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Buffett Interview

Buffett Interview

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Published by SheerazRaza

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Published by: SheerazRaza on May 08, 2012
Copyright:Attribution Non-commercial


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The Remaining Part of the interview Posted on ValueWalk.com
BUFFET: I did it by myself.CLAMAN: But these were tied very tightly to the price of natural gas.BUFFET: Absolutely.CLAMAN: Which plummeted shortly after you bought it.BUFFET: Right.CLAMAN: How'd you get that so wrong?BUFFET: It was easy. I'll probably be able to do it again.(LAUGHTER)BUFFET: The -- it was -- it was -- it was just a case of not -- not cranking that into mydecision, weighting it with the appropriate probability.CLAMAN: But 2010, you had to do a $2 billion write up -- write-down; 2011, another$398 million write-down.How much --BUFFET: (INAUDIBLE) that total. But the total -- the total we put in was about $2billion and -- and I think it's been written out of maybe $400 million or $500 million.CLAMAN: Well, how much was it going to get?BUFFET: Well, it can go all the way to zero.CLAMAN: Do you think it will?BUFFET: It -- it easily could.CLAMAN: Who -- who sold you on this idea, gold (INAUDIBLE) --BUFFET: Me. Me.CLAMAN: Really?BUFFET: No, no, no.(CROSSTALK)
 CLAMAN: Goldman Sachs?BUFFET: No, I -- I have -- I have a real ability to pick these -- pick these out.(LAUGHTER)CLAMAN: OK.One of the things you said that people sat on the edge of their seat, because they wantto know what you're buying, more newspapers.BUFFET: It's possible.CLAMAN: Jimmy Kimmel told a joke at the Washington correspondents dinner. Hesaid, what's black, white and red all over?BUFFET: Yes, so I heard.CLAMAN: Nothing.BUFFET: Yes.CLAMAN: Yet you're buying now?BUFFET: Yes.CLAMAN: And you said specifically local newspapers.How about "The New York Times?"Is that local enough?BUFFET: Well, I -- if a -- I would have to say, if I could buy "The New York Times," Imight buy it personally. I -- I don't know whether I'd buy it for Berkshire. But it's not forsale.It's -- that's a very special case.The newspapers that exist in communities where there's a strong sense of communityand where the newspapers respond to that strong sense of community by -- by tellingpeople a whole lot of things that they want to know about their own community that theycan't find some place else, those newspapers will do OK. They'll still be in decline overtime.CLAMAN: But is it that you see that their value is relatively -- that their price is relatively
cheap to earnings?BUFFET: In some cases.CLAMAN: Um-hmm.BUFFET: In some cases. But the earnings are not going to -- the earnings are notgoing to go up. I mean you're looking -- and -- and they're probably going to go down inmost -- in practically all cases.So you have to buy them at a value, actually, that takes that into account.CLAMAN: "The Washington Post," you stepped down from the board.BUFFET: Right.CLAMAN: But you still fully own your position?BUFFET: We own every share we've ever owned.CLAMAN: Even though it's off its 52 week highs.Do you feel it's doing pretty well?BUFFET: Well, it -- I don't know whether they've published their first quarter earningsyet or not. But -- but they have problems in two of their businesses, one in theeducation business and one in the newspaper. And -- and that's been reflected, I think,in the price.But those two businesses are -- well, the newspaper is far tougher than it was five or 10years ago. And the education business is tougher than it was about two years ago.CLAMAN: What's interesting to people, though, when you say that you would buy morenewspapers is at a time when everybody else is getting out, it seems like you andRupert Murdoch are the only people getting into newspapers.BUFFET: Yes, right. And he may not be quite as competitive for a while, either. So,no. But they are not a -- it's not an industry whose earnings are going to -- the earningsare going to just shrink in the newspaper business, as are the revenues. But not -- Idon't necessarily think they'll shrink at a dramatic rate where you have a strong feelingof community and you have a newspaper that serves that community well.CLAMAN: "The Washington Post" reported Friday and their revenue --BUFFET: Did they?

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