Andrew Kilpatrick, “Of Permanent Value” author, discusses the “burning questions” for this year’s shareholder meeting in Omaha .
who better to talk warren buffett with us than his biographer, and we mean the man who has written the book again and again and again. andy kilpatrick is the author of permanent value which is the word on what warren buffett has been up to. and andy, thanks so much for joining us. . my pleasure. we’re in the century link center where tomorrow this is the stage where they’ll be talking to about 30,000 to 35,000 shareholders.what’s the burning question this year? i guess the burning question is the health question and then the health question is the successor question. so that has to be gone lieu. i think it’s been aired out by everybody. and i think the disease is a very slow growing thing and a lot of doctors say it will be something else that he goes from. so i think he’ll go a long time. but this question is out there. and i went to continue he last night and i followed this for years and all we talked about was succession.so i think that’s the question. what was the topic around thetable? what do people feel about the succession plans laid out and would they like to hear more? everybody has their opinion.most of this was who it would be. and then we’re all guess andwe’re all been around the thing and none of us has aas to who it would be. and then people did say you know he’s right not to think because the person may change or he may buy another company with somebody else. or some star comes along. i think he’s doing the right thing by keeping it crow to his vest.and you might have people get discontentsed and say i wantedthat job, but i think he’s doing exactly the right thing. clearly the board will study it harder under this situation. in february he said that the person whose name was in the envelope had been there for a long time. it’s somebody who must have been at the company for a while because he has all these new companies that he’s bought. you can run through the companies that have come in here. and i think that’s what surprised me is that it’s been the same name for a while. i think in the end report hesaid someone well-known to the board for a long time and a good character. there are just sonl so much and i think it’s the names that everybody is talking about. last night we were saying it could be somebody from the s but who knows. as a shareholder, do you feel good about the succession plan? i feel good about it. it will be somebody clearly — buffett has spent his entire life planning this and it will be a good decision. will that person be buffett? but is he 87% or 97% of buffett? yes. it will be somebody fabulous, but if won’t have buffett’s personality or his swing. but coca-cola and ibm will be there, other things are there. either eye how the new personal low indicates the new money and that’s a big issue, but it’s become a little bit less of an issue as berkshire gets bigger and bigger. he’s put so many things in place like the railroad and the so much going on already that we’re just now doing incremental stuff. there are people who say that the real factor, i think doug kass has brought this up, the new ceo won’t get the special sweetheart deals. i agree with that. how big of a problem is that in terms of the valuation for the company? i think it’s a problem, but i think you can get around it or you just don’t get — you miss one or two great deals, but i don’t think it’s the end of the world. it will still be berkshire hathd away with a huge credit and a ton of money.and, weshlgs i’m not warren buffett, but do you want $10 billion to do the deal or not? what do you think about you how the stock has performed? berkshire itself started buying back shares which is something they would never have done before. i think it is undervalued and i think the stock has suffered because of buffett’s age. and these questions. but i thought on theannouncement of the cancer, the stock came back fairly quickly.even if something terrible were to happen, the stock already hasthat in there. i think it’s already discounted three successors. i don’t think a lot would happen. i want to thank you very much to coming in. it’s a big weekend. we have another andrew who willbe joining us later. and andrew, we’ll accepted it send it over to you. very interesting stuff.