Warren Buffett Lengthy Interview on CNBC All in One [VIDEO]

Buffett: Us Residential Housing Starting to Pick Up

Warren Buffett, Berkshire Hathaway CEO, discusses the global slowdown, saying the stock market is generally the best place for investors to have their money.

Transcript:

let’s get to becky in columbus, ohio, this morning with berkshire hathaway ceo warren buffett. is he there, becky? he’s ready to go. with a new york jets tie on. is that what that is? you said he had a nice net jets tie on, and — and what did i tell you? i said you’d have to ask him. did you bring one, warren? just we’ll get to it later. he wants to hear you beg for two hours. i know, and then he doesn’t do anything. i’m going to try. i’ll come up with something for you. i’m going to try. well, you know, joe, we are very fortunate to have warren with us here this morning. and warren, this is the first time we’ve gotten a chance to sit down and talk with you since the prostate cancer treatment. how are you feeling? i feel fine. i feel great. they gave me some hormones too, so occasionally i get some hot flashes which we males call those power surges, actually. no, it was — it got tiring after a while. the radiation, you know, you don’t feel anything. but i felt it was time to quit when i started getting the urge to pee sitting down. but you’re feeling good. i feel great. you look great, and we’re happy to have you with us today. thank you for joining us. this is one of the best times we’ve gotten to talk to you because there have been so many questions lately about what’s happening in the economy. we’ve heard from major companies like 3m, caterpillar, dupont, all these companies, u.p.s. who have come out and said the global economy is very uncertain. it’s slowing down a little bit. they’re not sure about what they see in the future. and it’s raised a lot of questions in the market too. the market’s been selling off over the last week or so. real concerns, people sitting up and saying, uh-oh, maybe there’s something really happening here. do you think the market’s overselling this situation? or do you think it’s catching up with reality? what do you see? well, i think stock market generally is the best place to have money. but i think that there’s no question that worldwide there is some slowing downgoing on. and in the united states, actually residential housing is picking up and we’ve been waiting for that for a long time. and it hasn’t gotten to any big level yet. but our carpet businesses and brick businesses and all of that will come on with residential construction. and that has turned. and the general economy, i think it’s better than the u.s., certainly better in the u.s. than it is in europe. and in terms of the rate of decline in asia, it’s reasonably and we’re still inching ahead, but it’s inching. when did you first start to notice this global decline? this global slowdown? well, we’ve had a couple of companies that really are kind of realtime as to what’s going on. the number one, they sell these little tiny punching tools or cutting tools and they fit in these huge machine tools, cost millions of dollars. anybody turning out anything big are buying these little razor blade type items from us. and they don’t need a big inventory, we can deliver very quickly. their purchases reflect usage. and our strongest market is in the united states. but europe and asia have fallen off some. ane’re gaining market share. so there’s a decided decline in activity in all that manufacturing where you’re stamping metal and doing this sort of thing. we heard from caterpillar the other day and he says that he looks around the globe and he doesn’t expect to see a recession anywhere in 2013. but europe is the biggest problem spot. would you agree with that assessment? well, it is at present. its rated decline — it’s off a lower base. its rate of decline is not greater in my view than the rate of decline in asia. it’s just asia was doing better. the united states, actually, as they got the steadiest trajectory. and i don’t see any change in that, i mean. we’ve got the freight car — we’ve got a big energy pick-up in the united states, we’re getting a housing pick-up. those are big industries. let’s talk about some of those numbers, housing is a huge key. you told us before we’re not going to see a turn in the unemployment picture until we see a turn in the housing. he said you’re not going to see a turn in the unemployment picture until you see the turn in housing. he kind of set the thing on his head and said it’s the other way around, which comes first. well, demand comes first. you hire people when you start seeing demand. and you are seeing more demand. you’re seeing greater — i was with a guy last night at the ge dinner that is in the business of selling lots. we have the largest housing manufacturing company in the counat clayton homes, manufactured homes, but those — that business is up in the area of 10 to 15%. in terms of volume? in terms of units. in terms of units. real estate brokerage, we not only see a 15% increase in transactions, but we also see a small increase in the median price. this comes from all over the country. you name it. so that’s changed. you know, we’re going to make a lot more money on carpet this year than we made last year. and we hire people when that happens. so the united states economy is not tanking. asia from a higher level, wouldn’t necessarily call it tanking, but it’s heading down and europe has been having its troubles for some time. does that catch up with us? does that affect us at some point too? well, what we really hope is we affect them over time. and, no, i don’t necessarily think so unless there gets to be chaos some place. we’ve already adapted to what’s going on around the world. tell me what you see in terms of the rail cars. you were saying you were watching loadings on those. burlington northern — well, at burlington, coal is down as it is with the other railroads, oil is up, and when you’re fracking, you bring in lots of sand. so sand would be, for example. and u.p. just reported and they’re seeing small gains in things other than — they’re seeing it in lumber. they’re seeing it in cars. we’re seeing it intermodal. we’re the biggest in intermodal. we carry 15% of all the freight measured by tonnage in the united states. just the burlington northern carries almost half as much as all the trucks in the united states in terms of ton miles. and you’re not seeing any downturn, seeing actually numbers go up? seeing numbers go up. that was a little deceptive a month or two ago. so the figures were very easy there for july and august. but we are seeing small gains. but they’re small. and in terms of what you see at mid-american. you talked about energy demand, that had been weak for quite a while because companies weren’t using as much energy. how is the picture on that? kilowatt hours were down this year. but we — look at it this way. berkshire-hathaway spent $6 billion on equipment, we spent last year $8 billion on plant equipment, another record, this year we’ll spend $9 billion on plant equipment, another record and practically all of that is in the united states. we see lots of things to do. a good bit of that is in the rail business and the energy business, but there’s a lot to do. and incidentally, you hear a lot about infrastructure and terrible shape it’s in, the rail industry’s infrastructure is the best shape it’s been in. joe has a question for you, as well. along the same lines, warren. if you were going to start a new berkshire hathaway, and you were trying to play whatever happens, trying to take advantage of what happens in this country over the next 20 years, what would — how would you do that? would it be natural gas? would it be coal? would it be solar? how do you think you would do that? all of the above? are you smart enough to see how this plays itself out with fracking and natural gas? i’m interested enough to follow it, but i don’t think i’ll be able to write the newspaper two years from now at the current time. but we are putting a lot of money in the solar and wind. that’s what we do at mid-ican. if you get into producing energy itself, i’m not — you know, i would be no good at that game. i’d have to join with somebody else i thought was terrific. but i don’t know — i read about it. and i feel very good about what i read, and we transport a lot of oil. but i don’t, you know, you stick me next to an oil well and i go back to a clark gable movie as to what i’m supposed to do. have you shared your thoughts about, you know, exporting natural gas? oh, i know where you’re going. i wondered whether you’ve talked to warren about that. i haven’t. warren, let me tell you before joe makes it sound worse than it is. i have had some concerns about this idea of exporting natural gas. because, look, if you want to be energy independent, he thinks it’s a stupid idea, he thinks we should use all of their stuff. but i worry if we want energy independent, why would we ship this natural gas to other people? build it and keep it here. tell me why that’s wrong. no, i’m with you. you are? oh, see. no, no — if you’ve got a national treasure, and we had that in oil. if you go back 50 years, we were an exporter of oil, producing way more than opec and the texas railroad commission used to announce every month how many days you could produce in texas. it was an opec of its time. we tookse huge prolific fields the east texas fields and we sent that stuff abroad and getting $3 a barrel for it. and we built a strategic petroleum reserve later on. now, i believe if you’re dealing with a scarce commodity, something you know is finite over time, use the other guy’s. joe, there, take that. i never thought warren was a protectionist. that’s amazing. i’ll protect something that we’re going to need to keep this country going 50 or 100 years from now. i don’t want to ship our tal overboard. we may have enough, though, for the entire world. and that would be a great export business eventually to be in if we were self-sufficient ourselves. it would be for a while. but if you’re looking out 100 or 200 years, and thank god people 200 years ago were looking out in many respects. although, we weren’t looking out in the 1950s. i love that you’re worried like 100 years from now and not just for your ancestors, it’s for you 100 years from now. i like that. exactly. i like it that you like it, joe. because i do. real quick, warren. i’m curious with the market selling off $500 billion in the past three days, knowing you, i think you’re probably watching this thinking what am i buying? is there anything — have you done anything in the past three days? maybe in the past week we’ve done some things. but basically i like to buy. and, you know, so that if the market is down, you know, i’m happier buying. i like to buy. if i go to the supermarket and they reduce prices, you know, i feel better. if i go to a men’s clothing shop, they reduce prices, i feel better. if i go to the stock exchange to reduced prices, i feel better. what did you buy in the last week? in the last week i bought some wells fargo. you did? yeah. we only have 430 million shares, i didn’t feel we had enough. you look at the banking business overall, is it going to be as profitable? no, it can’t be as profitable. the profitability of banking is a function of two items, return on assets and assets to equity. and return on assets is not going to go up particularly. they’re at about 1.7%. wells is between 1.4% and 1.5%. most banks are lower. now, if you have 20 times leverage and you’re getting 1.5% on assets, you’re making 30% on equity. and that was not lost on people a few years back. they pushed balance sheets and still pushing them in europe, but they’ve cut back on that here. they will not be having the leverage in the banking system. it’ll be even more restricted among the bigger banks as part of the new rules. and you won’t be able to earn more on assets than before. with less leverage and the same return on assets, you’ll have a lower return on equity. bank earning 25% on tangible equity not so many years ago. and really, that’s kind of a crazy number. you know, for a basic semi-commodity business,ou don’t want to allow that, but that was allowed because people felt their bank deposits were guaranteed by the government. therefore there was no market force that would look at the shape of — condition of a bank and say i won’t put my money there because they look kind of dangerous with all this leverage. and therefore people got to push it and push it and push it, and then the government says, listen, we’ve got a vested interest in this, you’re using our credit in effect. and if you want to play, you’re only going to have 10 to 1, the return on banks — but you still think it’s a well run, it’s a good business, but it’s not like — it won’t get back to what it was. okay. the european banks still are leveraged to an extraordinary extent just because they don’t know how to get out of it. but they are earning 1.5% on deposits either.

Warren Buffett: Global Economy ‘Slowing Down’

In this “Squawk Box” excerpt, Warren Buffett tells Becky Quick there’s “no question” the global economy is slowing down, but the U.S. is “inching along” as the U.S. residential housing market starts to improve.

Transcript:

but i think that there’s no question that worldwide there is some slowing downgoing on. and in the united states, actually residential housing is picking up and we’ve been waiting for that for a long time. and it hasn’t gotten to any big level yet. but our carpet businesses and brick businesses and all of that will come on with residential construction. and that has turned. and the general economy, i think it’s better than the u.s., certainly better in the u.s. than it is in europe. and in terms of the rate of decline in asia, it’s reasonably and we’re still inching ahead, but it’s inching. when did you first start to notice this global decline? this global slowdown? well, we’ve had a couple of companies that really are kind of realtime as to what’s going on. the number one, they sell these little tiny punching tools or cutting tools and they fit in these huge machine tools, cost millions of dollars. anybody turning out anything big are buying these little razor blade type items from us. and they don’t need a big inventory, we can deliver very quickly. their purchases reflect usage. and our strongest market is in the united states. but europe and asia have fallen off some. ane’re gaining market share. so there’s a decided decline in activity in all that manufacturing where you’re stamping metal and doing this sort of thing. we heard from caterpillar the other day and he says that he looks around the globe and he doesn’t expect to see a recession anywhere in 2013. but europe is the biggest problem spot. would you agree with that assessment? well, it is at present. its rated decline — it’s off a lower base. its rate of decline is not greater in my view than the rate of decline in asia. it’s just asia was doing better. the united states, actually, as they got the steadiest trajectory. and i don’t see any change in that, i mean. we’ve got the freight car — we’ve got a big energy pick-up in the united states, we’re getting a housing pick-up. those are big industries. let’s talk about some of those numbers, housing is a huge key. you told us before we’re not going to see a turn in the unemployment picture until we see a turn in the housing. he said you’re not going to see a turn in the unemployment picture until you see the turn in housing. he kind of set the thing on his head and said it’s the other way around, which comes first. well, demand comes first. you hire people when you start seeing demand. and you are seeing more demand. you’re seeing greater — i was with a guy last night at the ge dinner that is in the business of selling lots. we have the largest housing manufacturing company in the counat clayton homes, manufactured homes, but those — that business is up in the area of 10 to 15%. in terms of volume? in terms of units. in terms of units. real estate brokerage, we not only see a 15% increase in transactions, but we also see a small increase in the median price. this comes from all over the country. you name it. so that’s changed. you know, we’re going to make a lot more money on carpet this year than we made last year. and we hire people when that happens. so the united states economy is not tanking. asia from a higher level, wouldn’t necessarily call it tanking, but it’s heading down and europe has been having its troubles for some time. does that catch up with us? does that affect us at some point too? well, what we really hope is we affect them over time. and, no, i don’t necessarily think so unless there gets to be chaos some place. we’ve already adapted to what’s going on around the world.

Buffett: Instincts Go Against QE3

Warren Buffett, Berkshire Hathaway CEO, weighs in on the Federal Reserve’s decision to issue another round of quantitative easing; adding, he has “enormous respect” for Bernanke but has concerns over “expanding the balance sheet of the Fed.”

Transcript:

box, we are speaking to warren buffett and becky is out there.mr. buffett telling us he’s beenying wells fargo this week. that stock has now turned positive since those comments. becky, they told me to ask a question. is that okay? i’m not going to presume — yeah, go ahead. warren, you like to buy. you just said you like to buy. peter sellers liked to watch, but you like to buy. buying doesn’t preclude watching. no, not with you, i’m sure. but that — i figure anything that moves the market higher,you’re not going to — better than a sharp stick in the eye. so qe-3 is great. market’s been going up. but if you were a voting member, and they’ve got another one of the meetings today, two day — i don’t know, they come so quickly, i don’t even remember. if you were there when they voted for qe-3, would you have voted yes for qe-3 if you were a voting member? i hadn’t thought about that, but i would say this. i would listen very carefully to bernanke, but my instincts would probably be to go the other direction. but i would listen to his arguments. you said with qe-2, you thought maybe it was going too far at that point. so qe-3 is doubling down on that. my instincts are to goagainst it. i think it’s much easie if you’re a central bank and youcan print money. it’s much easier to acquire $2.7 trillion of securities than it will to be unwind that operation. and you can expand it indefinitely. if he wanted qe-2 to be $100 billion a month or qe-3, he’s the one guy that can do it. he has unlimited buying power. mited selling power could be a little different. you need some cooperation on that. warren, you’re a supporter ofthe president, though, governor romney suggested tha would — i wouldn’t suggest he would fire bernanke, but he wouldn’t pick him up for a third term. not clear, by the way, that bernanke wants a third term even under obama, but how does that in terms of politics? i think bernanke has done an absolutely superb job. i mean, what he did in the fall of 2008 was gutty, it was basically right, you know, everybody can talk abouttinkering at the edges, but i will say this, if ben bernanke hadn’t been there in 2008, i’m not sure where we would be now. i have enormous respect for him. he’s a very, very intelligent man.you’ve got to respect him enormously. and, you know, he sees an omy that he’s sort of fighting by himself to get started when you look over at a congress that’s more or less paralyzed. and i would never bet against him. i would say that i get a littleworried about continuously expanding the balance sheet of the fed. and, you know, we now are getting 3% of our revenues from the profit that the fed is running on its carry trade if you look — the united states gets 3%? yeah. that 2.4 trillion or 2.5trillion of revenue, the fourth biggest item, the first item ispersonal income taxes and then payroll taxes, then corporateincome taxes, the fourth is dividend from the fed. he makes $70 billion or $80 billion last year. this is unheard of if you go back a few years. when he borrows, he’s got $1.25 trillion, then $1 trillio of money in circulation,ch he doesn’t pay anything for except for the cost of the paper. do you worry about inflation down the road? is this something we’ll see coming? will we be able to put the brakes on in time and try to get the liquidity back out of the system? nobody understands that problem better than bernanke. yeah. that doesn’t mean i necessarily think the solution is going to be perfect. i’d rather have him thinkingabout it and trying to modify the impact of — but to andrew’s point, if he doesn’t have another term or if he chooses not to stand for another term and there’s someone else there, that person’s going to have a pretty difficult job. yeah, depends who it is. but i would vote for bernanke again. you know, i get my kids out and everybody else to vote for. but if bernanke says thathe’s not even interested in staying. they worry that he knows what he’s leaving behind. he says he maye hav done enough time there. well, i think he probably feels that way, particularlyafter his congressional testimony. but i do think if the presidentof the united states asks someone like ben bernanke to stay on, i think he will stay on. i think he’s that devoted to thecountry. all right. and i would rather have him there than anybody else. warren, do you think where the bond market is right now given the extraordinary action by the fed, do you think it’s not that far from where it would be if they hadn’t been asactive? and then i guess it’s okay. but if it be long way fromwhere it is without them, doesn’t that cause some dislocations that eventually are going to come back to haunt us? i like when stocks go up too. and i can see it in your eye, you like when the market’s going up. i’m wondering, is it worth it? no, no — you do. who doesn’t like when the market goes up for whatever reason. but if it gets to a point where it’s not up based on theunderlying fundamentals, seems like sooner or later somethinghas to happen, no? interest rates are — the prices of all assets, you know, li gravity is to the function of the earth. everything is based off interest rates. it may not seem obvious that the value of some plantation in brazil or something is geared off of it. but everything relates to interest rates. you start with what you can get risk-free interest rate. and so it has a huge, hugegravitational pull. affects what i’m doing. it affects what everybody’s doing. affects what you’re doing at berkshire?yeah. if i’m getting 0% on money, i am going to look at other assets somewhat differently, whether it’s buying a farm or anapartment house or anything else. and of course, the people who will lend money to me to buy the apartment house are going to lend it to me cheaper. it’s one of the reasons irecommended housing six months ago because the low interest rates caused low mortgage rates and low mortgage rates and when you can sign up for 30 years off a policy that may be in effect for another year or two, you’re getting a tremendous deal. but, no,joe, the fed has had an enormous effect on interest rates. but it’s okay. well, i don’t know if it’sokay or not. but i know that — the price is going up. well, i would say that it’s marvelously okay if you’re buying a house or something like that. but in terms of policy. in terms of policy, the chairman of the fed and the members of the fed made a decision that the economy needed enough of a jolt. and it wasn’t going to get it through enlightened fiscal policy and they were going to basically carry the whole load themselves. i don’t think they enjoy it, but i think bernanke, i think he’s avery responsible gu now, it doesn’t mean he calls them all right, but i think he’s

Buffett: ‘We Mostly Buy Stocks For Future Earnings’

Warren Buffett, Berkshire Hathaway CEO, discusses his long-range investment strategy, and weighs in on IBM.

Transcript:

i don’t know why buffet doesn’t put all his money in verizon andat&t. do you ever look at those companies? i don’t know what it would look like five or ten years from now. there he goes again, 100 years from now, so 5% in the meantime, you know, that’s true, though, warren. people would say, i’ve got a 5% yield, doesn’t take much for stock to go down 5%, does it? that yield doesn’t necessarily hold up if the market’s headed south. like toll booths — yeah. we mostly buy stocks for future earnings. if you used all the money to repurchase shares that could beeven more advantageous. because you end up owning a bigger and bigger chunk o the company. ibm spent 3 billion in eachquarter of this year. the cheaper they buy it, the more our interest goes up. you still like ibm after all the troubles technologycompanies have seen? they’re struggling a little. it was kind of interesting. in the — we owned — we own a little more than we owned at year end and we got great confidence over the years.but in the third quarter, they had a sale of a subsidiary rss that produced about 288 million, i think after tax, which was all the gain. and to my knowledge, the wall street journal did not have a line on it. it was one line in the report and it counted for all the gain in earnings and it was a sale of part of a business. you know, i think the reporting missed the boat on that one.

Buffett: ‘We’ll Add 8,000 Jobs Organically’

Warren Buffett, Berkshire Hathaway CEO, weighs in on what Berkshire Hathaway is doing to create jobs, adding “we’ll probably add another 10,000 or 15,000 jobs on acquisitions” this year.

Transcript:

welcome back, everybody. we are with warren buffett thismorning in columbus, ohio, at the summit sponsored by general electric and ohio state university’s business schoolhere. we talked an awful lot about businesses. the reason we’re here today is because of this focus on mid-sized businesses. an awful lot of questions about jobs and the jobs picture out there. mid-size companies account for a lot of the job growth we’ve seen over the last several years. can you talk to us a little bit about what berkshire’s been doing in terms of jobs. berkshire probably has at least 50 of the 75 companiesthat would fit the middle market 10 million to 1 billion of salescategory. it looks to me, there’s a few months left. but it looks to me like we’ll add at berkshire on a base of 270,000, we’ll probably add about maybe 8,000 jobs organically. and then we’ll probably add another 10,000 or 15,000 on acquisitions.for this year that we’re in right now? yeah. certain businesses like geico and burlington northern have added people. then we bought a fair number of what we call build on acquisitions. in terms of the jobs growth, what about the companies that are related to housing. you’ve been talking about how you’ve seen a turn there. has that translated into jobs growth? there’s some job growth. our clayton homes is going to produce something like 15% more homes this year and that takes more people.and geico is going to sell more insurance policies and thattakes more people. and the — our furniture businesses are doing very well. we’re selling a lot of carpet and furniture. and so we add people, but we’ve also got to add — moreacquisitions this year than ever before in our history by somemargin. and they bring with them thousands and thousands ofpeople. how much cash do you have onhand right now? bly have at least 40 billion. are you on the hunt for another big acquisition? i’m salivating. yeah. a fellow handed me a card last night and said this will cost you $6 billion. and he didn’t give me the financials, but i’m going to call him when i get — i know the company. so when i get home, i’ll call him and ask him for the financials. have you looked at any other big acquisitions? we had two acquisitions this year. possibilities that were plus and minus $20 billion. and where the ceo wanted to do it, but it didn’t get done. prices are tough. prices are tough right now. yeah. all right — and cheap money makes that a factor in it.

Buffett: ‘We Buy on an All Equity Basis’

Warren Buffett, Berkshire Hathaway CEO, says he feels some of the acquisition prices are getting out of control, but adds he is “salivating” to do another acquisition.

Transcript:

welcome back, everybody. we are coming to you live from ge capital’s middle market summit taking place at ohio state university in columbus. i’m joined by berkshire hathaway ceo warren buffett. and you’ve been talking about how you’ve been on the prowl looking for big acquisitions around $20 billion or so. a couple have fallen through, but part of it is becausepricing’s difficult. pricing’s difficult and money’s cheap. we don’t leverage our purchases and we’re buying on an all-equity basis. but people that do leverage are getting significant portions of the purchase price at very, very low rates, probably as low as they’ve gotten. so that enables them to bid pretty aggressively and doesn’t factor into our thinking. you think at this point maybe some of these acquisition prices are getting a little out of control? well, that’s the way i feel. but, you know, that’s natural when you’re getting beaten out. but you won’t raise your prices to compete? no. but now we had a record for boldon acquisitions. we’ve probably done, i don’t know, maybe 15 different acquisitions, but probably add up to $2 billion or something of the sort. and they’re good and fit in withcompanies we have. but what i really like is the elephant. so you’re always out elephant hunting. absolutely. with your elephant gun. and they’re more likely to come along when monditions are fairly tight or something of the sort. if you can borrow money at these rates, you can pay a lot of money. and other people if they pay the wrong price, they walk away fromthem. but if we pay the wrong price, we live with them forever. if these deals haven’t gone through, that means you’ve beenlooking more aggressively for stocks to buy in the market. well, we’re always looking for stocks and i’ve got two fellows working for me that are really looking for stocks all the time. but i usually end up buying more of something i already know. any new company, any new stock i look at, i measure it against the best idea i’ve got among the present ones, and i’m perfectly willing to just keep adding to the present ones. so it has to beat them.and i know those companies pretty well, so it’s a pretty high threshold. let’s go back to ibm. you were talking a moment agoabout ibm, have you added any shares to that company in thelast couple of months? maybe — we’ve added shares this year.we haven’t had a lot of shares. but we’ve — well, we probablyadded, you know, being many hundreds of millions. wells we probably added maybe $1 billion worth, something like that.when you first announced your stake in ibm, it caught a lot ofpeople by surprise because you have always stayed away fromtechnology companies, you’ve said it’s something you didn’treally understand and so you didn’t want to get involved with it.right. in looking at ibm, you said it was a little different situation, it made senseu at that point. i guess part of that is the services factor ofit. but when you look at these big technology companies, looks like some of them may be maturing, have you regretted getting into ibm shares at all? no, i’m delighted to be in it. uh-huh. and i think they’ll probably do better abroad than in united states over time. when we buy something like that, i go to our companies and see what they’re doing and plan to be doing in future years. and how tied in they are with given suppliers and how much stickiness there is to it. and so we — i — even though, you know, if you put me in a computer room and spin me around, i’m lost, you know, i just hoping it helps me get out. but i do know what our managers tell me about their plans.and the degree to which they’re involved. and i had one manager tell me something that isn’t quite repeatable in terms of — you get pretty locked in sometimes with your supplier.what’s not repeatable? well, i asked him how sticky — i won’t name the company, he said, well, it’s like — so it sticks. it really does. i should bring up the insurance companies. they’re big.jim cramer had said he’s very interested in hearing more aboutwhat’s happening with insurance because a lot of insurancecompanies have been doing very well lately. what can you tell us about berkshire’s? they’re doing very well. we have about$70 billion of other people’smoney, we call it flow. and when we run a underwriting profit, i get to earn the money on this. and this year we’ve had an underwriting profit. not only have they given us $70 million, but they give us more money to hold it. so when insurance’s good, it’s terrific, and it’s been good this year. what do you know about the consumer not only from the companies you have at berkshire that you own outright but from a company like coca-cola and being able to look around the globe to see how consumers are feeling. there’s been a lot of pressure on some of the consumer products companies because prices for commodities have gone up and sometimes they can’t pass those on to their consumer. when you think about it, coca-cola’s been around since 1886. that’s amazing. and it’s the basic product. now it’s got a whole bunch of extensions too. but coca-cola’s physical volume, not dollar sales, but physical volume was up 4% in the first nine months, and that’s in a world that’s growing maybe at . so their per capita usage of coca-cola products has gone up almost every year since 1886. he’s done a terrific job running that company.it’s a huge distribution machine. and mexico, i think the numbernow is up to over 600 plus 8-ounce servings per capita of coca-cola products, man, woman, and child, which is at least 50%higher in the united states. and grows every year, growing in the first nine months, it’s quite a product.

GE’s Immelt: ‘General Trend is Still Positive With Volatility’

GE CEO, Jeffrey Immelt, discusses general global trends, adding “the economic recovery will be volatile,” He explains why he believes natural gas is going to be a long term trend. Also, Immelt and Warren Buffett, weigh in on the fiscal cliff and its impact on the economy.

Transcript:

let’s now get back to becky at the ge capital middle marketsummit at ohio state university. in columbus. she’s joined by warren buffett and another special guest. hey, becks. hey, thank you, joe. as you mentioned, we have another special guest with us joining us right now. jeff immelt, the chairman and ceo of general electric. good to see you again. warren’s been laying out for us what he sees from the economy this morning. and ge probably has one of the best vantage points of any company to see what’s happening around the globe. i know you talked about it with earnings, but the market seems to be caught by surprise just over the last week or so. what does it really look like out there? and do you think the market’s overreacting? i think the general trend is still positive. there’s just volatility as we’ve climbed out of this recession. i always think about four big factors. the u.s. gets a little bit better every day. we can see that around housing. you know, i think there would be more investment in the u.s. if there was more clarity around the fiscal cliff and things like that. europe is bad, but not shockingly bad.in other words, it’s going to be tough, there’s still pockets, but europe’s tough. china, there’s not one china. there’s multiple economies in china. construction i think is slow, but if you’re in the health care aviation business in china, it’s still very robust.and i just got back from a trip to saudi arabia, abu dhabi, there’s business in all of those places. so i think if you’re out hustling, you can find business. i think the general trend is positive, but there is volatility in the world. so from that perspective, from both of you, you seem to have a more positive outlook than maybe with the market is reacting to over the last several days.i think you can’t blame investors for what they read and what they see. you’ll have a couple of days like we had. but if you step back, you know, i think for a company like ours, our organic growth was up 8% on the quarter. that is high, you know. and 10% year-to-date on a company our size, that is pretty good.backlog of more than $200 billion, that’s pretty good. so i just — and you know, we had dinner last night with 20 mid-market companies, some are doing poorly, but a lot are doing well. i think it’s volatile. and so you’ll have a day like yesterday or a day like friday and people are going to have concerns. who can blame investors for seeing it that way? but the general trend that i see. and we see 140 countries is still generally positive withvolatility. with volatility. and good prices for locomotives and turbines and all these things. would you like to buy a fewmore? he’s never given me a — joe has a question, as well.joe? i’m joe kernan, this is cnbc, we used to be one of yourfavorites, i don’t know. joe, 49% of nbc is still 100% cnbc. all right. jeff, ge capital, the report, it’s like raking in money again.and what i’m told is that the company continues to shrink it to some extent, i guess to right-size it if you will. but wow, it’s making money, paying a dividend back to ge again. and is there a tendency to want to say let’s ramp it back up? and i mean, it was a great unit for years and years and years. so much profit to the company. is there a tendency to want to do this? do you have to pull yourself back and say we’re going to get this where we don’t want to get to that point again? look, it’s a great business, okay. i think the difference in this recovery versus previous recoveries is just one of discipline. there are segments in financial services that we do better than banks.this is one of them. mid-market lending, we just do it well. we’re going to continue to grow the places that we do better than our competitors and let those grow. i think what’s different, joe,we’re just not going to do the incremental or the, you know,some of the distress stuff we used to do because we could.and i think we’ve got a green light on assets we’re great at, we continue to grow those. and ge capital in almost any way is healthier than any time in its history. our margins are better.and some day investors will agree with me that this is avaluable business. we’re going to stay in it and there’s segments that we’re going to do really well in. sorry, warren.warren and i are both large shareholders in ge. and we have a lot of questions. we have a lot of quest about, you know, the portfolio mix as shareholders. i think warren’s got — joe, if we vote together, joe, i think we can control the company. i’m with you on that. jeff, my other question had to do with we keep talking about the natural gas story and fracking. and number one, i know ge’s involved in all parts of energy production and natural gas. is the portfolio right now in energy, does it have enough exposure to natural gas? that’s my first question. and number two, have you looking out 20 years, has wind becomeless — less attractive long-term because of what’s happened with natural gas? you know, joe, i think natural gas is one of the big stories of our generation. it’s big, it’s real, it’s a gamechanger. we made the decision ten years ago to be long gas, both from an exploration standpoint and from a power generation standpoint. so we see the trend unfolding. we have a great exposure to it. we think this is a long-term really dominant trend and we love it. we’ve also made the choice to be a broad-based energy supplier. wind is going to have its fit,nuclear will have its fit. we paid $200 million for enron’s wind business ten years ago. let me tell you, we’ve generated billions of cash. the cost of electricity of wind is down to 7 to 8 cents akilowatt hour. so it’s going to have a fit whether it’s in the u.s. or not. remains to be seen. i’m glad we’ve got the breadth, but the big story’s gas, let’s be clear, the big story’s gas and we’re super long gas. let me ask you both about the fiscal cliff. we have talked to a lot of business leaders about it. it’s an issue you were both concerned about. the lead story in the financialtimes, jeff, was a story we talked about on squawk. ge is looking to make moves ahead of that. how big of a problem is it? what do you think needs to be done? and i’d like to hear from both of you on that. the research we’ve released today among mid market companies i think says that they’ve allslowed down because of the uncertainty. in the case of ge, we’re a high-tech long cycle business. boeing depends on us to keep investing in our engines no matter what, we’re going to dothat, we’re going to keep going, but there’s no reason why thiscan’t get resolved. we’re a group called fix the debt. it basically endorses simpson/bowles. i think everybody believes thatwe’re going to be plus or minus 10% of simpson/bowles, let’s get it done. people say business leaders should be more vocal. look, we’re vocal. you know, this is a complete distraction at a time — and an important distraction at a time when the country doesn’t need it. so i just think, you know, everybody is planning. every business is planning for something that’s plus or minus 10% ofsimpson/bowles. i don’t get it. and you’ll have dave cote on tomorrow. he’s a very respected guy in thebusiness community. it is filled with everybody who is — who runs big companies in the country. we are saying let’s get thisdone. you feel like you’re talking and washington’s not listening.well, washington’s on hold because of the election. but they’ll not only hear people talking, they’ll hear people shouting.there’ll be a march on washington by business if something akin to it. it’s manmade. everybody knows what the generalsolution should be. and you can argue about whether revenue should be 19%, 18.5% of gdp, or whether expenses should be 20% or 21.5%. everybody knows basically what the solution is.and bowles/simpson fits in there. simpson/bowles, we’re going to stay away from the acronym of bowles/simpson. there are hundreds of people that could that you know that could design a sensible plan. any plan that gets dick durbin and tom coburn to sign on. that reflects a lot of negotiation and effort by two terrific people in simpson and bowles. it’s going to get done. and the american people won’t stand for it not getting done. and incidentally, i think it’ll get done — i don’t mean simpson/bowles precisely, but something materially close to it will get done by either person selected. and by that, i mean, a lot of americans probably don’t even understand what’s in it. you’re talking about a plan that will lower tax rates, strip out a lot of the loopholes or things that we’ve built in as policy and decided we want. 4 trillion over ten years, becky, it’s about 1 billion of revenue.lower the tax rate, broaden the base. global system, stuff like that. you know, we’re not going to like — i guarantee, we’re notgoing to like all of it. right. i guarantee you. but, you know, i think the beautiful thing about american business is how flexible and how fast we adjust, you know. it just is today the most resilient economic system on earth. and i’ve seen them all. and business people small and large are going to figure out, okay, this is a business i can be in, i can do this, i can’t do that, let’s go. but you want a plan, you want to know what it is. it’s just the stakes are so gosh darn high for the country and all of us. i don’t get why we can’t do something this important. you know?in other words, i understand there’s two opinions on everything, i understand there’s republicans and democrats. i just think, you know, what i say inside ge is nervous laughter is a bad strategy. that’s kind of like — oh, this is really important, i hopesomething bad doesn’t happen. that’s a bad strategy. i think it’s — — at berkshire. you know, i know andrew has a question too.andrew? jeff, i’m curious on the issue of simpson/bowles. have you scored what ge’s effective tax rate would be and how it would impact the business? my hunch, andrew, is that the tax rate goes up, probably. i think we’re kind of ready for that. but, you know, the notion that you can have a territorial system and have flexibility around cash, i think that’s a positive that supercedes everything else. i think that’s, you know, and again, we’re not asking for — we’re asking for the same system that every one of our global competitors has. every one of our globalcompetitors lives in a territorial system. all we’re asking is for a chance to compete on a level playing field against those guys.what i always say, andrew, is look, like us or hate us, we’re the last american company standing in all the industries we’re in.we compete against global guys in everything we do. just give us the same system they’ve got. and i don’t think that’s toomuch to ask for. jeff, real quick, while we have you. we talked to warren in the last hour about bernanke and qe-3. and you were able to sell some bonds at great prices. are you worried?warren seemed to suggest he was a little bit about where we are. you know, again, as much as anything else, as i read whatchairman bernanke has said, there’s a sense of consistency in his actions where he has said he’s going to keep the coast ofmoney low until the economy gets better and he’s been consistent to his word. so if you love him or hate, you know, qe-1, qe-2, or qe-3, he’s the one person that has led to consistency around where we are. now, did business need — when interest rates are zero, do you need interest rates lower to borrow money? i don’t think so. in other words, this is not necessarily the problem we have to solve today. you know, and so i think there’s people smarter than i am that can figure that out. but i think if you take that aside and given the gridlock in washington, and what’s going on in europe and other places, it’s not bad to have one person in power who’s been more or less consistent from 2008 to today. and i think we at least have to give him credit for that. absolutely. gentlemen, very quickly, when it comes to the fiscal cliff. would you put odds on whether you think we go over this fiscal cliff in january? and go over maybe a day or two or something. what are the odds you think we go over in a bad way versus we find some sort of solution? i would say there’s pretty fair chance we go over for a short period of time. but, you know, who knows. it depends on which fella’selected president, on the composition of the house. it’s going to get done, becky. how long they want to be in the sand box before theyome up with an answer that’s obvious, they could come up with today, just depends on the personalities of leaders of the house and leaders of the senate and the president. i don’t think it will go on a long time. but you — if august of 2011 hadn’t happened, i would say the odds are zero.you know, when we defaulted and lost credit rating. so, i think companies have to be prepared it might happen. but let’s be clear, it shouldn’t. it shouldn’t. let’s be really clear. if it does happen, that’s a failure of governance. and that’s something weshouldn’t expect. yeah. and shame on them if it does happen.gentlemen, thank you both very much. warren’s going to be sticking with us. jeff, you have to — i’ve got to do some sellinghere. we appreciate your time very much. thank you. we will have more from warren

Where Buffett Is Investing Now

Warren Buffett, Berkshire Hathaway CEO, weighs in on Procter & Gamble’s disappointing earnings, and reveals where he is moving his money around.

Buffett: Election Comes Down to Who Has Better Ground Game

Warren Buffett, Berkshire Hathaway CEO, weighs in on his support for Pres. Obama and the presidential race, saying “the first debate changed things dramatically.” Adding, “Romney got a second chance to make a first impression.”

Transcript:

forecasts, full-year guidance topping consensus. let’s get back to becky and warren buffett. do you mind? can i ask — no. no.are you sure? no, you can wait. you can come in in a moment. i have one question to ask him and i know you’re going to want to play on this. stay with me for one moment. warren, i think we’ve let you go for long enough. you are a big supporter of president obama. correct. we have an election coming up. correct.things have changed in the polls over the last month or so,probably since the first debate. what do you think is going tohappen at this point? i have no insight that anyone else doesn’t have. if you go to intrade or something, their odds would beabout the same as my odds. you know — joe was just pointing them out a little bit. what are they this morning, joe? 54%? 55 now, 55 and change. that’s movement. that’s a fair amount ofmovement. now 56. that’s movement. and it may come down to who has the better ground game here in ohio. you’ve been watching elections a long time, though, what do you think happened? i think the first debate changed things dramatically.they say in life, you never get a second chance to make a firstimpression. romney got a second chance to make a first impression. he’d been portrayed a certain way through republican debates, advertising, and in the first debate 69 million people saw a different romney than they had more or less expected from the earlier republican debates as well as the advertising. did you see a different romney? it was huge.warren, did you feel like you — he’s asking if — did you see a different romney in the first debate? well, yeah, i saw him behave differently, yeah. he was less robotic. he was — he was aggressive without being rude. and obama was down that night. no question about it. that was that huge factor in thecampaign. you know you’ve been a huge supporter of the president, do you think it matters who gets elected and what it means just for business next year based on who gets elected.well, i do think under either of the two candidates, either one that becomes president, american business is going to get a lot better over the next four years. i think that in terms of socialpolicies, i think if i were a woman concerned about reproductive rights, i think there could be a very distinct difference. if i was concerned about supreme court appointments, there would be a difference. but the economy will get better under either one of them. joe, go ahead, i’m sorry. i want to stick with politics a little bit, warren. and you always surprise me. i never know how you’re going to answer this. i want to talk about a local politician here in new york. and i’m talking about mike bloomberg. every democrat’s favorite republican. let’s sayhat this caught on and that it was a nationwide ban on any coca-cola sold in acontainer that had sugar. sold over 16 ounces. does that make sense to you to do that for the obesity problem? you’re a big cok shareholder. and then i think about, you know, dairy queen and ice cream’s not good for you either. i there must be aay that’s adding to obesity and those crummy hot dogs you sell in your dairy queen. is this something that makes sense to you? first — yeah, go ahead. first of all, i’ve got to say, dairy queen sales were up 5.8% in september same store. you see where i’m going with this. but ice cream, i eat it for breakfast sometimes.and i’m 82, you’ll have to judge — well, somebody might not likeyou doing that at your age, warren, adding to cholesterol. and you might get taxed on it because we don’t really think it’s a good idea for you to have ice cream for breakfast. is that okay?yeah, well, let’s look at the 16 ounces of coke. 16 ounces of coke has 200 calories in it. and i would say there’s an awful lot of servings of a lot of things that have 200 calories or more, and the idea to say you can drink 200 calories of something but not 210 or 220 seems to be kind of silly. in the end, i’ve elected thefoods to eat over the years i like to eat and i think it’s kept me quite healthy. and if i’d been on broccoli and spinach, i’d been gone a long time ago. but i drink about — why don’t you tell me it’s preposterous and bloomberg has got a screw loose. why don’t you say that? well, because you’ve said it for me. all right.but you wouldn’t disagree with me? and then i’ve had people in from mt. sinai, doctors that tell me, hey, oh, well, cigarettes, youwant — it’s like cigarettes, you don’t want to tax cigarettes. and i go, well, red meat 20 years ago was the cause of all heart disease, and oh, that may not be the end all be all. i eat lots of red meat. no, it’s not — i eat lots of red meat, joe. and i drink about 60 ounces, about five 12-ounce cans of cherry coke a day. and that’s 750 calories but i elect to get — i’m going to –your prerogative. 750 of them are going to be cherry coke. and my doctor told me said drink more liquids and i said, you know, i said how about cherry coke. he says it’s fine. insanity. it’s insanity, and someone needs to tell this guy that. although he’s going to be every republican’s favorite democrat. andrew, god, if he ran for president, you’d be out there, you’d have 40 signs in your yard, bloomberg for president. i’ve got to say, mayorbloomberg has done a lot of terrific things. all kinds of things.this ruins it. i’ve also had dinner with him in sun valley after this came out and when they brought out the dessert, there was more than 200 calories in this dessert. i’m unable to determine why those 250 or 300 calories of dessert he was eating wasdifferent than my coke. did you say that? i had the biggest bottle of coke brought out that i could find. and did he drink from it? i drank from it. i wasn’t going to let him have any. getting back to the national election, you point out it could be the ground game right here in ohio. sure. that makes all the difference. i know you don’t have inside information, you’ve been watching elections for a long time. your father was a congressman, you used to watch those races very quickly. what do you think it actually comes down to what it means? i think in ohio may verywelcome down to organization. there’s been a lot of early voting in ohio. right. that’s organization. you want to get out your voteand a lot of people say they’ll show up on election day. and particularly when you’ve got a history as the democrats do ofturning out less of their base than the republicans. so early voting is a huge advantage to democrats. they are not going to get the same percentage of their base out on election day asrepublicans traditionally. so we’ll see who has the better ground game. no matter who wins the election, we are going to belooking at a different treasury secretary. right. tim geithner has made it pretty clear that he wants to go. you know a lot of people in finance, you know a lot of people, have you thought about who might make a good pick for treasury secretary?yeah, i do. and i won’t get a call from — i won’t get a call from governor romney asking me my opinion. but i think i’ve got a good idea. but i — i’ll say that — we’ll wait and see whether obama’s elected and wait and see if he calls. is it a name that’s been out? erskin bowles has been named recently. he would be terrific. he’s smart, patriotic, absolutely would do the best jobfor the country. erskine bowles is a fine human being. and what he and alan simpson accomplished in getting those 11 to sign on. that’s huge, that takes real negotiating ability. it takes humor, it takes a decent human being to get people to come together like that. i admire him a lot. okay. guys, i will send it back to you

Buffett: Euro Zone Banking Problem Clouds Recovery

It is going to be very tough for Europe to have austerity and at the same time grow GDP, said Warren Buffett, Berkshire Hathaway CEO, referring to the euro zone’s economic problems.

Transcript:

of the morning, warren buffett who has been kind enough to bewith us for the past hour and 45 minutes or so. warren, we look at europe all the time. and you’ve talked to us in the past about the eurozone crisis and what you see happening. you talked about the european banks. you think they’re in a differentposition than the american banks. but last week francois hollande suggested the eurozone is moving out the other side of things. is that the impression you get? i wouldn’t say so. i don’t know how it plays out. i certainly don’t feel that it’s clear on the road to recovery. they have a real banking problem. you have the sovereigns counting on the banks and the bankscounting on the sovereigns. and that creates a problem. and it’s going to be a very tough thing to have austerity at the same time grow gdp. it’s not an easy solution. europe isn’t going to go away. i think it could be pretty rough there for a while. is that a good argument for pulling back from the area? or is this a time you think business — they either have to come closer together or they’re going to go one direction or the other. but the idea of having a monetary union independent of really discipline on the fiscal side, although they said they had it originally. they’ve got to come closer together or it won’t be sustainable. although the ecb has made some major moves to try to reassure the markets and certainly given up quite a bit more time. central banks can print money. it’s a wonderful machine to have. in economics just like life, you can never do just one thing.anything you say you’re going to do is going to haveconsequences. and sometimes those consequences are delayed. certainly printing money has consequences. and not printing money would have consequences in the united states too. but we haven’t seen — the movie’s not over in europe. joe, you have a question too? do you still think a single-family home is one of the best investments around? and have you figured out a way to invest that? you’d like to buy — you said, buy as many as you could but they’re impossible to manage and you can’t do it. have you tried to figure out a way to do it? yeah, and i’ve had a lot of suggestions from people after i made that statement. it’s not really feasible. and certainly compared to other things we can do with money, it’s just too big of a problemto deal with small units like that and management problems and human problems. so i think that anybody that knows where they’re going to want to live has a reasonably assured income, i think they’re making a terrible mistake if they don’t buy a single family home now and get mortgages at these rates, and they should get a 30-year mortgage. it’s really a golden opportunity.it was a little bit better six months ago, but still wonderful now.you’re not going to see a chance like this five years from now. i’ll guarantee you that. five years from now, it’ll be a different picture. and rates will be higher and all kinds of things. and you think prices — if you know — you’ve got to want to live there. and home’s a wonderful thing. but i wouldn’t buy one if i was going to move in six months or something of the sort. and i wouldn’t buy one if i was terribly nervous about my job. warren, a couple you mentioned ted and todd talking about what they’ve been doing as an investment cycle. a lot of times we get these notes from the s.e.c. just about what berkshire is doing withinvestments. how much of it is theirs and home is yours? very little of it is mine. i have four stocks over 50 billion that i manage. i got a bunch of other things too. the action is with them. they’re building up portfolios. they will buy $500 million at a time of something. and probably more prone t move around in securities than i would be. there’s a lot of styles that work. i am enormously pleased. they are paying a higher tax rate than if they were running a hedge fund doing exactly what they were doing if they were at a hedge fund. it’s a really indictment of thetax system when you look at two guys who just moved doing thesame thing from morning to night they did before and now they pay double the tax rate for it. andrew? warren, i want to get anupdate on my favorite subject, newspapers. you bought the omaha herald earlier this year. you have had time to get underthe hood. what do you think? well, i’ll have a big section in the end report about newspapers. i did write a letter to ournewspaper publishers. if you have a newspaper that isindispensable to a significant percentage of its community,you’re going to do well over time. pweay very low multiples forthem. the trend of the newspaper industry is down but you have to be prime air about things that are of interest to your readers.if you’re in grand island, nebraska, where we have a product, we have to be relevant to what people in grand island are interested in. that’s a much tougher problem as you get into bigger metropolitan papers. it’s working better or worse than you expected? newsweek just said they were going to stop printing recently. i know community newspapers are a different situation. a lot of people always have questions. our small newspapers and by that i mean towns of 20,000, 25,000, our small newspapers year for us, the revenues are down about 1%. our larger newspapers like buffalo and omaha and nowrichmond, those papers, which are larger communities, revenues would be down 4% or 5%. there’s a real difference based on relevance of the paper to a very significant portion of its community. the bigger the community, the harder to have a community feeling. earlier this week was the release of greg smith’s book about goldman sachs. a guy that wrote that op-edpiece in the new york times saying this is why i left goldman sachs. did you see any of the interviews that he has done? did you take a look at any of the book? i haven’t read the book. i saw an interview. a guy 33 making $500,000 a year and unhappy because he isn’t making a million and any otheroccupation he wou making $75,000 a year, i thought the idea that one disgruntled employee leaving a company warrants an op-ed with no specifics in it. i did not think that reflected great editorial judgment. i bring this up because lloyd blankfein will be on later in the morning. we appreciate you for spending time for us and when we come back we have the last word that we’ll give to mr. buffett and as

Buffett’s Final Word: Hold

Warren Buffett, Berkshire Hathaway CEO, explains why investors should not “buy” or “sell” on current news, adding, “it’s just crazy.”

Transcript:

let’s get back to becky and warren buffett for the last word. thank you. last word is sort of a free word association game that we’ve been playing lately. i say a word and you tell me what it makes you think of and the question we get most frequently about you coming on is what should they be buying right now. if i say buy, you say? i say hold. the idea the european slowdown or this and that or anything like that would not cause you if you own a good farm run by a good tenant, you wouldn’t sell it because someone says this a news item happening in greece. if you owned an apartment house and you have to raise your rates, you wouldn’t dream of selling it. if you had a goodbusinessperson, you wouldn’t think of buying or selling everyday. when you own stocks, you own pieces of businesses.they’re wonderful businesses. you can pick the best businesses in the world. to buy or sell on current news is just crazy. you’re in a wonderful business. you have people running it for you. you know you’re going to do well over five or ten years. and for think news events should cause you to try to dance in and out of something that’s a wonderful game, it’s a terrible mistake. get into a bunch of wonderful businesses and stay with them. i said buy and you changed it to hold. if you haven’t got them yet, you buy them consistently over time so you average over time and i’ve been buying all my life. i bought my first stock when i was 11 years old. it was about three months after pearl harbor. all of the news was terrible. it was a great time to buy stocks. i should have held that stock forever. i have been buying stocks ever since. do you guys have any last quick thoughts? warren, have you bet zuckerberg and if you sat downwith him and you told him is there any way that he could explain the business well enough to where you would take a hugestake in facebook? probably not. that doesn’t mean that i’mnegative on it. i just don’t understand it well enough. i’m actually not even a member. there’s a billion of them out there. i like to buy things where i feel like i have a reasonable idea of how the business is going to be doing five or ten years from now just like i would buy an apartment house or a farm with an idea that it would be a good thing to own five or ten years later. there’s a watershed event tomorrow that may change your view. you’re free to send me questions as well if you would like. this is a game changer. actually, joe, i thought instead you always wanted a share. i’m going to take this. there’s dozens of planes this. i’m going to give this to becky. thousands of jets.i’m getting a tie. dozens of planes on it. thank you very much for your time today. appreciate it. make sure you join us