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this was the 54th annual shareholder meeting from Berkshire Hathaway and while shareholder meetings are known for being lightly attended stayed and downright boring this was anything but more than 40,000 people attended here including business leaders like Activision Blizzard CEO Bobby Kotick Quicken Loans founder dan Gilbert and Spanx founder Sara Blakely and for the first time Apple CEO Tim Cook was in attendance Apple is now Berkshires largest equity holding and Berkshires Apple's third largest shareholder we caught up with Cook this weekend and asked him what he thought about it all I think it's incredible I've never been to an annual meeting like this before you know I thought ours was lively but there's 40 plus thousand people here and I love the fact that Warren and Charlie take every question and of course through all of it not just the wisdom that they exude but you can feel the integrity and the humility coming out I think it's a great learning experience for me and for everybody in the audience I'm sure joining us now is Berkshire chairman and CEO Warren Buffett and warned that what does it mean to you to have gone through this weekend it's a lot of fun I mean you see who you're working for and they see you when you interact with them and and they come in sort of a Mardi Gras spirit I would say in the last 10 years who's now maybe 40 well from out of town not 40,000 but but a great many from around the world I just never get a letter of complaint I mean I know that somebody misses planes or has a car rental isn't available or a hotel room but they they they they just come in the spirit of enjoying it and and and the people and all that way so so people go wrong with smiles on their faces I mean we have 600 of our own people would come in from our various subsidiaries and work for a couple of days and and it was anything but smiles on their faces well there unfortunately we're not going to allow you to rest on your laurels this week because we have some major news that's breaking this morning you see the markets already down by almost 500 points the futures here for the Dow what do you think about the potential for trade tariffs coming back on and what that might mean for the trade dogs well I can't I can't gauge out both sides will play the game and they're always some people negotiate different ways and and if we actually have a trade war it will be that for the whole world and and could be very bad depending on the extent of the war but there's times in negotiations when you talk tough the one thing you can't do though is you can't you can't shake your fist first and then shake your finger later on I made it that is not a technique that works well so when you do push ahead you don't know exactly what the outcomes gonna be well you can't shake your fist first and then shake which finger later understand I have actually but well that's that's what you're worried about if you get the other figure back and and and you have to mean it after a while otherwise it doesn't mean anything obviously when you when you do that and you're gauging a response from someone else that also has their own calculus and has their own internal political considerations and so on so it's it's a dangerous game doesn't mean it's a game that shouldn't be engaged in but it's a dangerous game you negotiate a lot of deals too would this be your tactic well it is mine at all but but you know talk about the Occidental deal later on the illustrate but but but I've had a consistent way of negotiating and that has its advantages though has its disadvantages too but but I just say what I'll do and and I don't do anything else so people really know that's what I mean and they can decide whether what I've said is acceptable or not but they know that I don't go through it a game now there's lots of people with acquisitions that really like to play games and and there you stood in their own business and and it's their way of doing it and that's fine but it doesn't work with me and I don't want it I can't afford to spend the time on it I mean it you know you don't know whether you're ever gonna get there and you spent weeks and months and it's just it it it would be a huge time waster we did it you know I don't know that this is blessed are coming from President Trump though he's already put the tariffs on and I don't know that I would take this lightly and think that we're not going to be seeing something Friday you can't but if you're playing you're playing the game you have to solve that way I mean if it's with some people in negotiations the best technique is act half-crazy I mean that that know with your kids you can see how it works negotiating things with no you're not gonna shoot them so it really got the edge and that's that goes on all the time and it's interesting kind of with the reputation industry we bought a very large auto dealership operation a few years ago and and we didn't make more or less our kind of day of winning the price and and probably 20 times since then people come out they say we want to do something and they just never found one that we could do the same way I mean they just it's just part of their lives to negotiate and it's part of my life not to negotiate so I mean to come in with a high offer I'm sure you're going to say and I understand that I mean that's that's the way a lot of things takes take place but but probably a majority of transactions and but it's nice that reputation for not doing it because it makes it a lot easier you save a lot of time well let's talk about what it would mean if tariffs on Chinese goods rose to 25 percent from 10 percent done on that two hundred billion dollars worth of goods at the end of the week how significant is that what would it mean for Berkshires businesses well it would mean a lot to the world the it isn't just the countries involved because you know they they take the dollars they've received from us net and they buy goods in other places I mean there there there there trade surpluses considerably less overall than their trade surplus with us so everything is everything intersects in the world and and it depends who gets retaliatory with us or with them and it it's it's easier to start it than it is to stop it and and the effects would be huge it's conducted on a major scale over time just imagine Becky that that our Constitution was set up different and that states could erect tariffs and Michigan will put a tariff in on that cars and we would have wanted corn and that the degree to which trade would contract in this country the MIS located plants they the migration of workers the way I mean it would it would be well if it sounds ridiculous to talk about it because it is ridiculous but you've got countries where you would have similar effects if you if you get country after country after country because you can't just have it between two countries that did it will it was right now the very fact that it's sort of a nuclear threat is what brings people to the table so that means that's with it many play the game but you don't want to have too many nuclear threats out there because someday somebody may feel they have to fulfill one right obviously that's why the global markets are under pressure it's not just Chinese markets that are down you saw the Korea kospi was down by about 3% markets down it was just about everywhere it affects everything so that's a you're saying the markets reaction is the right one it's not an ovary it's rational and and then we'll see what happens next but but obviously if if you went to bed a week ago and you thought there was a 1% chance of a trade war and then subsequent events makes you think there's a 10% chance markets reflect that very quickly what would you put in terms of I mean you're you're an actuarial mind in terms of odds would you put on it when you talk about two leaders of the two major economic powers in the world that's not the sort of thing I can lay odds on I mean you were talking about two personalities who are very much used to getting their way and and and and and in politics and you're talking about how they will be perceived in their own country in terms of our behavior and it gets very complicated yeah there's no way I know how to predict that although you've written insurance contracts on weirder things than this yeah what would you what would it take for you to ensure that there was a deal done at the end of this it would take a big premium yeah this would not be the kind of thing I would look to ensure frankly because it's so unknowable yeah yeah and and you wouldn't you wouldn't need to have a hard time finding the the the risk precisely because if they lasted for a month and then so you get into the duration of how long it was you know a lot of trouble writing the contract and but there's the sort of thing not not precisely identical but it's a that we do take on unusual risk but this is a big one what will it mean for Berkshire businesses specifically and I just think on Friday we spoke with Jim Weber who's the head of Brooks running they've already relocated and and and moved a lot of their operations to Vietnam because of this concern they've been in the process of doing that since these trade talks first it's kind of well we've seen in them in our rail car log in or more all the stuff that rides on the west coast I meant everybody stocks up at a time and it distorts things just thinking about it you can imagine the distortion if you get into it and then you really can't predict the speed or the degree of effect because it spreads you can't do something between US and China in a big way without it affecting all the major markets as they go around and and you're starting a game that you don't know the ending of but you know it isn't a good game I could say it may be necessary to play another game to avoid that sort of thing I mean that does that's what mutually assured destruction was I mean yet as he felt as long as mutually assured destruction nobody would actually launch a missile and this is a similar can be a similar type game a little bit of chicken in it you say that intermodal rail loadings that were affected by it meaning that you saw an increase in in rail car loadings months ago months ago because people were trying to get people loaded up on inventory that they thought might I mean if you thought there's a mid 25% I mean if I thought there was gonna be a 25% tax on coca-cola next week I would have my house filled with coca-cola [Laughter] vague guys are transported my house would be doing great everything and boom it all ends well that's a big concern I mean if we've been looking at this great economy and thinking things are wonderful but it was really just pulling things forward and then you get into a situation where it stops down does that concern you just about well they're posting forward I think actually in the GDP figures there was a big inventory adjustment and know if you think the flow of something is going to either stop or get more expensive and you need it you're gonna load up ahead of time well that's will this change your behavior in any way when it comes to purchasing securities or making deals no we will buy the same stocks today where everything last week just I won't tell you their names but what do you buy more if you get them down 5g where they get the more I buy but it doesn't mean that you don't think the markets couldn't go there I'm not buying because I think they're gonna hope the next day or the next week yeah so it's something you're watching very closely yeah oh yeah but we watch the prices of things we do more than current events because in the end we aren't buying them because what's gonna happen next month third in that next quarter you know we're really buying them because we think they'll be good businesses ten years now if somebody came to us with a good business today we'd buy it and we buy it regardless of what's going on in the sort of situation we might have this is the case but you might were more likely perhaps to get something when other people are are fearful and you see that in a big way instantly in a market you know in the market for businesses it's but it's it's still there with people's minds welcome back everybody we are here and news is breaking there's just an SEC filing that came out from Crabb Tynes that's obviously a big berkshire hathaway holding craft ein says that it will restate earnings for 2016 and 2017 due to miss statements in the original filings it does not however believe that the mistake Minh SAR what they call quantitatively material to any individual reporting period it says that the impact on adjusted earnings it's expected to be less than 2% for each year craft ein says that it has now completed an investigation that shows several employees in its procurement operation engaged in misconduct but none of those were members of senior management our guest today again is Warren Buffett he's the chairman of Berkshire Hathaway whit's owns a major portion of Kraft Heinz and Warren what do you think of this this news just hitting while we're sitting here well that's more or less what I've heard I'm not on the board anymore but but great able and crazy a bit cooler on and so I've heard from them and this is this is an update that I heard last night that and they can't they can't issue the first quarter reports until the 10k is filed and they can't file with 10k til Price Waterhouse signs off on it and and that apparently is going to require a restatement of a few years and we could not report any earnings from Kraft Heinz in the first quarter because if we get a dividend from Bank of America that dividend goes into earnings but because we have over 20% of Kraft Heinz we don't report report the dividends we report the earnings so we received a dividend of about one hundred and thirty million in the first quarter but that we don't report that and and we expected to get the earnings before we issued our own report but when the time came to our report and we didn't have anything we just we put a zero in there and explained it in our release last Saturday and it's just a further indication of the facts as they stand now at some point Price Waterhouse Oh we'll need to be happy with the figures that are reporting and that evidently involves Restatement and at that time my guess is the quarterly figures have become quite current and that we keep picking up our share of the the earnings I mean this has been a long standoff period between PwC and the company if they've missed all the deadlines to get the numbers to you at that point what we didn't expect it I thought that we would have the earrings on on time and and Kraft announced earnings for last year but they had not been signed off on by their auditors so while they released them publicly they couldn't file the 10k with the SEC subsequently that's not unusual for companies to announce earnings before they've actually got the sign-off but in any event it's just you know we thought we were gonna get them this week or next week whatever might be and and then last Saturday came and that's our time for releasing quarterly earnings we did not have them so we stuck nothing in there and a footnote and we put in our press release as well that we just didn't have the figures if they're restating their earnings does that mean Berkshire Hathaway will also have to restate its earnings Annelle bad it would it would be sullen material by the time you take just our share or a much larger company so there I don't know exactly what we do when we get if it gets into the second quarter I don't whether we pick up two quarters in one quarter or exactly how that works they said that this is the they've wrapped up this investigation are you satisfied with what you've heard from that part of the investigation or do you know that I don't know about that I do know that because I've been I've been kept abreast of some of the things I don't listen and on directors calls or anything like that but but Gregg tells me what's the high points of what or the low points of what's happened and and we have a terrific head of the auto company jack he's an independent director he he knows this sort of thing and he and he and he's put in the hours on it and so I feel very good about about the fact that jacket is he's really in charge of things from the standpoint of the directors does the company have your confidence the company has my competence you had talked about it over the weekend where you said that what you paid for craft was too much in hindsight exactly not what you paid for Heinz that's correct we just want Heinz would it be a better investment and we don't we don't fifty odd just over 50% of it of the business of doing fine in relation to the what we paid for it but in a situation where you determine that you've now paid too much what do you do I paid too much for stocks I paid too much for a lot of things time usually works it out but it it means that capital could have been better deployed in other in other areas you can always pay too much for a business and I've done it with stocks many times I've done it with businesses we've got we've got at Berkshire we have at least a half a dozen businesses and I can't even use a we there I got to say I paid and if we make the next ten deals we make then there will be a couple worlds or not that I paid to let you warren there was other news the cross the wires just last night and another deal that you're involved in that would be backing up Occidental and it's been to try and take over Anadarko which is also engaged in talks with Chevron who's also got a bit out there last night Occidental put out its own statement and said that it's going to be revising its proposal it's now talking about a deal still seventy six dollars a share offer but seventy eight percent cash and twenty two percent stock by increasing that cash portion it allows what they call significant immediate value greater closing starting to enhanced creation because with this they no longer have to ask their shareholders for permission on this what are your thoughts about where the deal stands and what this latest updates yeah I got a call by yesterday after an evening first time I I talked Occidental actually since we can go yesterday Sunday and they told me that they were going in this direction which I like but I have nothing to do with it I mean that we committed 10 billion and it had nothing to do with whether how they frame frame their offer how much they offered or anything else that all they knew was that they were sure they could get ten billion dollars from us if they complete the deal without an article one of the pieces of the letter that Vicki Holub the president and CEO of Occidental put out in its letter back to Anadarko surprised me a little bit with just how it still seems like this is a hostile bid there's not good faith talks that seem to be taking place between them based on her letters she said this we remain perplexed at your apparent resistance to obtaining far more value for Anadarko shareholders which has been expressed clearly through our interactions over the last week it sounds to me like that is still kind of a hostile bid what well it's my understanding and bear in mind the first thing heard about this was that we can go Friday what Brian White had called us said the people Occidental like to talk to you and and I talked to them on Sunday a week ago yesterday my understanding is Anadarko and Occidental had talked much earlier well before the Chevron bed and we're talking about a transaction and then Chevron made an offer which Anadarko accepted but Anadarko was for sale I mean they and and so it it ended it held talks about something itself to to Occidental s this is my understanding and so they were talking maybe they were talking to more than two parties for that matter I wouldn't know that but they decided that that they were willing to sell I'm sure subject to price obviously and they accept that an offer and Occidental felt they had a better offer and and that's apparently where things still stand but I don't know part of the details part of the the idea behind it had been that well would Occidental be able to get approval from its shareholders because its stock was under pressure some of the shareholders obviously didn't like the deal by using your cash instead of issuing as much stock as they had anticipated originally that will keep them from having to go to their shareholders to ask permission for this and as they're saying in their own level letter that certainly increases the certainty of this deal taking place and remove some of that uncertainty yeah I would I would also think that the shareholders own Occidental you're bullish on oil over over the years and and you probably would polish on the Permian Basin because they've such a significant portion of their assets there so the idea that they will reduce use less stock and more cash as part of the deal although they're getting the cash from from us but I would think net it if I'd been a holder at Occidental over time I probably would like that kind of a deal like at Berkshire I hate their stock so generally speaking if any company we own is buying something we like it better when they buy it for cash than they use stock because we like their stock so I will see what the reaction is to this but but I would just imagine it had been an all stock offer to begin with I wouldn't think people would net their shareholders but the shareholders will be speaking out but I would think that share their shareholders would like the the shift Andrews got a question from beckon studio to Andrew hey Warren I was just curious whether whether you were surprised that Anadarko hadn't engaged with Occidental on this at this price and also if there was a price at which you would think that Anadarko rather that Occidental shouldn't pay meaning if Chevron were to come back in there you know five times the size of oxen I think they could just write a check and this could be over with if they wanted to but if the price were to go up I know you get preferred shares ultimately is there a price at which you wouldn't look at this favourably well we've committed the ten billion dollars of 100% but we do not have any control nor did we want any control over what Occidental's did with our 10 billion in the terms of reading there's nothing in our deal that provides that they have to come back to us and request permission really to do anything it's a remarkable deal but that's the way we do them and and in that respect and they so they get our ten billion if and when they close the deal without an arco and and and they don't have to consult us that certainly don't need our vote they don't it was a matter of courtesy I got to call you yesterday but it was not a matter of necessity on their part that's one of the advantages of dealing with Berkshire I mean we can do things that other people don't like to do where their lawyers don't like them to do and this is not a deal but our lawyers would have written is this deal a bet on the Permian Basin and on oil prices or is this just a bet on it's great to have an eight percent preferred well I'm Gregg that but a percent preferred in any oil it's about its bet on oil prices over the long term more than anything else it's also a bet on the fact that the the Permian Basin is what it's cracked up to be and all of that sort of thing but but it oil prices will determine will determine whether almost any oil stock is a good investment over time whether it's Exxon or some Wildcat Rover that oil goes way down you don't solve that by hardly anything and if it was way up you make you make a lot of money and edit it's not what it does next next week or next month or next year you're buying reserves that go far out into the future so you have to have a view on oil over time and Edie Charlie and I have got some views on that not too specific because they're not that well informed but they are we we feel good about about doing the financing why don't you just buy it yourself it's only a thirty-five billion dollar deal and you've got 110 billion and cash sitting around well that might have happened if an arc husband but we we wouldn't jump into some other deal that we just heard about through somebody coming to us and seeking financing no we hope we hope people come down on businesses but I had no idea that this transaction was going to happen I mean we could go Friday when I got the call from Brian Moynihan well I'd read in the paper about the deal but I that I've never had any contact without an R : any sort David Faber reported last week that you had said you would offer up to 20 billion dollars double the 10 billion dollars that you did do on this deal is that the case if they needed it but I think they I mean they have a arrangement obviously with the Bank of America who called us I don't know anything about that deal I just know that the eBay is as arranged that that financing if there were a different sort of thing but what am what I'm meant to some except with that as I'd be also very happy if somebody calls tomorrow and needs 20 billion occidental just needed the 10 billion okay but but you like doing these deals at bigger sizes not smaller sizes exactly back to Andrews point this is there for forever it doesn't matter if the bids go up doesn't matter what happens along the way your 10 billion dollars is in this deal for whatever happens yeah there's a the lawyers don't write deals like this but we tell them to the there's no material adverse change there's no if the stock market closes but the steel closes we're there we're there under all all circumstances and we don't we have not written any outs into it and but that's part of the attraction of doing business with Berkshire and and besides that we do it all ourselves so it isn't something that's a parcel out among ten parties and each one comes in and has to get their permission to make changes and all that when they came to my office at ten o'clock on Sunday we did Sunday they knew that if we agreed which we did by eleven o'clock they knew Berkshire was honor percent and now they had their own Board of Directors meeting the following evening but they they could say to their board you're gonna get ten billion dollars from Berkshire one discloses you don't need to give a thought to it obviously many stocks are under some pressure of from what they were seeing from these Chinese trade talks what the implications are from all of that one share that in one stock that is under pressure today shares of Apple if you want to take a look at the chart closed on Friday at two eleven seventy five this morning the bids at 204 ninety one the ask is at 205 ten and that's because China has been such a huge component for Apple Tim Cook talked in the last earnings last week about how things seem to be really improving there Tim Cook also traveled to Omaha this weekend he was here for the Berkshire Hathaway annual meeting it's his first time coming here but for for Berkshire Apple is now the biggest investment that they have in their equity portfolio it's also Berkshires also the third largest investor in shares of Apple so when we sat down with Tim Cook this weekend I got the chance to ask him what he thought and how he found out that Berkshire was first buying into shares of Apple listening I found out probably like you did which is the 13f gets filed and somebody tells me about it and oh this is really cool Buffett is investing in Apple you know we we welcome all shareholders but we run the company for the long term and so the fact that we've got the ultimate long-term investor in the stock is is incredible because our our interests are aligned and then if I knew Warren before then but we had no idea that we're looking at the company they do all that obviously secretly and have their own method of doing that and it's it's been a privilege and I'm super happy they've been accumulated what happened when you found out was there talk around the office were there any high-fives or was it a oh boy now what what it seemed like a it seemed like recognition in a way and in a like an honor and a privilege and I don't mean that been a light-hearted kind of way I mean wow it's more in Buffett isn't investing in the company and yeah and so it felt great I think for the whole company because we knew that he didn't he's been very clear he didn't invest in technology companies and companies he didn't understand he's been totally clear with that and so he obviously views Apple as a consumer company and in a different kind of way I think that's the that's that's really special a Warren what did you think hearing this because when I told you we were gonna tell you how he found out you said oh good I'd like to hear the story you've never talked to him about that and that not about that specifically no I have known him a little over the years I'd seen him maybe at least once a year and and maybe maybe twice year and I've talked to him on the phone a few times and Salmon Ladder I sent him a Martin Luther King speech some years ago that was kind of lost to history that was terrific and I thought they'd enjoy but no I didn't I didn't call him up while we were buying I try to keep as quiet as I can what would buy anything China though is a huge issue for Apple it's why the stock had under pressure earlier this year at the end of last year last week on the earnings call it certainly sounded like they thought China the situation there was improving what what does this news today mean for this for you well the important thing is really what the relationship is with China three years five years ten years twenty years from now at this I mean this all enters in and certainly it it's hard for me to imagine that the two most important countries in the world would do dumb things over a long period of time but they could I mean that the the possibility always exists that you get miscalculations or egos or or national pride or whatever it may be and that things do escalate I don't think that will happen I know it shouldn't happen I think it's a little probability but but but that would be bad be bad for everything Brooks you're owns I mean it isn't a question of Apple or have a very negative effect on our economy or the world economies and and there's there's chain reaction shorts type of things so I don't think it will happen but I don't think it's a zero that probably you say it would be bad for virtually all the businesses that Berkshire owns but apples are in a pretty unique position because it is so front and center because it's already come up as a potential target for some of these things do you think Apple runs a special risk or not well it would have I mean obviously in terms of our electric utility in Iowa it's going down we'd have a very minor effect relative to the other types of businesses but the ripple effect if you in a recession and it hits everything almost eventually and so I think it's very unwise it's kind of like having a have a nuclear war you don't want to say ha ha ha you know if you're in Canada because don't we attacking United States or something it's impossible to contain it if you have two superpowers and in trade and by the and and and you can't predict exactly how it spreads Apple shares are down three percent this morning I'm just looking at a chart yeah that's good why well because they're repurchasing shares and when they repurchase shares our interest goes up and we don't lay out a dime I love it you know and and obviously it's better to buy it at excellent 2x they've said they'll purchase they've reauthorized up to seventy five billion dollars in additional shares your fine not you're in favor of that I should say wildly I'm favor of it we're gonna talk a little bit more about share repurchases not just with Apple but more broadly because it is a question that came up pretty frequently this weekend at the annual meeting to repurchases can be the dumbest thing in the world or the smartest thing I've seen both but they're just repurchases by the company or just like purchases by us they're dumb at one price and they're smarter than other price and I like it when companies I like it when we're invested in companies where they understand that many companies just repurchase and repurchase you know it's the thing to do and they're encouraged to by some shareholders and by their brokers and repurchase it can be done they can be smart at Apple they've been smart warm we did talk at the top of the last hour about what the China tariffs potentially mean for business and what they mean for Berkshire but you're looking at the markets down almost 500 points this morning and for people who are just waking up and just kind of trying to figure out what this means for them for their portfolios for their businesses today I'm sure they've got some questions what what what can you tell them what what do you say when you look at the markets I guess down 460 points right now for the Dow well I'm saying if you own a farm and you're worried about something your farm because you read the newspaper this morning or you own a perfectly decent business in your town and you're worried about something you think you should worry about selling your business today because then you should think about worried about thinking about about selling stocks but if you look at stocks as businesses as you own little pieces of why in the world should you solid based on on headlines of any sort I mean if you expect a business if you expect the farm to be a good investment over ten years if you expect to an apartment house to be a good investment over ten years and if you want a marketable security which is an interest in the business and you expect that business to be a good business over ten years it's nonsense to get feeling good or bad about what stock prices do in a day unless you have extra money and they go down and then you feel better because you can buy more of them cheaper just like if you could buy the farm right next to cheaper you'd love that if you were a farmer you know usually that's an analogy that I understand and agree with but this time around a farm in particular I would be pretty worried if I was the farmer trying to figure out if I should be planting soybeans or if I think I'm going to be able to make enough money to get things back this time around tariffs have hit the farmers particularly hard and a lot of them have said they're behind the president they want to see us get to a better situation but many of them are also in a position where look they've already asked been asked to give a lot they thought we were about to reach a deal and they're hoping that the when they're making decisions for this planting season they have some players well it's true that business generally has improved markets and programming and the farmer has not participated in that so this has been a very good economy for a long time I mean that we've been coming back for eight or nine years and businesses kept getting better interest rates have been low for business stocks have gone up and the farmer has not participated the same way so maybe I shouldn't have used that example but they if you have a decent business I mean you buy into a business you don't buy a stock that Wiggles around you know and and people understand that but then they behave as if it's bad news when the business that the price goes down it if you had a half interest in a wonderful business and the person that all the other half came in and they were depressed by these headlines today and it's also do you my my share of the business a lot cheaper than yesterday because I think this whole thing is going to just end the world just say here I wish you were proud to be cheaper you know the business is gonna be here five years from now and ten years from now and all the headlines you don't know what the world's gonna look like in three years or five years or ten years what you do know isn't the United States is going to grow over time and the businesses are going to generally do well and if you own decent businesses you'll make money that's a great long-term perspective but for the shorter term not just for stock prices even for companies that are trying to think about their quarterly earnings or trying to figure out how they're gonna be able to pay for some items or figuring out how the relationship with the supplier is going to work at this point it could be an impact and pretty that's fairly new terms are owned subsidiaries obviously where they thought that tariffs could be increased they've loaded up more on inventory I mean know you you make business decisions but you don't make a decision about whether to buy or sell the business if you've got a good business and you've got it if you're gonna own the business for ten years you're gonna see a lot of terrible headlines you know I'm bought into my first business in 1942 they didn't notice that I did but just imagine all those headlines at that time in the world you know the Philippines were falling I mean we were losing the war and but the United States is going new kids are gonna look better than you did and your grandchildren but better than they do and and generally speaking productive assets are going to be worth more in this country and if you own a diversified group of productive assets you'll do fine as long as you don't read the papers although you did say an hour ago that the sell-off when the Dow was down by about 500 points was not an undue sell-off was not overdone at that point if we actually get into raising tariffs right well India it may not be undue I mean the day or the week but you shouldn't I don't have the faintest idea how to buy and sell stocks for a day or a week or a month I know how to buy businesses for a long period of time I'll be wrong on some of them you won't be wrong on America in terms of that when you look at the markets today if you see cheaper prices would that mean that you would buy more of a stock that you might have bought last week yeah some one more hit levels that I've might have been below you know I will always react well to declining prices but if I like I like to buy a business you know if I could buy this hotel we're in and they drop the price is that good news or bad news for me if I like to buy hotels so but the fundamental point some people get it some don't but when you are buying a stock you want you're buying something Wiggles around or is on a charter has a target price you're buying part of a business if you're right about the business you know that crazy price you can be right about the stock as long as you don't do dumb things yourself over the weekend a lot of questions came up about share buybacks people were asking specifically about Berkshire why don't you buy back more shares of Berkshire especially when you have a hundred and ten billion dollars in cash on hand what's your answer - well we want to buy we will only by Berkshire if we think that the shareholder the next day is or that say is wealthier after we've bought the stock in other words we bought it for shade less or maybe a lot less but but at least a shade less that it's actually worth and we don't set up to buy any given amount we set out to buy stock at prices below intrinsic value for sure now intrinsic value for sure is not something that is is precise to the penny or it's probably a band of 10% or something like that and my partner Charlie Munger if you asked us to give you a slip of paper with intrinsic value per share on it would not be the same figure but it'd be close and we both would have the band or something of the sort if you're buying it both at figure you know if I'm we've got a dollar and you'll sell me yeah and we put it on the table and you can't reach it for a while you say well I can't reach it it's also a my share for ninety-five cents I'll give you a ninety-five cents you know she's a $1 - yeah guys so it's not complicate maybe it may be beyond my ability to figure out the intrinsic value of certain kinds of businesses but with Berkshire I've got a reasonable idea and I tried to give the shareholders the same information that I regard as important in calculating that now it can change presumably who wanted to change upward over time because we retainer and said we should be building more value but but that's the question first of all you have to have the cash you need to run the business I mean that's Steve Jobs called me one time I mean he called me I don't know how many years ago but but I even think was thinking about repurchasing shares and I said Steven there's just two questions I said you know a you have all the business all the money that you need to develop the kind of business that you've got in your head for the next five or ten years and all he says we got plenty of money and then I said then the second question is is your stock selling for less than it's worth and he said it's Allianz so and for a lot less than it's worth and I said well you've answered your own question and bottle-feed answered we need we need the money we've got here actually to fully develop our business and we've got opportunities to do it it's forget about it you know build the new planets and do that maybe the cash will come in later where you can buy stuff and secondly if he said the stock isn't really cheap what's the reason for buying it in did he buy back shares after that he didn't like I think he was hoping I was going to give a different answer but I think maybe he was hoping for a different answer it's interesting that you say that because Tim Cook the current CEO of Apple was here this weekend and we got the chance to ask him about share buybacks too because share buybacks have been such a big deal for Apple they've deployed so much cash doing that and just announced last week at the earnings that they'd be buying back an additional 75 billion dollars worth of Apple shares or at least they've authorized the repurchase of that much again we sat down with Tim Cook this weekend and here's what he had to say about that to listen in Warren this is a funny story of debt is back in 2012 I been in the CEO spot maybe a year or so we were we had a growing amount of cash I think we had just cost 100 billion kind of market my memory is correct and I was and I was getting lots of input from a lot of different people as you you can guess and I when I don't have experience in something I always make a list of the people that I think are the smartest people that I can contact to talk to them and get advice and Warren was on the top of the list as you can imagine I'd never met Warren before and so I get his number I call out in to Omaha and I'm saying I wasn't sure you take a call you know sorry calling out of the blue he doesn't know me from Adam and but he took the call and I had a great conversation with him and that was the first time that I'd met Warren and he was very clear to me I still remember he said he goes let me just cut through it if you believe your stock is undervalued you should buy your stock and I thought that was just the simplest way of looking at it so here's what we do is we first and foremost take care of our people and we take care of the company in the future of the company and we've been investing a ton in both this country and some others we're gonna spend three hundred fifty billion dollars in United States and building their sites and we just found such a new expansion in Austin so forth so all of that is number one right and then if we have money left over we look to see what else we do part of what else they do he said its to make acquisitions and what I didn't realize is he said they're making an acquisition every week or two they make a lot of small like he said they've made twenty to thirty acquisitions over the last six months small acquisitions that they don't really talk about and don't tell people things about yeah you knew that if you look at the 10-q and you know you can see but they they they make a lot of acquisitions yeah and and is it I hope Berkshire makes a lot of acquisitions and I'd rather buy a an attractive business than buy our own stock at its intrinsic business value if our stock gets well below that I've still got this strong and I can do both fortunately but but why how an executive it can pay say we're going to spend ten billion dollars buying stock and then not paying the attention to the price at which they buy it they wouldn't buy any other business that way and and so we're price sensitive on it on the other hand when the price is right there's no easier way to make money for your shareholders you say you like Apple buying back shares so you think the price is right there well they've done a terrific job of it they've done a terrific job they've made their shareholders a lot wealthier because Kim has done that aggressively when the price was right what I mean how do you know in hindsight if do you know and how can you tell when a company's doing a bad job repurchasing and if you have to be able to figure out how to value these guys properly it's easier than you're making it said about the dress the truth is if you look back and I was director of the company but coca-cola kept repurchasing their shares at a time when it didn't make sense if you look at it in the years earlier they just they they they had a terrifically good idea of repurchasing one to come company only had a market value of you know in the less than ten billion and they bought a lot of stock and they were aggressive about it and but they fell in love with the idea and I was a a director at the time and and but they're one of many I mean the same thing happened that you'll add to it every eight it's interesting sometimes it's difficult for CEOs to be objective about their own stock price and they think this but they think the higher it sells the better you know and that's a fine way to feel example if you're repurchasing and you purchased at a prices up to the sky when coca-cola was buying back shares and it turned out it was a too high of a price and you are a director did you know that at the time I had a pretty good idea why didn't you say something well I may I may have made some comments but I the management had done a sensational job I mean that's one of the reasons it got so high they done a terrific job there made me a ton of money and and if it belch too often at the dinner table you don't get invited to parties anymore which is the difficulty I think with probably any it just that you don't get to be a director if you look maybe you're an activist or something but yeah people don't like it if you speak and some some CEOs like it a whole lot less than others some CEOs actually encourage a fair amount of dialogue and others you know make sure that all the important stuff comes up at 5 of 12 1 you have to leave at 12 to catch your plane explain six hours later that's interesting boards are managed in different ways have you known every board you've been on which has been managed well and which is not well some an aged well in some respects and they can be dumb financially I mean you have some sub management's that really have a money sense and then you've got others that that they're very good managers but but they're not good at I always love it when I hear management you know and I asked the guy what he's doing with his own money and he says well I couldn't possibly you know about you like stocks and everything I turned that over to somebody else and and then he goes out makes a five billion dollar acquisition or something doesn't really don't want to think about just buying a whole lot of stock some are good at some art that's true of our managers we have terrific managers some of them are good at bold on acquisitions and some of them would be terrible do you let the ones who would be terrible at it go ahead and make it both on it very often some of them don't have have great operational sense they don't have a money sense exactly you know that you talk to a lot of managers CEOs and they don't want to run their own stock portfolio well those are those are decisions and those are capital allocation decisions and they know a lot of they know a lot about businesses and they know how to value the things you'd think they'd be good investors but but I used one thought it was a big partner and back when I was running a prior ship a long long time ago and he had stock options places and he would regularly exercise and take the money and buy Berkshire well he actually was you know that's unique to have somebody who understands both operations and the money side of some some really do and I'm thinking I was I would say Tim Cook for example does x-ray he has a real grasp I mean he has he has a operational minor knee and someone in mind as well what about Greg able energy I asked it because a you know Berkshires in a unique position and you have people who are doing all kinds of things some who are managing money some who are managing operations yeah can somebody do both of those guys happen to have extreme money sides but I don't want to get startled I understand can't help but try welcome back to squawk box President Trump tweeting just minutes ago the United States but has been losing for many years 600 to 800 billion dollars a year on trade now with China we lose 500 billion dollars sorry we're not going to be doing that anymore take a quick look at the futures continue to be down close to 500 points 471 Point 472 Nasdaq down 161 that's a P down down 50 I guess Becky if I were to pose a question Warren it would just be that those trade deficit numbers you can you know we get bogged down and talking about whether they're good or bad or how to fix them and it's a symptom of really what it's a symptom more than a cause of what what happens with China I was just wondering Warren you've done great over the years with the status quo with how the United States is approached China and China trade Berkshires done great we've all done great everything's fine do you wish that Trump hadn't confronted China at all and we just aren't addressing any of these long-term problems with intellectual property or you know take your pick of which issue we're trying to solve but you just wish you'd left it alone and just let Berkshire do its business the way it's been doing or do you think there's some rationale to to confronting China China in the United States for the next hundred years I can tell you two facts about it there'll be the two superpowers of the world and we'll always have some tensions with them and and it can well be about intellectual property certainly has over the last you know 20 years or they're about 30 years and it will be about trade it will be about policies that they're carrying out you know in terms of their neighbors or we're doing there's no way you can have to come countries so dominant in the world without them having unless you you just don't you know you they're gonna be tensions they're gonna be negotiations and sometimes we'll both come away thinking we lost but it's inevitable so I and how you play the game if you're negotiating with some people that are tough negotiators on the other side I mean it's it's not those are not easy decisions to make I mean if you're doing with the labor you know nobody really wants to strike it's bad for both sides but it's sometimes things developed at that point so I I think I think you should get very used to the fact that if you're a young person you're going to see a lot a lot of different tensions over time and a little bit on the individuals involved and on the specifics of the situation but every time we sit down you know it won't be like a garden party Warren um you mentioned that there are gonna be times where both sides walk away and feel like they lose are there times that both sides could walk away and feel like they win because that's usually the sign of a successful one you want both sides of feel like they want to be and you know the idea of a negotiation is to to take something that that you have the other person needs and and and and in a sense trade that for something that they have that you need and and it's it's gonna be constant and and and and there's times when it's going to be tense it's just the nature of things you have that yes that a much different level when you're when you're negotiating nuclear arms reductions or something those sorta I mean we know it's in the interest to get the nuclear stockpiles down and all of that but that doesn't mean it's easy and and you you you you try to come up with deals that are good for both sides but that's that's not always easy I mean I try and think about that in this scenario and it it may be particularly different difficult in this scenario because for a long time we've been dealing with China as if they were still not a superpower as if they were still and so we've been giving them better sides of deals it's really hard to all of a sudden say we're taking some of the that back what what do they get out of this deal when we are trying to change a negotiation that we think has been unfair to this well it it's difficult for us to accept the fact most difficult for us to accept the fact after World War two that that that the Soviet was a superpower in terms of military power and and there were I mean as you know obviously there are all kinds of tensions involved in that and negotiations and and it's still a worry that you have to we have the two big nuclear stockpiles in the world and you worry in terms of mistakes being made I mean that it's a big game and with China it's overwhelmingly an economic game and it's an economic game we game we didn't think we'd be in 40 or 50 years ago I mean the Chinese the rise of their economy has been extraordinary and they do some things we don't like in connection with that and and sometimes you have to get tough to to make changes and we do some things they don't like but it but it's a reality now and it's going to be a bigger reality as the years go by and and it it's very easy for it to become a huge political issue I mean that so you'll have people fanning the flames for their own personal interest in politics or their own interest in in business manat easy-to-navigate but but leadership has that's the job of leadership is to take on the top problems having said that the economy has held up very well in the face of any tensions that we've seen to this point jobs report incredibly strong on Friday the last GDP report was very strong too so you can't stop America you can't stop China though either but you can't stop America I mean we're good we live as a country you know it's extraordinary what we have compared to 30 or 40 years ago that even in agriculture makes it tough in agriculture because we get more productive all the time and and and that that tends to depress prices but this country is going to move forward I mean there's no question about that but China's going a little forward and the way to try to do it is to do it that maximizes what both company the countries can do well and and and and more trade is better but trade in specific industries can hurt specific industries here and that that's a huge problem that the president the heads of both countries have to be the educators in chief and they have to explain why trade is good for the populace as a whole and it can be terrible for people in certain industries and that a rich country takes care of those people that become roadkill in the process of producing about our life for 330 million Americans lots of people on Wall Street are not going to be as sanguine about this news today I've been reading some reports last night Goldman Sachs saying that this is not only rapidly increases the odds that we don't get a trade pact with China but also increases the odds that you could see Trump announced that he's going to pull out of NAFTA or that he's going to put Auto tariffs on European imports what do you think of that and what would that mean it's the problem of escalation and in anything we have the problem of that was with nuclear weapons I mean the escalation and and it gets more and more dangerous as people become feeling more and more threatened and their own local political situation demands more and more action I mean that's that's the dynamic that you're facing anytime you get to these major problems between countries and that requires the the wisdom of the leaders but to some extent it requires the wisdom of the people I mean and then and how the leaders conveyed people and how they conduct themselves but we will have this sort of thing happen we've had it happen obviously and occasionally we would turn into wars in the past we can't do that anymore in the nuclear world you you can't get to that point and at any same person realizes but you don't want to you don't want to get too too close to that tinderbox us MCA also better known as new NAFTA that deal is out there but now I think Pelosi is saying that they're not going to bring it for a vote at this point what are you in favor over the new knife to do well I was in favor of the original one I we are very very lucky to have Canada and Mexico bordering us I mean that and then oceans on the other side I mean it's it's geographically it's a very attractive position compared our countries are situated around the world and and we've got lots and lots and lots of common interests and and and we are the big guy in the game and there's the big guy in the game we should we should do more than our share of making sure that our neighbors are growing in and prospering at a rate that is consistent with our doesn't mean they're equal but but that when we live better they live better and trade with Mexico and Canada enormous ly important we should treat them as as neighbors and not not adversaries we are live in Omaha where we've been talking for the last hour and a half plus with Warren Buffett who's the chairman and CEO of Berkshire Hathaway right now we're joined by Charlie Munger who's the vice chairman of Berkshire Hathaway he is also the chairman of the Good Samaritan Hospital in Los Angeles chairman of The Daily Journal and he's on the board at Costco and Charlie thank you very much for being here with us this morning glad to be here it's great to see you we are coming off of the annual shareholders meeting and obviously we're going to talk to you guys about the news of the day but first I'd like to take the opportunity while I have the two of you here together just to talk a little bit about what your partnership has meant to each other how many years weren't have you been partners with Charlie I met him in 1959 and we instantly became partners in thinking and then over the years we've developed all these financial relationships but I knew immediately Charlie that that we were going to be we were in sync and we've lasted a lot longer than I thought we would but yeah but we have had a incredible fun together we've done all kinds of things some work some haven't worked and we've never had an argument we we we disagree on things sometimes but they've never we've never had an argument and you never second-guess me I try not to second-guess him it's a great relationship Charlie 60 years did you know at that first meeting that you'd have a partnership well I knew that we were on the same page but it's been very lucky that a little company became as big as it did doesn't it we've had the run we've had what's it like I think we're very talented and all that but we've also had a tailwind of good luck what's it like in terms of how how you all kind of use each other as sounding boards how does that work here if you will collaborate in their own way they're better off Einstein would neither be able to do what he did if he didn't have various people to talk to it's more fun - yeah the ideas are better net but it's also more fun and when we disagree Charlie says will you'll end up agreeing with me because you're smart and I'm right [Laughter] you're you're both pretty you both act pretty unilaterally though you both kind of do your own things and then come to each other facto he knows what I'm thinking I know what he's thinking and either one of us would ever do anything we really thought the other ones opposed to we might we might feel that with a little something - no but we we are in sync let's talk about a deal you did recently occidental right where you agreed to back them up you you cut that deal and then you call charlie but you knew what he was thinking already I didn't want to wake him up doctors at the coast I thought be very unverified yeah or I knew I'd be for that deal sure I do how did how did you know that howhow do you know so much about each other and how you think well Occidental's in my part of the world and of course I've followed to some extent the developments that are interesting and what do you think of the accidental deal why do you like I like it why I think it's got potential because well because I think the Occidental is right to want to do it to buy into the Permian Basin to get more assets absolutely and what is it about the Permian Basin that you like it's got a lot of don't like it desert just for his own sake I asked Warren this earlier today if it's such a great deal in the Permian Basin is such a great deal why didn't you just buy in a Darko nobody asked us to that may sound strange but but who knows if they'd come to us you know we do we do usually wait till people come to us so it isn't like we if we wanted to buy into the field we necessarily then you know start dialing and flying around and everything that that occidental knows a lot about the basin and we don't actually like having somebody with us that know something about it yeah one word Salomon we had something called anglo-american that some promotional operation but there's no person selling it anyway but there was for something but it was it was neither it was neither and Swiss actually angle Swiss and they came to the directors and had this big plan for drilling in Russian and we were gonna put a lot of money and send it to Siberia and hope that we got oil back and Charlie said you know who's Anglo and and who's Swiss it was Swiss and and of course none of these people were I mean so they were lying in the name of the company and I did not go over so what was a Salomon board would Charlie pointed out and he sent a lot of money to Siberia and they got one little vial of oil the guy came to see me one time after I become chairman he showed me this magnificent you know exactly the kind of oil they wanted that's the only oil Weavers saw and it was producing 50,000 barrels a day toward the end they just kept it off and yeah and go Swiss Anglo Swiss no anglers are no Swiss just wise all the way down let me ask you though about Occidental and the steel in particular if you like the Permian Basin but you've also both commented on times when you think you've paid too much in the past is there a number that would hit that you would think okay this is paying too much for the Permian Basin to Charlotte of course all the time we always think that way yeah but it's not anywhere near it the price that they're paying right now yeah we don't know we don't know it may be the last dollar all we know is we're willing to do it you both have made some comments about it recently to us that you think prices are very high in terms of what you have to pay for a premium for buying a company outright is that because it's having more competition for buying companies by people who are using other people's money and therefore have less sensitivity to price and who are willing to borrow a whole lot more and are being offered the ability to borrow a whole lot more with less than the way of covenants the competition is tough on it and make it part of the upside and none of the idea of not none of the downside I think they make money on the downside yeah so that that is really terrible competition for us it gets worse every year is that why you're sitting on such a big pile of cash at this point part of the residual on the other hand you know I would much rather own many common stocks than bonds and of course that's I think stocks compared to bonds and you have to compare they are the old woman we've talked about bond yields and fact being gravity and when they're very low there's very little growing gravity to pull down stocks and and that condition that's exists today you know weed so much rather on America the business of America then get a 3% for 30 years from the government that and people were making those choices all the time in the investment world that stocks actually in many cases it looked like perfectly intelligent investments Charlie you agree with that sure let's talk about some of the IPOs that have been coming to market recently because there has been a bit of a fervor many of these IPOs have done very well although not all of lyft shares are under pressure uber comes to market this week and Warren you mentioned this weekend and you talked once again about how you had looked at uber about 18 months ago and and passed on that what do you think about new burr coming to market now well because I looked at I really don't want to that discuss right I don't have any special feelings about it then any other coming to Martin but we I would say that in in 54 years well I don't think Berkshire has ever bought a delicious I mean the idea of saying the best place in the world I can put my money is something where all the selling incentives are there commissions are higher you know the animal spirits are rising that that's going to be better than a thousand other things I can buy where there is no similar selling enthusiasm and the desire to get the deal done and extra commissions that that's the single best thing to buy at a given day I mean it's and I can't think that time we've ever done ever bought an idea yeah never well but how could it be the best single thing to use your money for in a given day is it something that you've got they got everybody the world out pushing it you know it it just doesn't make any sense I mean I'm not saying that necessarily what we're buying is going to work out better but there have to always be better things then one single issue if you make one decision on investing if you can't find something among all the choices we see that is better than something that and like I say you know the Commission's used I come down I think now on this but I mean the highest Commission thing that a stock salesman's gets out of securities was the new issue so yep all this push why don't we like to buy things we're nobody making a dime sell them to us Charlie just specifically on some of these companies and I won't talk about uber versus any of the others but a lot of these companies are coming very late in the cycle they've had mass of private capital that's been put to work to this point and they they still have massive losses and the need for more capital what's even worse than that some of them have preference for each round and so the rounds are really fair rounds there's a lot of lying and modern finance so you're not in favor of any of these big dollar lying what what do you think of these I ask this because we have a lot of retail investors who watch and who are looking at this and they feel the excitement behind it was about 5 euros whatever you buy a stock let's say your bike and General Motors 1.4 billion shares I will say the stocks for it is a little below that you should be able to take out a a one-page sheet of paper and say I am buying the General Motors company that's 56 billion dollars because and if you can't answer that question if you can't write that out then y'all go on to something else and if you're buying Berkshire you have to say I am buying Berkshire Hathaway at 500 billion dollars because and if the answer isn't something you can write you can't say I'm buying it because my neighbor thinks it's got to go up or because you know everybody's talking about on on CNBC this morning or whatever it may be I like already round over yeah no yeah you have yeah that's the question you answer now when you buy you know buy groceries buy everything else you can answer that question but if you can't answer it on something that you're bobbing your savings you know may here's more well why in the world should you why should you be doing it let me ask you gentlemen about a topic that came up over the weekend at the annual shareholders meeting and that's shares of Wells Fargo and and just the company to this point I got a lot of questions that were sent to me by shareholders questioning why you all have been standing behind Wells Fargo without saying more about what went on there Charlie what do you think well I think it's a fine company and so they made one bad decision about an incentive plan I regarded as an honest mistake not as some deep moral failure nobody was being under my ranks of Wells Fargo they just had a blind spot they had a blind spot when it cleared up very quickly though that's the problem yeah yeah but we get it on you don't they lost their jobs over a blind spot and huh but I don't think Tim Sloan had a blind spot I think he just lost his job because life is hard you thought dick kvass I don't like it you thought dick cavasso much had a blind spot yeah sure and and the following guy john stunk yeah but you don't think there was any criminal activity of course not but a car like tell you is filled whoa and that was forgivable they were under a crazy insanity system is the problem fixed now I think so I think a very a very very high percentage of what would be it certainly the intent this is correct I mean it's it's cost the shareholders you know a lot of money and and they want to correct that when I went into Sol and I wanted to correct it - I never could quite say it was over though people kept asking is over I don't know I wanted to be over I hope it's over and I'm trying to make it over and I'm looking for things but when you have 200 well they have 260 or so thousand people it's a it it's it's a scary job to be running a city of 260,000 people with no cops and we have something we have some things wrong at Berkshire now that I don't know about the Charlie meats this into me all the time you know as soon as you find a mistake do something about it and and sometimes that's unpleasant but I've got to do it I mean it I may have people that are deputized to do it but it's my own yeah and you do do it too fast is Wells Fargo different because it's a shareholding and not an actual Berkshire company that you own outright of course we don't have any control over you know what they do who should be the new CEO Charlie well I've been taking it it would have been Tim Sloan but now they're gonna get somebody sometimes a new person is better and sometimes worse about it I think about half and half yeah that's something yeah I met two weeks ago or thereabouts with four people and including Betsy Duke the Chairman and and and I never thought the first time I met her of my life or talked to her and as it but we talked about it then and it's it's a tough position to fill what did you tell you you talked to the chairman chairwoman of Wells Fargo and told her that you think what about no they think they called me I didn't call them I mean I I was I didn't jump into it but they they just asked what I thought that's first time they had best but I thought about it and I'm I gave him a suggestion or two and these people but I've suggested I well I suggested publicly that you know not be something from Wall Street not because aren't even good people on Wall Street I just think that that politicians are looking for the next one to be a pot and it's good television or the place right into the campaign and and you need somebody running it that does not bear the extra baggage of having a label on their forehead that says Wall Street which will cause half the viewers to cheer for whoever's you heard at the top all of this concern about China this is spooking the markets a little bit today Joe's right it's a decline of under 2% for the day but still down 460 points as a number that catches your attention and when you look at China's markets down five and a half percent and down seven percent that is certainly something that is catching their attention today too I can't think of three better people to talk about this this morning bill you've spent so much time going back and forth with China you know the Chinese leadership very well and can understand maybe what they're thinking on some of these things Charlie you've spent so much time getting excited about investing there and Bill you've invested there as well Warren same thing all three of you have traveled there and spent this time I just wonder what you're thinking about this morning as you hear these headlines and Bill you're the new one at the table today so I'll ask you to start off with this what are you thoughts on what you hear with this tweet and the potential for a real trade war I think good trade relations are incredible win-win for both countries and it's dangerous that people think this is a zero-sum game and so I'm hopeful that despite the latest announcement there is a trade agreement in the the two countries can find ways to work together it's the most important relationship in the world both sides bring a lot of strengths so it's I understand why markets are a little bit worried that that the these tariffs are gonna get higher and higher when we first got the tweet there had been some initial reports that Lee who and the delegation from China might not be coming here that's what we were hearing last night this is the first I've heard just a moment ago that the the Chinese have confirmed that they will be sending that delegation this week that in itself is good news but how do the Chinese kind of deal with this when when they're forced when they're faced with a real force like I think that tweet yesterday was well I'm not an expert on negotiation but it creates a a dynamic where both sides could start escalating against each other which would be a lose for both sides so you know they you know this week will be it'll be interesting you know they did even though China is not a democracy that the political dynamics don't allow them to look like they're caving in to a unilateral position Charlie you are an expert of negotiation what do you think well hardly but well if you back we we put a tariff on trucks to Varennes the Japanese from totally squelchy in the whole American auto industry and that lasted a long time it wasn't the end of the world so if we ended up with some trade settlement that involves something tariffs on both sides I don't get excited about it at all I rarely as part of normal life generally speaking I think a good settlement is better than lovely World War some tariffs are one thing 10% we seem like our economy has gone along just fine even with the 10% tariffs that existed on those 200 billion dollars today it's 25% tariffs on potentially all 500 billion plus of the imports coming in would that concern you about the American economy well I don't think we want a full-scale tariff or as it's just as high as both sides can make it that would be massively stupid and if both of them are a little disappointed with the negotiations would feel a little roughed up that's so they should feel what do you mean they should feel roughed up well both sides since a settlement is so much better for the war trade war for both sides they ought to just get used to having a little loss of face and make some kind of a settlement and I think they will what do you think about us taking a stance as being America taking a stance with China to this point well I don't think Trump is totally crazy to say that in some occasions you put a tariff on to save some no as the end industry is he right that we have been on the losing side of the deal for some time there's a lot of Americans I think he thinks of it more as a loss of we've got a trade deficit and I don't think that's it all automatic so I don't totally agree with him but I agree with Jonathan barge war on what do you think in terms of who pays the tariffs I mean that has boosted the US Treasury but a lot of those tariffs are being paid by the companies that import the goods and then passed on to consumers yeah their attacks on consumers and and you know as such that it changes what people buy it changes where things are produced it readjusts you can readjust the world you know it was through tariffs and and generally speaking I mean there's obviously exceptions for key equipment military equipment or you know but I generally think that a world that adjusts to something very close to free trade more people will live better than in the world that was significant tariffs and shifting tariffs over time I was a subject of constant negotiations and war two of this heavy crate on both sides yeah not not a trade war you mean a real war yes yes but you gotta remember that like our country the United States ran on tariffs for the first 150 years that was all we had this is not like some novel new thing is coming in this is an old subject is it a good thing or a bad thing well of course I'd rather have total goodwill and everybody getting along but I don't think it's the end of the world there's some little tension on the subject there has been since the start of the country bill just now said he's not surprised by the market's reaction warrants is the same thing earlier this morning what about you well what do I care about a brief temporary reaction over some over or over trade negotiations does that mean they're all so many little rebels in the space time to me look if you look at Chinese stocks in one market down five and a half percent and the other in the Shenzhen market down by over seven percent are our futures are down but that's still a decline of less than 2% this morning does that mean it's more painful to China than to us well I don't think China likes its market going down as a consequence of a trade uproar I think people are more like this settle a thing because they had this uproar today the settling is it sounds like a great alternative but it certainly does there have been a lot of friction along the way the biggest one may be just how do you enforce it and the at least among many of the trade negotiators and the negotiators in the United States that when we've cut deals with China in the past they say things and then don't follow through on it how do you make sure that if we have a deal it's actually enforceable I think China buying larges is a pretty good place it certainly worked well for the Chinese and I think it's desirable but it's worth it it works well we want China to prosper this yeah we do if you postulate a world where in the next 50 years the China or for that matter of the United States but it feel like they're being abused and the word isn't being kept and yeah it's for one thing and then you want to ask for one thing more I mean you're gonna have always have tension between the two countries all all we doesn't disagreements but you can't you can't really turn it where it gets not if there's something working out of control and things can't get out of their control partner but I guess I'm going back to try and figure out which side you think is right nobody wants to say that does anybody think they're both right to be as concerned as they are and I predict they'll settle it would you all agree with that same prediction though what do you think you know the it's a dilemma when it appears you're reacting to a an ultimatum you know in the in the Chinese case there's no elections scheduled so their leader won't be unelected simply because they've had to take a tough stance on on trade negotiations you know I markets up until recently were assuming this deal would get closed so that's a little bit why you see the Delta the rationale thing would be for a deal to get closed and I you know I'd still rate that as as likely I agree with bill deadlines are tricky thing so I mean that yeah they produce reactions and people and they they can think of you're responding to public opinion they couldn't they can't inflame people and then they start reacting their own the tricky things on the other hand sometimes it's best way to get things done a good sign though may be that the they just said that the Chinese delegation will continue to come because I had real questions about that or doubts about that myself after seeing that yesterday you want to conduct a negotiation so it doesn't look like the other guy has to cave or something exactly the ideal thing is to make a hero out of him and still get the deal you want over the weekend at the annual meeting you two had an aside on stage a lot of people kind of picked up on you didn't follow up on it so I thought we could do that here you were talking about Dairy Queen and how your presence in China is not large but you do have a presence in China for Dairy Queen it is a very large presence but not for Berkshire Hathaway no but you made the comment Warren that you you would have been a much larger presence had a big deal gone through you made it as a side to Charlie I was over the mics well Dairy Queen no not turning Dairy Queen into some global giant yeah we've looked at good sized things in China I would anyway you know we've done a couple things in China and Charlie's done more individually and and it's logical I mean with the kind of capital we have the big markets outside the United States they're gonna be the place where you're most likely to do something and certainly China's gonna be the biggest market and then outside the United States and there should be opportunities there and I think we are someone at Berkshire I think that that if they're looking for capital around the world we're a very logical prospect why did that deal not work out was it because of the trade tensions I can't go into the details on that thought I'd try you'll be the first to know in terms of what you do with your businesses do these trade talks have any impact on you on your investments even your own personal ones because you all have a large individual portfolio that you do and Charlie I know you focus on others no you focused a lot on China does this diminish your enthusiasm for Chinese investments in any way no no it doesn't really if we got a call today from some business we understood and liked from China and they were looking for a lot of it was big you know we would be delighted to get that call and we would follow through and we'd see whether something happened but that that would be that would be very interesting to us bill how about you well certainly you know there is in parallel with the trade talks talks about what the technology export regime will look like in terms of things like artificial intelligence and so I have some concerns about whether that will try and partition you know Chinese students from American students the general sentiment towards China right now is has gone down a bit and so there are businesses or business deals that have to go through a new process and they're talking about even making that tighter cepheus are beyond I think so I you know I'm I'm worried about even just sort of intellectual cooperation being slowed down well we'll see where that goes but it's a if they take our intellectual property at Dairy Queen no we can handle it we've talked an awful lot on our air recently about socialism vs. capitalism defending capitalism all of the different political pressures that are kind of being brought as we get into another election year and I thought maybe we could talk about that this morning - over the weekend several questions came up about defending capitalism in Warren you you did step out and and say that you're a card-carrying member a card-carrying capitalist in front of everyone what do you think about the attacks that we've seen to this point on capitalism well I think don't think people exactly even know what they're talking about it isn't the capitalism it's perfect but if you look at what was here in 1776 and look at what is here now this country is an incredible job in terms of the deployment of resources and and and human ingenuity and that is a product of the system and now does that mean that every decision should be made simply by open market determinants know that there's need for regulation obviously and there are things that have long term costs and might not get built in but the idea of people unleashing their potential using the resources they have to create what we have now from what was here two hundred forty something years ago it's it's absolutely a miracle and yet what all three of us have seen during our lifetime and if you compare that with any centralized planned economy I you know I think we win hands down and I I think I think we've just started with what capitalism couldn't produce in the United States but I do think it obviously it it needs certain rules and regulations well you did an interview in Davos with someone and I you made a pretty innocuous statement that you looked around you thought capitalism was the best system and you can attacked online from all these people who came up with these crazy statements about how could you say things like I mean what do you think about the climate when you see things like that well some people think when you defend capitalism you're defending the tax rates we have today and saying that higher absolute tax rates are more progressive tax rates that you disagree with them in I I don't think Warren and I are disagreeing that you could make the taxes more progressive in fact we've been very explicit in some areas like the estate tax and saying we think that would be a good thing socialism you got your where she came back socialism used to mean that the state controlled the means of production and a lot of people who are promoting socialism actually aren't using that classic definition so what we're gonna have is capitalism with some level of Taxation most people really aren't arguing against capitalism there may be a few but most people are just saying that the taxes should should change although you do have someone who I think is pulling the second-highest and the Democratic Party right now who was a socialist until very recently Bernie Sanders well whether or not he was a socialist by the full term about now there there is some money areas when you start to say there shouldn't be any billionaires that you have some cap on wealth or something like that that goes beyond what I think and and you could say I'm self-interested but the present ones a government needs to reallocate some resources I mean extreme case would be in World War two I mean that's the closest we've come to socialism you had an office of Price Administration you had a war production board yeah but during peacetime you're always prepared for warned you do that through government government government needs to reallocate some resources but the the market system which exists under capitalism is an extraordinarily effective way and is proven it of using resources human and other kinds to produce incredible goods and Henry Ford could learn devise a system that could turn out a couple million cars a year but he could only use half a dozen himself or his whole family could use 50 I mean he had to turn out a couple of million cars that other people got deals and that that would not have in my view I I think if you'd set up a government Bureau in 1850 and given them a hundred years you'd have ever come up with anything like the assembly lines of Ford and all of the things that have happened human ingenuity is incredible and you want something that maximizes its use and and then curbs a few of the people may have just sort of evolved for themselves Charlie you've made the great proof of the how capitalism works is China when China copied Singapore and let the farmers on their own plots and let the manufacturers on their own businesses and so forth China's productivity increased many times and they went from rural poverty to modern extreme wealth and they did it by adopting a fair amount of capitalism no the Democratic politician doesn't understand that he's nuts you've made the same point though Charlie that you think private sector does it much better than the government sector however a lot of these people who are running also want to make government much bigger do you have a quarrel with that or now well as they say if you love your post office you're gonna love socialized medicine they don't necessarily want to make it bigger in terms of redistributing mean wanna the market system brutal and it leaves behind people who are perfectly wonderful people who don't have market related talents and who are just unlucky yeah just plain unlucky and in a rich society believe me if we have a war or something like that we call on those people and you know pay them practically nothing to go fight for us and it and then we want goods slowing but it's going to displace the textile worker that we used to happens on so so the the function of government is not necessarily get bigger it may be in an important way to take care of people who for one reason or another get left behind in a market system that you also regarded as the is essentially this huge source of wealth and goods and services so how do you fix the problems or at least the perception of problems which there's a huge perception out there and the American bloating right now obviously the help of our government we're wiser and it would be wiser if the two sides didn't hate each other so much anger drives out reason and there is absolute cold fury between politicians on one side and politicians on the other it's quite counterproductive for that reason I don't allow myself to get angry at politicians how would you fix it well I just don't let myself get that angry well there's I don't expect them to the Bursar's work better because Charlie and I've never done that each other it just does I mean way better we got mad each other I'd you know I try and kill his deals you don't my deal it just doesn't work that way we don't need a couple of alpha males bluster handling or this stuff just cool it and take a little reputational hit and get get the feathers but we Otto down we ought to worry about the people that don't then end of the system but we want the system and a lot of people are getting left further and further behind because as capitalism gets more advanced it gets more specialized and there actually is greater difference between the haves and the have-nots and the haves can take care of that at interesting is both parties and basically agree on that they just yes how you get there like examine and come Tax Credit can make a huge jump in that direction I mean you know Social Security all that we've done various things over the years we have improved we've improved the public school systems we've been proved them things that do give people more of an equal chance and take care of people who fall by the wayside we just got to keep doing it well you've spent a lot of time on education in this country trying to figure out how to fix it and how to make things work what's the answer if that's one of the problems that we're not getting people the advantages they need before they get into that system what how do how do we fix that aspect of it yeah I think better education is so key to the United States living up to the dream of equal opportunity and particularly as more and more of our students are in the inner-city coming from low-income households we really have to to take the best teachers understand what they do and spread that further that is the best path to a reform of equality the progress has been pretty modest but there's a lot of you know smart people it's not just technology it's helping the the teachers finding out the ones who are doing things super well and spreading that around even the college system we still have very high dropout levels and and the way you you catch kids early when they get off track some use of online I'm hopeful in the education area although progress has been slow surprisingly slow yes when we compare the improvements in global health which is the other big area for the Gates Foundation to the improvement in education education was proven to be tougher to make big gains over the last decade was that what you expected when you got started no it's actually the opposite because global health involved going out to poor countries whose governments are really weak and there's not even stability there's some corruption we thought that would be the slow area to work in but very important that we've been surprised by how how much progress have been in the overall statistics like cutting child to death in half in education although there's some points of light some great schools some are charter schools some are using new curriculum the overall figures us math scores dropout rates have moved only slightly Charlie just getting back to your idea of people not hating each other so much and getting along how do we make that happen how do you try and push towards that because it seems like things like that I think you have to do it one relationship at a time and of course I think would help but both parties did not commit suicide in the primaries we get these extremists on both sides and they take over each party it's just awful the California Legislature has two kinds of evil right is not cakes and left us nut cakes they've kicked everybody else out this is not a good system why did it wind up like that particularly in California hatred lots of hatred is it we district ma how would you disappearing as part of a mostly it's just a wonderful product of hatred gentlemen just taking a look at what we've been watching with the markets today obviously things are under a little bit of pressure today but we have been looking at much higher markets if you go back to the Christmas Eve low and the concern that about what would the fed what might or might not be doing since that time the Fed has sounded much more dovish and I just wonder if you couldn't talk a little bit about your own take on the markets and Bill again I've spoken with with Warren and Charlie earlier about this a little bit so how about your take when you hear that the Federal Reserve is probably not gonna be raising interest rates anytime soon how does that change your outlook on on equities or equities versus Treasuries well the interest rate is like gravity and all these valuations are dramatically affected by it at the start of the year people didn't think that ten-year bond would be where it is today and that's provided a lot of lift so it's a big first quarter for US equities we still if you look forward or at these very high valuation levels and so it's hard to see that the mark will be gaining a lot over the next few years I think people should have fairly modest expectations on what what their portfolios will make in the year the years in front of us have you changed your your position so in your own portfolio as a result of this have you done any major no it's it's a very equity oriented portfolio it's overweight in the u.s. even though it's got a lot of overseas exposure you know it's a bullish portfolio that the American economy over time will do well you know fortunately even if we have a few years here where markets aren't are doing that well you know we've been lucky we have a cushion the foundation continue to spend generously but I'm in prayer I'm amazed at how high the valuations are if you look broadly charlie do you think that well sure I think that if you drive interest rates down to zero and all the countries print money like crazy it's it lifted the asset vote for everybody and I think it really is a didn't have anything else to do in the Great Recession and so they took the only weapon they had and you aggressively I don't think we should quarrel that it did cause the people were already rich to get richer and that wasn't done purpose or anything like that and I think that will correct or am i automatically do you think we should still be using that weapon aggressively which is what president Trump would like to see happen he wants them to cut interest rates again I think he said by 1% and also push up quantitative easing once again but I am so afraid of a democracy getting the idea that you can just rent money to solve all problems and eventually I know that will fail Singapore which has a marvelous economy has zero debt if I were running the world I would like the United States to be in that position that is not the typical that's that's nobody's position you know all these politicians in Europe and America have learned to print money and if we keep at these extraordinary measures for the Fed I guess not just the Fed here but central banks around the globe yes but who knows when money for any runs out of control and we at the end if you print too much you end up in something like Venezuela you're not suggesting that happens no I don't like the ideas and both parties that you at politician to say what we've learned is we printed all the one who want they don't have to raise taxes we just print Warren you share those concerns yeah I probably could not have conceived of a world recently is ten years ago I'd learned not have conceived world where you would have full employment 5% budget deficits with actually the probability of those rising from that level and at the same time have the long bar the 3% I would have said that that couldn't happen and then then people now you modern monetary theory which there's no question he's your Marlin any country should borrow money and its own currency I'm a dad that is not like it's some great discovery dollars but yeah and that's the point I mean it that isn't solved anything just to say well it's much safer to buy your own currency but the the convergence of these factors would have seen impossible to me and generally if I feel something is impossible it's going to change over time I don't know and in what way but I don't think we can continue to have these variables in this relationship now if we can then stocks are ridiculously cheap the one thing I will say though is this is a conversation I feel like we've had for at least four or five years right where you're watching and continuing to wait for these interest rates the yields to rise we're still sitting at two-and-a-half percent on the ten-year which and we're sitting with very very little inflation with a Federal Reserve that put a target for 2% on it not that long ago and it looks like nirvan it looks like we've found the promised land where we just essentially money doesn't cost anything and you can put lots of money and have full employment and no inflation and I would have thought that something would have happened before now I don't know what would have happened but I didn't I wouldn't think you could have these things in in at these these levels the long-term rates inflation rates budget deficits and to have that be a stable situation for a long period of time and I still believe that but I so far I'm wrong so in the meantime you haven't really changed how you I think stocks are ridiculously cheap compared if you believe that you're going to have the 3% interest 30-year bonds makes sense that's a big if that's what makes going to work interesting well this three so it's comfortable if everything goes down not by 90 percent so we're not a fair cross-section I'm sorry Charlie what was that say this threesome is comfortable if everybody if everything goes down by 90 Rozonda don't know the rest yeah but we wouldn't want that kind of a world out really everybody else right can we talk a little bit about health care because you all have spent plenty of time focusing on health care in the United States and abroad bill you're probably the foremost authority on on global health care your foundation has spent billions and billions of dollars on it I think more than 13 billion dollars just from inception through 2017 on global healthcare initiatives what what's the progress you touched on it a little bit earlier that that you've seen more progress here than in the education front in the United States would house that kind of shown up what's phenomenal that by taking the new vaccines and getting them out to more kids and a few other tools like malaria bed nets that we've gone from over 10 million children dying every year to now less than 5 million now 5 million still a lot we need a few more tools but actually the pipeline of innovation looks very good so you know this is a a phenomenally positive story that that those doubts are weighed down and that that'll continue what's the thing that brings you the most hope or gives you the most hope about advancements that you've made or research that you've found well one that were we were working on is to reduce malnutrition because of a kid is growing well their ability not only to avoid these diseases like diarrhea killing them but also the degree to which they'll develop their full mental and physical capacities and therefore contribute for their own life for their country's well-being dramatic reduction and malnutrition would be a huge thing and we we're now gaining understanding that we think that that will be possible it's been a long scientific Germany having to do with the gut inflammation and the microbiome but now we see that we'll get more of those kids on their growth path and so I'm super excited about them but malnutrition is not just them not having the food to eat even in cases where they do have the food to eat there's a problem that's right what happens is that because they're their diet doesn't have much protein in it they're got their intestines get into an inflamed state and that means you get a set of bacteria in there that don't let them absorb nutrition and so that's a downward path and so you can see even two twins one will get that and not be growing and the other one will achieve normal growth and so an intervention that stops the inflammation shifts the microbiome to a more healthy mix that would get rid of malnutrition for that child so what is a really cheap intervention where you can see the problem and stop it with probiotics or something yes that's the kind of thing although those tend to be broad-spectrum here we're gonna be to make it scale it up and have it be a cheap probably a pill it'll probably be a couple of vitamins and drugs does that translate to things that could be useful here in in the United States and other day well the basic understanding you're got and will finally lead us to understand not just malnutrition but over nutrition why is it so hard to control people's hunger over time people have tried to have pills to control hunger I'd say over the next decade that will finally succeed so even though that's not the foundation side we're focused on malnutrition the science of the gut microbiome has a lot of companies working on things that will reduce over nutrition worn back here in the United States one of the big problems is trying to figure out how to pay for health care and and stop some the cost that's a problem you've been focused on at Berkshire along with JPMorgan and Amazon what what have you found we haven't gotten any updates recently other than the name of this new organization is going to be Haven where are you on that process we are taking the first step on what is bound to be a very long journey I mean it I would say it's not more difficult than I expected but I expected to be ungodly difficult and you have an industry which basically is about the same size as the US government's receipts and everybody always says every dollar in the budget you know has a constituency and every dollar and in an industry expenditure has a constituency and we've got the right person we've got the right partners capital isn't the key part to it but we've got people who are willing spend of money but what we'll spend whatever money it takes if we're making progress and and it is going to be a long tough pull to make major journey to make major changes and there's you know it's it has an old guarantee of success sir at all but there's nobody I think that's in a better position in terms of number of ploys and totally of the people that are partnering to get along and all kinds of things to perhaps come up with something that makes the system more efficient and and you know we will try but it's nothing will happen quicker so there's no there's no revolutionary move or anything of the sort and there there will be lots of opposition to any change in interviewing people to run the place we interview people in all aspects of the medical profession and activity and and they all agreed 100% you know this system needs change but of course not my part that's very understandable we expect that and we'll find out what happens but I I know this I would rather have the private sector come up with a solution and throw it all the government and and if the private sector doesn't come up with some solutions of the increase and cost qualities it you know in many ways is unbelievable just hearing Bill talk about the advances that can be made what is the cost 5% of GDP and in my lifetime or even in my adulthood up to 18% it's the federal budget the state kind of constant around 17% everybody thinks is out of control and here our federal receipts I should say and now this is gone from five to 18 and nobody really thinks is going to stop charlie you've been oh go ahead you've been a good Samaritan the chairman there for how many years long for 40 years the if you take Senate war which is tends to have an intelligent government and do things right they spend about 20% of what we spend on health care and they're healthier and there are all kinds of abuse and and counter productivity they don't have insane were that we do have and Warren is right we're not gonna hell of a time getting incidents and board's direction because human beings are profiting or the existing system if you know it may look like an unnecessary operation to me in fact it does but did the helmet looks like God's work where would you suggest after your years at Good Samaritan where would you say focus here first I think we this system is out of control the deductibles in ordinary corporate health insurance are ridiculous if you're a poor family you get a $5,000 bill for a baby that you don't have medical insurance they just changed the system and and and then if you take the utterly unnecessary treatment that where people find a way to tap into these government's streams of money and do a lot of unnecessary work like belonging you know inevitable death and all kinds of ghastly things they do it's it's I would say we have a pretty disgusting system on the other hand it's the best in the world in terms of its ultimate scientific capacity but you take all the unnecessary operations and all the unnecessary procedures and all the rackets and the thing which Singapore is pretty well take it out it's discouraging as I look at Singapore I look at the United States and how the hell do we get from where we are to there and if you ask me what's going to happen I think we're gonna fail to get to it to a intelligent system well and that cheery note we are just about out of time if I can ask you gentlemen we have about a minute left if I can just ask you what you're reading because that's something we hear back from our viewers often warm what are you reading right now I'm just finished reading very recently and I read it at one sitting and it captivated me so much either a book by Melinda Gates which just came out very recently and bestseller them the moment of lost it it is a terrific it's a story but but it's it's it's it's learned much about the world that you should know and and I would say most people don't know I mean this is a story of her experiences as experience it's absolutely sensational yeah Warren took all your time bill I guess you're not you you

Channel: CNBC Television

Views: 2,130,172

Rating: 4.3914456 out of 5

Keywords: Squawk Box U.S., CNBC, business news, finance stock, stock market, news channel, news station, breaking news, us news, world news, cable, cable news, finance news, money, money tips, financial news, stock market news, stocks

Id: 2hdDE7XYr30

Length: 126min 6sec (7566 seconds)

Published: Mon May 06 2019

Reddit Comments

[u/goldenbug]

I don't know, I think maybe the r\wsb version was better.

[u/[deleted]]

I saw the real interview on r/wsb. I don’t need any other footage

[u/Networking4Eyes]

We hope to have the whole Congo mowed by 2023.

[u/dingo_mango]

Pretty fly for three white guys

[u/billyflynnn]

That’s a lot of money