2017 Berkshire Hathaway Annual Meeting (Full Version)

Thank you and good morning. Duh, that's Charlie. I'm Warren. You can tell us apart because, uh, he can hear and I can see. That's why we, uh, work together so well. We usually have our specialty.

Uh, I'd like to welcome you to, uh, we got a lot of out-of-towners here, and I'd like to welcome you to Omaha. It's a terrific, it's a terrific city. And Charlie, Charlie's lived in California now for about 70 years, but he's still got a lot of Omaha in him. Both of us were born within two miles of this, uh, building that you're in.

And Charlie, as he mentioned in his, in his description of his amorous triumphs in high school, Charlie, uh, graduated from Central High, which is about one mile from here. It's a public school, and my dad, my first wife, my three children, and two of my grandchildren have all graduated from the same school. In fact, my grandchildren say they've had the same teachers that my dad...

But, uh, oh, it's a great city. I hope you get to see a lot of it while you're here. Uh, and in just a minute, we will start a question period, hopefully a question and answer period, uh, that will last till about noon. Then we'll take a break for an hour, so we'll reconvene at one, and then we'll continue with the question and answer period till 3:30.

And then we'll break for 15 minutes or so, and then we'll convene the annual meeting of Berkshire, which I would... We have three propositions that people wish to speak on, so that could last perhaps as long as an hour.

Before we start, uh, I'd like to make a couple of introductions. Uh, the first being, uh, Carrie Silva, who's been with us about seven years. Can we have a light on Carrie? I think she... Carrie, you're there? Terry, stand up. Carrie, come on.

Carrie puts on this whole program. She came with us about seven years ago, and a few years ago, I said, "Why don't you just put on the annual meeting for me?" And she handles it all. She has two young children, and, uh, she has dozens and dozens and dozens of exhibitors that she works with.

As you can imagine, with all of what we put on and all of the numbers of you that come, the hotels and the airlines and the rental cars and everything, uh, she does it as if, you know, she could do that and juggle three balls at the same time. She's amazing, and I want to thank her for putting on this program for us.

I also, uh, I would like to, uh, welcome and have you welcome our directors. They will be voted on later, uh, so I'll do this alphabetically. They're here in the front row, and if we could just have the spotlight drop on them as they're introduced.

Alphabetically, there's Howard Buffett, Steve Burke, [Music] Sue Decker, Bill Gates, Sandy Gottisman, Charlotte Geyman, we have Charlie Munger next to me, Tom Murphy, Ron Olson, Walter Scott, and Merrell Whitmer.

One more introduction I'm going to make, but I'll save that for just a minute. Our earnings report was put out yesterday.

Uh, as we regularly explain, the realized investment gains or losses in any period really mean nothing. I mean, they... we could take a lot of gains if we wanted to; we could take a lot of losses if we wanted to. But we don't really think about the timing of what we do at all, except in relation to the intrinsic value of what we're buying or selling. We are not... we do not make earnings forecasts.

On March 31st, we have over 90 billion dollars of net unrealized gains. So if we wanted to report almost any number you can think of and count capital gains as part of the earnings, uh, we could do it.

So in the first quarter, and I would say that we have a very, very, very slight preference this year, if everything else were equal.

Well, it's true in any year, but it's a little more so this year. We would rather take losses than gains because, uh, of the tax effect. If two securities were equally valued and there's probably just one touch more of emphasis on that this year because we're... we are taxed on gains of 35, which means we also get the benefit, the tax benefit of 35 of any losses we take.

And I would say that there's some chance of that rate being lower, meaning that losses would have less tax value to...