Buffettstock One Decade Rewind: CNBC Goes to the 1998 Berkshire Hathaway Weekend
Buffett: Those are minor positions. No, our big money is in businesses. We own, at present market, 15 billion dollars worth of Coca-Cola and we own a number of operating businesses. So we love to own great businesses run by people we admire and trust. So that's, the other stuff is around the edges.
Scott: I guess what I'm wondering though is, the money that you have parked there, you've made a decision to do that. Is that something that people should follow your lead. Can they be as successful as you seem to have been in those areas?
Buffett: No, I think people should follow their own lead. They should decide what they know and understand and what they have competence in. And then they should do that, whatever that may be.
Scott: Let me ask you about Berkshire Hathaway stock. It seems to keep going up and up and up. You've talked before about whether you'd buy it ... You've been silent on that this year. Would you buy it at this price?
Buffett: I haven't bought a share of Berkshire Hathaway in a long, long time, but I haven't sold a share either.
You'll be able to see a more recent interview with Buffett, as Becky Quick rolls out an exclusive one-on-one conversation tomorrow (Friday) morning on CNBC's Squawk Box, which starts at 6am ET. We'll also post video clips and transcripts right here on the blog.
HOW TO KEEP YOUR SPOUSE AND SHAREHOLDERS HAPPY
In this report from the 1998 Berkshire meeting on a Buffett/Munger news conference, CNBC's Scott Cohn reveals what Buffett and Munger believe is the key to keeping your spouse, and shareholders, happy.
Warren Buffett: Fundamentals don't change that much. If you look at silver demand, it's relatively inelastic, production's relatively inelastic, so there's really nothing to change, really can change it dramatically.
Reporter: The price ...
Buffett: Well, price can change it, but because its relatively inelastic, price does not change it a lot.
Scott Cohn: While Buffett has continued dabbling in commodities, he's still not buying stocks with prices so high. As a result, he said, his cash position has been drifting higher as Berkshire Hathaway reallocates its resources.
Buffett: We change the ratio a little bit between stocks and bonds based on valuation, not based on predictions of what the markets would do. And that means we had to sell a little of several things. Everything we've ever sold has turned out to be worth more money later on. There's something, well, incidentally that's part of good investing. I mean, if you think you're going to sell something at the top, all you're saying then is you really think you're going to succeed with the bigger fool theory. We want to sell things to people who then make a lot of money out of them, and we've done it all our lives.
Scott: Among the stocks Buffett sold: McDonald's, without explanation until now.
Buffett: Obviously we owned less McDonalds at year-end 1997 than '96. We think it's absolutely first-rate company and it's a big, big brand. The fast-food business might be a little tougher than I would have thought earlier, but McDonald's will do very well in the future.
Scott: Buffett also talked about Berkshire Hathaway shareholders, reveling in a stock price that continues to soar. And that concerns him.
Buffett: If you ask Charlie (Munger) what the secret of a successful marriage is, Charlie will say that it's low expectations. (Laughter.) And that quality, if your spouse has it, makes the marriage very likely to last forever. And obviously with shareholders, it's better if they have low expectations than high expectations.
Reporter: They don't have low expectations.
Buffett: That is a problem. And we do what we can to have the expectations be realistic.
Scott: Would you buy Berkshire stock at this price?
Buffett: We'll get asked that tomorrow, and I'll, I will say this: I haven't sold any.
Current Berkshire price:
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