The New York Stock Exchange was the center of the financial world. But today most trading in stocks is done elsewhere by Robot Computers that buy and sell in microseconds, faster than you can blink an eye. And the computers have done so well that some institutional traders have come to believe that the game is rigged. Are humans ever involved in the trading . Humans are not involved in the trading because humans are way too slow. [ticking] there are close to 850,000 of them in the United States, twice the number of atms. The new slot machines, the Main Attraction at casinos, are like hightech video games. And states across america are increasingly relying on them to raise revenue 38 states and growing, including pennsylvania. But the former governor ed rendell didnt appreciate some of our questions about it. You guys dont get that i do get it. Youre simpletons. Youre idiots if you dont get that. Welcome to 60 minutes on cnbc. Im steve kroft. In this edition, we look at the world of big deals on wall street and in las vegas and examine the impact of highspeed computers in both places. We begin with perhaps the most famous investor of them all, Warren Buffett. His fame extends far beyond wall street, his oldest son, howard, not so much. And yet hes the person Warren Buffett wants to succeed him as chairman of Berkshire Hathaway, the mega Holding Company that buffett built. For most of his adult life, howard has been a corn and soybean farmer in nebraska and illinois. And as lesley stahl first reported in december of 2011, howard doesnt live the high life, and he loves getting down in the dirt. This is the man wholl become the next chairman of the companyacquiring, investmentpicking, moneymaking machine Berkshire Hathaway if Warren Buffett has his way. Howard is a farmer who would rather dig up the ground and drive big machines than sit in a boardroom. Were you stunned . Were you surprised . I was surprised. But no sign that hes about to leave . He wont leave until hes buried in the ground. I hate to put it that way. This is no gentleman farmer. Howard buffett works his 1,500 acres in pana, illinois, himself. Were gonna go pick some corn . Yeah, were gonna pick corn. This year, he harvested 87,000 bushels of corn with his 300horsepower combine that he runs handsfree off gps. Youre like a kid, you know, that can ride his bike without his hands, right . Its a big toy. Its a big toy. But its expensive. But with corn prices soaring, he can afford it. And incidentally, even a farmer named buffett can get farm subsidies. Howard received 300,000 in federal payments over 13 years. Heres something you said once. Heres a quote it seemed nothing i could do would be as successful as what he did, meaning dad. That comment would mean that in the worlds eyes, you know, i would never be seen in the same success as he would, particularly in investing and in business. Thats okay. I mean, you know, and my mom and dad always made it clear that that was okay. Theres no sense in trying to compete with me, because hes not gonna play my game. He should have his own game. Grain shipments were down a lot last week. Warren buffett says he always told howard to find something he loved as much as he loved making money. Naturally i have a lot of top secret stuff, but we got to keep that between us. You always do. So youre all business. I think of you as mr. Indoors. Youve got it. I got it. So here you have this son. I know. Hes a farmer. Hes outdoors. Hes down in the dirt. Are you sure hes your son . Well, i think thats worth checking out. Youll have a big exclusive. Well, he is really different. Explain that. Well, he likes not only farming. He likes machinery too. I mean, i think he likes doing big things, you know, moving dirt. He just is happiest when hes working hard. Im happiest when im just kind of sitting around watching football. Howards different in another way. Hes an active, handson philanthropist who visits up to 20 countries a year. The howard g. Buffett foundation focuses on world hunger, spending 50 million a year on projects like feeding programs in ethiopia and agriculture education in afghanistan. And he records it all through the lens of his own camera. You all of a sudden begin to kind of look around, and you notice theres a lot of people around that dont look too good. And, you know, theyre hungry. And they dont have great living quarters. They may not have access to water. They dont have good sanitation. You were seeing farmers who couldnt feed themselves . Oh, absolutely. I looked at that, and i thought, you know, this is wrong. I understand agriculture. I should be able to do something about this. [ticking] coming up the challenges of philanthropy. You know bill gates. Have you said to him, 80 of what youre throwing down there in africa is not gonna work . Well, ive said it a little differently, i think, and that is that we need to quit thinking about trying to do it like we do it in america. The buffetts and bill gates when 60 minutes on cnbc returns. Man, this helmet is just torture on my hair. Well you gotta use head shoulders for men. Its all you need to reach polamalu levels of scalp and hairness. Check it. [ male announcer ] head shoulders for men. With seven benefits for a flakefree scalp and great looking hair. Even if you wear a helmet for a living. I know. [ male announcer ] head shoulders for men. 100 flake free. [ male announcer ] head shoulders for men. So ally bank has a that wont trap me in a rate. Thats correct. Cause im really nervous about getting trapped. Whys that . Uh, mark . Go get help i have my reasons. Look, you dont have to feel trapped with our raise your rate cd. If our rate on this cd goes up, yours can too. Oh that sounds nice. Dont feel trapped with the ally raise your rate cd. Ally bank. Your money needs an ally. Warren buffett wants his oldest son, howard, to succeed him as chairman of his multibilliondollar Holding Company, Berkshire Hathaway. Its not unusual for a father to want his son to take over the family business. But its a little unusual in this case. Howard doesnt pick stocks, he picks corn. Howard buffett is a farmer. And as lesley stahl discovered in december 2011, he devotes a lot of his time and money to helping others learn how to farm better. [rooster crows] in places like el salvador, hes funding a Training Program for 5,000 poor farmers like carla and edwin trujillo. They learn new planting and fertilizing techniques to improve the quality of their corn and red beans. Carla, im howard. Hola. Mucho gusto. Buenos dias. We tagged along as howard inspected their sixacre plot in the tiny village of san juan el espino. And shes got an irrigation system. No big combines here. And their irrigation . It consists of hoses connected to a barrel of water brought in by a horse. Howard wanted to check on the quality of carlas corn. Does she mind . Tell her i wont destroy her corn crop. And that meant doing his favorite thing. Youre gonna dig it up . Yeah. Come on. He didnt just dig up her corn. He was like a doctor doing an invasive exam, pulling up the roots, ripping it open. You always have tough husks in this part of the world. And cracking it in half. His verdict . Youve done an excellent job with what youve got. Since howards program started, carla has doubled her income. In one way, at least, he is like his dad. He insists that the farmers learn accounting and managing credit and that they buy their own seed. Theyre looking for the standard kernels. Howard buffett is making a big difference but on a small scale. He started out giving farmers the best of modern agricultural technology. But now he only teaches methods they can afford themselves after his projects end. Howards passion for farming started early. When he was just five, he turned the family backyard into a cornfield. His father was fast becoming a multimillionaire, but the family always lived modestly. Did you know, as a kid, that you were rich . No, not at all. And the greatest story is my sister, who, when you had to go around the room in grade school and answer, what does your father do . And, you know, we knew him as a security analyst, and we had no idea what that really meant. And so she basically said, well, hes a security guard. And thats what we thought for a long time. We just didnt know any differently, you know. As his fathers fame and fortune grew, howard seemed to zig and zag on his own path, dropping out of three colleges, one after the next. You must have been worried. I wasnt. You werent . No, i wasnt. He just was kind of finding what he wanted to do. And it made no difference to me whether he found it in a college or not. Really . Now, that is an unusual parent. It is an unusual parent. But it was the way both his mother and i felt. None of our kids graduated from college. Now, if they pool all their credits, we can get a degree. I mean, i thought we ought to do that and pass it around. Once howard settled on farming, warren bought land for him but then made his son pay rent and tied it to his body weight. So if you gain weight, your rent goes up, and if you lose weight, the rent goes down. Something like that, yeah. Financial incentives are supposed to work in some things. They dont work very well in weight, incidentally. But why wouldnt you just give your son a farm . Well, i just dont think thats, you know, the way to bring up a son. I mean, i dont think hes entitled to be given a farm just because his last name is buffett. We didnt want them to see the world, you know, through the lens of a superrich kid that got everything he wanted. You just didnt want spoiled little rich kids. Yeah. Yeah. Warren buffett was famously unwilling to give his money away to charity. Im turning it over to you. So it came as a big surprise five years ago when he donated the vast bulk of his fortune, some 31 billion, to the Gates Foundation. Its a big challenge for us to make sure that this money gets used in the right way. Bill gates is often described as warrens third son. They vacation together, spend birthdays together. So the size of his gift to gates left an impression that the buffett children were given short shrift. Warren buffett doesnt believe in inherited wealth. I dont believe in lots of inherited wealth. I havent been spending my life trying to figure out how to transfer wealth and not have taxes and all of that so there can be a dynasty of all kinds of little buffetts going around for hundreds of years never having to do anything. But dont cry for those little buffetts. Howard, his brother, peter, and sister, susan, have gotten multimilliondollar gifts of money and Berkshire Hathaway stock from their parents. So while hes not on the fortune 500, howard is by any measure a wealthy man. On top the outright gifts, each buffett child is getting 1 billion to go toward their philanthropy. But all that pales next to the 31 billion thats going to the Gates Foundation. So did you know, as far back as you can remember, that you were not going to inherit his money . Yeah, yeah. Youve sort of always known that as you were growing up . Yeah. And from time to time, that was a little frustrating. cause you wanted it, or what do you mean . Well, i just mean, you know, you feel like that there are a lot of things you could do if you had more money. And i think that way even in the foundation. But heres the irony. Bill gates is spending a huge chunk of Warren Buffetts money on poor farmers in africa, giving them hybrid seeds and synthetic fertilizers. Its exactly the kind of hightech approach howard tried and now feels is doomed to fail with farmers who make barely 1 a day. Theyre pushing a system that really is similar to what we have outside this door. But isnt that wonderful . No. What i would argue is that at some point, those guys are gonna go home and the moneys gonna not be there. Its exactly the same thing we did. And i dont feel it worked. You know bill gates. Have you said to him, 80 of what youre throwing down there in africa is not gonna work . Well, ive said it a little differently, i think, and that is that we need to quit thinking about trying to do it like we do it in america. Howies the farmer here, so he can speak with knowledge. Im the city boy on the panel. Bill gates and Howard Buffett were both honored recently at the state department for their work on combating world hunger, work underwritten in both cases by the largesse of Warren Buffett. So your father gives all his money to gates. You come out and tell us what hes doing is all wrong. Im not saying its all wrong. Well, a lot of its wrong. Little bit of sibling rivalry there . No. Maybe . You know, once in a while, we call him brother bill. Exactly. No, you know what . Bill gates is the smartest guy in the world next to my dad, maybe. I better say that if im on tape. How old are you . Im 81, but i feel good. Yeah, you look great. Warren buffett says if the Berkshire Hathaway board approves his son as chairman after he dies, howard would not be paid and would not run the company day to day. Howard would be what warren calls the guardian of the culture. What were you worried about . Well, you worry that somebody will be in charge of berkshire that uses it as their own sandbox in some way, that changes the way that decisions are made in reference to the shareholders. You know, the odds of that happening are very, very, very low. But having howie there adds just one extra layer of protection. I guess someone whos on the outside looking in would say, but what does he know about this business . Oh, he knows plenty about the business, in the sense of the values of the business, sure, sure. I mean, he doesnt know what insurance policy were writing today, you know, or how many carloads the bnsf carried last week or something. But he knows the values of it. Besides, howard is the only one of buffetts children who has been a Corporate Executive in agribusiness and the only one who has ever served on the berkshire board. Let me just make sure i understand you. You will not be picking investments. Absolutely not. And i shouldnt. I mean, you know. Do you have concerns about taking over this big role . Well, as long as i can keep farming, im okay. And as long as he can keep funding projects in remote regions of the world, where, as we found, he is still working on becoming a household name. What did you know about Howard Buffett before . Had you ever heard of him . No a esta hora y. Never heard of him . Nada, nada. Had you ever heard of his father . He has a very famous father, Warren Buffett. Had you ever heard of him . Si. Oh, im impressed. As we reported, Howard Buffett doesnt always agree with bill gates on the best ways to help Farm Development in africa. But that doesnt mean they cant work together. Towards the end of 2011, the Howard Buffett foundation announced it was joining with the Gates Foundation to support the work of n2africa, a dutchled initiative to improve soil quality and increase agricultural productivity in eight african countries. The 2 million donation from the Buffett Foundation will support work in sierra leone and liberia. [ticking] coming up making money faster than you can blink. Are humans ever involved in the trading . Humans are not involved in the trading because humans are way too slow. When 60 minutes on cnbc returns. [ bottle ] okay, listen up im here to get the lady of the house back on her feet. 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Dear, ive dropped my tea into the boston harbor. Huhh. I guess this partys over. Geico. Fifteen minutes could save you fifteen percent or more on car insurance. [ticking] most people dont know it, but the majority of stock trades made in the United States are no longer being made by human beings but by highspeed computers capable of buying and selling thousands of different securities in the time it takes you to blink an eye. Its known as highfrequency trading. And as we first reported in october 2010, the securities and Exchange Commission and members of congress are asking some tough questions about its usefulness and potential dangers. [bell ringing] for 150 years, the floor of the New York Stock Exchange was the center of the financial world, the economic engine that helped American Business raise capital and create jobs. Today its still the public facade of wall street and a television backdrop for reporters relaying financial news. But less than 30 of the trading is conducted here now. And the specialists and the noise of the floor is being replaced by the speed and quiet efficiency of computers, and the action is moved elsewhere. There are now more than 80 alternative Trading Systems around the country plus two electronic stock exchanges which most of you have probably never heard of b. A. T. S. And direct edge. Theyre owned by the big banks and by highfrequency trading firms. And neither of them would give us an interview or let us inside to film their operations. But they trade more than a billion shares a day at blinding speed,