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Part 2

Becky asked How does BH net worth give you an advantage. He said that WFC had borrowing costs now of 1 1/2% but we have negative. Our advantage is the 58 billion of float.

Someone in the audience asked how Ben Graham would feel about Derivitives. Web said that he would not like them but thought that he would take advantage of clearly mispriced ones.

Andy asked if he thought that he would be dilited in the banks. WEB said that he has no idea but thought that the banks are earning great sums and will build capital rapidly and doesn't see a need to dilute WFC. Said if he could he would like to buy all of WFC and USB. Said when he met with students in early march and they pressed him about WFC that he gave a rare recommendation and said that if he was forced to put all his net worth into one stock if would be WFC.(i don't know if he mean't one stock or bank).

There was a question about BH without him in the future. He said that BH has a very competitive cultural advantage over other companies and that in his opinion will be long lasting. He thought that the cultural advantage they have would be very difficult for any company to even try to duplicate it.

One question from the audience asked him why do you hold forever when things change. WEB said that we don't. We sell things plenty of times. We won't sell any whole purchased subs but we will and have sold stocks of partially owned when we aren't in control. We don't tell investees how to run their companies so when we don't agree or lose faith in management we sell.

Andy asked at what price do you buy newspaper companies. WEB said new paper competitive advantage has been severly changed and doesn't see anything on the horizon to change that. He said he wouldn't buy a pure newspaper company at any price.

Any asked about BYD. Charlie talked the most about this company but was very high on them. Said the CEO started the company with practically no capital and now did 4 bil in biz last year.

Carol asked WEB about losing the AAA rating from Moodys. Said that it won't affect BH because they really don't borrow much except for utilities and not much difference in cost in the one notch downgrade. WEB did actually said that HE WAS Irratated with that downgrade. Charlie said he thought that Moodys would eventually change it back to AAA because they are smart and I'm right. :)

WEB and Charlie also mentioned that when the Corp bond market got way out of wack BH bought and filled up with attractive bond yeilds.

I have been coming to the meetings for about the last 12 years. I thought having the panel ask the questions worked real well. I thought Warren and Charlie looked good and sharp.
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