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Buffett and Munger annual meeting from 2001 Full Q&A Afternoon session

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I hope you have all had a course astral free lunch and we will move on. And when we stop we are about to go to zone 3. Hi my name is Jason tank from Traverse City Michigan. I've got one on kind of quick question that I'm sure you can answer relatively quickly if you're not interested. I know that Walter Scott's on the board of directors and he's also on the board of directors of a company called Level 3 Communications that is in an industry that's why there's been a lot of change happening and stock prices have been plummeting. I wonder if you've ever you've probably spoken to him at great length about the economics of that business and have you ever expressed any interest in that business especially at the prices today. That's the first question the second question is if you look at if you look at Berkshire Hathaway as a portfolio of you've got wholly owned subsidiaries is operating businesses marketable securities common stocks and bonds. If you strip out and my premise is wrong just please tell me if you strip out the leverage effect of the cost of that of the float being you know nearly zero or negative throughout the years. If you look at the portfolio minus that leverage piece How fast do you think your book value would have grown over the last 30 plus years. Are we talking about 5 or 6 percent due to just the leverage piece on the insurance flow. I don't think it would run as much as 5 or 6 percentage points but the flow has been very useful to us.

And actually I've never made the calculation so you could well be correct that if it was five or six points that would be a quarter of our book value gain over the years being attributable to insurance float and I think that's probably maybe on the high side. But but and and you can't make it we don't look at insurance for 100 percent the same as we would look at equity but but we've looked at it a good bit. You know it is largely tantamount to equity because we've had so much equity we could afford to do it that way. So you'll have to make that calculation yourself. We think insurance flow has been a huge asset to Berkshire. We think it will continue to be a huge asset and we look for every way possible to increase the amount of low cost float on a small scale we added You Ashlie of vulnerably last year an excess surplus lines carrier based in Philadelphia. And so far that's working out extremely well got perfect guy running it and you know in a small way we add float there. I just looked at the first quarter on it. We had a significant underwriting profit and we have flowed at it and you know that's the best of all worlds so we'll keep working on it and then we'll it will add it's a big asset that Berkshire has that a great many companies. I mean virtually no other company has the to the degree that we have that that also invests in other businesses and uses that as a source of money to invest in other businesses. Question about Level 3 obviously can't answer.

I just I can tell you that you have two enormously smart and high grade guys in Walter Scott and Jim Crow in that business. But it's not a business I know a lot about. And if I did I wouldn't talk about it Charlie. I can not talk just as well as you can. Not always. OK. Section 4. John Gollop from Kansas City.