BECKY: We are spending the morning with Berkshire Hathaway chairman and CEO Warren Buffett, and now we're adding another special guest, Berkshire Hathaway vice chairman Charlie Munger. Charlie, it is a pleasure to see you this morning. Thank you so much for joining us.
CHARLIE MUNGER, BERKSHIRE HATHAWAY VICE CHAIRMAN: I'm delighted to be here.
BECKY: People come every year because they want to hear the two of you on stage together. I talked to so many shareholders this weekend about it. You guys have been doing this together for how long, being on stage, taking questions from the shareholders?
MUNGER: Mostly 50 years, more or less, isn't it, Warren?
BUFFETT: Yeah, about that.
BECKY: So I guess my question is other than being a year older for all of us, what's different or what did you learn this year, because I know the two of you say that you learn something just about every day? Did you learn anything this weekend?
MUNGER: I think you always learn something, but it's hard to put a finger on it. I very seldom have an ecstatic moment, like Archimedes.
BUFFETT: I always learn something. One of the things that I have fun with, I have a lot of fun with, is the annual meeting is just getting up there and hearing what Charlie's got to say.
BECKY: I was going to ask you this. Do you ever talk about it in advance?
BUFFETT: Never, ever.
MUNGER: Preparation would be cheating.
BECKY: You two have perfect comedic timing. Has it gotten better over the years? Did you hit that off the first day?
MUNGER: We are natural wise asses.
BUFFETT: That's what attracted us to each other.
BECKY: I've heard the story before, but I know a lot of our viewers haven't. You two met, Warren, when you were 29, and Charlie, you were 35?
BUFFETT: Correct, yes.
BECKY: Can you tell us a little bit about that meeting?
BUFFETT: It was at a local dinner, our wives were there, and after about five minutes Charlie was rolling on the floor laughing at his own jokes. I've been known to do that myself. There's not many guys like us in the world, so I better hook up with him.
BECKY: What is it that you two share in common. What similarities do you think you have? Charlie?
MUNGER: Well, the Omaha background, and I think we're both very intellectually curious. We both kind of like competing in games. And I think we both love ideas. And I like to ask Warren what he wants to be remembered as, and he says a teacher. Who else in America who is a CEO says he wants to be remembered as a teacher? I like it.
BECKY: Charlie, what do you want to be remembered as?
MUNGER: Well, I wouldn't mind being remembered as a teacher, but I won't be. (Laughter)
BUFFETT: I think he will be.
MUNGER: I may be remembered as a wise ass.
BECKY: One of the things I've always wondered is how Berkshire Hathaway really works with the chairman and the vice chairman. How often do you two talk? Because, Charlie, you're in California.
MUNGER: Way less than we used to because we know what the other thinks. We're not wasting a lot of time checking what we already know.
BUFFETT: We're like an old married couple. We just sort of grunt at each other, but we know what the grunts mean. But originally, and this is when phone conversation was fairly expensive and we were not rich, we would talk for hours a lot of days. But now we may talk once every two weeks or something like that.
BECKY: You did say, though, Warren, that you spoke with Charlie about the Coca-Cola decision before you came to any conclusions.
BECKY: What did you two think about that as you were talking?
MUNGER: It took about ten seconds.
MUNGER: I do not find that a difficult decision.
BECKY: The abstention or the —
MUNGER: I thought he did it just right. He complained a little, but not too vociferously. I think that was just the right tone, and with compliments which were deserved to the management of Coca-Cola. I thought he handled it perfectly.
BECKY: Let me ask you two about the acquisition that you just did. There was a $3 billion acquisition that you announced for Berkshire Energy last week. Do you guys talk about everything that comes through?
MUNGER: That wasn't even talked about by me.
BECKY: What do you mean?
MUNGER: Warren and (Berkshire Hathaway Energy CEO) Greg Abel did that one. My guess is Warren didn't talk about it for more than a minute or two.
BUFFETT: That's true. I got the facts on it and I liked the deal and I knew Charlie would like it. So why waste a phone call?
BECKY: So that's a $3 billion acquisition. What kind of rates, as the level that you think, oh, I really need to talk this through with Charlie?
BUFFETT: Well, usually if I talk it through it's because down deep I know I might be doing something dumb, and he'll tell me.
BECKY: Warren, you said over the weekend that you're probably more inclined towards action than Charlie is. Charlie, you had a response to that.
MUNGER: Well, it depends on the action. We're both very action prone when it's obvious.
BUFFETT: .. the ones that are kind of marginal. (Laughter)
BECKY: But you said over the weekend that he's called you something before.
MUNGER: The Abominable "No" Man. He likes that. Kinda kidding.
BUFFETT: When we talked on a Thursday night about doing Burlington Northern Santa Fe, and Charlie was on board, and you know, immediately he thinks, he sees the facts so fast and thinks so fast, and he doesn't waste any time making arguments just for the hell of it, you know, that are speeches or anything like that.
I would say that the quality that we share is that to a great extent, we're rational. And we don't waste a lot of time exploring things that are just nonsense.
BECKY: What is something that you thought was going to be a great idea until you talked to Charlie?
BUFFETT: Well, if you go back far enough, I called him one time on the Pittsburgh and West Virginia Railroad. This is 40 years ago. I said, Charlie, do you think we ought to put a lot of money on the Pittsburgh and West Virginia Railroad? And Charlie said to me, Warren, if you've studied it carefully, and you think you know all the facts, you're going to pay attention to it, if you're going to put a lot of your own money in it. He said, then I'll just shut my eyes and say no. (Laughter)
BECKY: And was he right?
BUFFETT: He was right. That's the irritating part. If you take the batting average of the times we disagreed, he's been right a very high percentage of the time.