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Investing Warren Buffett Watch

  Thursday, 3 Mar 2011 | 12:45 PM ET

Download the Full Transcript

Posted ByAlex Crippen
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Here's the complete, downloadable, transcript of Warren Buffett's live three-hour appearance on CNBC's Squawk Box, March 2, 2011.

Among the highlights: Buffett's comments on why 'elephants' are hard to find , how the government should cut back on its economic stimulus efforts, the factors that will lead to greater job growth in 2011, and his now-infamous 'underwear' tie .

To download, either click Download to the right of the CNBC logo immediately below, or you may right-click the Ask Warren graphic above.

If you don't already have Adobe Acrobat Reader software to view the PDF, you can get it at Adobe's web site .

Current Berkshire stock prices:

Class B:

Class A:

For more Buffett Watch updates follow alexcrippen on Twitter .

Email comments to buffettwatch@cnbc.com

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  Wednesday, 2 Mar 2011 | 7:56 PM ET

Warren Buffett vs. the Bears

Posted ByDrew Sandholm

Warren Buffett, the "sainted, genuine stock sage," is completely at odds with what's reported about the stock market in the mainstream media, Cramer said Wednesday. Speaking on CNBC's "Squawk Box," the Oracle of Omaha painted a completely different picture than what one would hear from the bears that dominate the media today.

Buffett, who serves as CEO of Berkshire Hathaway , said he likes investing in the USA. There is "resiliency to the American system," he said. The 80-year-old executive also said the U.S. employment picture will continue to improve and the housing market will pick up after the excess supply is soaked up in one year's time.

Contrary to the bears, who suggest getting out of the stock market, Buffett said he wants to buy stocks now. Of course, the averages have been getting hammered and the bears are quick to note the market is overvalued. From costs to taxes to labor and materials, everything seems to be going up, too. Raw costs may decimate profitability in the steel industry, but Buffett said he likes steel companies.

Also unlike the bears, Buffett is optimistic. He remains bullish on the markets in the face of unrest in the Middle East and rising oil prices, among other calamities.

The renown investor also said he's happy with his purchase of railroad Burlington Northern. The bears, however, scoff at the purchase on fears China could raise rates to where nobody will want to ship anything by rail. Buffett doesn't seem worried, though.

Everything Buffett said seems to counter that what's reported day-in and day-out, Cramer said. Those who, like Buffett, think the U.S. economy is and will improve are made to feel like idiots. But if that viewpoint is making Buffett money, Cramer said it might be time we all give stupidity a chance.

Call Cramer: 1-800-743-CNBC

Questions for Cramer? madmoney@cnbc.com

Questions, comments, suggestions for the Mad Money Web site? madcap@cnbc.com

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  Wednesday, 2 Mar 2011 | 6:09 PM ET

Transcript Part 7: What Should Happen to CEOs of Failed Companies

Posted ByAlex Crippen
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Warren Buffett appeared live on CNBC's Squawk Box this morning, March 2, 2011.

This is Part Seven of a transcript of his comments.

Click here for Part Six: China and America's Diminishing Dominance

BECKY QUICK: Welcome back to Squawk Box here on CNBC. We are in Omaha, Nebraska, this morning at the Durham Museum with Warren Buffett. We're going to be answering some of your e-mail questions. And, Warren, just again for people who are coming in late, we're in the Durham Museum in front of the Ernest Buffett Grocery Store. And this is pretty important to you.

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  Wednesday, 2 Mar 2011 | 5:13 PM ET

Transcript Part 6: China and America's Diminishing Dominance

Posted ByAlex Crippen
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Warren Buffett appeared live on CNBC's Squawk Box this morning, March 2, 2011.

This is Part Six of a transcript of his comments.

Click here for Part Five: Cars and Bricks

BECKY: Well, let's talk about a big announcement that just came out late last night, NetJets is going to be buying, it looks like, 50 global business jets valued at about $2.8 billion dollars from Bombardier, and you've got options for another 70 global aircraft. If you buy all these, it's going to be retail price exceeding $6.7 billion, and that'd be the largest aircraft purchase in the history of private aviation.

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  Wednesday, 2 Mar 2011 | 4:32 PM ET

Transcript Part 5: Cars and Bricks

Posted ByAlex Crippen
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Warren Buffett appeared live on CNBC's Squawk Box this morning, March 2, 2011.

This is Part Five of a transcript of his comments.

Click here for Part Four: Blame Bankers, Bankers, Bankers?

CARL: Speaking of cars, someone who knows an awful lot about that business from multiple directions, Becky, is the man who's with you this morning, Warren, in Omaha.

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  Wednesday, 2 Mar 2011 | 3:04 PM ET

Transcript Part 4: Blame Bankers, Bankers, Bankers?

Posted ByAlex Crippen
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Warren Buffett appeared live on CNBC's Squawk Box this morning, March 2, 2011.

This is Part Four of a transcript of his comments.

Click here for Part Three: 'Elephant Gun' Targets & Riding the Railroad

BECKY QUICK: Carl, you have a question, too?

CARL QUINTANILLA: I do, Warren, and I hope you won't mind me again plumbing through the letter, which obviously has a lot of information and a lot of insight. You talk in one area about your managers and how they love to work at Berkshire in part because they're not subjected to meetings at headquarters, or— nor financing worries, nor Wall Street harassment. And I know you pick your words carefully. Do you think bankers have been harassed, and do you sort of agree with what (JPMorgan Chase CEO) Jamie Dimon said in Davos, that he's tired of hearing about blame being placed on, as he put it, bankers, bankers, bankers?

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  Wednesday, 2 Mar 2011 | 2:29 PM ET

Transcript Part 3: 'Elephant Gun' Targets, Riding the Railroad

Posted ByAlex Crippen
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Warren Buffett appeared live on CNBC's Squawk Box this morning, March 2, 2011.

This is part three of a transcript of his comments.

Click here for Part Two: The 'Zebra' That Got Away

BECKY QUICK: Welcome back, everybody. This is a special edition of SQUAWK BOX. We're live in Omaha with Warren Buffett, who's taken the time to sit down with us today and not only answer our questions, but also the questions that you've been sending in as well. And, Warren, we appreciate that. We got lots and lots of questions that came in. Carl mentioned that the probably most intriguing line of your letter was this idea that your elephant gun is loaded and you are ready, got an itchy trigger finger. That's what sparked a lot of the questions that came in. So do you mind if we play rapid fire real quickly with some of these questions?

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  Wednesday, 2 Mar 2011 | 1:49 PM ET

Will ‘Inflation Effect’ Overcome the ‘Wealth Effect’?

Posted ByJeff Cox
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Deborah Harrison | Getty Images

As each day passes, with oil, gold and other commodities scaling either multi-year or historic highs, the denials of inflation become harder to maintain.

Call it the “inflation effect,”—the antithesis of Fed Chairman Ben Bernanke’s “wealth effect” that helped convince Americans rising stock prices equated to greater wealth even while employment and housing lagged far behind.

In the case of inflation, some of the more conventional measures insist the phenomenon of too much money chasing too few goods has not taken hold. Government indicators for personal and producer prices remain tame, while there appears to be little of the wage pressure that also is a typical partner to rising inflation.

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  Wednesday, 2 Mar 2011 | 1:23 PM ET

"I Never Inherit My Investment Decision"

Posted ByAlex Crippen
Warren Buffett and Becky Quick check their notes during a Squawk Box commercial break
CNBC/Dave Grogan
Warren Buffett and Becky Quick check their notes during a Squawk Box commercial break

Warren Buffett says investors would be wrong to think Berkshire Hathaway's elimination of eight stocks from its portfolio means he's negative on the companies that were sold.

Last month, Berkshire's portfolio filing with the SEC showed that eight positions were liquidated in last year's fourth quarter, including Bank of America and Nike .

At the time, we guessed that Berkshire was cleaning out the positions that had been created by Lou Simpson, who retired at the end of 2010 .

On today's live Squawk Box appearance , Buffett confirmed that he and Simpson had jointly decided to liquidate the GEICO stockpicker's portfolio.

"I never inherit my investment decision from somebody else. If Charlie Munger made me a gift of 100 shares of some stock, I would sell it then — and then —I would then decide whether I wanted to buy it again myself. But I do not believe in default-type decisions on investments. So When Lou left, his portfolio left. When a new man comes in, his portfolio comes in."

That new man is Todd Combs . Buffett says Combs "is going to be responsible for his decisions — just as Lou was when he was (at Berkshire subsidiary GEICO.) And I want it to be Todd's portfolio."

Later, he was asked specifically about the Bank of America sale:

JOE KERNEN: Berkshire was in Bank of America, and it wasn't a good experience, and you're out now. I think you lost two-thirds or something. But, I mean, obviously the financial crisis hit. But that--that's making some--you're voting with your feet there, I think, what, on management, on the prospects for B of A? I mean, you like Well--you're staying in another bank, why would you get out with a loss instead of the...

BUFFETT: Yeah.

JOE: Go ahead.

BUFFETT: I never--Joe, I never bought a share of Bank of America. That was one of the 15 or so positions of Lou Simpson. So he did not make a decision to sell Bank of America in the second half of last year.

JOE: OK.

BUFFETT: He just--he was liquidating his entire portfolio. He sold a--he sold Nike. He hated to sell Nike. He loved Nike. But he was cleaning out his portfolio, and Todd's bringing in a new one. But I...

JOE: OK.

BUFFETT: Bank of America was never part of a portfolio I managed.

JOE: OK. So when you see Berkshire liquidates its entire stake in Bank of America, you can't say, oh my God, they don't like the prospects--or Warren doesn't like the prospects for Merrill Lynch...

BUFFETT: No.

JOE: ...or (CEO Brian) Moynihan...

BUFFETT: No.

JOE: ...or you can't draw any conclusions from that.

BUFFETT: No.

JOE: OK.

BUFFETT: Zero, zero. I never bought a share and I never sold a share personally.

KERNEN: All right. OK.

Current Berkshire stock prices:

Class B:

Class A:

For more Buffett Watch updates follow alexcrippen on Twitter .

Email comments to buffettwatch@cnbc.com

»Read more
  Wednesday, 2 Mar 2011 | 1:22 PM ET

On Stimulus: Government Should Cut Back

Posted ByAlex Crippen
Warren Buffett is interviewed by CNBC's Becky Quick in 2011 in front of a mock-up of the Buffett family grocery store in Omaha where he worked as a child.
CNBC/Dave Grogan
Warren Buffett is interviewed by CNBC's Becky Quick in 2011 in front of a mock-up of the Buffett family grocery store in Omaha where he worked as a child.

Warren Buffett tells CNBC he thinks the government should reduce its efforts to stimulate the U.S. economy now that the recovery is gradually picking up steam.

On Squawk Box this morning , Buffett said that "the government really did its job there in the fall of 2008" at the height of the credit panic, but now "I don't think we need as much monetary or fiscal stimulus as is going on."

Asked specifically if the Federal Reserve should end the QE2 program that has it buying billions in assets to keep rates low, Buffett replied, "Yeah. I have enormous respect for (Fed Chairman) Ben Bernanke. He knows way — you know, he knows more about the Fed than I do by a factor of 100 to one. But in the end, I don't — I don't think we need more of that now."

On the fiscal side, Buffett points to government spending at 10 percent of GDP. "We have massive stimulus going on in the United States. Stimulus like you haven't seen since World War II. We just don't call it a stimulus bill."

He believes the "most important factor in coming out of the recession is sort of the natural regenerative capacity of capitalism... 300 and some million people trying to figure out how to live better tomorrow than they're living today."

That's why he's been "optimistic on America right along," even back in 2008, "when I knew things were going to go to hell."

Current Berkshire stock prices:

Class B:

Class A:

For more Buffett Watch updates follow alexcrippen on Twitter .

Email comments to buffettwatch@cnbc.com

»Read more

About Buffett Watch

  • Warren Buffett is arguably America’s most-admired and most-followed investor. Buffett is the largest shareholder and CEO of Berkshire Hathaway and one of the world’s most famous and most generous philanthropists. Legions of investors - from all walks of life - follow Buffett's homespun investment philosophy: invest in what you know, invest in value. Here on CNBC.com's Warren Buffett Watch, we’ll keep you up to date on what the “Oracle of Omaha” is doing by following Buffett's trades, words and deeds.