic bomb that we never dreamt of, you know, at the time I was born. So I would not get discouraged about the fact that that it never doesn't look like. like if we solved a very problem that's come along, and if I were being born today, you know, I would just keep negotiating in the womb until they said you can be in the United States. So we're all pretty lucky. We've got two non-United States guys here just to get the other side. Who now live in the U.S. Okay, station four.
QuestionerHi, Mr. Buffett. My name is Daniel, and I'm from Tenafly, New Jersey. First of all, I just want to say how grateful I am for getting the opportunity to ask you a question. When it comes to your principles of investing, you often talk about how important it is to be patient. Has there ever been a situation in your investing career where breaking that principle and acting fast has benefited you? Thank you.
WarrenWell, that's a good question. There are times when you have to act fast. In fact, we made a great deal of money because we're willing to act faster than anybody around. Jessica Tooms is, I think, she's the stepdaughter of, our step-granddaughter of Ben Rosner, manager of ours. And in 1966, I got a call from a phone name, Pell Steiner, and New York. And he said, I represent actually nine Annenberg sisters, I believe, before War Annenberg came along as the son. But he said, we have a business we'd like to sell you. So I called Charlie up. And I got a few details. And it sounded very interesting. And when I went back to the office of Will Falstiner in New York was a marvelous guy. Never met him since. But he was handling. things for Mrs. Well, A. Simon, but she her name was Annabert. And her husband had been the partner of, but he had died. And Ben got kind of tense about working with her. And so offered us this business at a bargain price. He offered us a business for $6 million. It had $2 million of cash. It had a $2 million piece of property in the 900 block. of, of, what's the key street in Philadelphia down there, Market Street.
[1:04:54]
WarrenAnd it was making $2 million a year pre-tax, and the price was $6 million. And Charlie and I went back to this place. And Ben Rosner was there. And he really, he just was upset about doing business with his widow. She was extremely wealthy. And And he just didn't, he wasn't enjoying it. He was very nervous about selling it. And he said to me and Charlie, he said, I'll run this business for you until December 31st. And then I'm out of here. I got Charlie, we went out in the hallway, and I said, if this guy quits, at the end of the year, you can throw away every book on psychology if I've ever read. And so that began a wonderful, we bought the company. I had a great relationship. And did I know that morning when I got a phone call from Will Falstiner? There'd been a background about, I've had a couple of times, and that was one of them where people in the East, they had a stereotype in their mind of what people from the Midwest were like. And Ben had been married, his first marriage was to him. woman from Iowa, and he just figured that anybody from the Midwest was okay. And the trick when you do, when you get in the business with somebody, they get in a room with somebody like that and they want to sell you something for $6 million that's got $2 million of cash and a couple million of real estate and it's making me $2 million a year. You don't, you don't want to be patient then. You want to be patient in waiting to get the occasional call. My phone will ring sometime. And with something that, you know, wakes me up. I may be sleeping in there or something, but you just never know when it'll happen. And that's what makes it, what makes it fun. I mean, it's, so patience, it's a combination of patience and willingness to do something that afternoon if it comes to you. You don't want to be, you don't want to be patient about acting on deals that makes sense. And you don't want to be very patient with people that are talking to you about things that will never happen. So it's not a constant asset. It's not a constant ability to be patient.
Greg AbelGreg, you. Well, Warren, I was going to add, as you're being patient, I happen to know, and I think that goes for our Ajit also and all our managers. Very patient when we're looking at opportunities. And as you touched on, we want to. act quickly. But while we're being patient, never underestimate the amount of reading and work that's being done to be prepared to act quickly. Because we do know, be it
[1:08:24]
Warrenequities, but I would include a variety of private companies that when the opportunity presents itself, we're ready to act. And that's a large part of being patient, is using it to be prepared.
QuestionerYeah. And of course, it doesn't come in anything like an even flow. I mean, the most uneven sort of activity you could get into. And the main thing you have to do is you have to be willing to hang up after five seconds and you have to be willing to say yes after five seconds.
WarrenAbsolutely. And you can't be filled with self-doubt in the business. You just forget it. it's going to some other activity. But you also, I mean, one of the great pleasures, it is the great pleasure actually in this business, is having people trust you. And that's really the, why work at 91, you've got more money than anybody could count, you know, if they started today and having machines that are helping them and everything else. It means nothing in terms of how you're going to live or how your children are going to live or how your children are going to live or anything else. And it, but both Charlie and I, we just enjoyed the fact that people trusted us and they trusted us 60 years ago or 70 years ago in partnerships we had. And we never sought out professional investors. to join our partnerships. Among all of my partners, I never had a single institution. I never wanted an institution. I wanted people. And I didn't want people that were sitting around and having people present to them every three months and tell them what they wanted to hear and all that sort of things. And that's what we got. And that's why we've got this group here today. So it's all worked out. But that, you know, we know, I want to be patient when the time comes to act. You want to get it done that day.
OtherOkay. Becky.
QuestionerThis question is from Flavio Montenegro, a shareholder from Guatemala. A couple of years ago in this meeting, Mr. Jane outlined the significant challenges Geico faced in modernizing and integrating its IT systems. It was also mentioned that competitors were ahead in their pricing strategies because of the use of telematics. Today, Geico's turnaround is evident through strong pricing and operational improvements. Would you provide more details on the specific actions taken under Todd's leadership and how those changes will help sustain a long-term competitive advantage in the coming years?
WarrenYeah. Todd has done a great job for us in terms of turning around the operations.
[1:11:50]
Ajit JainWhen he took over, there were two major issues that, issues that Geico was behind its competitors on. Firstly, the term Warren used and we all have been using is matching rate to risk. And secondly, telematics. We were at the bottom of the list in so far as telematics had been around about five, six years ago. Since then, we have made rapid strides. And telematics, which used to be a source of competitive disadvantage to us, is that no longer so. And I would argue that our telematics at GEICO is about as good as anyone else as today. So that's been one huge catch-up. Secondly, in terms of matching rate to risk, there again, I think we have caught up with our competitors and we are as good as anyone else in the field. All this together with the cost reduction effort that Geico and Todd gets a lot of credit for. He has basically reduced the workforce by 20,000, starting with something to goes to 50,000. He's brought it down to 20,000. And that translates to, I guess, at least $2 billion per year. So all of this has allowed GEICO to become a much focused competitor. So much so in the last seven quarters, Geico has shown a combined ratio that has an eight in front front of it. And I never thought I'd live to see the day when anyone could have a combined ratio at it's so low as it is right now. So I think GEICO has done a great job. It's 80 combined translates to the largest profit anyone is making on the underwriting side in the personal order of a real business. So, you know, we've achieved a lot, taught has achieved a lot, but I do not want to be so arrogant as to say that mission accomplished. We've achieved a lot, but I still think we need to do a lot more in technology. technology, AI, as we talked about, is going to be a big force. And we need to play catch-up there, not catch-up, but we ought to be in a state of readiness. So I think GEICO is in a great shape right now. Warren, you want to add anything?
WarrenNo, it's a fascinating case study, but that's what's so interesting about the whole game of business, but particularly about our businesses, is that each one is a little different But they're all, they all have challenges of certain sorts, but they also, many, certain numbers have opportunities. We paid $50 million for half of GEICO in 1970s, what turned out to be half of GEICO, 50 million, 50 million, we now own 100%, but 50% of $2 billion that we earned in the first
[1:14:58]
Warrenquarter is a billion. which on a $50 million investment is, you know, $20 for one and a quarter. So it takes years to develop. But the interesting thing is the auto insurance policy, which didn't even exist 100 years ago. I mean, you didn't, it just, well, I should say 120 years ago. But it's by far the largest item in the property casualty. insurance business. It's huge.
QuestionerThe only thing I'd like to add is in addition to the underwriting profit, GEICO provides $29 billion of float.
WarrenOh, yeah, in addition, yeah. And that's not unimportant when you paid $50 million to get the businesses giving you $29 billion to work with for nothing. And on top of that, gives you a billion dollars of profit in a quarter. The interesting thing about auto insurance is that we are, the company was starting, at 1936. We're selling the same product as 1936. We're being more sophisticated about pricing it than we were then. Somebody just made the judgment, a fellow that came from USAAA, made the judgment that government employees, the name Geico stands for government employees insurance company, that government employees were better drivers than average. And I don't think was an actuary or anything else, but he just made an observation. And so he left USAAA, which is still a very successful company. And he started GEICO for a few hundred thousand dollars. And he made money the first year for my underwriting. He made money the second year. This is not a public offering type thing, you know. He was phonedyney accounting for 10 years and all that sort of thing. They just priced it to make money. And that's exactly. exactly what's been done since 1936. The policy really, you know, your insurance, your auto insurance policy looks a lot like the one that you had done. And this huge field has sprung up around us and it's still growing. And, of course, nobody likes to buy insurance, but they sure like to drive. And, and, and, uh, uh, uh, Geico is, it's a fascinating story. And about three times over the years. The company has gotten sidetracked one way or another. And then it gets back to its basics. And it's a wonderful, wonderful business. And we showed at this annual meeting one time, a message from Lorimer Davidson. And Lorimer Davidson in January of 1950. He was the only person in a building that I'd gone down on a Saturday to visit. But it turned out they didn't work on Saturdays in Washington. And I pounded down the door until finally
[1:18:20]
Warrena janitor brought me in. And I said, this is a janitor? Is there anybody I can talk to here except you? He didn't take it personally. And he said, well, there's one guy up on the sixth floor. And a fellow named Lero and Orimer Davidson did wonderful things for me. You get a few breaks in life in terms of people you will meet who can just change your life dramatically. And if you need a handful of those, and when you get them, you treasure them. And we've had them on this board of Berkshire. We, you know, if you take Tom Murphy and Sandy Goddismund and Walter Scott and Bill Scott, The one thing we've done is we've held on to human assets. We've made lifelong assets out of people that are the right sort. And with incredible talent, but also just lots of fun to work with and always doing more than their share. And, you know, to get a chance to talk to Lorimer Davidson on a Saturday afternoon, you just listen carefully. And that comes in the... in the category of turn every page. Some of them you want to turn pretty fast, but you just get lucky in life. And you want to take advantage of your luck.
QuestionerOkay. Station 5. My name is Benjamin Graham Sanderson from Pasadena, California. Warren, thank you for all you've taught us over the years. Earlier you said nobody but Steve Jobs could have created Apple, but nobody but Tim Cook could have developed it like he has. Warren, nobody but you could have created Berkshire. And I presume you view Greg as an outlier among outliers. But he seems so normal. Sorry, Greg. That's a nice way of saying it's not normal, actually, but I appreciate it. So I was hoping you could share what specifically about Greg makes him your preferred successor. And Greg, we're excited to get to know you more over the next few decades. Thank you.
WarrenThank you. Well, you've hit on the most important question in terms of the business. We've got a wonderful group of businesses. We've got an ability to do things that nobody else can do, which is hard to get it in the capitalistic system that's been developed as fully as the United States has been. I mean, imagine being able to create something that in a very, very, very big playing field. I don't think you'd really be very, very hard to develop anything like about. I don't think you could develop the people around it, let alone the capital position, you know, the history and everything else. And the answer, of course, is that it does take a long, long time.
[1:21:46]
WarrenAnd it takes getting around you a small cadre of people, which then spreads out somewhat. somewhat, but you've got mutual trust where people do more than their share. And I've been around a lot of businesses over the years, and by nature, I'm somewhat critical of everything. I mean, I'm looking for what's wrong in things, because that's part of investing is looking, you know, what aren't you, what are you missing? People that they're asked to put on a show. like this instead of doing whatever their regular job is, they participated. I went around the groups of people who were exhibiting yesterday for an hour and a half. And these are people who are thanking me, you know, and totally enthused about coming and doing a lot of work for which they don't get paid or anything extra, and I don't know anything about the arrangements of the individual companies make, but they work hard and they enjoy their work. And, you know, you really want to work as something you enjoy. I've always had, I've had five bosses in life, and I liked every one of them. And they were all interesting. I still decided that I'd rather work for myself than anybody else. But if you find people that are wonderful to work with, you know, that's the place to go. And I've told my kids that basically that you don't get lucky like I did when I found at seven or eight years of age, what really interested me, you know, it could have taken a lot longer, but you want to find the song, find the sound, there's a movie called The Glen Miller Story, and Glenn Miller went on from having a broken down band for 15 years to turning out the first, he found the sound and, and, uh, and, and, and, uh, and creating a broken down band for 15 years to, the first gold record, I don't know whether any of you know what it was, but it was to Chattanooga Choochoochoo, in 1941, I think it was. And he turned around from being a nothing, and with a band that he had until he found the sound. And I always have told my kids ever since that their sound isn't my sound, you know, but, and you don't find it necessarily. on the first job you take, because you got to eat, you know, but if you get lucky like I did, you find it to be, you find it when you're very young. And then, you know, just keep doing it, and, uh, and don't worry, don't worry too much about starting salaries and don't worry about, about, uh, and be very careful who you work for
[1:25:13]
Warrenbecause you will take on the habits of the people around. just so there's certain, certain jobs you shouldn't take. But you've got the greatest country in the world and you've got the greatest time in the world. So, I would say that, that, well, I'm handing this over to Greg, that you can't even dream all the dreams that you could have about a place like Berkshire, but the big thing you have to do, though, is always, is to be sure you can play the next day. I mean, in terms of, in terms of financial activities on a meaningful scale, uh, I want to go, you don't, you don't, you don't, you only have to get rich once. I mean, you don't, you don't want to do anything that risks. It's been created. So you don't, you know, if very stupid things are happening around you, you do know and not want to participate. If people were making more money because they're borrowing money or they're participating in securities that are really pieces of junk, but, but they hope to find a bigger sucker later on. You just have to forget that. That'll bite you at some point. And the basic game is so good, and you've been so lucky to be born now. I mean, if I've been born in 1700, I'd say, I'll I want to go back in the womb. What the hell with this? It's too hard. And, but now I've come along to do something where I can just play around all day with things I enjoy doing. And, uh, and, uh, it's really, uh, it's a pretty wonderful life. Greg, you want to subtract from that?
Greg AbelNothing to subtract, but, uh, I would always just say it couldn't be more, as I've said in the past, more humbled than honored, obviously to be in this role. But to, uh, to, to, to, to, to, to, have actually been part of Berkshire for Warren. It's now 25 plus years had the opportunity to be part of Berkshire and to work with you and Ajit and our board, but many other people in our company. And as you touched on, um, when you find something like that and you find something like that, like Berkshire that's so special, it's, it's, you fall in love with it and it's, it becomes just what you want to do every day and it's just an incredible opportunity. So thank you.
WarrenIf you don't find it immediately, you know, uh, don't starve the death or anything in the meantime, but, but, uh, you will find it, and you'll, you'll find it in, in the right individual, and in the sense, it's somewhat like finding the right person in marriage.
[1:28:40]
WarrenI mean, and, uh, probably the first, some of you married, may have married the person you made, met on your first date, although I guess they don't even have dates. anymore, but the, but the, uh, but, you know, it's, uh, sometimes it pays to wait, too.
QuestionerOkay, Becky. This is a question from Mark Bonkey and Helen Friedrickson in Rapid City, South Dakota. As the U.S. dollar quickly loses value in relation to other foreign currencies in 2025, is Berkshire Hathaway taking steps to minimize this currency risk and its impact on quarterly and annual earnings. If so, please explain, and I'll just add from Mary Cheng, another shareholder. Berkshire currently borrows in Japanese yen to offset its currency risk and its Japanese stock investments. In the future, will you invest in foreign currency denominated assets unhedged?
WarrenYeah, well, we always have pretty much. The Japanese situation is different because we do intend to stay so long with that position. And the funding situation, situation is so cheap that we essentially have attempted to some degree to match purchases against the end denominated of funding. But that's not a policy of ours. In fact, that's the first time we've done that. And we've owned lots of securities in foreign currency. So we do nothing in terms of the question about its impact on quarterly and annual earnings. We don't do anything based on its impact on quarterly and annual earnings. I mean, there's never been a board meeting I can remember where I, or the conversation I had with Charlie when I said, where I say, if we do this, our annual earnings will be this, you know, and therefore, we ought to, whether it's accounting or anything, we just, you know, the number will turn out to be what it'll be, what counts is where we are five or 10 or 20 years from now. And if you start focusing on what number you're going to produce, you will quickly get tempted, at least based on the experience I've seen from viewing 20 companies, you will get so you'll, one some way or another, I'll play around with the numbers and sometimes seriously play around with the numbers. And I've seen people that, you know, I trust them in all kinds of other ways, but they regard playing around with numbers is perfectly okay. And that's just not something, you know, we just don't think about that. So actually, the relationship, the relationship. of the end, behavior of the end in the last quarter, you know, resulted in certain gap
[1:32:07]
Warrencharges and, uh, but it doesn't make it, it doesn't make any difference. It'll change next, you know, next month or next year. And, and obviously, we wouldn't want to be owning anything that we thought was in a currency that was really going to hell. And that's the big thing we worry about with the United States currency. I mean, it's the the tendency of a government to want to debase its currency over time is there's no system that beats that. You can pick dictators, you can pick representatives, you can do anything, but the people, there will be a push toward weaker currencies, and of course, that is, I mentioned very briefly in the annual report that the fiscal policy is what scares me in the United States. because it's made the way it is and all the motivations are doing a lot of things that will cause, can cause trouble with money. But that's not limited to the United States. It's all over the world. And some places it gets out of control regularly. As I know, they know, they know, no, they know. They devalue it rates that are breathtaking, and that's continued. I mean, people can study economics and you can have all kinds of arrangements, but in the end, if you've got people that control the currency, you can issue, or you can engage in clipping currencies like they used to do centuries ago or be people, the nature of their job. I don't, I'm not singing them out as particularly evil or anything like that, but the natural course of government is to, is to make the currency worth less over time and, and it's got important consequences. And it's very hard to build checks and balances into the system to keep that from happening. And we've had a lot of fun here in the last, either the first 100 days of the last 100 days of the last 100 days. whatever you want to call it, the watching what happens when people try to make sure that they aren't running fiscal risks and that game isn't over and it never will be over, you know, in finality. If you look up in search the great inflations, most World War II, it's just a list that goes on forever and the same names keep popping up. and everything. So currency is a, the value of currency is a scary thing. And, and, uh, don't have any great system for beating that. Do in this particular Japanese position, because we expect to hold it for 50 or 100 years or more. And we will be owning something that's denominated in the end and easily predictable.
[1:35:54]
WarrenAnd we'll just, as long as the, the carry on it is right and everything, we'll, will, uh, will, will, will, uh, will, will, attempt to issue Japanese denominated liabilities. But that's not because of anything we carry about in terms of quarterly or annual earnings. Greg, do you have anything to say?
Greg AbelI was just going to say that, relative to the question, that there's no question we were fundamentally very comfortable with investing in the five Japanese companies and recognizing we're investing in yen. The fact we could then borrow in yen, was a almost just like a nice incremental opportunity. But we are very comfortable both with the Japanese companies and with the currency we would ultimately realize, i.e. in the yen.
WarrenYeah, we only made, as I referred to earlier, one big currency play, which was connected a little bit with when I wrote that article for fortune. And we got along 12 other currencies, as I remember, only four or five of them are really big currencies. But when I say we got longed, that means we're short the dollar. And so we held that position for a couple of years, and we made several billion dollars on it, which was significant to us then. So is. Charlie always felt that if he had to pick an area outside of stocks in which to invest. And he knew a lot about bonds. He knew a lot about real estate. He knew a lot about a lot of things. But he said the, he thought he could, he thought he could make a lot of money out of being in foreign currency. But we've done it once. It's not inconceivable. We would do it again. But it's unlikely. It would be things happen in the United States that would make us want to own a lot of other currencies. And I suppose if we, if he made some very large and investment, European country or some, there might be a situation where we would do a lot of financing in their currency, but it's not a, it was something that just was sort of obvious to do in the Japanese situation where we had the ability to borrow yen a very, very low carrying cost. And we felt very good about the income we'd be receiving from these securities. And if the present condition, which it won't, I mean, it never does, but fail for decades and decades, we would probably keep doing the same sort of thing. But things change in the world, too. So don't take that as a prediction. Okay. Section 6. Good morning, Warren and Greg Ejid. Thank you so much for hosting this event.
QuestionerGood to be here.
[1:39:32]
QuestionerI'm here. My name is Dash Boy, Uindigir, and I'm from great country of Mongolia. A little bit background about my country entry. Mongolia is an emerging market and landlocked countries sandwiched between Russia and China. But we are reaching history and minerals and have full democracy and growing economy. Last week, we hosted our second annual the annual Mongolia Investor Conference in New York to attract investors like yourself. I know you need and give advice informally to government leaders such as South Korea, China, and India. What advice would you give to government business leaders of emerging markets like Mongolia to attract institutional investors like yourself? be great if you have long-term plans for exposure to emerging markets as a hedge or an opportunistic investment. Lastly, I welcome all of you to Mongolia, and my country folks would be very happy if you can make it to our economic forum this July. Well, thank you.
WarrenYeah. I have trouble planning a trip to Council Bloss, which is just few miles from here. But it takes an optimist. Actually, I met a fellow here at the annual meeting probably 20 years ago or more. Who did a lot in Mongolia? And he did very well in Mongolia and actually moved there for one. I would say that if you're looking for advice to give the government over there, it's not It's a developer reputation for having a solid currency over time. I mean, that we don't really want to go into any country where we think that there's a chance, I mean, a significant probability of runaway inflation. It's just, it's too hard to figure. Other people figured out ways to make money in hyperinflationary situations, but that's not our game. And I don't think I'd play it well. So we wouldn't be—that would be a factor with us. The chances are, and we won't find anything in Mongolia, it fits our size requirements aside from that. But like I say, I think my friend that I met here 20 years ago has done very well in Mongolia. And if the country develops a reputation for being— business-friendly and currency conscious, you know, I think that that bodes very well for the residents of that country, particularly if it has some other natural assets that it can build around. I don't know that much about the minerals there or anything of the sort, but who would have been on the United States in 1790, but. I have perfection. We just had to be better than the other guy for quite a while, and we started out with nothing,
[1:43:36]
Warrenand we ended up with close to 25 percent of the world's GP and faster growth rates and generally sounder currencies and all kinds of things. So I wish you well. Okay.
QuestionerBecky.
QuestionerThis question is from Peter Shen in New Jersey. It's for Mr. Buffett and Mr. Jane, in recent years, large private equity firms like Blackstone, Apollo, and KKR have aggressively expanded into insurance, raising permanent capital, managing float, and aiming to replicate the model that Berkshire pioneered decades ago. Given that these firms are now directly competing for insurance assets, often using higher leverage and more aggressive investment strategies, how do you view their impact on Berkshire's insurance operations and underwriting discipline? Do you believe that the private equity model poses risks to policyholders in the broader financial system? And has this competition made it more challenging for Berkshire to find and price insurance opportunities safely and profitably today?
WarrenOkay. Okay. Yeah. Part of the question is very easy. There's no question the private equity firms have come into the space and we are no longer competitive in the space. We used to do a fair amount in this space. But in the last three, four years, I don't think you've done a single deal. Now, you ought to separate this whole segment in two separate segments. One is the property casualty end of the business and the life end of the business. The private equity firms that you mentioned are all very active in the life end of the business, not the property casualty end of the business. You are right in identifying the risks in these private equity firms are taking on both in terms of leverage and in terms of credit risk. And while the economy is doing great and credit spreads are low, these people, the private equity firms who've taken the assets from very conservative investments and I wouldn't say high octane, but they've certainly invested these assets in situations where that is where they get a lot more return on the investment. And as I said, as long as the economy is good and credits are low, they will make money, they'll make a lot of money because of leverage. However, there is always the danger that at some point the regulators might get cranky and say, you know, you're taking too much risk on behalf of your policyholders, and that could end in tears. We do not like the risk reward that these situations offer, and therefore we put up the white
[1:46:30]
Warrenflag and said, you know, we can't compete it. the same thing right now. Yeah. People don't want to copy Berkshire's model, but usually they don't want to copy it by also copying the model of the CEO having all of his money in the company forever. And I mean, they've got a different equation. They're interested in, and that's capitalism, but they have a whole different situation, and they probably have a somewhat different fiduciary feeling. about what they're doing. And sometimes it works and sometimes it doesn't work. And if it doesn't work, they go on to other things. And if I, what we do here at Berkshire doesn't work, I spend the end of my life regretting what I've created. So it's just a whole different personal equation. And there is no property casually company that can basically replicate Berkshire. Berkshire. That wasn't the case at the start. I mean, at the start, we just had national indemnity a few miles from here, and anybody could have duplicated what we had, but that was before a G. And the G came with us in 1986, and at that point, the other fellows should have given up.
QuestionerYeah. Station 7, please. Hi. Hi. My name is Marie. I'm from Melrose, Massachusetts. Thank you for the time today. As a young person interested in investing, like myself, I would love to hear your insights, Mr. Buffett. What were some pivotal lessons you learned early in your career, and what advice do you have young, for young investors who are looking to develop their investment philosophy? Thank you.
WarrenWell, those are good questions. I wish I thought. of myself earlier in my life, the, you know, who you associate with is just enormously important. And don't expect that you'll make every decision right on that. I mean, but you, you are going to go into, you're going to have your life progress in the general direction of the people that you, that you work with, that you admire, that become your friends. I mentioned a few fellows that have died in the last couple of years. Well, all of those people were people that, that, that, you know, if we were working together on something, one, 10,000th of size of Berkshire, I mean, they'd be the kind of people you choose. You just, they're, there are people that make you want to be better than you are, and you want to hang out with people that are better than you are, and you want to hang out with people that are that are. feel are better than you are because you're going to go in the direction of the people that you
[1:49:58]
Warrenassociate with. And, uh, and that's, that's something you learn. And, of course, you've learned and of course, you've learned it late in life and that, uh, you appreciate how important some of those factors are until you get much older. But when you've got people around you, like Tom Murphy and, and, like, well, like, well, like, he's his name of Sandy Goddisfund, that, uh, Walter Scott, but you're just going to live a better life than you do if you just go out and look at somebody just making a lot of money and decide you're going to try and copy them or something of the sort. So I would, I would try to be associated with smart people too where I could learn a lot from them and I would try to look for something that I would do if I didn't need the money. I mean, what you're really looking for life is something where you've got a job that you'd hold if you didn't need the money. And I've had that shortly had it for a very, very long time. In fact, all the fellows I named had it. And they also, every one of those ones I named, they always did more than their share. And they never sought more than their share of the credit. They just behaved as the way you'd like anybody you work with. And when you find them, you treasured. German, and when you don't find them, you still keep doing whatever causes you'd eat or enables you to eat, but you don't give up on looking around. And you will find, you'll find people do wonderful things for you. I mentioned, I mentioned earlier, you know, going down to Geico and knocking on the door when the door was locked. I mean, who knows what was behind that door? I went in 10 minutes I found that I had a man that just wonderfully helpful to me. And of course, if somebody's going to be helpful with you, you want to try to figure out ways to be helpful to them. So you get a compounding of good intentions and good behavior. And unfortunately, you can get the reverse of that in life, too. And, you know, with a lot of—I was lucky in having a good environment for living that kind of a life. And other people, you know, have a whole different environmental situation. They have to overcome it. But don't feel guilty about your good luck if you've got, you know, if you've got, well, if you live in the United States, you know, you've, you've, you've, if there are 8 billion people in the world and there's 330 million in the United States, you've already won the game.
[1:53:12]
Warrento a great degree and then just keep making the most of it. But you don't want to, don't want to associate with people or enterprises that ask you to do something that or tell you to do something that you shouldn't be doing. And that's one of the problems. I mean, different professions select for different types of people. And, uh, there's, it's interesting to me that in the investment business, so many people get out of it after they've made a pile of money, that, uh, really want something that you'll stick around for, you know, whether you need the money, Craig doesn't need the money, and she doesn't need the money, uh, remotely. They enjoy what they do, and they're so damn good. It's, uh, it's, you know, it's, uh, you know, it just, well, I've had it just, well, I've had it just. out of the advantage of seeing how that works over time. They're the best manager I ever knew, and there's a lot of contention for who that would be. But actually was Tom Murphy, senior, that, uh, who lived the almost 98. And, uh, I've never seen anybody that could get the potential out of other people, uh, more than Murph could. I mean, if, if, if, if you wanted to the, If you wanted to become a better person, you want to work for Tom Murphy. And, uh, there are all kinds of successful people that, that really don't have that sort of, don't bring that to the party. And, and I'm not saying that's the only way to succeed, but I think it's, I think it's the most pleasant way to succeed for sure. And, uh, and I think that fragrance is pretty dramatic, I mean, to operate with Sandy Goddessman from 163 until he died a couple years ago. And Walter Scott, but 30 years and Graydon operated with him for 25 years or so. Right, yeah, 30? Yeah, 30. Yeah, and you really can't miss. It, you know, you'll learn all the time, but you'll not only learn how to be successful in business. You'll learn how to be successful at life. at life. And, uh, uh, so that's, that's, uh, my recommendation and, uh, and, uh, for some reason, I, apparently you live longer too, because it's pretty amazing. I mean, these people I'm talking about, including myself, I mean, I mean, you know, I like to attribute it to this and a few other things, but. happy person was longer than somebody that's doing some things that they don't really admire that much in life.
QuestionerOkay. Let's move on to, I guess it's Becky next. The first quarter ended March 31st, and it did show that Berkshire's cash pile expanded from the end of the last year.
[1:57:20]
QuestionerBut the greatest market turmoil came in April. Martin Devine, a shareholder from Scotland, who was attending the meeting today, wants to know, has the recent market volatility presented Berkshire with opportunities? And Martin just wrote in an addendum in the last 40 minutes or so, pointing out that you mentioned Berkshire almost invested $10 billion recently and wanting to know if you could talk more about that.
WarrenWell, then, I can give you a good answer to the second part, which is no. And the, but 10 billion would have done that much, you know. That's the other side. Another side of it. What has happened in the last 30, 45 days, 100 days, whatever you want to pick up, whatever this period has been, it's really nothing. There's been three times since we acquired Berkshire, that Berkshire has gone down 50% in a very short period of time. three different times. Nothing was fundamentally wrong with the company at any time, but, but this is not a huge move. The Dow Jones average at 381 in September of 1929. It got down to 42. So that's by going from 100 to 11. This is not been a dramatic. This is not been a dramatic bear marketer anything of the sort. I mean, it's, you know, like, pointed out if I've had 50 trading days a day, you know, for 20 years, I've been old enough to trade stocks, I've got 17 or 18,000 days. There's been plenty of periods that just are dramatically different than this. When the day I was born, the Dow Jones was at 240. And my first, that was August 30th, 1930, and between that and the law, it went from 240 to 41. I mean, that's, so, if people think that it made a really major change, it didn't, if it had gone up 15% instead of down 15% people think they take that with remarkable grace. But if it makes a difference to you, whether you're saying, stocks are down 15% or not, you need to get a somewhat different investment philosophy, because the world is not going to adapt to you. You're going to have to adapt to the world, and you will see a period in the next, certainly in the next 20 years, you'll see a period that will be in, what somebody in the market described one time as a hair curler compared to anything you've seen before. I mean, That's just, it just happens periodically. The world makes big, big, big mistakes and surprises happen in dramatic ways. And the more sophisticated the system gets, the more the surprises can be out of right field.
[2:00:58]
WarrenThat's just part of the stock market. And that's what makes it a good place to focus your efforts if you've got the proper temperament for it and a terrible place to get involved if you get frightened by markets that decline and get excited when stock markets go up. I don't mean to sound particularly critical. I mean, I know people have emotions, but you've got to check them at the door when you invest.
OtherOkay. Station 8, please.
QuestionerGood morning, Mr. Marford. Mr. Gregg and Mr. Ajik. My name is Peter Chim. I'm from Shanghai, China. This is my first time attending this sheriff. I would like to ask a question about the wisdom of life. Have you ever encountered any major setbacks or lower points in your life? And how did you get through and overcome them? Thank you very much.
WarrenWell, everybody gets setbacks and some people have particularly bad luck in that respect when others get through with barely minors. But Charlie, you know, he had setbacks, I had setbacks. I had setbacks. I mean, it's part of life and they're not any fun. I don't have any great advice for you about, you know, having time of your life while you're having some major setback, but it's, you know, it comes with lifetime. You know, you certainly have a setback when you're having a setback. you die. So everybody's got that such big guarantee to them. But some people get, and I mean, it isn't a laughing matter in a sense because, I mean, people get extraordinary bad luck and other people get extraordinary good luck. Usually the people who get good luck don't really think it was so much luck as themselves. But you're just going to have it, I think. You're just going to have it, I you're going to, I think that you're less likely to have it in terms of medical problems, in terms of, you know, various things in life. I mean, you were born at a good time. I mean, if you look all the way for the history of China, when would you rather have been born, you know, 100 years ago, 500 years ago, 1,000 years ago, or now? You know, it's just hands down. You'd be lucky. I mean, you know, if I came from 20 generations of shepherds, I think I get kind of tired of my life's just looking at these sheep every day. But, you know, we can sit here and I can watch Nebraska not quite play the same game of football that we played 20 years ago. But, I mean, everything in life has been made so much better. that you've got to figure that you do a lucky straw by, you know, staying in the womb for
[2:04:33]
Warrena couple hundred thousand years and then just emerging it at the right time. So I would always, I would focus on the things that have been good in your life rather than than the bad things that happened, because bad things do happen. But, but it's, it's, it can often be a wonderful life, you could get terrible breaks in it. I mean, you know, it, so far that really hasn't happened with me, but it's happened with some of my friends. But you get some bad breaks from time to time. For 94 years, I've been able to drink whatever I want to drink and, you know, and they predict all kinds of terrible things for me, but it has happened yet, so. It's true. I mean, if you look at what pro football players are making now and everything compared to what they were making 30 or 40 years ago, you can say, well, isn't that wonderful? But if you look at the, if you look at the lifespan of professional athletes, after a while, you get used to, you really decide that you're better off if you, if you really weren't the first one chosen to be on the baseball team or the basketball team or the basketball team or anything. else the human body and i think i speak for the others to some extent that we never didn't we never really exercised that much or did anything we were carefully preserving ourselves for the so look at the bright side of things to the extent that you can and that and that uh and you know you're lucky enough to you're here today you're healthy you're healthy you're You've come from a long distance and you're getting a chance to learn more about something that interests you and compare that with the situation a couple hundred years ago that you would have been off. So anyway, that's enough moralizing. Okay, Becky.
QuestionerThis question comes from Hymanshu Bendal for Ajit and Warren. And autonomous vehicles are already driving across roads in American cities with no driver involvement. How do Warren and Ajit think about any disruption risk from these autonomous vehicles to Geico's auto insurance business, which is built around understanding and underwriting human drivers? Wouldn't what we call auto insurance today just become product liability for autonomous vehicles and autonomous software companies?
WarrenWell, Ajit.
Ajit JainYeah, there's no question that insurance for automobile is going to change dramatically once self-driving cars become a reality. The big change that we will see is what you identified.
[2:08:07]
Ajit JainMost of the insurance that is sold and bought revolves around operator errors and how often they happen, how severe they are, and therefore what premium we ought to charge. To the extent these... If these new self-driving cars are most safe and are involved in fewer accidents, that insurance will be less required. Instead, it will be substituted by, as you mentioned, product liability. So we at Geico and elsewhere are certainly trying to get ready for that switch, where we move from providing insurance for operator errors and be more ready to provide protection for product errors and emissions in the construction of these automobile builds.
WarrenYeah, we expect change in all our businesses and good thing we did. Charlie pushed me into it, but if I'd settled for being in New England textiles, you know, and even though it worked well for 70 years or so prior there too, you know, the world changes and and if the game didn't change it all really would be very interesting, you know. If every time you, if you ever, every time you, you know, swung in a baseball, you had a home run the game wouldn't be interesting. If every time you hit a golf, a golf ball, you had a hole and it wouldn't be interesting. So, and the fact that there will be things you have to think about all the time as you go along and you'll make mistakes and all that. And that's really part of the fun. I mean, your brain would turn to mush if you didn't have a few problems now of that. So, I, I, uh, pro-insurance will change, although it's remarkable, how little it has changed. But it's only been around since, you know, for a relatively small time, and who knows what we're doing to move in transportation a hundred years from now. If you go back a couple hundred years ago, who could have predicted the United States would look like what it does, and people would move like they do, and people would enjoy themselves like they do. I mean, it's just, it's a dynamic world, and the biggest thing we have to worry about, unfortunately, is that we've learned how to destroy the world, too, in recent years. And so we've got this wonderful world, which now we know that there are eight countries that probably a ninth coming on to destroy and, and we don't have what I would consider the necessarily the perfect people leading each of one of the nine, or some of the nine countries. And, you know, Einstein came up with the equals MC squared back in 1905.
[2:11:32]
CharlieHe didn't dream of the fact, I mean, men that would really be converted, or converted in energy, and the way that would change the world. When I was born in 1930, they had known about the law of physics that Einstein had come up with 25 years earlier. Nobody, to my knowledge, had thought, what can this do to change warfare in the future? And literally, it just wasn't thought. Einstein didn't think about it at that point. And then in 1939, Roosevelt got a letter. They got around August 1st. It's the most famous letter in history from Leo's the Lord. Leo's Lord couldn't get his letter in front of Roosevelt because whoever heard of Leo's the Lord, but he got Einstein to sign it. And Roosevelt probably understood about as much about physics as I do, so he didn't understand it, but he understood that Einstein signed it. So he calls in a general role, or may not have been general, then, and said, we should do something about this, and all we did was learn how to destroy the world. And we needed to do it, and Germany at Heisenberg, and he looked like he was, he was ahead of us. And he can't put that genie back in the waddle. And its role does change. And we've got all these ones, we've got wonderful things. We've got wonderful things, but we also have, we have a guy in North Korea, if we criticize his haircut, you know, who knows what he might decide to do with. What does North Korea need, need nuclear weapons for? I mean, can that be a good thing in the world? But they're not going to go away, so it's a world of change, and we are enjoying incredible change. We've treated everybody in this room living so much better than people were living a couple hundred years ago. But we haven't been able to, we haven't changed human beings very much so far. We've certainly changed weapons of mass destruction, but we haven't made much progress with the human race. And we'll see what happens with that, but in the meantime, we'll see changes in auto insurance, too, and cars. And the easier for us to deal with it than it was when we had to deal with the problems of turning out textiles in New England. And you deal with the world as it develops. And like I say, everybody here is living in the luckiest period. And you still try to figure out the answers to what's going to happen. Yeah. Yeah. In all insurance, as we go along, and we've done. pretty well actually adapting to the answers. There's a few big problems in insurance.
[2:15:40]
Ajit JainAnd I don't know how the insurance industry adapts to them particularly, but that makes the game interesting. You really don't want, you wouldn't want to go out and play golf if you know you're going to hit the ball in the hole on every hole. I'd just like to add, we talked about the shift to product liability and to protection for accidents that take place because of an error in terms of how the product was designed or supplied. The only thing I want to add is in addition to that shift, I think what we'll see is a major shift where the number of accidents that take place and need to be provided for will drop dramatically because of automatic driving. But on the other hand, the cost per repair, every time there's an accident, the cost of repairing and bringing everything back to where you to be would go up very significantly because of the amount of technology that's going into the car. How those two variables interact with each other in terms of the total cost of providing the insurance, I think is still an open issue. Interesting figures to ponder.
WarrenWhen I walked into Geigo's office is in 1950, the average price of a policy was around 40 bucks a year. It varies all over the lots of depending on location, everything, but you to get up to $2,000 and depending on how urban your areas are and everything, you can get considerably higher. During that same time, the number of people killed in auto accidents falling from roughly six per 100 million miles to rather than this over one. So the car's become incredibly safer, and it costs 50 times as much. down or they're about to buy insurance policies. So people talk about the developments and car driving and all that sort of thing. It's a lot easier sometimes. I mean, the Buck Rogers aspect of it people look at, but they don't actually think of what really happens to the math of the business. The insurance, auto insurance industry has been a huge growth industry. And for that matter, owners, insurance insurance. prices in Nebraska have doubled in the last 10 years, adjusted for general inflation, and invective storms, you know, have just gone on a terror, and it's still unprofitable, but right of home homeowner's insurance in Nebraska after doubling the price in the last 10 years. So it's very hard to predict what these big changes mean, and you just have to keep thinking all the time, but you don't want to read some research report.
[2:19:08]
Warrenwhere it says the world's coming to an end or the world's going to be wonderful because of this or that because there's about 50 other developments going on at the same time that you need to think about and that you needed to keep observing as you go along. You don't, you never reach an answer in this business. You reach a point of action that you take, but but we try to get into as high probability things as we think we think we can do in play the game in the same way. But it will be different than you think. And you should wake up every morning and think about that too if you're in the business of managing businesses.
QuestionerWarren, as we approach the break, would you like to address the operating earnings?
WarrenOh, yeah. Yeah, let's put up the, we released our 10 Q this morning and we tried to do it on a Saturday. They said nobody gets a jump on other people. And we just have three simple chart. You'll see that our insurance underwriting income was down dramatically for the first quarter. And last year was as good a year as you'll see in insurance. And it's always unpredictable insurance, but everything broke our way or the insurance industry's way last year. prices are down this year, risks are up this year. So you don't have to be a genius to figure out what the answer is on that. So, uh, but we have, we do have unusual advantages in the insurance business. Uh, it can't really be replicated by our competition. That doesn't mean they aren't trying to get advantages we don't have that. We'll try to replicate anything that seems better. In fact, we'll try and chop it. But we, I wouldn't talk about our insurance business as much as I do with, unless I really thought we had some really permanent advantages in a very, very large industry. We just announced within the last 24 hours that we in Zurich and Chubb have arranged a joint operation to be the writer of a really large sums. Very few people can do. And of course, we've got to write about the right price in terms of liability. But we can do that sort of thing without blinking. And anybody that wants to do it wants to get us in it. I mean, that, uh, so anyway, our investment income did not change that much because we have a float that grows a little bit, which gives us more money for investment, and then we have retained earnings, which grows. So we would expect in an energy. a year to have like $40 billion or more that will build up investments unless we find
[2:22:31]
Warrenthings to do with it. So the investment income rates on treasuries are less than they were, or short-term bills, I should say, are less than they were before. So you had that negative effect pulling it down, but not that much, and we had more money. So we came up with a little more in the way of earnings. The railroad is earning a little more than last year. but it's not earning, but it should be earning at the present time, but that's solvable and is getting getting solved. And it's still an incredible asset for Berkshire. The energy company last year was having particular problems, and those are absent this year, so those earnings are up. And then among our range of general businesses, they're were pretty much a push. And I think you did a little calculation the other day on how many were up and how many were down to that, Greg.
Greg AbelYeah, of our 49 that we measure closely, 21 were up and 28 were down, so you can tell it was really a mixed quarter when you go across the operating, the non-insurance operating businesses.
WarrenYeah. The next slide. I'm getting a five-minute warning here. And the, uh, we'll throw the long ball now, the, uh, the, uh, shows our financial condition, which continues to a lot more in cash, treasury bills than I would like. But I, but I, but simply a question, opportunities occur. And if you get real opportunities every five or six years, you're, you know, you have to be patient. Charlie always pointed out that we may most of them. of our money. I'm about about eight or nine ideas over 50 years. And we talked about it every day and we read every report and we did everything else. But if you think you can get an idea a day from listening to your friend of your book or doing a lot of reading of the financial information published or because every now and then you get extraordinary opportunities. And most of the time, much of an edge. So we also have on that thing, our float, which continues to build. I don't think any kind, there's no company that has, property casualty company that has our float is there, a Jeep?
Ajit JainYeah, clearly we are heads and shoulders above anyone else.
WarrenYeah. So that is money that long as we're riding it and underwriting profit is absolutely free money. And expect that over a 50 year, 100 year pre-year pre-year pre-period. that we would be able to say the same thing. But there will be, there will be years when you have record and it'll lead into the flow earnings. But so far in the last 20 years,
[2:26:05]
Ajit JainI think, only had one underwriting loss of any. Yeah. I think if you look at the entire range, including life insurance, our cost of float is 2.2 negative. That means we've got the float plus. plus somebody has given us 2.2% of that of cash to... Yeah, it's like running a bank where people leave their money with you, and you pay a minus 2.2%. And you don't have any check clearing or anything else to do. It's included in that. So, but we run our business actually with a different mindset than any other PC company, I think, probably the world. And I wouldn't be talking about it if I thought they could duplicate her.
WarrenAnd then the final page is on share repurchases, and clearly we haven't made any. We have not made share repurchases so far this year. And repurchases, if it sure buys Berkshire shares and repurchases, we've now pay more than you will pay if you buy Berkshire shares. I don't think people generally know that, but there is a... a tax that was introduced a year or so ago, where we pay 1%, and that only hurts us, because we pay more for it than you to pay. It's a better deal for you than for us. But it actually hurts some of our investing companies quite substantially. Tim Cook has done a wonderful job. I mean, really wonderful job running the Apple, but He spent $100 billion roughly in a year repurchasing shares, and there's a 1% charge attached now, so that's a billion dollars a year that he pays when he buys when he buys apple stock in, which we like, compared to what you pay, and it doesn't sound like much, but well, a billion dollars sounds like a lot still, no matter. But there are people that want to increase that particular rate. right dramatically and we won't read about it or anything like that, but it does make it's slightly less attractive, was before, and we will only in our shares if we think that they are underpriced as valued very conservatively, and we get that opportunity occasionally. But the higher that charge goes that the federal government charges is for doing it, the less we will be able to do a re-purchases. So on that happy note, we will rejoin at 1 o'clock and we will, I'm sorry, I'd like that to 11 o'clock, and then we will. Yeah, 11 o'clock. And then we'll continue to 1 o'clock. And in the meantime, enjoy yourself. And I think all our stores are still open, so bring the cash register. Thank you.