The meeting with Warren Buffett took place in an old office building in the middle of Omaha, Nebraska. Outside it was cold and rainy, and the American city that at the end of the week would host the annual investors conference of Berkshire Hathaway Inc. (NYSE: BRK.A) seemed deserted.
Much has been written about the modesty of one of the wealthiest men on earth, but you have to see the nondescript building, the worn carpets, and the basic furniture in these rented offices to understand it. Buffett himself, incidentally, lives not far from the office, in a pleasant, unostentatious house, which a local estimates to be worth just 300-400 thousand dollars.
A few hours after signing the deal to buy from the Wertheimer family the remaining 20% of Iscar Ltd. that Berkshire Hathaway did not already own for $2.05 billion, Buffett is smiling and full of humor, and willingly submits to reporters' questions.
Mr. Buffett, how unusual is it in your view for a company the size of Iscar to double its valuation within seven years?
"It's very satisfactory, let's put it that way. It's an exceptional company, I will tell you that."
When you bought the stake in 2006, did you see the company rising in value so rapidly?
"Well, I knew when we went in we would get a very pleasant result. We were in with the right people, the right business, the right country. You know I wrote a check for four billion without even going over to Israel."
What's your forecast for the future can the company continue to grow at this rate?
"Iscar will be worth more money as the years go by, because the business will be built further. The management will never be satisfied with where they are, and I love that about it. I'm never satisfied. I feel OK, but still, I look forward to tomorrow, and they do too."
Why did you wait seven years to buy the rest of the shares in Iscar? Why now?
"Eitan and I were talking in Washington in late January and it seemed the time for the family to do it and it seemed like the time for us to do it. We both had to be 100% happy or it wouldn't have happened, and we both are."
Are any further business partnerships planned with the Wertheimer family?
"It always could happen. A few years ago we had lunch and we talked about various things. It would be terrific if it happened."
Do you have anything specific on the agenda?
"No, but I never do. I just wait to see what the next day brings. But I do plan be associated with first class people all the time, and nobody fits that description better than the Wertheimer family."
Are you aware of the criticism in Israel of the tax benefits awarded to big companies, Iscar among them, compared with the high taxes paid by ordinary individuals.? What can be done to spread the wealth among more people?
"The best way to spread wealth is to have more wealth to be spread. I can't speak to the Israeli situation. I actually think that in the United States things have been tilted too much in recent years to the rich. But I emphasize, that's in the United States. The best thing to do is to have a growing pie, but you also want everybody to participate in that. The goals aren't inconsistent. They've been achieved in the United States to a significant extent over time, but there's always room for improvement."
You are a very wealthy man who is known for living modestly. How far does money contribute to happiness in your opinion? How much money do you need to be happy?
"You need enough money to be able to live comfortably, but beyond that it won't necessarily make you happier. Money can cause a lot of trouble for certain people, and great happiness for others. It's like fire. It can be useful in the hands of some and destructive in the hands of others. It doesn't really create happiness by itself. If you're loved by a lot of people, you're going to be happy."
What would you say to a young person who asks you what's the best investment they could make?
"You invest in yourself, your own talents. You maximize your speaking talents, your writing talents, you maximize every talent that you have. The nice thing about investing in yourself is nobody taxes it. I was very lucky to be introduced to what I enjoyed and was good at when I was eight or nine years old. I got an early start. People are good at different things, and nobody has ever over educated themselves."
Through Berkshire Hathaway you are investing in the traditional press as well. Would you recommend someone who excels at journalism to invest in his talent as well?
Buffett laughs. "It's got a lot of satisfactions to it, but it's not a way to get reach. I love newspapers. We have bought a number and we're going to buy some more. It used to be a way to get rich for the owners; it never was a very good way to get rich for the people who work there. Television pays more. I happen to like newspapers better than any other medium."
Will there still be print newspapers at the end of this decade?
"Yes, we will have print. Certain types of print we won't have as much of, but we will have print."
The stock market is supposed to reflect economic reality. Do the continuing rises on Wall Street reflect the state of the US economy?
"The stock market does reflect not only the current economy but also people's evaluation of what the future of the economy is going to look like.
"Generally speaking, in the United States, the stock market has been a reasonable evaluator and predictor of the future of businesses and the economy, but it certainly is not universally correct, and occasionally it really goes off the rails completely in one direction or another, and when it does I hope I've got some money."
Do you see a market correction in the near future?
"I don't have any idea. I don't even think about it."
What about making further investments outside the US?
"We think about any opportunity that comes our way. It's important to realize that the largest single investment that Berkshire has made outside the United States has been in Israel, by a very large margin."
We appreciate it.
"I appreciate it."
Will you come to visit us any time soon?
"I don't travel very much, but find me a big company over there that I can buy, and I'll be there tomorrow."
"When you don't have to buy or sell is the best time to do business"
"We proposed to Buffett that he should buy all the shares in Iscar seven years ago, and at the time he requested that we should remain with 20%," Eitan Wertheimer told "Globes", "Now it suited both sides. When you don't have to buy or sell is the best time to do business. Furthermore, we don't live forever, and it's necessary to think of the long term in the family. The chances of it reaching generations ahead are very complicated. Not everyone has the head for it. We have wonderful children, but anything could happen in another 15 or 20 years.
"I continue to do all kinds of things in philanthropy with Buffett," Wertheimer said. "As far as I'm concerned, I am now freed up to do a mini-Iscar in philanthropy, because everyone reaches the stage at which they realize that their task is to plant trees for other to enjoy their shade."
Published by Globes [online], Israel business news - www.globes-online.com - on May 2, 2013
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