Warren Buffett, chairman and chief executive officer of
Berkshire Hathaway (NYSE: BRK-A) (NYSE: BRK-B), appeared on
CNBC's Squawk Box for three hours Monday morning.
Buffett, fresh off of a booming weekend in Omaha, Nebraska
after Berkshire Hathaway's annual shareholders meeting, spoke
from an airplane hanger in Omaha, next to a NetJets private
Buffet started off the morning by saying that the big headline
of the weekend was that all of the attendees of the meeting had a
good time, including him, noting that he waved to thousands.
"They all call me Warren, which I like," said Buffett.
Buffett was joyous, stating that sales covering Berkshire
Hathaway's various enterprises broke records.
"So people seem pretty happy," said Buffett.
The conversation went to the recent leverage that Berkshire
Hathaway took on in buying BNSF Railway, during which Buffet said
that he doesn't consider their partners in this private
"These are people that buy for keeps," said Buffett.
Buffet said that Berkshire Hathaway prefers buying business,
and that they'll be at Heinz (NYSE:
) forever. He included that if other partners ever decided to
sell out, he would hopes that they sold to Berkshire
In regards to the jobs report, Buffett thought it would be a
weaker number. He said that in terms of Berkshire Hathaway's
business, there has been gradual improvement over the past four
years, noting a slow pace across the economy.
But Buffett also included that Berkshire Hathaway has had
record investment for the past two years in their various
As far as Europe goes, he says that you never stop investing
just because an economy is in trouble.
"We bought stocks when the United States was in trouble in
2008, and it was in huge trouble, and we spent $15 and and a half
billion in three weeks," said Buffett.
"And between Sept. 15 and Oct. 10., it wasn't because the news
was good, it was because the prices were good."
Buffett went on to say that if you believe that Europe will
still be around, than the troubles it is having now will offer
you an opportunity to buy into their future. He compared it to
buying his first stocks after Pearl Harbor, because prices were
good and he believed that the U.S. would would win the war.
Bill Gates, Microsoft (NASDAQ:
) co-founder and chairman, who joined Buffett later on during the
morning, is on record saying that he saw a 25 percent increase in
private jets at the shareholders meeting.
Buffett talked about private jets while viewers got a glimpse
inside a plane that he helped designed, the NetJets Global 6000.
From inside the jet, Buffett said that very, very rich people cut
back in flying in recent years, but now it's coming back.
Buffett also talked on insurance operations being up,
commenting on Berkshire Hathaway not paying out a lot in terms of
catastrophe dollars. According to Buffett, all parts of their
insurance stakes are doing well, led by GEICO.
Buffett said that it's important to have productive assists,
and that he favors those enormously over fixed dollar
investments. He declared that bonds are terrible investments
Buffett also talked about investing in the United States'
future for hundreds of years to come. In regards to oil and
natural gas, Buffett believes that we have to look at our
reserves as investments in our future generations, saying that
using natural resources from outside of the U.S. isn't good for
the economy in the short-term, but is better for the country in
Buffett also commented on why he stays away from big broadcast
media and technology, saying that because these industries are
subject to change, he can't predict them ten years in advance. If
the foresight isn't there for Buffett, he's not buying.
"As long as I can make money with ketchup and Coca-Cola (NYSE:
)…There'll be a couple of big winners in that list and there'll
be a couple that will really surprise you on the downside," said
Buffett, referring to several bigger tech and broadcast media
In regards to buying shares in International Business Machines
) and the bad past couple of quarters that they've had, Buffett
"I think we'll be right about IBM," said Buffett.
He likes IBM's position in the world and is willing to invest
a lot of money into the company, but Buffett doesn't think they
are as bulletproof a company as Coca-Cola.
In regards to J.C. Penney (NYSE:
), where Fruit of the Loom is a supplier, Buffet calls retail a
tough game where the competitors are smart. But as someone who
once worked for J.C Penney, he's rooting for them, saying that he
hopes they're successful after turning off a percentage of their
costumer base and losing momentum.
As for the government, Buffett said that sequestration is
stupid, because it was designed to be stupid. Buffett had a
somewhat frustrated tone when referring to the disjointed and
often times late night efforts of congress to pass
"Letting things like the sequester kick in, we deserve a
better congress than that," said Buffett.
Later on in the morning, when Bill Gates arrived, he also
agreed that equities are a good deal relative to bonds. But the
market is a gamble, and many see issues due to high frequency
trading. Gates said that buying and holding equity is the
solution to the issue, simplifying the high frequency trading
"The primary function of the market is to have people provide
capitol to businesses, drive the evaluation of those businesses,
and that works just fine without this high frequency or even day
type trading," Gates said.
In regards to the profitability of technology, Gates provided
the simple sentiment that if you have something to offer, you'll
As far as the wealthy donating to global issues, Gates
believes that people will give more in time to come and that
philanthropy will improve, but he said that as far as the poorest
countries go, it's governments that still give the most.
In regards to the online tax, Gates believes that the bill
asking for online consumer taxes makes sense. He thinks that not
asking for taxes is unfair to those with physical stores, and the
revenue is good for state budgets is addition to overall
As far as his future as a board member of Berkshire Hathaway,
Gates said he'll stay on the board long after Buffett's
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