Warren Buffett – Iconic Voices For Our Time

Warren Buffett – Iconic Voices For Our Time

Warren Buffett – Iconic Voices For Our Time

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0:26when I was in high school I bought in any class that would required and in
0:30college and I finally signed up for a day on Carnegie course when I got out of
0:34school I realized I had to talk to people and I spent 200 bucks I got this
0:38little diploma I proposed to my wife during the during the term of the course
0:44so I really got my money's worth there but in terms of public speaking I really
0:48had to force myself on that in terms of talking privately they couldn't stop me
0:52from the moment I started school I think I have always liked to talk how do you
0:58keep up with all the media and information that goes on in our crazy
1:03world in your world of Berkshire Hathaway what's your media routine I
1:06just read read and read i probably read five to six hours a day I don't read as
1:10fast now is as when I was younger but I read five daily newspapers I read a fair
1:15number of magazines I read 10 case I read at your reports and I read a lot of
1:20other things to us I have always enjoyed reading i love reading biographies for
1:24example to process information very quickly how I have some filters in my
1:29mind so if somebody calls me about an investment in the business or an
1:33investment in securities I usually know until three minutes whether I have an
1:38interest and I don't I don't waste any time with the ones I don't which I don't
1:41have an interest
1:43when I think about your world three hundred and thirty thousand people who
1:47are employees of Berkshire Hathaway or its subsidiaries how do you send the
1:51message that they are being scrutinized under the microscope by the media at all
1:54times well i send a message to their managers at those 330,000 people work
1:58for maybe 70 or so
2:01CEO's an intern work for me so i my job is to have those 7770 CEO's sending out
2:07the right message so every two years running a very simple letters a page and
2:11a half I don't believe in two hundred page manuals because they put out of two
2:14hundred page manual everybody's looking for a little balls basically but page
2:19and a half
2:20very hard for him to argue about what I'm talking about so I tell them you
2:24know that my reputation Berkshire's reputation is in their hands and not
2:28only and we've got all the money we need more money we got all the money we need
2:32we don't have an answer reputation beyond what we need and we can't afford
2:37to lose it so we never will trade reputation away from money and and
2:42they're the ones that are the guardians of that and that I want them to not only
2:46do what's legal obviously I want them to judge every action by how it would
2:54appear on the front page of their local paper written by a smart semi unfriendly
2:59reporter and i were really understood to be read by their family their neighbors
3:04and their friends and has to pass that test as well and I tell him I don't want
3:08anything around the lines at all there's plenty of money to be made in the center
3:11of the court and I may be for my eyes aren't together anymore ok quite see the
3:15lines that well so just keep it in the center of the court and if they have any
3:18questions call me
3:21what advice do you have for a CEO who is on the media hot seat because of a
3:25similar situation well as a couple pieces of advice on that person is that
3:29when you find out a bad news bad news correct that and if it's necessary to
3:33report them to authorities reported immediately the big problem with Solomon
3:36was not met a fellow named moser did which was defined the US government not
3:41ever a very good idea but that could have been handled but he reported he
3:46didn't reporter John Meriwether is supervisor picked up on it and late
3:51April 1991 and went to the president and the chairman and chief legal counsel of
3:57Solomon and said here's what this fellow Moser has been doing and they all agreed
4:03it was wrong they all agreed with reportable to the Federal Reserve
4:06promptly at an unfortunate nobody did anything and then in the middle of May
4:11mosier went out and did it again and now you got a terrible problem because you
4:14know the guy was a bad actor few weeks earlier and it hadn't reported it and
4:19the compound of there and then you're in a real pickle so when you find bad news
4:26I get it right in a fast get out get it over and get it right is important but
4:32when I questioned the Moser done it there but they get it fast and get out
4:36they missed on and so deal with bad you're going to get bad news I mean I
4:41got 330,000 people I mean I I will guarantee you that probably dozens of
4:47them are doing something wrong right now I just hope I find out about early and
4:51the person below me find out and let me know if it's bad enough that they stop
4:55it so you can have a study of 330,000 without an occasional quite so it's
5:03gonna happen and you've got to do something about it fast when it does
5:08the biggest sin and journalism that I see I think incident I think I probably
5:12as a CEO have spent more time talking to journalists that perhaps the country
5:18partly that's good I may be four but partly because I like you target
5:21journalists do what the greatest sin they commit
5:26you've got to start the story with the hypothesis I mean you're looking into
5:29something because you have a working hypothesis but you have to give up that
5:33hypothesis of it turns out not to be correct or that orbit misleading in a
5:37major way so I always worry about the journalistic calls me they've decided
5:43what stories they're working on a older looking for us confirmatory evidence so
5:47I call it quote shopping tho talked to be four forty-five minutes hoping to get
5:50one quote that confirms our story and ignoring the other 43 minutes when I
5:54told them things that should limit the story so it's it's very natural you know
6:00you get time invested in that you got this working hypothesis and once you've
6:04invested a lot of hours and your editor know you've invested a lot of hours
6:07maybe it was the editors i working hypothesis to start with that and now
6:11you're yeah you gotta go back and tell him I mean there's there's a lot of
6:15there's a lot of momentum toward a bad story a lot of momentum toward a good
6:21story do but but you have to ask you have to be able to writer to say my
6:27hypothesis no longer correct and all it was was a hypothesis that's no sin to
6:31say that but it's hard to do
6:34my first diversity training in GU was in the mid-eighties Simon almost my
6:39thirtieth year and being trained how to run a meritocracy how to be open how to
6:46encourage an open workplace there's no excuse of four people of my generation
6:49not to be open to no matter where you came from
6:54no matter what you've done if you can bring it if you're if you've got married
6:58if you're winning you're gonna get promoted
7:01looking back with you became CEO in 2001 would've been the most unexpected
7:06hurdles so you know Jesse it's funny I it's been almost 14 years to the day and
7:12we had the anniversary of 911 last week you know so it always makes me
7:16thoughtful I think the world if I had to pick one you know we've come out of this
7:21time period of really geopolitical peaceful us' was the center of the
7:27economic world we really hadn't seen a meaningful recession since 1990 and
7:33things like that so I think the bigger surprise just been the world has just
7:38been twisted from one of relative I would say you know benign growth to one
7:44of just a high volatility hi geopolitical risks things like that and
7:49so in many ways the environment today is nothing like what it was like when I
7:53thought it would be when I became CEO
7:56we want to stay relevant today the second thing I would say is I'm I'm
8:01blown away by companies like Google you know Google's I think twelve years old I
8:08am completely impressed with what they've done in 12 years but the third
8:12thing I say is look we matter we're not going away we're paranoid we're
8:18investing with changing were relevant to our customers and the industries that we
8:23serve and so I I always think these you know we don't want to be Microsoft we
8:28don't want to be Google but we're inspired by them were we we we we we we
8:34want to be better because of them
8:37look I've done this now fourteen years it's a hard job in other words anybody
8:43that sits there and says they think these jobs are you see these are hard
8:47jobs you have to learn every day I think I think what's what I love about our
8:52company and what I try to match myself is just resiliency that there's this
8:59sense that were never as good as we want to be were never as good as we can be
9:04and that no matter what happens we can keep getting better so I i think i think
9:10what I would say we've accomplished is we've done all these changes in a very
9:16unforgiving with almost no talent right so we've been able to change the
9:20portfolio grow earnings do things like that and it has three recessions you
9:26know political unrest and and and and things like that you know i i was i was
9:32having lunch today with political candidates running for president and you
9:40know we don't really don't think today as a company about government doing tax
9:47reform or immigration reform or great things we we are more worried about the
9:52government shutting down and two weeks that's something that my predecessors
9:56didn't have to grapple with great in terms of where the world is so in a very
10:02volatile world we've stayed focused on you know kind of what we thought we
10:07could be accountable to you know our customers are investors need each other
10:12and and I think that's made us a better company
10:15we've got a great creative people that work for GE and we turn them loose on on
10:21social media and allow them to create their own stories one of things I
10:26reviewed this morning is on National Geographic Channel Ron Howard and Brian
10:31glacier doing a six-episode story of technology and science that has
10:37world-class directors from Hollywood for producing shows on the brain
10:42the future of energy and GE scientists are a part of that so I think we're into
10:48the the things that interest people and and we're willing to experiment in new
10:55ways of storytelling with the talent we haven't said the company and I think
11:00that combination I don't know if it makes us over twenty year old daughter
11:04she might disagree with the notion of a clever mix as well of it would probably
11:09even more important
11:11when you are in a country like Indonesia how much do you have to think about
11:16profit versus how much do you have to think about the indigenous peoples and
11:21where do you draw the line is not aligned you it is really not only
11:27because we can't create value for our shareholders unless we operate ethically
11:35that means complying with the laws in the countries where we operate in laws
11:43like the Foreign Corrupt Practices Act and UE securities laws and if we are not
11:50responsible to the environment are the local people are the government's where
11:56we operate or were forced we all make him a process and so it is not a
12:05question of a or b to create shareholder value in our business we have to act
12:18how do you manage through a foreign government to do the right thing you
12:23know we have this transition in the developed world that we're going through
12:29you probably can put a pin point about 1961 and colonialism started dying out
12:42and performed many governments dictators and so for and now there's this
12:58transition of those types of governments to democracies and many places you find
13:07a mature democracies different countries have different views about ethical
13:15issues and we do call option here you know government officials participating
13:24in business and so are challenges we can we can go through a strategic analysis
13:33say we want to operate in a particular kind of country because that's a good
13:37country operating we have to go find resources and go where those resources
13:42are and see if we can enter into a relationship with the host government
13:49virtually everywhere in the world outside the United States government's
13:54own resources you know here in the USA government on certain resources but
13:59private property owners own resources and so to get the right operate we have
14:05to negotiate arrangements with central governments and then we're located as
14:12you pointed out also in places where their indigenous people and their
14:19relationships friends
14:21indigenous people or or or are strained what we've learned is that while we have
14:30to adhere to the laws and the terms of our arrangements with host governments
14:35we can turn a blind eye to the local communities
14:40the current stoppages a relatively small group of popcorn workers who actually
14:48are protesting the fact that management didn't penalize so earlier strikers that
14:56we had last fall and so they are protesting the actions of certain other
15:04parts of the work force and the fact that we didn't disclose more more
15:13time this is a fantastically difficult social structure there in Papua to deal
15:23with where you have indigenous people and different tribes or maybe
15:30six-and-a-half seven million people in the total Holland 25% the world people
15:37that racially different from the rest of Indonesia they're almost all Christians
15:41christians I grew up in the Bible Belt and they you know they are dyed in the
15:47wool Christians in a country that 85 percent Muslim you know it's a literal
15:54form of Islam in Indonesia because the racial differences religious differences
15:59that tribal differences were right in the middle of operate
16:07did the work for a company called computer signs a friend of mine was the
16:12managing partner person I met at this firm managing partner he looked at me
16:29and said a woman partner we don't have any women partners are so America the
16:38secret sauce for a hundred years was the best and brightest women whose job
16:43opportunities were somewhat restricted to nurse or teacher once they were
16:50emancipated and the opportunities came today
16:55car company the scene over largest defense company and the CEO of IBM our
17:01old women the country needed to recalibrate and think ok people that
17:07have educated this country for a hundred years our best and brightest many of
17:12them might be moving to other fields now as opportunities are open to them and
17:17we're gonna have to re-evaluate the compensation structure and incentive
17:21structure in our educational system to deal with the fact that we're not
17:26competing with whether they're going to be a nurse or a teacher but whether the
17:30CEO and the country even today has not fully adjusted to that change
17:38in the late nineteen eighties I visited with them really brave man at the
17:46russian embassy in the United States and EC and he had with him his equipment to
17:53our commerce secretary and he told me they want to get into venture capital
17:59they want to get into small and medium businesses they understand that they
18:04create all the jobs and they want to find a way to make that happen and they
18:08have a very strong science commitment so so I told him I i you need to understand
18:19if you're gonna get involved with venture capital not later financing but
18:23just start new businesses it's quite possible seven of the 10 will fail and
18:30then the commerce secretary commissar said to meet you put the people in jail
18:36ok of those 710 that fail I said no we assume they learn something from the
18:44experience and they'll do better next time so and then I told my don't think
18:49you're quite 24 venture capital
18:52but if america at that time had an enemy
18:55it probably would have been considered to be gorbachev was gorbachev he
19:00admonished to tear down that wall we spoke with president gorbachev not long
19:05ago and he said President Reagan was a great man so here's the biggest opponent
19:10as you could get saying about his opponent he was a great man we think
19:16today about can you work on the opposite side of things and in the end of the
19:21respect and admiration of the person who you SAT across from in it in opposing
19:27views and I think that's the kind of gentleman that president reagan was he
19:32left you with respect that that makes maybe makes a definition of leadership
19:39he also one of the greatest memories I have and it's something you might have
19:46some association with their was in a museum in New York City a handwritten as
19:53I recall three-page note that was a young student wrote to governor reagan
20:03and asked him what would how would he defines success in life if I recall and
20:08he took the time to write a long note explaining what he thought would be a
20:15definition of success in life he was a reflective man he was a compassionate
20:20man and someone who would who would take time to work with the young person and
20:27handwrite take the time to hand to personally tell the story of what he
20:32thought would be a definition of success
20:35I don't think anybody can have it all I don't think that's a female or male
20:38shortcoming in that you have to make some choices in this world and you make
20:44choices and and then once you once you said that course you know get to go back
20:51and read and read choose those I haven't had a family I raised my younger
20:56brothers and sisters but I i'm not biologically a mother but that was a
21:03choice that I made and I think that one of the benefits we have today as he have
21:07the opportunity to do choices and and I think it's never been better and that's
21:15just hope that we face the challenges like replacing as we've just been
21:20talking about on the international scale or on the biomedical scale or in
21:24technology encoding there is more to be done than ever before we need the talent
21:30of both men and women and I think that increasingly the wise money is going to
21:36the optimal talent engagement and not necessarily just a male talent
21:42engagement so I think nobody can have it all I can curve that I've had a great
21:48life and no complaints about that but i think thats still people do make choices
21:54and and you choose and the choices you make early on and especially at the time
22:00like college time the choices that you make now set a course that will be
22:06decisive about many of the future opportunities that you get better and
22:10better education you can get better
22:13involvement in the better the more learning that you get in your youth room
22:19or the broader the rich will be what you can do with your ultimate careers and

Baupost’s Seth Klarman Suggests That The U.S. Could Be Uninvestable One Day

Seth KlarmanIn his 2021 year-end letter, Baupost's Seth Klarman looked at the year in review and how COVID-19 swept through every part of our lives. He blamed much of the ills of the pandemic on those who choose not to get vaccinated while also expressing a dislike for the social division COVID-19 has caused. Q4 2021 Read More

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