Warren Buffett | Charlie Rose | October 5, 2007

Transcript

warren buffett is here he is the chairman and ceo of berkshire hathaway it is a very successful company it just had one of his most successful years ever warren buffett has been ceo for 42 years he has become perhaps the most admired investor in the world we first began a series of conversations in 2004 and they have continued since then as we have... Read More

Summary

In this video, Warren Buffett discusses a range of topics including his successful year with Berkshire Hathaway, his philanthropic contributions, and his love for his work. He also talks about the high price people are willing to pay for lunch with him, the risks and benefits of being a large company, his investment strategy, his mistakes in the stock market, and his thoughts on the media industry. Buffett also explores his concerns about the growing trade deficit, the importance of understanding risk in investing, and his view on political candidates and world issues.

Questions & Answers

Q: What were some highlights of Warren Buffett's year with Berkshire Hathaway?

2006 was a great year for Berkshire Hathaway, with good acquisitions and no major issues. They had the largest growth in net worth of any company in American history (except Exxon), which was a record-breaking achievement.

Q: How much did someone pay to have lunch with Warren Buffett?

The most expensive lunch was sold for $610,000, and another $10,000 was paid by someone else to give them the lunch. The total amount of $620,000 goes to charity. The person who paid for the lunch was a Chinese American who became an American citizen, and he brought seven other people with him, including his talented wife.

Q: How many of these expensive lunches has Warren Buffett had?

Buffett has had around 10 of these high-priced lunches since the prices escalated after they were put on eBay. He enjoys meeting interesting people and has learned a lot from these lunches.

Q: What kind of conversations does Warren Buffett have during these lunches?

The conversations during these lunches can be about anything the attendees are interested in. Buffett has talked about investing, business, raising children, and various other topics. The lunches can last as long as three hours, and Buffett is open to discussing whatever the guests want to talk about.

Q: What are the risks and downsides of being a big company like Berkshire Hathaway?

Size is an anchor to performance because it becomes harder to manage larger amounts of money. With a small amount of capital, Buffett had a wide universe of investment opportunities. But as Berkshire Hathaway grew, the number of viable investment options decreased, and the focus shifted more towards acquisitions instead of equity positions.

Q: What is Buffett's strategy for Berkshire Hathaway?

Buffett's strategy is to build more earning power by acquiring operating businesses with strong managers. He wants to continue expanding the number of businesses owned by Berkshire Hathaway and increase overall earning power. He also enjoys buying stocks but considers it more of a game compared to the long-term focus on operating businesses.

Q: What investments has Warren Buffett made recently?

Buffett has invested in Walmart, but it was a smaller position compared to some other investments. He also mentioned the possibility of a large acquisition but acknowledged that it is challenging to find the right opportunity that aligns with Berkshire shareholders' interests.

Q: Why does Warren Buffett love newspapers?

Buffett has always been a fan of newspapers and enjoys the significance and importance that comes with owning a newspaper. He believes newspapers provide a unique value and make the owners significant figures in their communities. Buffett also mentions his fondness for the people and the business side of newspapers.

Q: What does Buffett think about Rupert Murdoch's attempt to buy the Wall Street Journal?

Buffett thinks it's not surprising that Murdoch wants to buy the Wall Street Journal because he loves newspapers and understands the industry. Murdoch's acquisition could bring a different future for the Wall Street Journal compared to other metropolitan newspapers. Buffett believes the Wall Street Journal and the New York Times have a different role and significance in the internet age.

Q: Has Buffett made a decision about his successor at Berkshire Hathaway?

Buffett has chosen three candidates for the CEO position at Berkshire Hathaway, and the entire board has approved this decision. However, the candidates may change in the future, depending on interviews and other factors. Buffett's main criteria for the successor are understanding risk and preventing the zero in investment performance that can lead to irreversible damage.

Q: What does Buffett think about the trade deficit and its impact on the US economy?

Buffett believes that the trade deficit is a significant issue because it involves giving up US assets to feed the country's spending habits. He compares it to consuming more calories than one burns over a long period, which eventually leads to negative consequences. Buffett acknowledges the challenge of addressing the trade deficit in a democracy but emphasizes the importance of considering the long-term consequences.

Q: What is Buffett's view on political candidates and world issues?

Buffett names Hillary Clinton and Barack Obama as two candidates he would love to see as President of the United States. He believes they both have the potential to lead the country towards a better future. Buffett is particularly interested in candidates who can address the needs of the entire population rather than just benefit individuals or specific groups. He also expresses concerns about weapons of mass destruction and the threat of terrorism, calling for global cooperation and vigilance.