kunit17/BPL · Datasets at Hugging Face

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	Okay. If you're ready, we are. We're going to keep going in the same order because there's people in the other rooms that have been waiting, so we will go to number 11. Hi. My name is Christian Baha from Superfund. I have a question for you, Mr. Buffett.	0
	What do you think about managed futures funds? About which one? I didn't quite get that. What kind of fund? Managed futures funds, like a very well -diversified portfolio in stocks and bonds, going long and short, all the different markets, based on the most natural human behavior, trend -following or hurt behavior. Managed futures funds.	0
	Well, I would say that we think the most logical fund is the one we have at Berkshire, where essentially we can do anything that makes sense, and are not compelled to do anything that we don't think makes sense.	0
	So any entity that is devoted to a limited segment of the financial market, we would regard as being at a disadvantage to one that has total authority, if you have the right person in charge. But that's an assumption you're going to make under any fund.	0
	So we would not want to devote our funds to something that was only going to buy bonds, something that was only going to buy futures, or anything of the sort. We buy futures at Berkshire. We buy bonds at Berkshire. We buy currencies. We buy businesses. So I think it's a mistake to shrink the universe of possibilities.	0
	Ours is shrunk simply by size, but we don't set out to circumscribe our actions in any way. But in the end, there's no form that produces investment results. Hedge funds don't produce investment results. Private equity doesn't produce investment results. Mutual funds don't produce it. That if it was simply a matter of form, we'd all call ourselves, you know, whatever that form happened to be.	0
	What really makes the difference is whether the person that's running it knows what their limitations are, knows where their strengths are, plays when they have the opportunity to play advantageously, and stays out when they don't see any opportunities. Charlie? Yeah, I'd go further. I'd say averaged out, I would expect that the return per dollar per year in managed futures funds would be somewhere between lousy and negative.	0
	And I would agree with that. Yeah. Yeah. Usually those are sales tools. I mean, people find out something that will sell, and it can be, you know, it can be bond funds at some point, it can be, but when they find something that can sell, it'll get sold to the public. It will sell till it stops selling. And that means lots of money comes in and lots of competition for a limited number of opportunities.	0
	And I think it's a mistake to get sold something on the basis that here is a great area of opportunity. Areas don't make opportunities. Brains make opportunities, basically. Number 12. Matthew Monaghan from Palo Alto, California. Mr. Buffett, Mr. Munger, First of all, I want to thank both of you for so freely sharing your wisdom and knowledge over the years.	0
	Even though we've never met in person, I consider you both to be close personal mentors and attribute your teachings and philosophies to any success I've had in business so far. So thank you. Here's my question. For a 23 -year -old with high ambitions, some initial working capital, and a genetic wiring, as you call it, for disciplines like investments, mathematics, and technology, what do you foresee as the significant areas of opportunity over the next 50, even 100 years?	0
	And if you were in my shoes, what would be your approach and methodology for really learning, tackling, and mastering these areas of opportunity for the purpose of massive value creation?	0
	Well, I remain very... And frankly, when you get the chance to talk to somebody like Lorimer Davidson, as I did when I was 20 years old, I probably learned more from Lorimer Davidson in those four or five hours than I learned in college, with the exception of learning some accounting, and one or two subjects like that. So you just want to soak it up.	0
	If you have those qualities you talked about, you'll see the areas as you go along. I mean, we have... Charlie and I probably, you know, we've made money in a lot of different ways, some of which we didn't anticipate, you know, when we were 30 or 40 years ago. But we did have the ability to recognize some. We didn't have the ability to recognize others. But we did know when we knew what we were doing and when we didn't.	0
	And we just kept looking. We had a curiosity about things. You would know at a time like the long -term capital management crisis, for example, that there were going to be ways to make money. I mean, it just was... They were going to be out there, and all you had to do was just read and think eight or ten hours a day, and you were going to cover a lot of possibilities, probably a very high percentage of them good, and some of them sensational. So you can't really lay it out ahead of time.	0
	You can't have a... You can't have a defined roadmap. But you can have a reservoir of thinking, looking at different kinds of businesses, looking at different kinds of securities, looking at markets in different places. And you will then spot a reasonable number of things that come along. You won't spot every one of them. We've missed all kinds of things.	0
	But the biggest thing, too, is to have something in the way you're programmed so that you don't ever do anything where you can lose a lot. I mean, our best ideas have not been better than other people's best ideas, but we've never had a lot of things that pulled us way back. So we never went two steps forward and one step back. We probably went two steps forward and a fraction of a step back.	0
	But avoiding the catastrophes is a very important thing, and it will be important in the future. I mean, you will have your chance to participate in catastrophes. Charlie? Yeah, and of course, the place to look when you're young is in the inefficient markets. You shouldn't be trying to guess whether, you know, one drug company has a better drug pipeline than another. You want to go when you're young someplace that's very inefficient.	0
	And you shouldn't be trying to guess whether the stock market's going to go up or whether long -term bonds are going to change in yield. I mean, you don't have anything going in that kind of a game. But you can have a lot going in games that very few people are playing and maybe where they even got their heads screwed on wrong in terms of how they're thinking about the subject. The RTC was a great example of a chance to make a lot of money.	0
	I mean, here was a seller of hundreds of billions of dollars worth of real estate where the people that were selling it had no economic interest in it, were eager to wind up the thing, you know, and they were selling it at a terrible time when the people who had been venturesome in lending were no longer lending. The people who had been venturesome in the equity end of real estate had gotten cleaned out. So you had a great background of environment, and then you had an imbalance of intensity in terms of analyzing situations.	0
	between the seller, which was the government, with a bunch of people who had no economic interest in it and were probably eager to wind up the job, and buyers on the other side who were of the generally cautious type because the more venturesome type had taken themselves out of action. And there were huge amounts of property. So you get these opportunities, and you'll get more. I mean, there won't be any scarcity of opportunities in your life, although there will be days when you feel that way.	0
	Okay, let's go to the other rooms now. They've been waiting. Number 13. John Goss, Key West, Florida. Katrina created litigation that resulted in some rulings that combined flood damage and wind damage, where the insurance companies thought they covered wind only. As a result, some insurance companies are significantly reducing coverage in those states.	0
	Florida recently empowered their insurance company, called Citizens, to be more aggressive not only with Windstorm, but also with homeowners, while at the same time not allowing requested rate increases of other insurance companies. The result is that some solid insurance companies have announced reducing their coverage or pulling out of Florida. Is this type of government interference a random fluctuation in insurance or a major cause of concern for the future?	0
	Well, that's an easy one to understand both sides of the question on. I mean, the average homeowner is not going to sit there and there's an insurance policy, and a lot of times the agent is not going to explain it carefully to them. So when something comes along and he thinks it's insured, and it turns out that he bought a policy where it wasn't insured, he's going to feel very unhappy about it.	0
	And when tens of thousands of people feel unhappy about it, you're very likely to get some kind of governmental interference and probably an inflation by judicial degree or by threats of the government to, in effect, extend the terms of the policy beyond what the insurance company thought it was insuring. Now, an insurance company that's had that kind of experience is going to be very reluctant to write insurance policies in the future if they don't think that the words will be adhered to.	0
	And on the other hand, I can fully understand some guy who's had his house blown away in a storm, and a lot of it was water damage and a lot of it was wind damage, thinking that, you know, he's been wiped out, and the insurance company comes around waiving a policy that's got a lot of small print in it. You know, he's going to be unhappy. So it's a real tussle on that.	0
	And, you know, I guess I would, if I were writing policies, I would put the exclusions in very big type and very easy to understand.	0
	But I still would expect that if thousands of people suffered losses, that courts and legislators would probably seek to stretch the terms or even abrogate the terms of the contract in order to take care of their own constituents and figure that guys like me or institutional investors who own insurance companies can afford it better than the homeowner.	0
	When you get into the question of whether you should, in effect, have all of the people in the country pay premiums for, we'll say, hurricanes, in a way subsidize it through policies in Nebraska or Minnesota or someplace, for hurricanes in Florida. That gets very tough.	0
	I mean, it can be very expensive to insure hurricanes if hurricanes become more frequent and more intense. In fact, it can become so expensive that people really will not want to bear the cost of insurance and they'll want to socialize it some way. And, of course, the guy in Nebraska says, lookit, you went down there to live on the ocean, and, you know, you thought it was wonderful, and we're back here with these terrible winters, but why should we pay a portion of your insurance?	0
	So you're going to have that tussle go on, and you'll really have that tussle go on if you get a $100 billion or $150 billion insured loss in Florida because that will mean a huge change in taxation. If the state of Florida steps in to compensate people, there'll be calls for Washington to pay for it.	0
	But, you know, it's how much people who are not exposed to a risk should pay for the people who have elected to be exposed to the risk is, you know, it becomes a political question. And my guess is that sometime in the next five or ten years, you'll see a struggle on that subject that exceeds, far exceeds what we saw on Katrina. Charlie? I've got nothing to add. Number 14. Hi.	0
	My name is Glenn Tung, and I'm a shareholder from New York. I'd like to congratulate you on Berkshire's newest director. Sue is a terrific addition. My question is... We agree with you. My question is, according to the 10Q filed yesterday, you purchased about $5 .3 billion in shares in the first quarter. This acceleration in activities occurring while the general market levels are getting more expensive.	0
	Does this indicate some shift in your thinking about hurdle rates of return for your ever -growing asset base and or your prospects for an elephant -sized acquisition? Well, that's a good question. I would... Incidentally, I would say in the first quarter, actually, stocks didn't rise, but they've risen a lot in April. But they didn't go down either. I mean, they were pretty much flat. And we did invest $5 billion or so in equities.	0
	Did we change our standards? You know, I don't think so. But, you know, you can't be 100 % sure that you haven't... You know, if you haven't had a date for a month, you know, you may say that was a girl you would have dated the first day. But who knows? So, I don't know for sure the answer. But I think we would have dated that girl the first day.	0
	And the second question, in terms of... Does it reflect giving up on finding an elephant to acquire in terms of a business? The answer to that is no. We've got plenty of... We would sell stocks if we really... I mean, that would not be a problem if we really needed to, to buy a really big business. So, we're as prepared as we've ever been prepared to buy a big business outright.	0
	We hope we do. We hope we buy relatively small ones if they're attractive. We bought a very attractive business, TTI run by Paul Andrews. Terrific business in the first quarter. And, you know, I wish it was five times the size, but maybe it will be someday. But we know that we're in with the kind of person we want and the kind of business we want. And if we find larger ones, one way or another, we'll swing them. Charlie? Charlie? Yeah.	0
	The one thing I think we can promise you is that we won't make returns on average in the kind of stuff we're buying now, like those that we made 10 or 15 years ago. Yeah. We won't come close. No. It's a different world with more modest expectations. And we hope you share them. Let's go to number one. Hello, Charlie. Warren.	0
	Bill Paparella from St. James, New York. Warren, I brought my 10 -year -old daughter, Gina, with me. She asked me last summer, how do I get rich? She asked me last summer, how do I get rich? So I gave her your letters, writings, even gave her Charlie's Almanac. So she's been reading ever since, asking me a lot of questions.	0
	So I said maybe we'll go to our first meeting together. Is she married? I mean, she's the kind of girl that I want my granddaughter or grandson to meet. So we're learning together. Warren, my question for you is in regards to your recent charitable gifts.	0
	And if I could start by saying that I mean no disrespect, you're my hero, nor is it political. You're doing fine so far. Okay.	0
	I am, as a father of five daughters, perplexed and upset that one, or I've read that one or more of these foundations is a big supporter of Planned Parenthood and abortion rights.	0
	If you were to go on the Planned Parenthood website, you would see a website that promotes promiscuity, goes out of its way to support internet porn. Let's get to the question, please. Do you have a question?	0
	The question is, Warren, I was hoping that you could speak to the billions of dollars that's been allocated with an agency as Planned Parenthood that is very well funded. It just doesn't seem to jive with the hero that I study. And I was hoping that you could speak to it. Yeah, well, I'll be glad to speak to it. I think it's a terrific organization.	0
	And I really think it's too bad that for millennia, you know, women, not only in the United States, but all over the world, have had involuntary bearing of babies forced upon them, and usually by a government run by men.	0
	So I don't think we want to get into a... We don't want to get into a cheering contest here, but, you know, I think that it's a very important issue. I think it tends to have a small natural funding constituency because it isn't a popular type thing where it's like sticking your name on a hospital or something like that.	0
	But I would say that if we'd had a Supreme Court with nine women on it, starting when the country became the United States, that by now, I don't think a question like yours is what he did in the United States. You know, men set the rules for a lot of years, and I think it's wonderful that a woman can make reproductive choices.	0
	But, you know, we've got a lot of people that disagree with me on that. I've got a lot of people that agree with me on it, and I hope you'll respect my opinion as I do yours. Thank you. Thank you. Number two, please. Hi. I'm Bob Klein from Los Angeles.	0
	Pursuing your earlier comments on sigmas from a different angle, the conventional wisdom in the investment world is that an investment's risk can be measured by the volatility of the price of the investment in the marketplace.	0
	To me, this approach has it backwards since changes in price are determined by the changes in the opinions of investors in the marketplace, why would a rational investor substitute the opinions of the marketplace as reflected in the volatility of the price for his own assessment of the risk of the investment?	0
	And consultants take this idea further by tracking the volatility of a portfolio manager's results in an attempt to measure risk. So could you guys expand on your thoughts on this? Yes. Volatility does not measure risk.	0
	And the problem is that the people who have written and taught about volatility do not know how to measure, or taught about risk, do not know how to measure risk. And the nice thing about data, which is a measure of volatility, is that it's nice and mathematical and wrong in terms of measuring risk. It's a measure of volatility, but past volatility does not determine the risk of investing.	0
	I mean, actually take it with farmland here. In 1980, or in the early 1980s, farms that sold for $2 ,000 an acre went to $600 an acre. I bought one of them. When the banking and farm crash took place, and the beta of farms shot way up.	0
	And according to standard economic theory, market theory, I was buying a much more risky asset at $600 an acre than the same farm was at $2 ,000 an acre. Now, people, because farmland doesn't trade often and prices don't get recorded, you know, they would regard that as nonsense, that my purchase of $600 an acre of the same farm that sold for $2 ,000 an acre a few years ago was riskier.	0
	But in stocks, because the prices jiggle around every minute, and because it lets the people who teach finance use the mathematics they've learned, they have, in effect, they would explain this away a little more technically, but they have, in effect, translated volatility into all kinds of, past volatility in terms of all kinds of measures of risk. And it's nonsense.	0
	Risk comes from the nature of certain kinds of businesses. It can be risky to be in some businesses just by the simple economics of the type of business you're in. And it comes from not knowing what you're doing.	0
	And, you know, it is, if you understand the economics of the business in which you are engaged and you know the people with whom you're doing business and you know the price you pay and is sensible, you don't run any real risk.	0
	And I don't think Charlie and I, certainly at Berkshire, I don't think we've ever had a permanent loss in marketable securities that was, what, 1 % maybe? Half a percent of net worth?	0
	I made a terrible mistake in buying Dexter Shoe which cost us significantly more than 1 % of net worth where I bought an entire business then. But I was wrong about the business. It had nothing to do with the volatility of shoe prices or leather or anything else. I just was wrong.	0
	But in terms of marketable securities, I cannot recall a case where we've lost, I mean, we've done a lot of things in securities that had a very high beta. We've done a lot of things in securities that had a low beta. It just, the whole development of volatility as a measure of risk has really occurred in my and it's been very useful for people who wanted a career in teaching.	0
	But it is not, we've never found a way for it to be useful to us. Charlie? Charlie? Well, it's been amazing that both corporate finance and investment management courses as taught in the major universities, we would argue it's at least 50 % twaddle. And yet these people have very high IQs.	0
	One of the reasons we've been able to do pretty well is that we early recognized that very smart people do very dumb things and we tried to figure out why. And we also wanted to know who so we could avoid them. And we will not run big risks at Berkshire.	0
	Now, we will be willing to lose, as I put in the annual report, $6 billion in a given catastrophe. But our catastrophe business, run over many years, is not risky. You know, a roulette wheel will occasionally pay off at $35 to $1. And that sounds like you're paying out an awful lot of money compared to the amount that you bet on one number. But I would love to own a lot of roulette wheels. Number three.	0
	Hi. My name is Stuart Kaye and I'm from New York City. Warren and Charlie, you spend a lot of time evaluating the management quality and integrity of the companies that you may invest in. In my current job, I do not have the opportunity to do that.	0
	As I read through annual reports and financial statements, what do you suggest I focus on to help me to determine the quality and integrity of management? Well, you can, we spent many, many years and we bought many things.	0
	I mean, I, without meeting managements at all, having any entree to them, the stocks, the five billion of stocks that we may have bought in the first quarter, most of those were companies I've never met the management, never talked to them. We read a lot. We read annual reports. We read about competitors. We read about the industries they're in.	0
	In terms of sizing up managements, obviously, if we're going to buy the whole business, that's a different question than you, because we're going to buy it, be in bed with them, they're going to run them and we care very much about whether, whether they're going to behave in the future as they have in the past once we own the business and we've had very good luck on that. But in terms of marketable securities, we read the reports.	0
	Now, Charlie and I were just talking about one the other day where we read an annual report of a large oil company and the company, you know, 100 pages, public relations people, lots of pictures, spent a fortune on it and you can't find in that report what their finding cost per MCF or per barrel of oil was last year.	0
	That's the most important figure in an oil and gas company over a period of years, but every year counts. The fact it wouldn't even be discussed, the reason it wasn't discussed, it was absolutely terrible, but the fact it wouldn't even be discussed and to the extent it was touched on, it was done in a dishonest manner. When we read things where we basically are getting dishonest messages from the management, it makes a difference to us.	0
	You know, like I say, in marketable securities, we can solve that by selling the stock and it's not the same thing as buying the entire business. But I think you can learn a lot by reading the annual letters. I mean, for one thing, if it's clearly the product of some investor relations department or outside consultant or something of the sort, you know, that tells you something about the individual.	0
	If he's not willing to talk once a year through a few pages to the people that gave him their money to invest, I mean, I've got some questions about people like that. So I like that feeling that I'm hearing directly from somebody who regards me as a partner and you may not get it all the way, but when I get it zero percent of the way, I don't like it.	0
	I've still bought, we've still bought into some, in marketable securities, we've bought into some extremely good businesses where we thought they were run by people we didn't really like very well. We didn't feel they could screw them up. Charlie? Charlie? Yeah, I think that's exactly right. There are two things, the quality of the business and the quality of the management. And if the business is good enough, it will carry a lousy manager.	0
	And the converse case, where a really good manager gets in a really lousy business, you'll ordinarily have a very imperfect record. In other words, it's a rare person that can take over a textile business totally doomed, which is what Warren did in his youthful folly. Right? And turn it into what's happened here. You should not be looking for other Warrens on the theory they're under every bush.	0
	I figured it out in 20 years, though. I'll have to say that for myself. 20 years and I finally figured out I was in the wrong business. But there are businesses. If you gave me first draft pick of all the CEOs in America and said, it's your job to run Ford Motor now or, you know, pick a company that's in a terribly tough business, you know, I wouldn't do it. I mean, it's just too tough.	0
	They may get it solved, you know, if they get cooperation from unions and a whole bunch of things, but it will not be solely in the control of the CEO who has that job. He is dependent on too many good things happening outside to say that he alone can get the job, even if he's the best in the world. Number four. Hi, Warren. Hi, Charlie. I'm Walter Chang from San Jose, California.	0
	My wife and I are expecting our first baby boy in July and we're going to name him Warren after you. You're trying to get into my world again. I'm rooting for you for the next one. I'd move him further down the line, maybe number five. Warren and Charlie.	0
	Warren, if you were writing a follow -up to the very prescient Forbes, I'm sorry, Fortune Magazine article from November 1999 in which you were talking about the lean and fat 17 -year periods, what would you be writing? And since we're halfway through this third 17 -year period, how is it turning out based on your expectations from back in 1999?	0
	Yeah, the 17 years, of course, I had a little fun with because of the fact that there were two 17 -year periods and there are also 17 -year locus, so I stretched it a little from a literary standpoint, but there's nothing magic about given spans of time. There was something very different between the first 17 years of that 34 -year period and the second 17, and I used that for kind of a dramatic contrast.	0
	If I were writing something now, I would say what I said just a little earlier in response to Frank Martin's question, that it is, if I had to own long bonds or long -term position equities, I'd rather have equities, but I would not have high expectations for them, but I would have expectations beyond four and three -quarters percent. How much beyond, I'm not sure, but something enough beyond four and three -quarters percent that I would rather own equities than bonds.	0
	I did not feel, I felt in 1999 that people were extrapolating the experience of the previous 17 years and assuming there was something magic about owning equities and expectations of the people were bound to be, the people were bound to be disappointed. They simply had an unrealistic view by extrapolation and that was the main purpose of that article.	0
	But if I were writing something now, I would not, I would not have high expectations for equities, but I would have better expectations for equities than for bonds. Charlie? Charlie W. Yeah, and I would say that since that article was written, the results from owning equities have been pretty lean, at least compared to what happened in the glorious 17 years that preceded.	0
	So Warren has been right so far and he's probably right now when he says modest expectations. you really don't have, in markets, you can't say something terribly important or intelligent every day or every week or every month.	0
	That's one of the problems of if you went on television too often or to write weekly letters or something of the sort. Every now and then you get something extreme. I mean, I did close down the partnership in 1969 and an article appeared. I did give an interview in 74. I gave another interview in 81 or 82. I mean, every now and then things really get out of whack. But the gradations in between, they're too tough.	0
	But the nice thing about it is you don't have to have an opinion every day or every week or every month. You know, if you own some good businesses and you bought them at the right price, if they get to a silly price, you probably should sell them. And if you find that everything is extremely cheap, like in 74, you should put every available dime into equities. And that's what we've tried to do. Number five. Yes, thank you, gentlemen, for this opportunity to ask you a question.	0
	My name is Ronnie Pellegrini and this is my 14 -year -old daughter, Michaela. We are here representing hundreds of ocean commercial hook and line salmon fishermen and their families from the West Coast. They are barely hanging on to their livelihoods because of the Klamath River crisis. My husband is a fourth generation hook and line commercial fisherman from Eureka, California.	0
	His family has fished for the last 100 years. Last year, our commercial salmon season was completely shut down because of the crisis in the Klamath River. It is caused by the four lower hydroelectric dams owned by your subsidiary, Pacific Corps.	0
	We personally took a 95 % hit in our income, excuse me, and we had no way to make up that loss. We have used our savings and were forced to take out a small business administration disaster loan to meet our financial needs. Our daughters were so upset after overhearing my husband and I last Christmas.	0
	They came to us wanting to give us all the money in their bank accounts. I am telling you this, gentlemen, and shareholders, because you and the shareholders can help. Under Klamath Dam relicensing, it is shown that this dam removal makes economic sense for Pacific Corps and Mid -American.	0
	You are a great businessman who have built an incredible empire. We sure could use your creativity and expertise in solving this crisis situation so the Indian people along the river and we in the coastal communities can continue our long and proud heritage.	0
	People back home are eagerly waiting for me to bring a response back from you. My question is, what can I tell them is your position on removing the outdated Klamath dams? Yes. Our position on it is quite simple.	0
	The FERC and several of the regulatory commissions have before them 27 different proposals or positions by various interest groups. Some want, some like hydropower which is what comes from the dams because it does not generate the emissions that come from coal or gas fired generation.	0
	Some like the fact that hydropower is cheaper, several hundred thousand consumers. Some people have been hurt by what you describe in terms of the fish. and you have a public policy question which will not be determined by Pacific Corp. It will be determined by FERC because they represent the public. In fact, the Secretary of Interior has advised FERC that it's a very tough question.	0
	FERC will be having, they will listen to the positions. The Oregon and Utah, California perhaps, public utility commissions will be listening to the arguments and in the end we are a public utility responding to public policy, public policy weighing both your interests and the interests of others in the matter will come to a determination and Pacific Corp will do exactly what they say.	0
	We are responsive to the, to the people that regulate us just as people have been in that position since the first dam was put in 1906. So that is entirely a question for FERC and the, and the state commissions. Number six. Good afternoon, Mr. Buffett and Mr. Munger. Thank you for taking my question.	0
	This is my second time at the Berkshire Hathaway meeting that I have attended. My name is Cameron Sparrow. I am 13 years old and from Boulder, Colorado. Colorado. My question is for Mr. Buffett. Mr. Buffett, what is your opinion about the merger of the New York Stock Exchange with the Euronext? Do you think this, that the merger will have a positive or negative effect on the market?	0
	Well, I really don't know the answer to that. My guess is that, I mean, both of those institutions were very large institutions beforehand and we would judge a positive effect in terms of narrowness of spreads as an investor in terms of cost of execution and that sort of thing. both places have been very efficient in the past.	0
	I mean, we pay quite low payments, although my broker is here, we probably should be paying even less. But the both, the New York Stock Exchange has gotten far more efficient in terms of costs from 30 years, from the days of fixed commissions back in the early 70s and before that. I mean, it's a fraction of the cost. And the real test from our standpoint is, you know, do we get better executions and less costly executions?	0
	And like I say, both institutions were big, big effective institutions beforehand. If they get a little more efficient, I hope it gets passed on to the customers, but it may just result in larger profit. But we're pretty satisfied, quite satisfied, actually, with the functioning. And the New York Stock Exchange is where we do most of our business. But we've done business, we've been buying international stocks and we've had generally good executions throughout the world.	0
	So it's not a source of either concern or enthusiasm to me. Charlie? I don't know anything about it. I don't either, but I took longer to say so. Number seven, please. Mr. Buffett and Mr. Bunger, thanks for hosting this wonderful meeting.	0
	I'm, my name is Chandr Chawla and I'm visiting from Seattle, Washington. And I think Berkshire Hathaway can contribute to the reduction of global warming if for next year's shareholder meeting, Mr. Gates and I fly on the same plane.	0
	my question is, I have made a few mistakes in business by trusting the wrong people. people. So in, and I don't know where to learn how to trust the right people. They don't teach you that in business school and the people who are supposed to teach you in the corporate world sometimes betray you. So, how can I learn who to trust and who not to trust?	0

Okay. If you're ready, we are. We're going to keep going in the same order because there's people in the other rooms that have been waiting, so we will go to number 11. Hi. My name is Christian Baha from Superfund. I have a question for you, Mr. Buffett.

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What do you think about managed futures funds? About which one? I didn't quite get that. What kind of fund? Managed futures funds, like a very well -diversified portfolio in stocks and bonds, going long and short, all the different markets, based on the most natural human behavior, trend -following or hurt behavior. Managed futures funds.

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Well, I would say that we think the most logical fund is the one we have at Berkshire, where essentially we can do anything that makes sense, and are not compelled to do anything that we don't think makes sense.

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So any entity that is devoted to a limited segment of the financial market, we would regard as being at a disadvantage to one that has total authority, if you have the right person in charge. But that's an assumption you're going to make under any fund.

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So we would not want to devote our funds to something that was only going to buy bonds, something that was only going to buy futures, or anything of the sort. We buy futures at Berkshire. We buy bonds at Berkshire. We buy currencies. We buy businesses. So I think it's a mistake to shrink the universe of possibilities.

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Ours is shrunk simply by size, but we don't set out to circumscribe our actions in any way. But in the end, there's no form that produces investment results. Hedge funds don't produce investment results. Private equity doesn't produce investment results. Mutual funds don't produce it. That if it was simply a matter of form, we'd all call ourselves, you know, whatever that form happened to be.

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What really makes the difference is whether the person that's running it knows what their limitations are, knows where their strengths are, plays when they have the opportunity to play advantageously, and stays out when they don't see any opportunities. Charlie? Yeah, I'd go further. I'd say averaged out, I would expect that the return per dollar per year in managed futures funds would be somewhere between lousy and negative.

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And I would agree with that. Yeah. Yeah. Usually those are sales tools. I mean, people find out something that will sell, and it can be, you know, it can be bond funds at some point, it can be, but when they find something that can sell, it'll get sold to the public. It will sell till it stops selling. And that means lots of money comes in and lots of competition for a limited number of opportunities.

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And I think it's a mistake to get sold something on the basis that here is a great area of opportunity. Areas don't make opportunities. Brains make opportunities, basically. Number 12. Matthew Monaghan from Palo Alto, California. Mr. Buffett, Mr. Munger, First of all, I want to thank both of you for so freely sharing your wisdom and knowledge over the years.

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Even though we've never met in person, I consider you both to be close personal mentors and attribute your teachings and philosophies to any success I've had in business so far. So thank you. Here's my question. For a 23 -year -old with high ambitions, some initial working capital, and a genetic wiring, as you call it, for disciplines like investments, mathematics, and technology, what do you foresee as the significant areas of opportunity over the next 50, even 100 years?

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And if you were in my shoes, what would be your approach and methodology for really learning, tackling, and mastering these areas of opportunity for the purpose of massive value creation?

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Well, I remain very... And frankly, when you get the chance to talk to somebody like Lorimer Davidson, as I did when I was 20 years old, I probably learned more from Lorimer Davidson in those four or five hours than I learned in college, with the exception of learning some accounting, and one or two subjects like that. So you just want to soak it up.

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If you have those qualities you talked about, you'll see the areas as you go along. I mean, we have... Charlie and I probably, you know, we've made money in a lot of different ways, some of which we didn't anticipate, you know, when we were 30 or 40 years ago. But we did have the ability to recognize some. We didn't have the ability to recognize others. But we did know when we knew what we were doing and when we didn't.

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And we just kept looking. We had a curiosity about things. You would know at a time like the long -term capital management crisis, for example, that there were going to be ways to make money. I mean, it just was... They were going to be out there, and all you had to do was just read and think eight or ten hours a day, and you were going to cover a lot of possibilities, probably a very high percentage of them good, and some of them sensational. So you can't really lay it out ahead of time.

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You can't have a... You can't have a defined roadmap. But you can have a reservoir of thinking, looking at different kinds of businesses, looking at different kinds of securities, looking at markets in different places. And you will then spot a reasonable number of things that come along. You won't spot every one of them. We've missed all kinds of things.

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But the biggest thing, too, is to have something in the way you're programmed so that you don't ever do anything where you can lose a lot. I mean, our best ideas have not been better than other people's best ideas, but we've never had a lot of things that pulled us way back. So we never went two steps forward and one step back. We probably went two steps forward and a fraction of a step back.

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But avoiding the catastrophes is a very important thing, and it will be important in the future. I mean, you will have your chance to participate in catastrophes. Charlie? Yeah, and of course, the place to look when you're young is in the inefficient markets. You shouldn't be trying to guess whether, you know, one drug company has a better drug pipeline than another. You want to go when you're young someplace that's very inefficient.

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And you shouldn't be trying to guess whether the stock market's going to go up or whether long -term bonds are going to change in yield. I mean, you don't have anything going in that kind of a game. But you can have a lot going in games that very few people are playing and maybe where they even got their heads screwed on wrong in terms of how they're thinking about the subject. The RTC was a great example of a chance to make a lot of money.

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I mean, here was a seller of hundreds of billions of dollars worth of real estate where the people that were selling it had no economic interest in it, were eager to wind up the thing, you know, and they were selling it at a terrible time when the people who had been venturesome in lending were no longer lending. The people who had been venturesome in the equity end of real estate had gotten cleaned out. So you had a great background of environment, and then you had an imbalance of intensity in terms of analyzing situations.

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between the seller, which was the government, with a bunch of people who had no economic interest in it and were probably eager to wind up the job, and buyers on the other side who were of the generally cautious type because the more venturesome type had taken themselves out of action. And there were huge amounts of property. So you get these opportunities, and you'll get more. I mean, there won't be any scarcity of opportunities in your life, although there will be days when you feel that way.

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Okay, let's go to the other rooms now. They've been waiting. Number 13. John Goss, Key West, Florida. Katrina created litigation that resulted in some rulings that combined flood damage and wind damage, where the insurance companies thought they covered wind only. As a result, some insurance companies are significantly reducing coverage in those states.

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Florida recently empowered their insurance company, called Citizens, to be more aggressive not only with Windstorm, but also with homeowners, while at the same time not allowing requested rate increases of other insurance companies. The result is that some solid insurance companies have announced reducing their coverage or pulling out of Florida. Is this type of government interference a random fluctuation in insurance or a major cause of concern for the future?

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Well, that's an easy one to understand both sides of the question on. I mean, the average homeowner is not going to sit there and there's an insurance policy, and a lot of times the agent is not going to explain it carefully to them. So when something comes along and he thinks it's insured, and it turns out that he bought a policy where it wasn't insured, he's going to feel very unhappy about it.

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And when tens of thousands of people feel unhappy about it, you're very likely to get some kind of governmental interference and probably an inflation by judicial degree or by threats of the government to, in effect, extend the terms of the policy beyond what the insurance company thought it was insuring. Now, an insurance company that's had that kind of experience is going to be very reluctant to write insurance policies in the future if they don't think that the words will be adhered to.

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And on the other hand, I can fully understand some guy who's had his house blown away in a storm, and a lot of it was water damage and a lot of it was wind damage, thinking that, you know, he's been wiped out, and the insurance company comes around waiving a policy that's got a lot of small print in it. You know, he's going to be unhappy. So it's a real tussle on that.

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And, you know, I guess I would, if I were writing policies, I would put the exclusions in very big type and very easy to understand.

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But I still would expect that if thousands of people suffered losses, that courts and legislators would probably seek to stretch the terms or even abrogate the terms of the contract in order to take care of their own constituents and figure that guys like me or institutional investors who own insurance companies can afford it better than the homeowner.

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When you get into the question of whether you should, in effect, have all of the people in the country pay premiums for, we'll say, hurricanes, in a way subsidize it through policies in Nebraska or Minnesota or someplace, for hurricanes in Florida. That gets very tough.

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I mean, it can be very expensive to insure hurricanes if hurricanes become more frequent and more intense. In fact, it can become so expensive that people really will not want to bear the cost of insurance and they'll want to socialize it some way. And, of course, the guy in Nebraska says, lookit, you went down there to live on the ocean, and, you know, you thought it was wonderful, and we're back here with these terrible winters, but why should we pay a portion of your insurance?

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So you're going to have that tussle go on, and you'll really have that tussle go on if you get a $100 billion or $150 billion insured loss in Florida because that will mean a huge change in taxation. If the state of Florida steps in to compensate people, there'll be calls for Washington to pay for it.

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But, you know, it's how much people who are not exposed to a risk should pay for the people who have elected to be exposed to the risk is, you know, it becomes a political question. And my guess is that sometime in the next five or ten years, you'll see a struggle on that subject that exceeds, far exceeds what we saw on Katrina. Charlie? I've got nothing to add. Number 14. Hi.

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My name is Glenn Tung, and I'm a shareholder from New York. I'd like to congratulate you on Berkshire's newest director. Sue is a terrific addition. My question is... We agree with you. My question is, according to the 10Q filed yesterday, you purchased about $5 .3 billion in shares in the first quarter. This acceleration in activities occurring while the general market levels are getting more expensive.

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Does this indicate some shift in your thinking about hurdle rates of return for your ever -growing asset base and or your prospects for an elephant -sized acquisition? Well, that's a good question. I would... Incidentally, I would say in the first quarter, actually, stocks didn't rise, but they've risen a lot in April. But they didn't go down either. I mean, they were pretty much flat. And we did invest $5 billion or so in equities.

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Did we change our standards? You know, I don't think so. But, you know, you can't be 100 % sure that you haven't... You know, if you haven't had a date for a month, you know, you may say that was a girl you would have dated the first day. But who knows? So, I don't know for sure the answer. But I think we would have dated that girl the first day.

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And the second question, in terms of... Does it reflect giving up on finding an elephant to acquire in terms of a business? The answer to that is no. We've got plenty of... We would sell stocks if we really... I mean, that would not be a problem if we really needed to, to buy a really big business. So, we're as prepared as we've ever been prepared to buy a big business outright.

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We hope we do. We hope we buy relatively small ones if they're attractive. We bought a very attractive business, TTI run by Paul Andrews. Terrific business in the first quarter. And, you know, I wish it was five times the size, but maybe it will be someday. But we know that we're in with the kind of person we want and the kind of business we want. And if we find larger ones, one way or another, we'll swing them. Charlie? Charlie? Yeah.

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The one thing I think we can promise you is that we won't make returns on average in the kind of stuff we're buying now, like those that we made 10 or 15 years ago. Yeah. We won't come close. No. It's a different world with more modest expectations. And we hope you share them. Let's go to number one. Hello, Charlie. Warren.

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Bill Paparella from St. James, New York. Warren, I brought my 10 -year -old daughter, Gina, with me. She asked me last summer, how do I get rich? She asked me last summer, how do I get rich? So I gave her your letters, writings, even gave her Charlie's Almanac. So she's been reading ever since, asking me a lot of questions.

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So I said maybe we'll go to our first meeting together. Is she married? I mean, she's the kind of girl that I want my granddaughter or grandson to meet. So we're learning together. Warren, my question for you is in regards to your recent charitable gifts.

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And if I could start by saying that I mean no disrespect, you're my hero, nor is it political. You're doing fine so far. Okay.

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I am, as a father of five daughters, perplexed and upset that one, or I've read that one or more of these foundations is a big supporter of Planned Parenthood and abortion rights.

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If you were to go on the Planned Parenthood website, you would see a website that promotes promiscuity, goes out of its way to support internet porn. Let's get to the question, please. Do you have a question?

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The question is, Warren, I was hoping that you could speak to the billions of dollars that's been allocated with an agency as Planned Parenthood that is very well funded. It just doesn't seem to jive with the hero that I study. And I was hoping that you could speak to it. Yeah, well, I'll be glad to speak to it. I think it's a terrific organization.

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And I really think it's too bad that for millennia, you know, women, not only in the United States, but all over the world, have had involuntary bearing of babies forced upon them, and usually by a government run by men.

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So I don't think we want to get into a... We don't want to get into a cheering contest here, but, you know, I think that it's a very important issue. I think it tends to have a small natural funding constituency because it isn't a popular type thing where it's like sticking your name on a hospital or something like that.

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But I would say that if we'd had a Supreme Court with nine women on it, starting when the country became the United States, that by now, I don't think a question like yours is what he did in the United States. You know, men set the rules for a lot of years, and I think it's wonderful that a woman can make reproductive choices.

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But, you know, we've got a lot of people that disagree with me on that. I've got a lot of people that agree with me on it, and I hope you'll respect my opinion as I do yours. Thank you. Thank you. Number two, please. Hi. I'm Bob Klein from Los Angeles.

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Pursuing your earlier comments on sigmas from a different angle, the conventional wisdom in the investment world is that an investment's risk can be measured by the volatility of the price of the investment in the marketplace.

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To me, this approach has it backwards since changes in price are determined by the changes in the opinions of investors in the marketplace, why would a rational investor substitute the opinions of the marketplace as reflected in the volatility of the price for his own assessment of the risk of the investment?

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And consultants take this idea further by tracking the volatility of a portfolio manager's results in an attempt to measure risk. So could you guys expand on your thoughts on this? Yes. Volatility does not measure risk.

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And the problem is that the people who have written and taught about volatility do not know how to measure, or taught about risk, do not know how to measure risk. And the nice thing about data, which is a measure of volatility, is that it's nice and mathematical and wrong in terms of measuring risk. It's a measure of volatility, but past volatility does not determine the risk of investing.

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I mean, actually take it with farmland here. In 1980, or in the early 1980s, farms that sold for $2 ,000 an acre went to $600 an acre. I bought one of them. When the banking and farm crash took place, and the beta of farms shot way up.

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And according to standard economic theory, market theory, I was buying a much more risky asset at $600 an acre than the same farm was at $2 ,000 an acre. Now, people, because farmland doesn't trade often and prices don't get recorded, you know, they would regard that as nonsense, that my purchase of $600 an acre of the same farm that sold for $2 ,000 an acre a few years ago was riskier.

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But in stocks, because the prices jiggle around every minute, and because it lets the people who teach finance use the mathematics they've learned, they have, in effect, they would explain this away a little more technically, but they have, in effect, translated volatility into all kinds of, past volatility in terms of all kinds of measures of risk. And it's nonsense.

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Risk comes from the nature of certain kinds of businesses. It can be risky to be in some businesses just by the simple economics of the type of business you're in. And it comes from not knowing what you're doing.

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And, you know, it is, if you understand the economics of the business in which you are engaged and you know the people with whom you're doing business and you know the price you pay and is sensible, you don't run any real risk.

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And I don't think Charlie and I, certainly at Berkshire, I don't think we've ever had a permanent loss in marketable securities that was, what, 1 % maybe? Half a percent of net worth?

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I made a terrible mistake in buying Dexter Shoe which cost us significantly more than 1 % of net worth where I bought an entire business then. But I was wrong about the business. It had nothing to do with the volatility of shoe prices or leather or anything else. I just was wrong.

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But in terms of marketable securities, I cannot recall a case where we've lost, I mean, we've done a lot of things in securities that had a very high beta. We've done a lot of things in securities that had a low beta. It just, the whole development of volatility as a measure of risk has really occurred in my and it's been very useful for people who wanted a career in teaching.

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But it is not, we've never found a way for it to be useful to us. Charlie? Charlie? Well, it's been amazing that both corporate finance and investment management courses as taught in the major universities, we would argue it's at least 50 % twaddle. And yet these people have very high IQs.

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One of the reasons we've been able to do pretty well is that we early recognized that very smart people do very dumb things and we tried to figure out why. And we also wanted to know who so we could avoid them. And we will not run big risks at Berkshire.

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Now, we will be willing to lose, as I put in the annual report, $6 billion in a given catastrophe. But our catastrophe business, run over many years, is not risky. You know, a roulette wheel will occasionally pay off at $35 to $1. And that sounds like you're paying out an awful lot of money compared to the amount that you bet on one number. But I would love to own a lot of roulette wheels. Number three.

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Hi. My name is Stuart Kaye and I'm from New York City. Warren and Charlie, you spend a lot of time evaluating the management quality and integrity of the companies that you may invest in. In my current job, I do not have the opportunity to do that.

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As I read through annual reports and financial statements, what do you suggest I focus on to help me to determine the quality and integrity of management? Well, you can, we spent many, many years and we bought many things.

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I mean, I, without meeting managements at all, having any entree to them, the stocks, the five billion of stocks that we may have bought in the first quarter, most of those were companies I've never met the management, never talked to them. We read a lot. We read annual reports. We read about competitors. We read about the industries they're in.

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In terms of sizing up managements, obviously, if we're going to buy the whole business, that's a different question than you, because we're going to buy it, be in bed with them, they're going to run them and we care very much about whether, whether they're going to behave in the future as they have in the past once we own the business and we've had very good luck on that. But in terms of marketable securities, we read the reports.

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Now, Charlie and I were just talking about one the other day where we read an annual report of a large oil company and the company, you know, 100 pages, public relations people, lots of pictures, spent a fortune on it and you can't find in that report what their finding cost per MCF or per barrel of oil was last year.

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That's the most important figure in an oil and gas company over a period of years, but every year counts. The fact it wouldn't even be discussed, the reason it wasn't discussed, it was absolutely terrible, but the fact it wouldn't even be discussed and to the extent it was touched on, it was done in a dishonest manner. When we read things where we basically are getting dishonest messages from the management, it makes a difference to us.

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You know, like I say, in marketable securities, we can solve that by selling the stock and it's not the same thing as buying the entire business. But I think you can learn a lot by reading the annual letters. I mean, for one thing, if it's clearly the product of some investor relations department or outside consultant or something of the sort, you know, that tells you something about the individual.

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If he's not willing to talk once a year through a few pages to the people that gave him their money to invest, I mean, I've got some questions about people like that. So I like that feeling that I'm hearing directly from somebody who regards me as a partner and you may not get it all the way, but when I get it zero percent of the way, I don't like it.

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I've still bought, we've still bought into some, in marketable securities, we've bought into some extremely good businesses where we thought they were run by people we didn't really like very well. We didn't feel they could screw them up. Charlie? Charlie? Yeah, I think that's exactly right. There are two things, the quality of the business and the quality of the management. And if the business is good enough, it will carry a lousy manager.

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And the converse case, where a really good manager gets in a really lousy business, you'll ordinarily have a very imperfect record. In other words, it's a rare person that can take over a textile business totally doomed, which is what Warren did in his youthful folly. Right? And turn it into what's happened here. You should not be looking for other Warrens on the theory they're under every bush.

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I figured it out in 20 years, though. I'll have to say that for myself. 20 years and I finally figured out I was in the wrong business. But there are businesses. If you gave me first draft pick of all the CEOs in America and said, it's your job to run Ford Motor now or, you know, pick a company that's in a terribly tough business, you know, I wouldn't do it. I mean, it's just too tough.

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They may get it solved, you know, if they get cooperation from unions and a whole bunch of things, but it will not be solely in the control of the CEO who has that job. He is dependent on too many good things happening outside to say that he alone can get the job, even if he's the best in the world. Number four. Hi, Warren. Hi, Charlie. I'm Walter Chang from San Jose, California.

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My wife and I are expecting our first baby boy in July and we're going to name him Warren after you. You're trying to get into my world again. I'm rooting for you for the next one. I'd move him further down the line, maybe number five. Warren and Charlie.

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Warren, if you were writing a follow -up to the very prescient Forbes, I'm sorry, Fortune Magazine article from November 1999 in which you were talking about the lean and fat 17 -year periods, what would you be writing? And since we're halfway through this third 17 -year period, how is it turning out based on your expectations from back in 1999?

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Yeah, the 17 years, of course, I had a little fun with because of the fact that there were two 17 -year periods and there are also 17 -year locus, so I stretched it a little from a literary standpoint, but there's nothing magic about given spans of time. There was something very different between the first 17 years of that 34 -year period and the second 17, and I used that for kind of a dramatic contrast.

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If I were writing something now, I would say what I said just a little earlier in response to Frank Martin's question, that it is, if I had to own long bonds or long -term position equities, I'd rather have equities, but I would not have high expectations for them, but I would have expectations beyond four and three -quarters percent. How much beyond, I'm not sure, but something enough beyond four and three -quarters percent that I would rather own equities than bonds.

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I did not feel, I felt in 1999 that people were extrapolating the experience of the previous 17 years and assuming there was something magic about owning equities and expectations of the people were bound to be, the people were bound to be disappointed. They simply had an unrealistic view by extrapolation and that was the main purpose of that article.

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But if I were writing something now, I would not, I would not have high expectations for equities, but I would have better expectations for equities than for bonds. Charlie? Charlie W. Yeah, and I would say that since that article was written, the results from owning equities have been pretty lean, at least compared to what happened in the glorious 17 years that preceded.

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So Warren has been right so far and he's probably right now when he says modest expectations. you really don't have, in markets, you can't say something terribly important or intelligent every day or every week or every month.

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That's one of the problems of if you went on television too often or to write weekly letters or something of the sort. Every now and then you get something extreme. I mean, I did close down the partnership in 1969 and an article appeared. I did give an interview in 74. I gave another interview in 81 or 82. I mean, every now and then things really get out of whack. But the gradations in between, they're too tough.

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But the nice thing about it is you don't have to have an opinion every day or every week or every month. You know, if you own some good businesses and you bought them at the right price, if they get to a silly price, you probably should sell them. And if you find that everything is extremely cheap, like in 74, you should put every available dime into equities. And that's what we've tried to do. Number five. Yes, thank you, gentlemen, for this opportunity to ask you a question.

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My name is Ronnie Pellegrini and this is my 14 -year -old daughter, Michaela. We are here representing hundreds of ocean commercial hook and line salmon fishermen and their families from the West Coast. They are barely hanging on to their livelihoods because of the Klamath River crisis. My husband is a fourth generation hook and line commercial fisherman from Eureka, California.

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His family has fished for the last 100 years. Last year, our commercial salmon season was completely shut down because of the crisis in the Klamath River. It is caused by the four lower hydroelectric dams owned by your subsidiary, Pacific Corps.

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We personally took a 95 % hit in our income, excuse me, and we had no way to make up that loss. We have used our savings and were forced to take out a small business administration disaster loan to meet our financial needs. Our daughters were so upset after overhearing my husband and I last Christmas.

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They came to us wanting to give us all the money in their bank accounts. I am telling you this, gentlemen, and shareholders, because you and the shareholders can help. Under Klamath Dam relicensing, it is shown that this dam removal makes economic sense for Pacific Corps and Mid -American.

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You are a great businessman who have built an incredible empire. We sure could use your creativity and expertise in solving this crisis situation so the Indian people along the river and we in the coastal communities can continue our long and proud heritage.

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People back home are eagerly waiting for me to bring a response back from you. My question is, what can I tell them is your position on removing the outdated Klamath dams? Yes. Our position on it is quite simple.

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The FERC and several of the regulatory commissions have before them 27 different proposals or positions by various interest groups. Some want, some like hydropower which is what comes from the dams because it does not generate the emissions that come from coal or gas fired generation.

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Some like the fact that hydropower is cheaper, several hundred thousand consumers. Some people have been hurt by what you describe in terms of the fish. and you have a public policy question which will not be determined by Pacific Corp. It will be determined by FERC because they represent the public. In fact, the Secretary of Interior has advised FERC that it's a very tough question.

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FERC will be having, they will listen to the positions. The Oregon and Utah, California perhaps, public utility commissions will be listening to the arguments and in the end we are a public utility responding to public policy, public policy weighing both your interests and the interests of others in the matter will come to a determination and Pacific Corp will do exactly what they say.

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We are responsive to the, to the people that regulate us just as people have been in that position since the first dam was put in 1906. So that is entirely a question for FERC and the, and the state commissions. Number six. Good afternoon, Mr. Buffett and Mr. Munger. Thank you for taking my question.

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This is my second time at the Berkshire Hathaway meeting that I have attended. My name is Cameron Sparrow. I am 13 years old and from Boulder, Colorado. Colorado. My question is for Mr. Buffett. Mr. Buffett, what is your opinion about the merger of the New York Stock Exchange with the Euronext? Do you think this, that the merger will have a positive or negative effect on the market?

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Well, I really don't know the answer to that. My guess is that, I mean, both of those institutions were very large institutions beforehand and we would judge a positive effect in terms of narrowness of spreads as an investor in terms of cost of execution and that sort of thing. both places have been very efficient in the past.

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I mean, we pay quite low payments, although my broker is here, we probably should be paying even less. But the both, the New York Stock Exchange has gotten far more efficient in terms of costs from 30 years, from the days of fixed commissions back in the early 70s and before that. I mean, it's a fraction of the cost. And the real test from our standpoint is, you know, do we get better executions and less costly executions?

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And like I say, both institutions were big, big effective institutions beforehand. If they get a little more efficient, I hope it gets passed on to the customers, but it may just result in larger profit. But we're pretty satisfied, quite satisfied, actually, with the functioning. And the New York Stock Exchange is where we do most of our business. But we've done business, we've been buying international stocks and we've had generally good executions throughout the world.

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So it's not a source of either concern or enthusiasm to me. Charlie? I don't know anything about it. I don't either, but I took longer to say so. Number seven, please. Mr. Buffett and Mr. Bunger, thanks for hosting this wonderful meeting.

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I'm, my name is Chandr Chawla and I'm visiting from Seattle, Washington. And I think Berkshire Hathaway can contribute to the reduction of global warming if for next year's shareholder meeting, Mr. Gates and I fly on the same plane.

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my question is, I have made a few mistakes in business by trusting the wrong people. people. So in, and I don't know where to learn how to trust the right people. They don't teach you that in business school and the people who are supposed to teach you in the corporate world sometimes betray you. So, how can I learn who to trust and who not to trust?

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