copy annual shareholder reports?
BUFFETT: Yes.
CLAMAN: How do you decide?
BUFFETT: Well, that’s — I get hundreds of them and I like getting them and I can read them very quickly, but there’s some that take me at least maybe even two hours to read. And some I read very carefully.
CLAMAN: We’ve got the Federal Reserve’s on everybody’s mind, including Columbia University. Columbia Business School has a question for you, Warren, about that, I believe. So why don’t you look in the camera. Go ahead, Columbia.
JENNIFER HODGE, COLUMBIA BUSINESS SCHOOL: Good morning, Mr. Buffett. I’m Jennifer Hodge (ph), an MBA student from Columbia Business School. My question is: How is your investment strategy and the performances of your businesses affected by a prolonged low interest rate environment? And how are you positioning now for interest rates to increase or remain low?
CLAMAN: Yes, because you know eventually they’re going to tighten.
BUFFETT: Eventually, yes, Jennifer, eventually interest rates are going to go up and I don’t know when that will happen. And certainly low interest rates have helped our business, they’ve helped the economy, they’ve hurt savers who are relying on fixed income type investments. I think overall the policy has been sound and there’s no question that Berkshire Hathaway Inc. (NYSE:BRK.A) (NYSE:BRK.B) is better off today and the American people are better off today because of the actions of Ben Bernanke and keeping interest rates so low.
It won’t go on forever and it’s going to be very interesting when the first signal comes out that they’re going to advance.
CLAMAN: Are you changing anything at Berkshire and the policies there, as Jennifer asked?
BUFFETT: When we borrow money, we’re thinking in terms of long maturities. Now, we don’t borrow much money. I rarely borrow money and our railroad borrows money and our utility business borrows money, and we are doing a fair amount of 30-year maturities when we do that. Anybody who’s borrowing money should borrow for a long period of time. And if you ever want to get a mortgage, today is the day to get a mortgage.
CLAMAN: Thank you, Jennifer.
And that gives me a perfect segue to the mortgage deduction, Warren. There’s a lot of talk about scaling it back or perhaps eliminating it overall. What do you think about that because people look at it and say that’s a way to wrap our arms around some of our tax problems?
BUFFETT: Yes, I think it’s unlikely to happen. If it were to happen, it would be part of an enormous tax package. It’s certainly not going to happen in isolation or just with a few items. And there’s a big constituency out there for maintaining the mortgage interest deduction.
CLAMAN: Well, you with your housing interest from Benjamin Moore Paint to Shaw Carpet to Acme Brick, are you part of that sort of silent lobbyist or not so silent lobbyist movement?
BUFFETT: No, we wouldn’t be lobbying on something like that at all. But the question is whether you get a whole package that encompasses that and many other things. If you eliminate deductions perhaps you would have lower rates, for example. So you have to look at the package that finally gets introduced.
CLAMAN: Would you think that it might derail the housing recovery?
BUFFETT: It would depend what it was combined with. I mean, if you had lower tax rates, but eliminated the interest deduction, it’s hard to measure. You’d have more than one variable affecting them.
CLAMAN: What do you think of the good old single-family dwelling as an investment these days?
BUFFETT: I said a year ago that I thought it was a very good investment for people that knew they were going to live in that locale for a considerable period of time, found a house
