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Susie had foot surgery in the spring of 2003 and had to give away her beloved Manolo Blahniks.2 While laid up, she wrote out her usual list of “nine hundred” things for Kathleen Cole to do. The second the doctor released her, she sprang out of bed and off she went. When she traveled, Susie had a decided preference for five-star service most of the time—although many people had the impression that she usually slept on the floor in a hut. It was true, however, that she sometimes traveled without complaint in circumstances that would daunt many people. Susie sometimes actually did sleep in a hut, even though she suffered from acid reflux and a tendency toward esophageal ulcers severe enough that she normally had to sleep propped up at a forty-five-degree angle.

Warren wanted to spend time with her so badly that he agreed to go to Africa to celebrate her seventieth birthday. Howie had started planning this trip, which was to take place late in the spring of 2003, eighteen months earlier. “It would have been the eighth wonder of the world to see my father in Africa,” he says. The Buffetts were going to Londolozi and Phinda, two seven-star safari resorts in South Africa. Howie traveled to Africa often; in a characteristic move, his mother had gotten him interested in photographing the suffering people of the continent as well as its wild animals. For his father, he was having a Wall Street Journal and a New York Times flown in daily on the trip. “It would be three days late,” Howie says, “but they would get the papers to him. It was going to cost five hundred bucks a day, but they would hook it up so he could be online in his room and check the news. They already had the hamburger and french-fry thing down because they do that for me.”3 The Buffetts would be leaving for Africa a few weeks after their annual trip to New York, which always followed the annual shareholder meeting.

On April 1, 2003, as the shareholder meeting drew near, Berkshire announced the acquisition of a mobile-home manufacturer, Clayton Homes. This deal was like many others Berkshire was making at the time—a natural continuation of buying discount assets in the post-Enron slump.

The Clayton deal had come about because years of low interest rates had given lenders piggy banks full of cheap money, and that had turned them into pigs.4 Banks were quick to train consumers that low interest rates meant they could buy more stuff for less cash outlay now. Those with equity in houses learned it could be used as a checking account. But whether it was credit cards, houses, or mobile homes, the lenders, in search of growth, increasingly turned to people who were the least able to repay—but wanted to participate in the American dream anyway.5 In the case of mobile homes, the banks lent money to the manufacturers, who used it to lend money to the buyers. Historically, this process had worked, because if the mobile-home maker made bad loans, it faced the discipline of not getting paid back.

But then the mobile-home makers began to sell their loans, handing off the risk of not getting paid back. That was now somebody else’s problem. The “somebody else” who had assumed the problem was an investor. In a process known as “securitization,” for some years, Wall Street had neatly packaged loans like these and sold them to investors through a “collateralized debt obligation,” or CDO—debt backed by the mortgages. They combined thousands of mortgage loans from all over the U.S. and sliced them into strips called “tranches.” The top-tier tranches got first dibs on all the cash flow from a pool of mortgages. The next tranches had second dibs, and so forth down the line.

These tranches allowed a rating agency to assign the top AAA rating to the first-dibs tranches, AA ratings to the second-dibs tranches, and so on. The banks sold off the tranches to investors. The banks analyzed the likelihood of default using a model based on historical repayment patterns. The lending system was changing,