I.O.U.S.A - Addison Wiggin [85]
Q: Are you concerned about the level of foreign ownership of U.S.
Treasury bonds and the fact that it ’ s been increasing recently rather quickly?
Alan Greenspan: I ’ m not concerned by the fact that foreigners own a great deal of America. Indeed, one of the very important aspects of globalization is that there is a huge amount of trade amongst countries, and as a consequence of that the claims to wealth, which are a necessary concomitant of trade, grow. We in the United States own a good deal of the rest of the world, and the rest of the world owns a great deal of us, and that will continue to grow as globalization, which I think is a very powerful and positive force in a society, continues. So, provided we are dealing c13.indd 173
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174 The
Interviews
essentially with business, private assets, and very little government involved in this, I have no concern.
Q: Mr. Walker, he says that our country has a budget defi cit problem, a savings defi cit problem and a trade balance problem, balance of payments problem, all possibly made worse by leaders that are not warning us of what lies ahead fi nancially with unfunded liabilities. Do you think that there ’ s a tidal wave on the horizon, a tidal wave of spending that if we choose not to address and choose not to fi x, it ’ s going to make life much different for our children and grandchildren?
Alan Greenspan: There ’ s an extraordinary event for the fi rst time in human history about to occur, which is a tsunami of retired people as the baby boom generation over time doubles the number of retirees; and the fact that life expectancy continues to increase is going to increase that burden further. This means that the average working family, is going to have to produce, or I should say the average worker, is going to have to produce not only suffi cient physical resources for himself and his family, but also for the retired people. What this essentially suggests is that unless we fi nd a way to delimit the size of the physical resource shift that it ’ s implicit in current law, we are going to be in very serious trouble. You cannot consume more than you produce, and what these various different defi cits are suggesting is basically that we are trying to consume more than we produce. We can do that in the short run, but over the long run, it is of course impossible.
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Warren Buffett
Warren Buffett is regarded as one of the world ’ s greatest stock market investors. That said, it should come as no surprise that Forbes magazine named the “ Oracle of Omaha, ” as he is called, as the richest person in the world in 2008. This savvy businessman and noted philanthropist has been the CEO of Berkshire Hathaway since 1970.
Q: How long has Berkshire Hathaway been here in Omaha?
Warren Buffett: We moved in at the start of 1962. It wasn ’ t Berkshire Hathaway then, but this is the only offi ce I ’ ve had since I had an offi ce in my bedroom.
Q: Do you fi nd things that you like and then stay there? That seems to be the case with your house and your offi ce, and your investing philosophy is certainly that way as well.
Warren Buffett: If I ’ m happy with something, I don ’ t change.
I mean, if I fi nd that I like hot dogs and hamburgers and French fries and cherry Coke, that ’ s what I ’ ll be eating the rest of my life.
Q: What do you say to people who say, “ Oh, economic matters are too complicated, and I can ’ t fi gure it out ” ? Why should the average American try to get a handle on these matters? Why is it important?
Warren Buffett: I think it ’ s very tough for the average American to understand economics well, just as it ’ s tough for them to understand physics well. It ’ s a subject that requires some experience and thought and a fair amount of interest. And, as a practical matter, a high percentage of the population probably will not be interested in economics any